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Govt And Policies

Nation sees $39.3 billion surplus

China recorded a $39.3 billion surplus in its capital and financial account in the first quarter, indicating eased capital outflows pressure, the nation's top currency regulator said on Thursday. Surplus of financial account helped offset the pressure on China's balance of payments in the first quarter, according to the State Administration of Foreign Exchange. In the first quarter of this year, the financial account surplus was $ 36.8 billion, compared with $ 126.3 billion deficits during the same period last year. The current account registered a surplus of $18.4 billion in the first quarter, the administration said. The forex regulator attributed the change to more rational outbound investment and increase in the flows of foreign investment.

China-backed AIIB gets top credit rating

The China-backed Asian Infrastructure Investment Bank received a boost to its operations with Moody's Investors Service giving it the top credit rating. This puts it on the same level as the World Bank and Asian Development Bank or ADB. The AIIB was rated Aaa with a stable outlook, Moody's said in a statement on Thursday. The bank is in its second year of operations and is expanding lending and membership. The credit rating will pave the way for the $100-billion bank to issue bonds in the global market to raise more capital, as it prepares to embark on projects as the sole lender. The bank now has 80 members and has approved a total of $2.5 billion in loans for 16 projects since its launch last January.

Country willing to negotiate Mexico FTA

Qiu Xiaoqi, Chinese ambassador to Mexico, said on Wednesday that China is willing to negotiate a free-trade agreement with Mexico. "Mexico is China's second-largest trading partner in Latin America and China is Mexico's second-largest trading partner in the world. This is a highly important relationship and we have great interest in deepening and broadening these ties," said Qiu. "I think any agreement to make trade easier is very worthy." The ambassador spoke to the media after a speech at the National Autonomous University of Mexico celebrating the 20th anniversary of Hong Kong's return to China.

Companies And Markets

Alibaba 'in talks to buy ZTE software arm'

Alibaba Group Holding Ltd is closing in on a deal to acquire Chinese telecommunications gear maker ZTE Corp's software subsidiary, an acquisition that could help strengthen its global internet computing business, people familiar with the deal said. China's leading e-commerce operator has been in negotiations to buy ZTEsoft Technology Co for months and is nearing an agreement, according to one of the people, who asked not to be identified discussing a private deal. Alibaba could pay between 2 billion yuan ($294 million) and 3 billion yuan for a division that provides software support and services to carriers around the world, another person said. Alibaba, which grew to become one of China's two biggest corporations alongside a boom in online shopping, is investing billions in expanding a cloud computing business that competes with Amazon.com Inc and Microsoft Corp.

Sinomach merges with State textile giant

China's State Council has approved a merger between China National Machinery Industry Corp (Sinomach) and textile giant China Hi-Tech Group Corp, an official statement announced on Thursday. The textile conglomerate has become a wholly-owned subsidiary of Sinomach, an equipment manufacturing group, and will no longer be directly supervised by the State-owned Assets Supervision and Administration Commission, according to the statement released on SASAC's website. The news brought down the number of central State-owned enterprises to 101. The SASAC has planned to reduce the number of central SOEs to under 100 as part of the ongoing reforms to improve efficiency of the companies.

Fulihuade listed on New Third Board

Beijing Fulihuade Bio-medical Technology Co Lt has listed on the New Third Board. Fulihuade was co-founded in January 2009 by Chen Lihua and Ferid Murad. It is devoted to the research and development of skincare and healthcare products including Zitan - a type of timber whose extracts are beneficial for cell reproduction, radical scavenging and anti-oxidation. Over the decade, Fulidehua and the US Murad Lab have successfully produced a series of skincare products based on the research and development of Zitan.

Norwegian firms urged to invest at home

Norwegian oil suppliers currently focused on the rapidly growing overseas offshore wind power market are being urged to invest in the domestic market, the newspaper Aftenposten reported on Wednesday. While the companies are building offshore wind power parks abroad, there is a lack of interest in the industry's development in Norway, the report said. "There is a huge market out there. Norway needs to do something fast if we are going to be able to hang on," said Oyvind Isachsen from the Norwegian Wind Energy Association. According to the newspaper, the prices of offshore wind power plants have fallen sharply in recent years, and industry experts said power generated by major offshore wind farms will be competitive with other power sources within the next seven years.

Around The World

AI to significantly boost global GDP

Global GDP will be 14 percent higher in 2030 as a result of artificial intelligence, with China and North America seeing the greatest economic gains, according to a new research report released by consultancy firm PriceWaterhouse Coopers. AI will contribute $15.7 trillion to the global economy by 2030, PwC said in the report. Labor productivity improvements are expected to account for more than half of all economic gains from AI over the period 2016 to 2030, while increased consumer demand resulting from AI-enabled product enhancements will account for the remainder. The greatest economic gains from AI will be in China, with a 26 percent boost to GDP in 2030, and North America, with a 14.5 percent boost, equivalent to a total $10.7 trillion and accounting for almost 70 percent of the global economic impact, according to the report.

S. Korea business sentiment falls

Sentiment among South Korean businesses fell for the second consecutive month due to cheaper crude oil, central bank data showed on Thursday. The business sentiment index for manufacturers stood at 78 in June, down 4 points from the previous month, according to the Bank of Korea. The index below 100 means pessimists outnumbered optimists. It was based on a survey of 1,762 manufacturers and 1,120 non-manufacturers conducted on June 15-22. The figure gained ground from January to April thanks to exports recovery, but it began to decline from May as cheaper crude oil lowered oil product-related exports. Consumers refrained from spending money amid massive household debts. The debt-serving burden was expected to grow as pressures increased on the BOK to hike rates following the US Federal Reserve's rate increases.

French confidence at 10-year high

French consumers showed more optimism about the general economy and financial situation in June, with the monthly sentiment indicator hitting a 10-year high compared to May data, national statistics bureau Insee said on Wednesday. The consumer confidence index gained five percentage points to 108 points over the period, its highest level since 2007. Households' sentiment to their future personal financial situation had improved for the second consecutive month by two points, while their appreciation for their economy in the coming months gained 15 percentages points, Insee figures showed. In June, people showed less pessimism about the unemployment after the index decreased for the third successive month by 9 points reaching its lowest level since 2008.

Myanmar announces 10 priority areas

The Myanmar Investment Commission has announced 10 areas which will be prioritized for investment by both local and foreign entrepreneurs, the Myanmar News Agency reported on Wednesday. The 10 prioritized areas for investment include agriculture, livestock and fishery, export promotion, import substitution, power, logistics, education, healthcare, affordable housing construction and the establishment of industrial estates, said the commission. Myanmar's Investment Law was introduced last October.

(China Daily USA 06/30/2017 page19)