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BEIJING, March 7 (Xinhua) -- Chinese President Hu Jintao met here on Friday with former U.S. President George Bush.     Hailing the progress of China-U.S. relations in recent years, Hu said that to develop healthy, stable bilateral ties was in the common interest of both sides and had great significance for peace and development of the Asian-Pacific region and the world at large.     China was willing to properly handle divergence and major concerns through dialogue and beef up bilateral exchanges and cooperation on the basis of mutual respect, equality and mutual benefit, Hu said.     He said that he appreciated Bush's efforts to boost China-U.S. friendship. He also briefed the former U.S. leader about China's stance on the Taiwan issue and its preparations for the Beijing Olympic Games.     Calling U.S.-China relations one of the world's most important bilateral ties, Bush said that he was happy with the development of the progress of bilateral relations and expressed confidence that there would be even closer ties with China. Chinese President Hu Jintao (R front) meets with former U.S. President George Bush in Beijing, capital of China, March 7, 2008    As the honorary president of the U.S. delegation for the Olympic Games, Bush said he expected to be back in China in August to watch the Games.     Calling the Olympics a world sports festival, Bush said that he opposed politicizing the event and expected a complete success for the Games.

The State Environmental Protection Administration (SEPA) yesterday outlined its plan to significantly reduce air and water pollution this year.It aims to cut up to 2.3 million tons of sulfur dioxide (SO2) emissions and 1.3 million tons of chemical oxygen demand (COD), a measure used in the monitoring of pollution.SEPA director Zhou Shengxian said yesterday in Beijing that this year's targets are to reduce SO2 by 6 percent and COD by 5 percent based on their 2005 levels, which serve as the base for the environmental goals of the 11th Five-Year Plan (2006-10).By 2010, the plan is to reduce both SO2 and COD levels by 10 percent, based on 2005 figures."Industrial restructuring will play a fundamental role in curbing pollution," Zhou said.He said more high energy consuming and high polluting power plants will be shut down this year, including a number of small-sale thermal power plants with a combined output of 13 gigawatts, steel plants with a total capacity of 6 million tons, cement plants with a combined output of 50 million tons, iron production facilities with a total capacity of 14 million tons, and papermaking factories producing a combined 1 million tons."This phase-out plan, if achieved by the end of this year, will help China reduce its emissions of SO2 by 600,000 tons and cut the COD by 400,000 tons," Zhou said.Key eco-friendly projects will also be implemented, Zhou said.The country's urban wastewater treatment capacity is to be increased by 12 million tons a day, which will cut COD by 600,000 tons.In addition, industries will be required to strengthen their wastewater treatment capacities and will be expected to decrease COD by 200,000 tons a year.In terms of air pollution, the use of sulfur scrubbers to clean emissions will be emphasized.New thermal power generation units with a combined capacity of 30 gigawatts will be installed with sulfur removal capabilities, which is expected to reduce SO2 emissions by 1.5 million tons.Measures taken by the central government and environmental agencies last year also saw progress being made in the green battle.The density of COD in water resources was 6.5 mg per liter, down 7 percent on 2006.A reduction in SO2 emissions also saw the area of land affected by acid rain shrink by 100,000 sq km.The number of blue-sky days with good air quality was also up on the previous year.However, the fight against pollution is far from over, Zhou said.SEPA figures showed that last year, the quality of more than 26 percent of water runoff was worse than grade V - a level unfit for human contact.The air quality in cities on more than 100 days was below grade II, the level at which it is considered healthy for humans.

China is tightening its grip once more on foreign investors in Chinese real estate, banning them from borrowing offshore in the latest effort to tame property prices and cool the economy. The new rule, set out in a circular from the State Administration of Foreign Exchange , could squeeze foreign investors who take advantage of lower interest rates outside China. Some may find it especially difficult to fund projects as Beijing has told its banks to cut back on loans for the construction industry. The central bank ordered Chinese banks to stop lending for land purchases as far back as 2003. "The only alternative is to fund the entire equity," said Andrew McGinty, a partner at the law firm Lovells in Shanghai. "But that's not a very favoured method, because your internal return on investment goes down dramatically." Property funds operating in China tend to borrow to fund at least 50 percent of a project's value. The circular, which the currency regulator sent to its local branches in early July but has not yet published on its Web site, also increases red-tape for foreign property investors. Investors seeking to bring capital into China to set up a real estate company must now lodge documents with the Ministry of Commerce in Beijing -- not just with local branches of the ministry, according to the new circular with de facto effect from June 1. That process could take a month or more, said an official at the Ministry of Commerce, declining to be identified. "What we mean is very clear: First we are targeting foreign real estate firms that are illegally approved by local governments," a SAFE official said. McGinty said the new rule would reduce foreign investment in the real estate sector, but the real impact would depend on how it is enforced. UNCERTAIN IMPACT China has applied a raft of measures to rein in property investment, including interest rate rises and rules to discourage construction of luxury homes. Some steps have specifically targeted foreign investors, who account for less than 5 percent of total investment in the property sector. Foreign investors must now secure land purchases before setting up joint ventures or wholly owned foreign enterprises in China. However, funds such as those run by ING Real Estate, Morgan Stanley , Hong Kong's Sun Hung Kai Properties , Henderson Land Development and Singapore's CapitaLand Ltd. are pouring more money than ever into China to tap a middle class hunger for new homes and rising capital values. China's urban property inflation rose to 7.1 percent in June, compared with a year earlier, from 6.4 percent in May. McGinty said some foreign investors may eventually quit China for more interesting markets if an inability to employ leverage reduces their internal rate of return. However, others said they would stay on. "We are not too worried about it. Cooling measures won't stay forever," said Robert Lie, Asia chief executive for ING Real Estate, which has raised a 0 million fund to build housing in China. ING Real Estate borrows locally, partly to hedge its currency risk. Most other foreign investors in China do the same. Some foreign property firms that have been in China for many years have strong connections with local lenders -- Chinese banks as well as international banks incorporated in China. "There is still strong interest in China, although there will be some form of slowdown in the number of transactions," said Grey Hyland, head of investment at Jones Lang LaSalle in Shanghai. He said the new approval rules would further dampen the ability of foreigners to compete with local rivals. "It's still early to say how, because these rules are still very new and being tested," Hyland said. One consequence, he added, could be to drive foreign property investors inland to second- and third-tier cities that the authorities are eager to develop and where approval is therefore easier to obtain.

