China’s social security funds to be replenished with state capital

(THIS ARTICLE IS COURTESY OF SHANGHAI CHINA’S ‘SHINE’ NEWS NETWORK)

 

China’s social security funds to be replenished with state capital

Xinhua

China will replenish social security funds through the injection of state capital this year to make the funds more sustainable. Policies to reduce employers’ contributions to social insurance schemes will be further implemented to ensure that pensions are paid on time and in full.

The decision was made at the State Council’s executive meeting chaired by Premier Li Keqiang on Wednesday.

Li has set out measures for such capital transfer in the Government Work Report for four consecutive years.

The State Council issued the implementation program on replenishing social security funds with state capital in November 2017, deciding to pilot the measure in selected central and local state-owned enterprises.

It was decided in the guideline to set the transfer ratio at 10 percent of these enterprises’ state-owned equity, with the exception of state-owned enterprises serving public interest, cultural enterprises, policy and development financial institutions and those otherwise stipulated by the State Council.

“We need to ensure that work on this front progresses steadily and effectively and sends a reassuring message to the public,” said Li.

It was decided at the meeting that the pilot measures introduced will be extended nationwide this year.

Large and medium-sized state-owned and state-controlled enterprises at both central and provincial levels, as well as financial institutions, will see 10 percent of their state-owned equity transferred to the National Council for Social Security Fund and relevant local receiving entities who shall, as financial investors, enjoy the right to yields from the transferred equity.

“Old-age pensions must be paid on time and in full,” said Li.

The meeting also decided to lower social security contribution rates.

So far, various types of social insurance funds are in steady operation, and are competent in ensuring payments on time and in full. Policies to reduce social security contribution rates delivered notable effects in the first half of this year, as companies saw their spending on workers’ basic pensions, unemployment insurances and work-related injury insurances decreased by over 128 billion yuan (US$18.5 billion).

The meeting urged departments to gain firsthand information on delivery of the policies and corporate feedback, and promptly address new problems as they arise.

The payment format will remain consistent. While keeping the share borne by employers for workers’ basic aged-care insurance at no higher than 16 percent, no policy adjustment will be made this year regarding the varying payment rates and bases in certain provinces. Local authorities must earnestly shoulder their primary responsibilities of pension payments and ensure that no one is left unpaid.

“The tax and fee cuts we introduced early this year have boosted market confidence and delivered concrete benefits to market players. Such measures are fairest, most effective, and most direct in anchoring market expectations and spurring future development,” Li said. “We must ensure full implementation of our policies introduced early this year to reduce employers’ contributions to social insurance schemes.”

Authority to investigate ‘financial service fee’ for Benz sales loan

(THIS ARTICLE IS COURTESY OF THE SHANGHAI CHINA NEWSPAPER ‘SHINE’)

 

Authority to investigate ‘financial service fee’ for Benz sales loan

An investigation has been launched after reports that Mercedes-Benz Automobile Finance Co illegally charged a customer a financial service fee, as claims surfaced in Shanghai of dealers also charging fees.

The China Banking and Insurance Regulatory Administration has asked its Beijing authority to initiate an inquiry.

A woman who bought a Mercedes-Benz she claims was defective from a dealer in Xi’an, Shaanxi Province, has now claimed she was cheated over a “financial service fee.”

The woman said she bought the Mercedes-Benz CLS300 from Xi’an Lizhixing Co for 660,000 yuan (US$98,445) but found the engine was leaking oil after she picked it up on March 27. She asked for a refund or a replacement but the dealer only agreed to change the engine.

The incident attracted wide attention after a video of the woman sitting on the bonnet of a Mercedes-Benz while weeping and arguing with salesmen at the 4S dealer store on April 9 was posted online.

The Xi’an market watchdog launched an investigation and asked the dealer to refund the buyer. The regulator also arranged a face-to-face negotiation between the two sides on Saturday, during which the buyer said she had intended to purchase the car outright.

However, the dealer persuaded her to use Mercedes-Benz finance as it is said to feature low interest.

