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Govt and policies

Consumer price hikes 'to accelerate'

China's consumer inflation is expected to pick up in April due to rising non-food prices and a low base for the same period a year ago, according to a report from the Bank of Communications. The bank forecast that the official consumer price index, a main gauge of inflation, will have grown 1.1 percent year-on-year for the month, slightly faster than March's 0.9-percent growth and the 0.8-percent increase in February. Price hikes in refined oil products have become a significant support for non-food prices, which likely rose 2.4 percent from a year ago, and a stronger carry-over effect also helped push up the CPI.

Book celebrates Wuhan's contribution

Former foreign minister Li Zhaoxing joined local officials and entrepreneurs last Friday to launch a book celebrating the contribution made by Wuhan's firms in economies along the route of the Belt and Road Initiative. Five groups of journalists went to 13 countries along the Belt and Road last year to record the 20 large-scale infrastructure projects conducted by companies from Wuhan, capital of Hubei province. The city ranks second regarding the number of level A or top 100 engineering design companies in China. It will apply for the title of City of Design from UNESCO in July.

Companies and markets

BYD invests in monorail project

China's leading new energy vehicle maker BYD will set up a monorail train production base and launch a tourist monorail line in Shandong province. According to an agreement recently signed between BYD and the government of Jining, the 35-km-long rail connects Qufu, the hometown of Confucius, with Zoucheng, the birthplace of Mencius. Confucius and Mencius were both Chinese thinkers more than 2,000 years ago. The total investment for the first phase is 8 billion yuan ($1.16 billion). The rail will be completed in September next year. Monorail trains can run at a maximum speed of 80 km per hour. Compared with subways, overground monorail costs less and is less noisy.

New routes to link with Astana, Zurich

Air China, the country's national flag carrier, will launch two direct routes in June to connect Beijing with Kazakhstan's capital Astana and Swiss financial hub Zurich. Beijing-Astana round-trip flights will begin on June 1, ahead of the 2017 World Expo to be held in the Kazakhstani capital. An Airbus 320 aircraft will fly between the two cities on Tuesdays, Thursdays and Sundays. The inaugural flight from Beijing to Zurich will take off on June 7, according to Air China. The Zurich-bound flight will leave Beijing on Tuesdays, Wednesdays, Fridays and Sundays, and return five and half hours after its arrival in Zurich. The airline currently conducts direct flights between Beijing and Swiss city Geneva. It expects the new route to bring more convenience to those traveling between China and Switzerland.

China Southern sees profit decline

China Southern Airlines, the country's biggest carrier by passenger volume, said its net profits slumped 42.44 percent year-on-year to 1.55 billion yuan ($220 million) in the first quarter of 2017. In a report filed to the Shanghai Stock Exchange, the airline attributed its profit drop to rising global fuel prices in the three-month period. The company's business revenue rose 10.58 percent from the same period last year to 30.97 billion yuan in the first quarter, according to the report. Earnings per share stood at 0.16 yuan.

Hyundai Motor opts for CATL

Hyundai Motor, South Korea's biggest automaker, has selected Contemporary Amperex Technology Co Ltd as its first battery supplier in China to enhance cooperation in new energy vehicles. "We selected CATL as our first Chinese battery partner as Hyundai seeks to diversify its supplier base," a Hyundai official said. The official said CATL was widely recognized for its competitiveness in the automobile battery market. The Fujian province-based company will provide batteries for Hyundai's plug-in Sonata sedans that are expected to hit the Chinese market in the first half of 2018. The Sonata plug-in hybrid electric vehicle models will have both an internal combustion engine and an electric motor.

Sony's group net profit retreats

Sony Corp's group net profit last year dropped 50.4 percent from the previous year. Sony said for the past year to March 31, it posted a group net profit of 73.29 billion yen ($658 million), dropping 50.4 percent from the previous year. The Tokyo-based maker also said that its operating profit was 288.70 billion yen, declining 1.9 percent, on sales of 7.60 trillion yen, a drop of 6.2 percent. The maker of PlayStation game consoles and Bravia LCD TVs attributed losses to the earthquakes in southwestern Japan in April last year. The quakes forced Sony to shutter some of its operations at a plant in quake-hit Kumamoto Prefecture.

Around the world

South Korea posts big rise in exports

South Korea posted the second biggest exports last month, bolstering expectations for the economy's recovery, a government report showed on Monday. Exports, which account for about half of the export-driven economy, reached $51 billion in April, up 24.2 percent from the same month of last year, according to the Ministry of Trade, Industry and Energy. In terms of value, it was the second largest ever recorded by the South Korean economy. The country's exports continued to rise for six straight months, posting double digit increase for the fourth consecutive month.

Welfare cheats to be targeted

In an attempt to bring the nation's budget back into balance, the Australian government will target around 20,000 welfare cheats, Employment Minister Michaelia Cash said on Monday. Ahead of the federal budget next Tuesday, the government has confirmed it would target welfare cheats, after figures revealed that a growing number of jobless Australians were taking advantage of a loophole which allows them to access welfare payments despite missing mandatory "appointments". Data obtained by local media showed that last year 7,006 Australians skipped their welfare appointments but "made contact" before the fortnightly "cut-off," meaning their welfare payments continued despite missing the meetings.

Eurozone inflation picks up in April

Eurozone annual inflation is expected to be 1.9 percent in April, up from 1.5 percent in March, according to Eurostat, the statistics agency of the European Union. It means inflation is back at the European Central Bank's target of below, but close to, 2 percent. The inflation pick-up in April is mainly due to the rising energy prices which jumped 7.5 percent annually. The core inflation, which strips out volatile energy and unprocessed food prices, rose to 1.2 percent in April from 0.8 percent in March. April's core inflation rose to the highest level since September 2013, which may show that eurozone economy is gaining momentum.

France's first-quarter growth at 0.3 percent

France recorded a slower than expected economic pace of 0.3 percent GDP growth in first three months of the year due to sluggish household spending and falling exports, a report said. Rising 0.5 percent in the last quarter of 2016, economic activity slowed at the start of this year as consumer spending stalled over the period at 0.1 percent from 0.6 percent a quarter earlier, national statistics institute Insee said in the report. Sales abroad reported a negative trend in the first quarter after falling by 0.7 percent compared to a 1.4-percent rise a quarter earlier, while imports rose by 0.7 percentage points to 1.5 percent.

Spanish govt predicts economic expansion

Spain's economy would grow on average 2.5 percent year-on-year until 2020, the Spanish government said. Unemployment would fall to 15.6 percent in 2018, 13.7 percent in 2019 and 11.2 percent in 2020. The government confirmed the 2.7 percent economic growth prediction for this year, revised up from the previously 2.5 percent. The government also said that the public deficit would fall to 3.1 percent of the country's GDP this year, 2.2 percent in 2018, 1.3 percent in 2019, and 0.5 percent in 2020.

Iran backs crude output freeze

Iran's Petroleum Minister Bijan Namdar Zanganeh said on Sunday that Iran will support a decision by the Organization for Petroleum Exporting Countries to extend the oil output freeze agreement. "If a majority of OPEC and non-OPEC states agree to extend the oil freeze deal, Iran will also go along with it," Zanganeh told reporters after his meeting with the visiting European Climate Action and Energy Commissioner Miguel Arias Canete. Positive signals have been received for extending the oil freeze agreement in the second half of 2017 and Iran will back other member-states of OPEC if they support the extension, he was quoted as saying.

China Daily - Agencies

(China Daily USA 05/02/2017 page14)