Ciba opens plant in China
Swiss Ciba Specialty Chemicals Holding AG has opened a new production plant and regional technical and training center in Guangzhou. The plant will manufacture textile chemicals for supply to markets in the Asia Pacific region and will have around 100 employees. (Dow Jones Newswires, 7 November)

Trade union law revised on eve of WTO entry
China has revised its 52-year-old law on trade unions. Amendments to the law included granting all employees the right to join trade unions and forbidding organisations or individuals from interfering with the process. The mainland says it protects workers' rights fully, but in reality workers have little recourse to protect their interests against unscrupulous employers. Beijing now permits just one trade union (the state-controlled All-China Federation of Trade Unions). China has also exempted itself from allowing free trade unions under a United Nations human rights covenant it ratified in March. Around 100 million of China's 250 million workers are union members and the majority of them work in state-owned enterprises. (SCMP, 5 November)

China to maintain zero growth in energy consumption by 2040
China will maintain zero growth in energy consumption by 2040, said vice minister of the State Development Planning Commission Zhang Guobao recently. By 2040, China's total consumption of primary energy resources will rise by 300%. New energy resources and renewable sources of energy will become the key field in the China 's energy strategy in the coming five years. (People's Daily, 6 November)

Government employees enjoy pay hikes again
Civil servants and employees of government-supported institutions in China are enjoying another pay boost, as the central government has increased their salaries as of October 1. With the pay hikes, another RMB 80 will be added to the pocketbook of an average public servant, who was given a monthly pay raise of RMB 100 at the beginning of this year. (People's Daily, 6 November)

Pension system on verge of bankruptcy
The planned revamp of China's social welfare system is running into massive funding problems, forcing the government to divert funds budgeted elsewhere and hampering other reforms. Already, future welfare liabilities are approaching an estimated USD 1 trillion. The most worrying thing is that the social welfare reforms now being introduced cover only urban workers, leaving China's nearly 700 million farmers to fend for themselves. (www.cbiz.cn, 6 November)

Bickering delays financial policy meeting
Authorities have postponed a key meeting aimed at charting the future of financial reforms over the next five to 10 years until early next year because of bickering over the agenda. Problems which may have delayed the meeting, included how to handle slumping stock markets, massive bad loans of banks and greater foreign competition after China's WTO entry. (SCMP, 6 November)

Wal-Mart to open branch in Beijing
A branch of the US-based Wal-Mart, the world's largest chain store retailer, is to open in Beijing. According to an official of the Beijing Municipal Government, the store will be a joint-venture between Wal-Mart and a domestic company. (People's Daily, 6 November)

China's first welfare lottery exclusive dealership shop opens in Shanghai
A welfare lottery exclusive dealership shop which claims to be the first of its kind in China has opened in Shanghai. Last year, the lottery sales of Shanghai exceeded RMB 1.16 billion and the per capita investment in lottery of the city reached RMB 88, setting a national record. The Shanghai municipal government will pool 80% of its next three years' welfare lottery income to improve the lives of elderly people. (People's Daily 7 November)

Asian leaders back free trade area with China
South-east Asian leaders endorsed a proposal to create a free-trade area with China over the next 10 years in what would be the first step towards a larger east Asia trading zone. The decision taken at the annual summit of the Association of South-East Asian Nations in Brunei is aimed at reducing the region's trade dependence on the US. (FT, 7 November)

New bank watchdog
A new bank supervisory body is expected to be set up following a high-level meeting of Chinese officials on financial issues. The body, tentatively called the China Bank Regulatory Commission, would take over the roles of supervising and regulating banks now handled by the People's Bank of China. (FEER, 8 November)

China might expand money supply to fund pension
China could be forced to pay for its accumulated pension debt by printing money. China is currently moving from a cradle-to-grave welfare system to partially and fully funded schemes tied to individual pension accounts. State Administration of Foreign Exchange Director Guo Shuqing pointed out that despite the ongoing transition, the government still has to fund the benefits worth about RMB 5 trillion to retirees covered by the old welfare system. (Dow Jones Newswires, 8 November)

Beijing backs off plan for Nasdaq-style board
China does not have enough high-technology companies to support a Nasdaq-style second board, state media quoted a senior official as saying in a strong sign the launch of the planned board will be delayed further. China originally planned to launch a second board in Shenzhen this year to help hi-tech and private start-ups raise capital. The launch was delayed partly by the burst of the global technology bubble. (SCMP, 8 November)

