Dancing to the tune of the WTO
The National People's Congress and its Standing Committee are busy amending and making laws as the nation is becoming a member of the WTO. Provincial people's congresses, the State Council, related ministries and local provincial governments are also involved in the legislative preparations for WTO entry. Statistics suggest that 140 laws passed by the NPC need to be amended and 570 laws need to be repealed. An investigation of 2'300 administrative regulations and ministerial rules passed by State Council and its ministries last year found 830 needed to be repealed and 325 amended. (Business Weekly, 13 November)

Foreign direct investment in China increases
China approved 20'549 new enterprises of foreign direct investment from January to October 2001, 17.47% above the same period last year. During this period, the contracted foreign investment totaled USD 55.20 billion, up 26.85% over the same period last year, while foreign-funds in use increased 18.63% to USD 37.25 billion. By the end of October 2001, China had approved 384'894 foreign- funded enterprises involving contracted foreign investment of USD 731.92 billion, of which USD 385.88 billion is in use. (People's Daily, 13 November)

Ericsson commits USD 5 billion to mainland
Ericsson has vowed to invest USD 5 billion in China following the mainland's accession to the WTO - double its aggregate investments during the past 15 years. (SCMP, 12 November)

Beijing sets out timetable for yuan-currency business
China has published details of banking reforms, offering a breakdown of cities in which foreign banks can conduct domestic currency business over the five years after WTO entry: 
- Immediately after WTO entry: Dalian and Tianjin, adding to Shanghai and Shenzhen. 
- After 1 year: Guangzhou, Qingdao, Nanjing and Wuhan. 
- After 2 years: Jinan, Fuzhou, Chengdu and Chongqing. 
- After 3 years: Kunming, Zhuhai, Beijing and Xiamen. 
- After 4 years: Shantou, Ningbo, Shenyang and Xian. 
- After 5 years: All geographic restrictions lifted.
(SCMP, 14 November)

Chinese stock market valued USD 533 billion
China's total stock market cap reached RMB 4.37 trillion (about USD 533 billion) by the end of October, according to the China Securities Regulatory Commission, a RMB 990 billion decline from the RMB 5.36-trillion cap at the end of last June. (People's Daily, 14 November)

WTO entry to create 12 million jobs, but also reduce 10.95 million
According to recent estimates, China's accession to WTO will will increase the nation's GDP by 2.94 percentage points and create nearly 12 million job opportunities. The combined number of reduced job opportunities will reach 1.35 million. In addition, there will be 9.6 million people transferring from the agriculture industry to non-agriculture sectors, since grain and cotton imports will cause a decrease in domestic agricultural production. (ChinaOnline, 14 November)

Expert warns of changing job market
According to a think tank under the Ministry of Labor and Social Security, China's unemployment could rise a whopping 30% a year over the next few years due to post-WTO-entry structural overhauls. (ChinaOnline, 14 November)

Water diversion project ready for construction in 2002
The preparation work of the South-to-North Water Transfer Project has met the technical requirements for the start of construction in 2002. The project, which grew from a strategy first bandied about in 1958, aims to divert water from the south to the north of China so as to ensure the water supply for farming and industry there. The project will have three water diversion routes, which are designed to connect the Yangtze with the three largest rivers in the north - the Yellow, the Huaihe and the Haihe rivers. Total cost will be more than RMB 480 billion. (People's Daily, 14 November)

Hinterland challenges Shanghai
For the first time since Shanghai started building a manufacturing hub in the farmlands of Pudong, a nearby city has topped it in attracting foreign manufacturing investment, according to a Guangzhou-based weekly. Suzhou, 30 kilometres west of Shanghai, attracted USD 4.7 billion in contracted foreign investment in the first half of 2001 - USD 680 million more than Shanghai. It's further evidence that the manufacturing centre along the lower Yangtze River is spreading inland. Taiwanese firms have driven much of the move. (FEER, 15 November)

