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AIIB approves $324m in infrastructure

The Asian Infrastructure Investment Bank said on Thursday it has approved two loans and one equity investment worth $324 million in Georgia, Tajikistan and India. The bank's first ever equity investment of $150 million aims to help attract private capital for infrastructure projects in India, the AIIB said in an emailed statement. "Approving our first equity investment is another milestone for the bank and will enhance our potential to source and fund high quality, private sector projects," said D.J. Pandian, AIIB vice-president, in the statement. "These three projects demonstrate a growing sophistication in our ability to support our member countries across different regions and sectors." The Beijing-based AIIB, formed in January 2016, aims to provide infrastructure financing in the Asia-Pacific region. The multilateral development bank has been viewed as a rival to the Western-dominated World Bank and Asian Development Bank.

Country's FDI inflow drops in May

Foreign direct investment into the Chinese mainland dropped 3.7 percent year-on-year in May to 54.67 billion yuan ($8.05 billion), data from the commerce ministry showed on Thursday. In the first five months, FDI inflow was 0.7 percent lower than the same period in 2016, said the Ministry of Commerce.

Overcapacity cuts progressing smoothly

China's top economic planner announced on Thursday that the country's drive to cut overcapacity in steel and coal has progressed well. As of the end of May, 42.39 million metric tons of crude steel capacity and 97 million tons of coal capacity had been cut, accounting for 84.8 percent and 65 percent of the annual goals, respectively, said the National Development and Reform Commission. China will phase out about 50 million tons of crude steel capacity and over 150 million tons of coal capacity this year, according to the NDRC. By the end of June, all facilities producing inferior-quality steel bars will be dismantled, the NDRC said in May.

CAAC censures Emirates over safety

China's civil aviation authority has fined the world's largest longhaul carrier, Dubai-based Emirates, and barred it from adding new destinations and aircraft in China for six months, following two incidents of "unsafe operations". Airline crew were responsible for an April 17 incident in which an aircraft flew at the wrong height and another on May 18, when a plane temporarily lost contact with air traffic control, the Civil Aviation Administration of China said. Both incidents took place over the far western region of Xinjiang, the regulator said in a statement on its website late on Wednesday. The regulator fined Emirates 29,000 yuan ($4,270) over the incidents, and said it had summoned senior airline officials to a meeting, but gave no further details.

Yida said interested in Italy supermarkets

Chinese Group Yida International Investment has formally expressed interest in Esselunga, Italy's fourth-largest supermarket chain, Italian daily la Repubblica reported on Thursday. The offer for supermarket chain amounts to 7.5 billion euros ($8.39 billion), higher than a valuation of 4 billion euros to 6 billion euros made by private equity funds Blackstone and CVC Capital Partners in September.

SPIC in talks for Chile power assets

China's State Power Investment Corp is in exclusive talks to acquire energy company Latin America Power's Chilean assets for $325 to $400 million, said two sources with knowledge of the matter, as SPIC steps up its involvement in the region. Latin America Power has more than 300 megawatts of wind and hydropower assets in Chile and Peru, over 250 megawatts of which is located in Chile. That includes two large wind farms near the Chilean capital Santiago. In 2015, now-bankrupt SunEdison agreed to purchase the company, which is partially held by Grupo BTG Pactual SA and Blackstone Group-backed Patria Investimentos, for $700 million. The US solar company later terminated the deal, however, resulting in a court battle and a $28.5 million settlement for LAP in 2016.

China Aircraft Leasing buys 50 Boeing aircraft

China Aircraft Leasing Group Holdings Ltd said it would buy 50 Boeing 737MAX series aircraft from Boeing for an aggregate list price of $5.8 billion, to meet demand for more efficient aircraft while expanding its fleet portfolio. The aircraft lessor's unit had agreed to buy the Boeing aircraft, in a deal to be settled from internal resources and loans and other borrowings, the company said in a filing to the Hong Kong bourse on Thursday. China Aircraft, which now owns and manages 87 aircraft, said the actual purchase price would be lower than the list price as Boeing would grant price concessions as per industry practice. The Boeing aircraft will be delivered in stages up to 2023.

Freight trains resume service via Slovakia

The transportation of Chinese freight trains via Slovakia has been resumed after a more than one-year interval on Wednesday. More than 40 containers were transported from a broad-gauge railway to a European-gauge railway at Dobra terminal near the Slovak-Ukrainian border on Wednesday. The train was from the southern Chinese city of Changsha and is heading via Slovakia to Budapest. "This is a new beginning of cargo trains' heading from China to the European Union via Slovakia. It's a great success and we have achieved it after more than a year's efforts and a series of joint negotiations with Chinese, Russian and Ukrainian partners," Slovak Transport and Construction Minister Arpad Ersek said on Wednesday.

BMW to recall X5, X6s in mainland

BMW will recall more than 86,000 imported X5 and X6 vehicles in China starting from Nov 1, 2017, due to a problem in the drive shaft. The recall involves 57,371 X5 vehicles and 29,407 X6 vehicles manufactured between April 2010 and April 2013, according to the General Administration of Quality Supervision, Inspection and Quarantine. The seal in the front drive shaft bearing could move away from its designed position and cause undesirable wear to the bearing due to sand and water that could get in. In extreme cases, the cross shaft joint may rupture, causing the front wheels to lose their driving force. The company will replace the defective drive shafts free of charge.

South Korea posts $5.7b trade surplus

South Korea posted a trade surplus at $5.7 billion in May thanks to export growth, customs data showed on Thursday. The revised figure for the trade surplus was $5.7 billion as exports, which account for about half of the economy, logged double-digit growth for five straight months, according to the Korea Customs Service. Exports increased 13.3 percent year-on-year to $45 billion in May, while imports gained 19.1 percent to $39.3 billion. Semiconductor exports surged 56.2 percent, leading the exports recovery for the first five months of this year.

US May consumer inflation decelerates

US consumer prices unexpectedly declined in May, a sign that inflation pressure remain muted. The Consumer Price Index, a main gauge of inflation, fell 0.1 percent in May on a seasonally adjusted basis, compared to a 0.2 percent increase in the previous month, said the Labor Department on Wednesday. On a year-on-year basis, the index increased 1.9 percent, down from the 2.2 percent increase in April. The food index rose 0.2 percent in May, the same growth as in April, while the energy index fell 2.7 percent in the month, after rising 1.1 percent in April. Excluding the volatile food and energy categories, the so-called core CPI went up 0.1 percent in May on a seasonally adjusted basis, and was up 1.7 percent over the year, also lower than the 1.9 percent growth in April.

Manufacturing confidence drops

Business confidence in Macedonia's manufacturing industry dropped to 16.5 points in May from 16.9 points in April, but increased compared to 14.4 points in May 2016, Macedonia's state statistical office said on Wednesday. According to managers of manufacturing companies operating in Macedonia, production volumes declined over the past three months and will continue to drop in the next three months, while employment is expected to remain almost the same. According to the state statistical office, insufficient domestic and foreign demand, a skilled labor shortage and economic uncertainty were the factors that affected the production volume most.

Albanian's Q1 retail turnover increases

Albania's retail trade turnover volume index in the first quarter of 2017 rose 2.7 percent year-on-year and increased 0.6 percent from the previous quarter, data published by the National Institute of Statistics showed on Wednesday. Meanwhile, employment rose 1.5 percent year-on-year, but fell 2.1 percent compared to the previous quarter. The wage fund index rose 0.5 percent year-on-year, but fell 1.4 percent compared to the previous quarter.

China Daily - Agencies

(China Daily USA 06/16/2017 page18)