The dealer also “forced” her to pay a “financial service fee” of 15,200 yuan to a personal account without providing a receipt, she claimed. The woman said she thought this was fraud as the dealer hadn’t provided any services.

Mercedes-Benz issued a statement on Sunday, saying it never asks for any financial service fee from dealers or customers.

A Shanghai consumer surnamed Wang who visited several Mercedes-Benz 4S shops to purchase an off-road vehicle said he was asked to take out a loan at the Songzhixing shop on Changshou Road.

The salesperson said the car was popular, and many 4S shops would not sell it if buyers refused to take a loan, Wang said. A salesperson would not get a commission without arranging a loan.

The same requirement was raised by the Minxing Automobile Service Co 4S shop, Wang said.

The Shanghai Consumer Council said yesterday they had received complaints about other automobile companies charging financial service fees.

Lawyers said car sales companies often use various excuses to charge fees to raise their profits, which infringes consumers’ rights to make choices.

A Shanghai consumer surnamed Huang who wanted to purchase a car at a 4S shop last year was told that he must buy a 13,800-yuan package including sticker and tachograph, and a three-year car insurance if he wanted to enjoy a discounted price of the car.

Huang asked several 4S shops the next day, and some had the same requirement.

Meanwhile, a woman Wang Wen who paid 340,000 yuan for a new Mercedes-Benz at the Zhongshengzhixing 4S shop on Jinyun Road in Jiading District found it was faulty.

She asked for a refund, but the 4S shop refused, and offered free exchange, free components and reduction of insurance fees as replacement.

Wang learnt that the car was an “auction car” sold to dealers at a discounted price, and had probably been used for display or trial runs.

A video of a woman sitting on a Mercedes-Benz and arguing with salesmen has gone viral.

China: People trafficker given 8 years 

(THIS ARTICLE IS COURTESY OF THE SHANGHAI CHINA NEWS AGENCY ‘SHINE’)

 

People trafficker given 8 years

A woman who trafficked 24 Filipino maids into China has been sentenced to eight years behind bars at Shanghai No.1 Intermediate People’s Court.

Liu ran a domestic helper agency and found it was lucrative to import Filipino maids, hailed as the best in the industry, to China, where the need for qualified domestic helpers is increasing.

She contacted two people in the Philippines and formed a people-smuggling network.

Between February and September 2017, they trafficked 24 maids from the Philippines to coastal cities such as Shanghai, Guangzhou and Qingdao, on tourist visas.

 

When they arrived China, Liu picked them up and took them to in inland cities such as Beijing, Chengdu and Xi’an.

Employers said they contacted Liu via friends or ads posted on the Internet. Liu had a catalogue for them to choose from and she brought the maids right to the doorstep. They paid her a commission equal to several months of the maid’s salary.

According to the maids, their monthly income was 6,000 yuan (US$870), but for the first six or seven months, they made 2,000 yuan per month with the rest going into Liu’s pocket.

By charging commissions from both sides, Liu was able to earned 1.2 million yuan in only seven months.

According to the court, Liu cooperated with others to violate immigration rules. As she admitted her guilt, she was granted a lighter sentence. Besides eight years in prison, she was fined 200,000 yuan.

The court said it is risky to recruit illegal maids.

Employers can be fined up to 100,000 yuan and if they have disputes with foreign workers they will find it hard to defend their rights.

According to a report by Labor Daily, Filipino maids are highly-prized for their professionalism and there are about 7 million working around the world. In China, due to lack of standards and training, local domestic helpers cannot provide consistent, qualified service.

The newspaper said there are an estimated 200,000 illegal Filipino maids in China’s mainland where the pay is almost twice that they receive in Hong Kong.

Foreign domestic helpers were entirely banned in Shanghai until July 2015, when high-level foreign professionals living and working in the city were allowed to hire them, but such cases are few so far, according to Shanghai police.

Yuan’s international usage remains stable: report

(THIS ARTICLE IS COURTESY OF THE SHANGHAI CHINA NEWS AGENCY ‘SHINE’)

 

Yuan’s international usage remains stable: report

Xinhua

International usage of Chinese currency renminbi, or the yuan, remains stable despite a sharp fall in the offshore exchange rate, according to a new report by Bank of China.