Goldman Sachs, China Cinda Asset Management ink JV deal
International investment bank Goldman Sachs and China Cinda Asset Management have agreed to set up a foreign joint venture to help dispose of nonperforming assets. Cinda said the joint venture with Goldman Sachs will assist the company in meeting the challenge of disposing of its nonperforming assets, particularly as foreign investment barriers are lowered after China's entry into the WTO. Cinda Asset Management acquired nonperforming loans from China Construction Bank and the China Development Bank. (Dow Jones Newswires, 15 November)

China's Jan-Oct fixed asset investment up 17.4%
Growth in investment in fixed assets in China slowed slightly in January-October, rising 17.4% year-on-year to RMB 1.84 trillion, 0.8 percentage point slower than the January to September result. To fund the fourth year of its spending program, the government this year issued RMB 150 billion in treasury bonds, or 1.6% of GDP. (Dow Jones Newswires, 15 November)

Peugeot cars to be made in China next year
France's PSA Peugeot Citroën Group has entered into an agreement with Dong Feng Motors to produce Peugeot vehicles in China. The Dong Feng Citroën Automobile Co. joint venture already produces Citroën vehicles in China. The manufacturing joint venture is to receive a RMB 1 billion cash infusion: (ChinaOnline, 15 November)

Krugman uneasy about China's economic outlook
Contrary to most assessments, a respected U.S. economist said he was uneasy about China's economic outlook. Paul Krugman said China risked capital flight if it failed to continue reforms and improve corporate transparency. He said opening up the economy was right in the long run but in the interim corruption, nepotism and a lack of transparency may frighten off investors. (FEER, 15 November)

Microsoft's Windows XP at USD 3.60
Pirated versions of Microsoft's Windows XP computer operating system went on sale in Beijing markets days before its official launch in China. Copies of Windows XP sold at about USD 3.60, compared with USD 180 for an official simplified Chinese version of XP. Microsoft officials said that the pirated versions came from samples and may damage computers. (FEER, 15 November) .of course, they would say that.

China cuts stock trading duty
The Ministry of Finance cut the stamp duties, after months of heated debate, on transactions of both A and B shares to 0.2%, 0.2 and 0.1 percentage points lower than their original levels respectively. The move constitutes a signal from the government to stop the further slide of the stock market, which has lost around 30% of the market capital since a peak on June 14. (People's Daily, 16 November)

Policy on subsidies to state companies to be revised
China is considering to change its policy of subsidizing state enterprises to comply with WTO rules. The subsidies, in the form of interest payment of bank loans for technology upgrades of state enterprises, would easily lead to unfair competition, which violates WTO rules. Statistics show that China spent RMB 19.5 billion to subsidize state-owned enterprises in the past two years. (People's Daily, 16 November) See below the same news reported from a foreign perspective.

China plans to continue subsidies for companies post-WTO
Just days after it was accepted as a member of the WTO, China has outlined its plans to continue subsidizing exporters of certain high-technology products. While officials said they will change the way those subsidies are paid, they left no doubt that the Chinese government continues to see the close management of the economy and the support of companies as its duty. (Dow Jones Newswires, 16 November)

Prudential and Everbright plan China funds venture
Prudential Financial of the U.S. will form a joint venture with Everbright Securities Co., a unit of China Everbright Group, one of China's largest finance companies, the latest in a wave of such deals that are changing China's financial landscape. Everbright Group is controlled by China's State Council and has operations ranging from securities trading and insurance to real estate and forestry. (WSJ, 16 November)

China cuts tax for "Green" Cars
Three car manufacturers will enjoy up to 30% exemption of consumer tax, the State Environmental Protection Administration said. Officials said that cars whose exhaust emissions are confirmed to meet the Europe II standard are qualified for the tax exemption. (People's Daily, 17 November)

Big push to reduce red tape
Beijing has lifted more than 1'000 restrictions contravening WTO principles on areas of business that have been subject to an arbitrary and often lengthy bureaucratic approval process. (SCMP, 17 November)

Weekly Market update		16 November 2001	09 November 2001
Shanghai A		1718.06	1701.06
Shanghai B		152.58	150.63
Shenzhen A		497.75	493.80
Shenzhen B		243.67	243.73
Hong Kong Red Chip		1369.23	1247.98
Hong Kong H		1776.43	1844.39
Source: South China Morning Post