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Govt and policies

June auto sales accelerate

China's auto sales grew again in June after two months of decline, data from the China Association of Automobile Manufacturers showed. Some 2.2 million vehicles were sold last month, up 4.5 percent year-on-year, compared with a 0.1 percent decline in May and a 2.2 percent drop in April. Meanwhile, 2.2 million vehicles were produced in June, up 5.4 percent from the same period last year, according to the CAAM. Passenger car sales climbed 2.3 percent to 1.8 million vehicles last month, 2.2 percentage points slower than the overall growth. But both production and sales in new energy vehicles were particularly robust, with 59,000 NEVs sold in June, up 33 percent year-on-year, while 65,000 NEVs were produced, up 43.4 percent.

B&R shipping indices released

The Shanghai Shipping Exchange officially launched the Belt and Road shipping indices on Tuesday, to track freight trade data among economies involved in the initiative, after a two-year trial. The indices include a Belt and Road trade index, a Belt and Road freight volume index and a Maritime Silk Road freight index. The Belt and Road Initiative was proposed by China in 2013 to build trade and infrastructure links along ancient overland and maritime Silk Road routes, connecting economies in Asia, Europe, Africa and Oceania. Exchange President Zhang Ye said the indices would help the shipping industry keep tabs on trade volumes and freight rates. The indices will also boost market transparency, he added.

Companies and markets

Huawei drives into Africa

Huawei has partnered with UK money transfer service operator WorldRemit, to serve African expatriates sending money home to subscribers of the tech giant's mobile money service platform in the continent. The deal, announced on Tuesday, will enable Huawei to add a ready-made solution for remittances - a growing mobile money product offering - to its suite of services. "International remittance is a very important mobile money service in Africa, and our partnership with WorldRemit will bring international remittances directly to Huawei's customers across the continent," said David Chen, vice-president of Huawei Southern Africa.

VW sales motor ahead

Volkswagen Group China said it made record sales in the first half of 2017, driven by strong SUV sales. Volkswagen delivered nearly 1.4 million vehicles to the Chinese mainland and Hong Kong from January to June this year. In June alone, Volkswagen's year-on-year sales rose by 5.4 percent, according to Stephan Wollenstein, CEO of Volkswagen China Passenger Cars Brand. The SUV remained the primary force of growth for the group, with sales of the Tiguan model up 39 percent.

Space firm to launch in Malta

Scottish "NewSpace" company Orbital Access will soon open its headquarters in Malta, hoping to pioneer the industry on the island nation, local paper The Malta Independent reported. NewSpace refers to the new space sector - as distinct from the old space missions with government agencies launching vertical rockets - and the private space flight industry. Orbital said satellites are launched into space on standard airplanes, detaching from the aircraft at preset heights and continuing into space. The 400 billion euro ($455.5 billion) industry is one in which Malta is currently not involved. Company director Edmund Arcadian said the plan was to encourage other companies in the sector to establish businesses in Malta, not only because of the financial services Malta offers, but also the country's prime location for launching satellites.

Around the world

Italy's output revs up in May

Italy's industrial production beat expectations to rise by 2.8 percent in May compared with the same period last year, national statistics agency ISTAT reported on Tuesday. Industrial production rose 0.7 percent in May compared with April, by 0.2 percent in March-May compared with the previous quarter, and by 1.7 percent in the first five months of the year over the same period in 2016, ISTAT said. "Yearly industrial production +2.8 percent. Better than forecast. Growth will mean more jobs, less inequality," tweeted Prime Minister Paolo Gentiloni. There was a marked rise in May production of capital goods, up 5.9 percent, followed by consumer goods up 2.5 percent, energy up 1 percent, and intermediate goods increasing 0.4 percent. The best-performing sector was transportation vehicle manufacturing with a 7.3 percent growth and the worst-performing sector was mining, dropping 18.8 percent, according to ISTAT.

French to cut spending by $5.12b

France is working to generate 4.5 billion euros ($5.12 billion) in spending cuts in 2017, to reduce the public deficit to 3 percent of economic output by the end of the year, Gerald Darmanin, minister of action and public accounts said on Tuesday. In an interview with local newspaper Le Parisien, Darmanin said France would "keep its word" after it had broken several promises to reach the 3 percent level ordered by the European Union. "We found 4.5 billion euros of savings, to lower the deficit to under 3 percent from this year by reducing the state budget. Neither local authorities nor social security will be involved," the minister added. In an "unprecedented" move, Darmanin said the government would squeeze public expenditure without increasing taxes and affecting public services.

Morocco readies dirham float

The International Monetary Fund said Morocco is ready to start floating its currency, local media reported on Tuesday. In June, the country's central bank announced Morocco would take the first step of floating the dirham, Morocco's official currency, in early July. "Morocco has been ready, as we've already said. It's a sovereign and voluntary decision the Moroccan authorities have taken, as part of a long process of integrating the country into the world economy," Moroccan financial daily l'Economiste quoted Nicolas Blancher, Morocco's head of mission to the IMF's Middle East and Central Asia Department, as saying. "We don't see any big exposure to risk," he noted. The Moroccan government has said studies are being carried out to ensure enough time for the process.

Jakarta upgrades its GDP target

Indonesia's government on Tuesday agreed to revise upward its economic growth target this year, due to better prospects for exports. At a meeting on economic assumptions, the GDP growth target was revised to 5.2 percent from 5.1 percent in the previous revision. Chief Economic Minister Darmin Nasution said an improvement in global economic conditions had helped boost prices and the demand for commodities, which are Indonesia's biggest exports. The meeting also agreed on a 4.3 percent inflation target this year, with a 13,400 rupiah value per US dollar. President Joko Widodo's administration has accelerated spending of the country's development budget, one of the major contributors to the country's economic growth, for the current year.

Iran's exports to UAE soar

Iran exported $6.6 billion worth of goods to the United Arab Emirates in the last fiscal year that ended on March 20, 2017, the Financial Tribune daily reported on Tuesday. The value of Iran's exports last year to its southern neighbor was up 35 percent compared with the year before, the report said. The main exported commodities during the period included light oil, mineral oil, tar, gasoline, pistachio, saffron, trucks, iron and steel products, lead and jewelry. According to the Islamic Republic of Iran Customs Administration, the UAE was Iran's second biggest non-oil export destination, after China, in the last fiscal year, accounting for 17 percent of all Iranian exports.

Kenyan debt mountain climbs

Kenya's domestic debt rose to $21 billion following increased sales and uptake of Treasury bills and bonds, after the government moved to offset a budget deficit. Central Bank of Kenya data indicated on Tuesday that debt hit the new level at the end of June, up from $20 billion at the end of May, a rise of nearly about $1 billion in nearly a month. About $20 billion of the debt is held in Treasury bonds and bills. Treasury bonds accounted for the largest chunk at 64 percent, with Treasury bills at 35 percent. Following the surge in borrowing, the share of domestic debt to total public debt, which stands at $40 billion, is 51 percent.

China Daily - Agencies

(China Daily USA 07/13/2017 page14)