In June, the yuan remained in 5th place in the currency rankings for global payments with a share of 1.81 percent, BOC said in its Offshore RMB Express report citing data from SWIFT, a global financial institution network.

Currently, Hong Kong is the key offshore market for yuan payments, accounting for 75.98 percent of renminbi trading volume.

Total turnover via the Real Time Gross Settlements clearing system reached 21.46 trillion yuan (US$3.11 trillion), up 10 percent month on month and 38.7 percent year on year, the report showed.

China’s domestic capital market’s opening continues at a steady pace, BOC said.

As of July 31, the quota in the RMB Qualified Foreign Institutional Investors program came in at 622.1 billion yuan, data from the State Administration of Foreign Exchange showed.

So far, 19 countries and regions have obtained RQFII quotas, totaling 1.94 trillion yuan, according to the report.

China Toughens Punishment For Stock Market Irregularities

(THIS ARTICLE IS COURTESY OF THE SHANGHAI DAILY NEWS)

China toughens punishment for stock market irregularities

CHINA’S securities regulator has toughened punishment on illegal market activities this year amid strengthened supervision, which handed out more fines in the first five months than the whole year of 2016.

From January to May, fines totalling 6.14 billion yuan (about 901 million U.S. dollars) were slapped on law violators in the securities sector, according to the China Securities Regulatory Commission (CSRC).

A total of 29 people were suspended from securities business in the five months, the regulator said.

In 2016, the CSRC punished 183 illegal market activities and handed out fines of 4.28 billion yuan, up 288 percent from the 2015 level. Some 38 people were barred from the securities industry.

While affirming improved market supervision, CSRC vice chairman Jiang Yang warned that the economic uncertainties, as well as new technologies,products and trading mechanisms, are likely to trigger new risks and challenge regulation.

The CSRC has been toughening supervision and punishment of illegal market activities such as insider trading and stock manipulation after the market rout in 2015 shattered investor confidence.

In March, the CSRC slapped a 3.47 billion yuan fine on a company chairman for stock market manipulation, a record high.

China Shows Off Domestic Innovation When It Comes To The ‘Ball Point Ink Pen’

(THIS ARTICLE IS COURTESY OF THE SHANGHAI DAILY NEWS)

China has grown by leaps and bounds during its quest for greater domestic innovation, becoming a world leader in sectors like robotics-based manufacturing and consumer software. But one of its most recent accomplishments is in an area that’s considerably more basic: ballpoint pens.

Today Chinese steel maker Taiyuan Iron and Steel Co., also known as Taigang, formally announced (link in Chinese) that it had developed technology to manufacture the stainless steel tip cases found at the end of high-quality ballpoint pens. The feat shows how the Chinese government remains insecure about the country’s continued reliance on foreign technology, and the lengths it’s willing to go to overcome it.

China produces an estimated 40 billion ballpoint pens annually, but many of them work poorly. Domestic manufacturers wanting to make higher-quality pens must import tip cases from Japan and Germany made of a specialized stainless steel. According to Taigang, an 83-year-old state-owned enterprise based in the Shanxi province, that’s because in better pens the cone-shaped case that holds the ball requires both special raw material and special machinery (link in Chinese). To fulfill demand, Chinese pen makers have been importing more than 1,000 tons (link in Chinese) of the needed steel annually.

In 2011 Taigang and government bureaus allocated 60 million yuan ($8.6 million) toward researching the technology needed to develop the part independently. The company says trials began in earnest in 2014 (link in Chinese) and finally finished last year, when a set of 2.3-mm-tipped pens with the superior tip cases passed the ultimate test—the ability to write for 800 meters (875 yards) without interruption. The company will supply the tip cases to Beifa, a pen maker based in the city of Ningbo in the Zhejiang province. It’s unclear when the resulting pens will officially hit the market, or why Taigang is announcing the news now.

