SHANGHAI: Singapore and China have concluded talks to upgrade the China-Singapore Free Trade Agreement (CSFTA), Singapore’s Ministry of Trade and Industry (MTI) said in a statement on Monday (Nov 5).
This was announced following a meeting between Singapore’s Trade and Industry Minister Chan Chun Sing and Fu Ziying, who is China’s Vice Minister of Commerce and the China International Trade Representative, on Monday. The meeting took place on the sidelines of the China International Import Expo.
Under the current CSFTA, there are no tariffs on 95 per cent of Singapore’s exports to China, while there are no tariffs on all Chinese exports to Singapore.
The upgraded CSFTA is expected to provide Singapore businesses with greater trade facilitation and investment protection in China.
It is also expected to provide Singapore businesses with improved market access and will cover cooperation in new areas, including legal and financial services, e-commerce and the environment.
Mr Chan said this development marks “an important step forward” for bilateral economic relations between Singapore and China.
“The upgrade signals our joint commitment towards greater economic collaboration and trade liberalisation. Singapore businesses can expect to enjoy greater access to the vast Chinese market and greater certainty in their investments when the upgraded CSFTA takes effect,” he said.
The CSFTA was the Chinese government’s first such agreement with an Asian country.
Talks to upgrade the FTA, which entered into force in January 2009, have been three years in the making. They began after Chinese President Xi Jinping visited Singapore in November 2015.
In September, Singapore Deputy Prime Minister Teo Chee Hean had said that the signing of the upgraded pact is expected when Chinese Premier Li Keqiang visits Singapore for the ASEAN Summit next week.
The G7 summit, which groups Canada, the US, the UK, France, Italy, Japan and Germany, is being held in the town of La Malbaie in Quebec, Canada.
The leaders of the nations, which represent more than 60% of global net worth, meet annually. Economics tops the agenda, although the meetings now always branch off to cover major global issues.
What did Mr Trump say about Russia?
Mr Trump said he regretted the meeting had shrunk in size, putting him at odds with most other G7 members on yet another issue.
“You know, whether you like it or – and it may not be politically correct – but we have a world to run and in the G7, which used to be the G8, they threw Russia out. They should let Russia come back in,” he said.
He found support in the shape of the newly installed Italian Prime Minister Giuseppe Conte, who tweeted that it was “in the interests of everyone” for Russia to be readmitted.
Canada, France and the UK though immediately signalled they remain opposed to Russian re-entry. A Kremlin spokesperson said they were interested in “other formats”, apart from the G7.
Russian President Vladimir Putin is currently in Beijing, where he was presented with a friendship medal by Chinese counterpart Xi Jinping.
Fellow members of what was then the G8 suspended Russia after it took control of Crimea, saying it would remain until Russia “changes course”.
By the BBC’s diplomatic correspondent, James Robbins
Relations between Donald Trump and America’s leading allies were already at a new low over trade tariffs before the president casually dropped his Russia hand-grenade.
Most G7 leaders think the decision to expel Russia in 2014 was right then, and remains right today. Even Russia itself seems lukewarm about rejoining.
In many ways, this seems to be a deliberate Donald Trump tactic, to distract attention from his war of words with the rest of the G7 over trade and protectionism.
President Trump dislikes the whole idea of the G7: a club of nations which traditionally comes together around shared values rooted in a world order based on agreed rules. Last to arrive, he’ll also be first to leave.
What were the exchanges on the eve of the summit?
It was mainly France and Canada v Donald Trump, sparked by Mr Trump’s imposition of steel and aluminium tariffs.
Appearing alongside host leader Justin Trudeau, French President Emmanuel Macron said: “A trade war doesn’t spare anyone. It will start first of all to hurt US workers.”
For his part Mr Trudeau described Mr Trump’s citing of national security to defend his steel and aluminium tariffs as “laughable”.
Never one to back down, Mr Trump fired off a series of tweets, keeping up the tirade on Friday.
According to the leaders’ programme, Mr Trump will be around for the economic and security issues being discussed on Friday but will miss climate change, the environment and probably gender equality on Saturday.
The US president was very much the odd man out on climate change during the G7 in Italy last year, later announcing his intention to withdraw from the landmark Paris agreement.
(THIS ARTICLE IS COURTESY OF THE SHANGHAI DAILY NEWS)
Mainland-HK trade drops 7.1% in first 11 months
Source: Xinhua | December 31, 2016, Saturday | ONLINE EDITION
THE Chinese mainland’s trade with Hong Kong totaled US$274 billion in the first 11 months of 2016, down 7.1 percent year on year, according to the Ministry of Commerce.