Taiwan scraps 50-year China ban
Taiwan has lifted a 50-year ban on direct trade and investment in China on the eve of the two economies joining the WTO. Taiwanese businesses can now invest directly in the mainland instead of sending investments through a third country. (SCMP, 8 November)

Motorola aims to double output
Motorola will invest USD 6.6 billion in the mainland over the next five years and double its production in one of the world's few remaining high-growth telecommunications markets. (SCMP, 8 November)

ADB Outlook: China 2002 GDP forecast cut to 7.0% from 7.5%
The Asian Development Bank cut its 2002 growth forecast for China's GDP to 7% from 7.5%, citing a slowdown in exports due to the weakening global economy. But the ADB left its GDP growth forecast for China for this year unchanged at 7.3%. The bank said it expects China's export growth to slow to 6% this year and then decelerate further to 4% next year. However, the ADB said it expects the drag on economic growth from a slower export rise to be "largely offset" by a strong recovery in domestic demand. (Dow Jones Newswires, 8 November)

PBOC expects China's GDP to up 7.5%
According to the People's Bank of China, China's macro-economy has shown a clear slackening tendency. The growth rate of China's GDP of 2001 is expected to reach 7.5%. China's GDP growth rate for the first three quarters of this year added up to 7.6%. Calculated on single quarter basis, the GDP increased by 8.1, 7.7 and 7.0% respectively in the first, second and third quarter of this year. The slackening international economic situation is the major factor for the slowdown of China's economic growth. (People's Daily, 9 November)

Foreign debt soars after IMF change
Outstanding foreign debt at the end of June was USD 170.41 billion, a sharp rise from the end of last year mainly due to a change in compilation. China's central bank yesterday said it had included overseas borrowings of foreign financial institutions operating in China, offshore deposits at Chinese banks and some trade-related loans into its foreign debt for the first time as recommended by the IMF. Under the old compilation method, China had foreign debt of USD 145.73 billion at the end of last year. China's long-term foreign debt was USD 112.88 billion at the end of June, while short-term debt was USD 57.53 billion. Sovereign debt was USD 49.69 billion, while debt of Chinese financial institutions was USD 33.76 billion. Debt of foreign financial institutions operating in China was USD 16.12 billion. Overseas borrowings by foreign-invested firms were USD 34.07 billion. Those of domestic firms were USD 11.6 billion. The bank has said China's foreign exchange reserves topped USD 200 billion on October 18. (SCMP, 9 November)

Simpler Forex procedures to help exporters
The State Administration of Foreign Exchange has simplified some of its procedures to help exporters. Companies can now check on the status of their export tax rebates directly with their banks each month instead of going through SAFE. SAFE has also lowered some of the requirements for opening foreign-exchange bank accounts to include companies with hard-currency income. China's currency, the yuan, can be converted only for foreign-trade, and most exporters must sell 85% of their overseas receipts to state-owned banks. (Dow Jones Newswires, 9 November)

China's economy: Celebration, and concern
The Economist looks at China's economy on the eve of accession to WTO: "WTO membership will bring little short-term cheer to ordinary Chinese, as the country's leaders cope with the impact of the world's economic slowdown as well as economic problems at home. [.] In the longer term, the potential benefits of WTO entry are clearer. If China carries out its commitments, it will force more inefficient state-owned enterprises to adapt to market competition or close down. It will encourage efforts to reform China's banking system, which is insolvent by any sane measure. It will put private enterprise on a more equal footing with the state sector." (Economist, 9 November)

Industrial output up 8.8%
China's industrial output growth continued to slow in October as the deteriorating global economy took its toll on local manufacturers. October's value-added industrial production rose 8.8% over last year to RMB 233.2 billion. A slowdown in output by light industry contributed to the slower growth, the State Statistics Bureau said, though it noted that output by heavy industry and the electronics sector was still strong. (Dow Jones Newswires, 9 November)

Western development program pays off
The GDP of 12 provinces, autonomous regions and municipalities in western China increased by 8.7% in the first half of this year thanks to China's drive to accelerate western development. Investments in fixed assets soared 25% in the first three quarters of the year, much higher than the national average growth rate. Construction of 10 key projects began in western China last year at a combined cost of RMB 20 billion. More projects were begun to be built this year, which will cost about RMB 300 billion. (People's Daily, 11 November)

Weekly Market update		09 November 2001	02 November 2001
Shanghai A		1701.06	1764.74
Shanghai B		150.63	156.09
Shenzhen A		493.80	514.29
Shenzhen B		243.73	251.63
Hong Kong Red Chip		1247.98	1210.20
Hong Kong H		1844.39	1846.12
Source: South China Morning Post