Chinese once associated tattoos with criminals and misfits; today, they are redrawing the lines around how they think about ink. The growth of China's emerging tattoo culture was evident by the more than 2,000 visitors who attended Saturday's opening of the country's largest tattoo gathering, Tattoo Show Convention 2007, which ends today. Attracting more than 100 artists from all over China and the world, the show at the Sanshang Art Beijing Gallery was intended as a platform for interaction among Chinese from around the country, their international counterparts and the public. "We hope to give them a platform so they can learn from each other," said Xiao Long, who founded the non-profit convention in 2001. Tattooed Chinese photographed each other's ink, while artists displayed their works and even tattooed visitors at their booths. German artist Frank Kassebaum, of Bremen, said he was surprised by what he saw. "Before I came here, I thought that China wasn't so far along in its tattoo culture, but from what I see here, I really think that, in 10 years, they'll be better than the United States, Japan and Europe," he said. "The boom in Japan was 10 years ago; now, the boom is here." Co-organizer Chris Wroblewski, of New York City, said one of the major purposes of the show was to educate Chinese to be prudent about getting tattoos. He said that during China's "Tattoo Renaissance", many shops were opening up, offering "mass production stuff" drawn by "artists who learned in two weeks and are just plowing needles into skin". He explained that as tattooing developed in China, there would be a proliferation of both "high art and low art". YZTattoo parlor model Qi Xuan, 26, said she believes the convention showcases the progress made by China's "high-art" tattoo artists. "In recent years, Chinese tattoo artists have become more skillful in design, technique and use of color," the Beijinger said. "Now, you can see more tattoo artists who can make very international designs. Because artists come to this show from every part of the country, we know what they are doing outside of Beijing." Wroblewski said that because Chinese tattooing was "still in its infancy", it often emulates the West. "But the Chinese are beginning to pick up on their roots and will start demanding more of their own culture." Student Wang Hao, of Beijing, said he came to the show because he was considering getting a tattoo and wanted to learn more about them. "I'd like to get a traditional Chinese tattoo, because I love China," the 22-year-old said.

An increasing amount of investment capital is flowing from the Chinese stock market to the relatively stable real estate markets in major cities like Shanghai, Beijing and Shenzhen, according to several banks and property consultancies. Low- and medium-level residential properties have been attracting the bulk of the funds diverted from stocks, while luxury residential houses and office buildings are taking in a much smaller share, according to a recent survey by Shenzhen-based Worldunion Properties Consultancy (China) Limited. The survey, which covers 16 real estate projects in Shenzhen, Beijing and Tianjin, estimates that funds diverted from stocks accounted for around 50 percent of the total transactions in low- to medium-priced residential properties from October 2006 to June 2007, 10 to 20 percent in luxury apartments and about the same percentage in office premises. "The volatility of the stock market after the stamp tax hike in late May has also increased the potential risks and reduced the returns of stock investment, prompting many risk-averse investors to shift their focus to the property market," the Worldunion report said. "It can be seen from the weak and uncertain performance of the stock market and the strong performance of property prices in various major cities," the report said. Housing prices in 70 large-and medium-sized cities in China continued to rise in June, up 7.1 percent over the same period last year, while the Shanghai Composite Index dropped 7 percent that month. "From my experience in other markets, the risks of investment in real estate are relatively lower than that in the stock market," said Mao Zhi, a professor at China Real Estate Index Research Academy. Some are even selling their stocks to pay for house loans before the recent lending rate hike of 27 basis points. These funds have indirectly flowed into the real estate market, analysts said. "The interest rate hike is not expected to have a negative impact on the property market. The gap between long-term deposit and lending rates narrowed only 9 basis points after the rate adjustment, showing that the measure is not targeting the real estate market," said Li Maoyu, an analyst at Changjiang Securities. At the macro level, the fund flow trend from stocks to real estate is reflected in the sharp increase in bank loans, economists and market analysts said. According to statistics from the People's Bank of China, the increase of loans outstanding in June alone was 451.5 billion yuan, while it's only 247.3 billion in May. Of the additional increase of 56.6 billion yuan loans from the same time a year ago, 79.9 percent were household loans. "Since the majority of household loans were mortgage loans, it's clear that more funds have been relocated to the property market lately," said Shen Minggao, an economist at Citigroup. "Investments in luxury residential properties also shot up as many investors cashed out of the Shanghai stock market and turned to luxury properties as long-term investments," said Lina Wong, managing director of Colliers, an international real estate service provider. In line with the increased transaction volume, selling price for luxury properties grew 2.7 percent in the first half, compared with 3.5 percent in the past 12 months. The rents also grew 2.9 percent, while it rose 3.8 percent from last June. Worldunion said it's like the two markets are on a seesaw, when "one goes up, the other comes down." The National Bureau of Statistics has announced that China's real estate investment rose 28.5 percent from a year earlier to 988.7 billion yuan in the first half of 2007. "Anticipation of further renminbi appreciation should secure a continuous inflow of foreign capital and help fuel the property market," said Wong of Colliers.