The value accounted for 8.3 percent of the mainland’s total overseas trade in the January-November period.
Mainland exports to Hong Kong hit US$258 billion, a decrease of 9.3 percent year on year, while the mainland’s imports from the region saw an increase of 51.9 percent to US$16.1 billion.
Hong Kong is the mainland’s fourth-largest trading partner and third-largest export market, according to the ministry.
The mainland approved 11,309 Hong Kong-invested projects from January to November, with the actual use of Hong Kong capital reaching US$72.8 billion, down 6.8 percent from the same period of last year.
By the end of November, the mainland had approved 397,522 Hong Kong-invested projects, with the actual use of Hong Kong capital reaching US$906 billion, accounting for 51.6 percent of the mainland’s actual use of overseas capital.
(THIS ARTICLE IS COURTESY OF THE SHANGHAI DAILY NEWS)
Stability needed next year for stronger global economy
Source: Xinhua | December 17, 2016, Saturday | ONLINE EDITION
FOR China and the world to witness stronger economic growth next year, one thing is needed: stability.
For an international market trapped in fluctuations during a year of surprising events, a new direction in 2017 is a must, something discussed at a recently ended annual economic policy meeting in Beijing.
“Seeking progress while maintaining stability” was the main theme of this year’s Central Economic Work Conference, according to a statement released by the conference on Friday. Economic priorities for 2017 were also be hammered out.
With a gross domestic product (GDP) accounting for over 15 percent of the global total, China’s growth at 6.7 percent in the third quarter, or between 6.5 percent and 7 percent annually, represents a natural and significant contribution to global economic stability.
That is true more than ever since the International Monetary Fund in October revised down global growth to 3.1 percent for 2016 and 3.4 percent for 2017.
Moreover, the spillover of China’s new economic policies will be strongly felt in the ongoing joint construction of the China-proposed Belt and Road Initiative, which will see development of countries along its route.
STABILITY WITH CONTINUED SUPPLY-SIDE STRUCTURAL REFORM
In combination with the growth trend in the second half of 2016, the important messages Chinese policymakers convey at the key annual economic conference will highlight a clear reform course for the world’s second largest economy.
Stability is a prerequisite for reforms, commented Margit Molnar, head of the China Desk of the Economics Department of the Organization for Economic Cooperation and Development.
Having dealt with such flashpoints like the asset bubble and local government debt, China will help prevent systematic risks, creating conditions for continuing the supply-side structural reform, he told Xinhua.
The economic work conference has maintained supply-side structural reform as necessary for stable growth, with a continued focus on upgrading the country’s economic structure.
Reforms which focus on expanding effective supply in a dynamic supply-demand equilibrium, will promote stability, said Zhao Yao, professor with the business school of Rutgers University in the United States.
LONG-TERM MOVES TO COOL DOWN REAL ESTATE
Homes are for living in rather than speculation, the conference stressed, proposing to use financial, land, taxation, investment and other instruments to establish a fundamental and long-term system to curb real estate bubbles and market volatilities.
Guo Shengxiang, dean of the Australian think tank Academy of APEC Creative Finance, described the idea as “forward-looking”.
“It will be a good news, to stabilize the market, improve people’s well-being and facilitate the development of the real economy,” he said.
The Hong Kong and Shanghai Banking Corp. (HKSB) believes measures to cool down real estate will not thwart China’s economic recovery.
Without a complete tightening of monetary policy, the impact of government regulations could be neutralized by infrastructure investment with financial support, it said.
PRUDENT AND NEUTRAL MONETARY POLICY AGAINST RISKS
The conference defines China’s monetary policies for 2017 as “prudent and neutral”, promising better adjustments to ensure stable liquidity.
Monetary policymaking should adapt to changes in the use of money supply tools, and further efforts are needed for smoother policy transmission, it said.
China will keep the yuan basically stable, while improving the flexibility of exchange rates.
“The stance shows the government is trying to find a subtle balance between stabilizing growth and controlling asset bubbles,” noted Hong Hao, chief China strategist at BOCOM International.
Earlier, a Standard Chartered Bank report predicted financial and monetary policy instruments available to the Chinese government would suffice to support China’s growth in the coming years.
In Sydney, a multi-million dollar export industry starts with a simple trip to the shops.
Laden with plastic bags that are almost too heavy to carry, we meet Rika Wenjing, a 24-year-old accountancy graduate from Wuhan, the capital of Hubei province.
She labours with tins of infant food, supplements and skin lotions from a discount chemist to sell to customers back home in China.