Taigang’s efforts didn’t come out of nowhere. A year ago in China a minor media frenzy erupted (link in Chinese) when premier Li Keqiang, a vocal proponent of bolstering technological innovation, lamented how China was producing 800 million tons of steel annually but still importing the specialized type of stainless steel needed to make the better tip cases.

He reiterated this point frequently during public appearances, adding that pens using domestically produced parts felt inferior to foreign ones. The ballpoint pen became a potent symbol for perceived flaws in China’s economy and technological capabilities. “That’s the real situation facing us,” Li said at a meeting with economists in December 2015. “We cannot make ballpoint pens with a smooth writing function.”

At one point last year, state-media outlet CCTV broadcast an hour-long program examining why China couldn’t make quality tip casings for ballpoint pens on its own.

News of Taigang’s pen-tip “innovation” has made waves on China’s internet in the past few days. An article about the company from state media outlet People’s Daily has so far attracted over 10,000 comments and 20,000 shares on Weibo, China’s Twitter-esque social media platform. “Wow, it had never occurred to me that I had been using ballpoint pens relying on foreign technology!” wrote one user (link in Chinese).

The Chinese government has repeatedly stressed the importance of keeping its domestic technology competitive with foreign alternatives. While that has typically manifested itself in R&D funding for the internet and semiconductor industries, the ballpoint pen has proven to be a more useful symbol for capturing the imaginations of ordinary Chinese.

But that’s not the only pedestrian product public figures have held up in the name of bolstering innovation. Last March Xiaomi CEO Lei Jun appeared at China’s annual “Two Meetings” political gathering to lament how Japan’s rice cookers were superior to those made domestically. Weeks later, his company announced a wifi-enabled rice cooker.

Beifa and Taigang say that making the quality tip casings in China will save about $15 million annually. But even comments from Beifa suggest that the decision was more political than financial.

“Frankly speaking, it’s not that China was incapable of developing the technology,” Beifa CEO Zhang Xuelian told Beijing News (link in Chinese). “This type of steel part requires a special type of steel [to make]. The market for it is not big. Only companies that make pen tips will need it.”

Additional reporting by Echo Huang.

China: Eastern Airlines Commercial Pilot’s Quick Actions Saves Hundreds Of Lives

(THIS ARTICLE IS COURTESY OF THE SHANGHAI DAILY.COM)

3m yuan reward for quick-thinking pilot

CHINA Eastern Airlines has rewarded the pilot who averted an airport tragedy last month with 3 million yuan (US$443,682).

Captain He Chao’s quick thinking occurred at Hongqiao airport on October 11 when his Airbus 320 flight MU5643 to Tianjin was taking off around noon. At the same time an Airbus 330, also operated by China Eastern, landed at the airport from Beijing and began taxiing across the same runway.

He decided to speed up and continue taking off as his aircraft speed had reached more than 240 kilometers per hour.

He flew over the A-330 — with the two aircraft being only 19 meters away from each other at one stage, according to an investigation by the Civil Aviation Administration of China.

It said air traffic controllers had given wrong orders to the pilot of the A-330 to taxi into the runway where the A-320 was taking off.

The licenses of two air traffic controllers were revoked and 13 air traffic control officials were punished for the incident.

The crew of the A-320 aircraft also received 600,000 yuan as a reward to them.

The Yuan Joins Elite Class Joining The International Monetary Fund

(This article is the courtesy of the Shanghai Daily News)

Yuan joins elite club of reserve currencies

THE yuan’s inclusion in the International Monetary Fund’s elite reserve currency basket on Saturday was hailed by Chinese businesses and analysts as a “historic moment.”

“Ten years ago, the yuan could hardly go out of the country. But now China’s opening-up and huge economic size has made it more and more popular in the international market,” said Lu Jian, vice president of Guangdong Guangken Rubber Group Co Ltd.

Early this year, Guangken Rubber launched a US$270 million bid for Thailand’s Thai Hua Rubber, the world’s third-largest rubber producer.

The company then sought loans from domestic and overseas banks, with some offering to fund its bid in yuan.