Rika has worked part-time for the past two years as a daigou, a freelance retail consultant.
She is glued to her phone and tablet, using the messaging app WeChat to build a network of 300 clients who aren’t afraid to pay premium prices for trustworthy Australian goods.
“In the beginning I just had my friends and my aunty to buy baby formula or unique brands from Australia, like Ugg boots. Then I wanted to build a platform to show more products to them,” she told the BBC. “I don’t want just to earn money, I want to provide products to my friends.”
In Australia, it’s estimated there are 40,000 daigou, which means “on behalf of” in Mandarin.
The online shopping agents are almost exclusively from mainland China, and are young migrants or international students looking for flexible ways to help cover their rent and university fees.
The epicentre of the trade is in Sydney, a city with a growing Chinese community and frequent direct flights to China, which makes doing business quicker and smoother.
Earlier this year, Beijing tightened regulations on cross-border online shopping, but there is still money to be made, especially in baby milk formula, known as “white gold”. Shoppers in China cannot always find the brands of baby milk formula they want locally
In 2008, at least half a dozen children died and as many as 300,000 fell ill in China after consuming milk products contaminated by melamine, a chemical used in plastics and adhesives. Since then, imported milk has become highly prized by sections of China’s affluent and health-conscious middle classes.
“Everyone cannot buy the good quality or the reliable formula in China, so they want to buy from Australia. Maybe it is more expensive, they don’t care [about] the price but they do care about the quality,” Rika explains.
At the height of a boom last year in demand in China for milk formula, a buying surge from daigou attracted criticism in sections of the Australian media for leaving domestic shoppers empty-handed.As demand peaked last year some shops limited the amount of formula customers could buy
Daigou came to prominence in Europe by shipping luxury goods such as Gucci handbags to China. In Australia, the trade revolves around everyday items including food, beauty products, wine and clothes.
“There are smaller daigou, so mum doing a home business and ship the product to China. There are also those which open up their own shop and try to do a bigger-scale business,” says Benjamin Sun, the co-founder of Think China, a digital marketing company in Sydney.
“Some of the daigou… establish their own logistics, own e-commerce website and try to formally distribute the products. It is all about trust, that is what daigou is doing – building trust between their clients. They are small but they are a lot of people. If you add them together, they are huge.”
Daigou typically charge premiums of about 50% above the retail price in Australia. But even allowing for transport fees, buyers in China invariably pay much less for the same product in a local shop – assuming it is available.
The industry with its home-spun roots does have its challenges. Customers must be convinced the goods they receive are genuine, and not fake, and that the supplier is reliable.
Consultants often live stream their visits to supermarkets and chemists to prove the authenticity of the goods they send. It is an industry founded on trust.
In the Sydney suburb of Yagoona, Bob Sun, originally from the city of Dalian but now studying accountancy at Macquarie University, is renting a warehouse with three Chinese friends for their expanding business.
They pack their products – again mostly milk powder, vitamins and skin creams – with Australian magazines to help prove their provenance.
“The income from daigou is reasonable compared to other working opportunities like working in a restaurant and that sort of thing. The profit is really enough to cover your rent. It is easy to do that,” the 24-year-old student told the BBC.
“The biggest reason for me to do daigou is to not work in some company or to work in a restaurant. It is flexible.”
These freelance exporters have created thousands of trading routes both small and big into China, a market that can be almost impenetrable for some Australian companies, and others from New Zealand. Increasingly firms are collaborating with specialist consultants to harness their contacts and expertise.
“We think daigou are good for both the local economy… and they are very good for our business,” says Peter Nathan, chief executive of A2 Milk, a New Zealand baby formula manufacturer that also operates in Australia.
“We clearly believe they are a positive force and it’s fair to say that it is something we are accessing.”
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Chinese President Xi Jinping on Saturday called for a “smooth transition” in Beijing’s relationship with Washington and praised outgoing President Barack Obama for strengthening ties between the two nations.
During a meeting in Peru, Obama repeated the U.S. urging that all sides in the dispute over the South China Sea reduce tensions and resolve their disputes peacefully.
The meeting is expected to be the last between the two leaders before President-elect Donald Trump enters the White House. Trump has been sharply critical of China.
“We meet at a hinge moment in the China-U.S. relationship,” Xi said at the start of the meeting, through an interpreter.
“I hope the two sides will work together to focus on cooperation, manage our differences and make sure there is a smooth transition in the relationship and that it will continue to grow going forward,” he said.
Trump, a Republican, has accused China of being a currency manipulator and promised to slap big tariffs on imported Chinese goods. He has also called climate change a “hoax” designed to help Beijing.
“The concept of global warming was created by and for the Chinese in order to make U.S. manufacturing non-competitive,” Trump wrote in a tweet in 2012.
Obama and Xi pushed for the international community to back an agreement forged in Paris to combat global warming. Obama called that an example of the benefits of the two countries working together.
“Now we face the work of making sure our economies transition to become more sustainable,” he said.
Trump’s election has raised questions about whether the United States would try to pull out of the accord, a key legacy accomplishment for Obama, a Democrat.
China also helped negotiate the Iran nuclear agreement, another big piece of Obama’s foreign policy that Trump has threatened to dismantle.
Neither Xi nor Obama mentioned Trump in their remarks in front of reporters.
“Mr. President, I would like to commend you for the active efforts you’ve made to grow this relationship,” Xi said to Obama.
Obama noted that the two leaders would discuss areas of disagreement, including “the creation of a more level playing field for our businesses to compete, innovation policies, excess capacity and human rights,” he said.
“I continue to believe that a constructive U.S.-China relationship benefits our two people’s and benefits the entire globe,” he said.
(Reporting by Jeff Mason; Editing by Mary Milliken and David Gregorio)
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(This article is courtesy of the Shanghai Daily News)
Beijing welcomes Taiwan officials
Source: Xinhua | September 19, 2016, Monday | PRINT EDITION
ZHANG Zhijun, the Chinese mainland’s Taiwan affairs chief, met in Beijing yesterday with a delegation of county and city officials from Taiwan.
The delegation includes officials for New Taipei City and the seven counties of Hsinchu, Miaoli, Nantou, Hualien, Taitung, Kinmen and Lienchiang.
Zhang, head of the State Council Taiwan Affairs Office, welcomed the visiting officials and applauded their adherence to the 1992 Consensus and efforts to promote cross-Strait cooperation and exchange at the county and city levels.
Taiwan’s current leader, Tsai Ing-wen, and her administration had refused to recognize the 1992 Consensus since she and the Democratic Progressive Party took office in May, Zhang said.
The 1992 Consensus affirms that both sides of the Taiwan Strait belong to one China.
The refusal had shaken the political foundation for the peaceful development of cross-Strait relations and had dealt a heavy blow to the good momentum of peaceful cross-Strait ties that had been achieved through eight years of efforts, Zhang said, adding communication across the Strait had been affected and the interests of people on the two sides had been severely damaged.
Zhang stressed adherence to the 1992 Consensus under the new situation, vowed to firmly oppose and curb “Taiwan independence” and promote cross-Strait exchange in various fields to boost economic and social integration.
The officials from Taiwan voiced concerns about cross-Strait relations and pledged to continue to stick to the 1992 Consensus and maintain peaceful development of cross-Strait ties along with the mainland.
Mainland officials with the Ministry of Commerce, National Tourism Administration, General Administration of Quality Supervision Inspection and Quarantine, and the All China Federation of Supply and Marketing Cooperatives also attended the meeting.
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(This article is courtesy of the Shanghai Daily News Paper)
Forex reserves fall to lowest since 2011
Source: Agencies | September 8, 2016, Thursday | PRINT EDITION
CHINA’S foreign exchange reserves fell to the lowest since 2011 in August as the central bank intervened to support the yuan as it weakened to near-six year lows.
While the US$15.89 billion drop was in line with market expectations and was described by analysts as modest, it was the biggest fall since May and could signal fresh capital outflows from the economy as it starts to show signs of steadying.
China’s reserves fell to US$3.185 trillion in August — the lowest since December 2011 — from US$3.20 trillion at the end of July, central bank data showed yesterday.
China’s reserves, the largest in the world, fell by a record US$513 billion last year after Beijing devalued the yuan, sparking a flood of capital outflows that alarmed global financial markets.
But declines have slowed sharply in recent months as authorities tightened capital controls and cracked down on forex trading which is suspected to be speculation.
Traders believe the central bank has stepped in via state-run banks since mid-July to slow the pace of depreciation in the yuan, which has weakened 2.6 percent against the US dollar so far this year.
Analysts expect pressure on the yuan and reserves to continue as expectations of another US Federal Reserve interest rate hike this year support the dollar.
“With a Fed rate hike likely before the end of the year, the authorities will have their hands full with containing any wild spikes in USDCNY triggered by capital outflows, and can expect FX reserves to remain on a downward path through to the end of the year,” said Chester Liaw, an economist at Forecast Pte Ltd in Singapore.