The acquisition in yuan helps reduce foreign exchange risks as well as fund-raising costs, said Lu.

“Ten years ago, all our overseas business was conducted in the US dollars and we often did not have yuan clearing banks. It’s quite a different scenario now,” he said.

Today, China has 21 overseas yuan clearing banks across the world.

“Despite the fluctuations in the exchange rate, the international market has not lost interest in the yuan and on the contrary, global demand is increasing,” Lu said.

On Friday, the IMF announced the launch of its new Special Drawing Right basket, including the yuan, effective from Saturday, saying it was a “historic milestone” for China, the IMF and the international monetary system.

The inclusion makes the yuan one of the five reserve currencies fully endorsed by the 189-member organization, joining the US dollar, the euro, the Japanese yen and the British pound.

Now, the yuan accounts for the third-largest share of the new SDR basket with 10.92 percent, following the US dollar’s 41.73 percent and the Euro’s 30.93 percent.

“The yuan’s inclusion reflects the progress made in reforming China’s monetary, foreign exchange and financial systems and acknowledges the advances made in liberalizing and improving the infrastructure of its financial markets,” IMF Managing Director Christine Lagarde said.

The yuan has moved into the top 10 but still trails the other major currencies, according to the Bank for International Settlements.

Created in the 1960s, the “Special Drawing Right” is a unit of account used by the IMF as a foreign exchange reserve asset and is not a freely traded currency. To help manage financial crises, the IMF issues loans to member countries denominated in SDRs.

In July 2009, China approved pilot program for cross-border trade settlement in yuan, embarking on the internationalization process of the currency.

The yuan was the fifth most active currency for global payments by value in July, with a share of 1.9 percent, an increase from 1.72 percent in June, according to data from global transaction services organization SWIFT.

China’s central bank said on Saturday that the country will continue to push forward financial reforms and market opening after the yuan’s inclusion.

Zhang Lijun, a partner with Price Water House Coopers China, said the yuan’s inclusion was of similar significance to China’s joining the World Trade Organization.

“The two cases also have shown that China helped to improve rather than topple global rules and this has positive significance for the coordination of global economic governance,” said Zhang.

Shanghai China Now Ranked 16th Among World Financial Hubs

(This article is courtesy of the Shanghai Daily News)

Global survey ranks city 16th among financial hubs

SHANGHAI ranked 16th in a list of 87 global financial hubs, with Shenzhen at 22nd and Beijing at 26th place, a survey showed yesterday.

London, New York, Singapore, Hong Kong and Tokyo were ranked in the top five, according to the Global Financial Centers Index report.

Shanghai stayed sixth in Asia rankings, a repeat of its position in the prior survey released in March. However, the city’s financial infrastructure gained higher points.

The index is compiled by the London-based Z/Yen Group and the non-official think tank China Development Institute. The index began the ranking in 2007, featuring five sub-indexes of human resources, business environment, entry barrier, infrastructure and general features.

Shanghai ranked fifth in 2011, but has since been surpassed by cities such as Los Angeles and Montreal, due to fast development of financial technology firms and better plans to deal with post-economic crisis problems.

“I believe Shanghai has real capacity,” said Mark Yeandle, associate director of the Z/Yen Group. “If we give it some true light in years to come, Shanghai might rank back among the top-10 centers though that’s with the expectation of how long it will take for the yuan to become truly internationalized.”

Shanghai aims to become an influential global financial center by 2020, “in accordance with China’s economic strength and a broader use of the yuan,” Zhen Yang, director-general of the Shanghai Financial Service Office, said in a speech yesterday.

The country’s currency will be included in the International Monetary Fund’s currency basket from October 1, holding a 10.9 percent weighting in the Special Drawing Rights administered by the fund, as China looks for a bigger say in the global market.

China’s Slowing Economy Is Still Far More Robust Than That Of The EU Or The U.S.

(This article is courtesy of the Shanghai Daily News Paper)

Forex reserves fall to lowest since 2011

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.

Add Your Comment

Write your comment…
Post a Comment
0 / 500
Be the first to comment.