News@ChinabyNumbers

Some Chinese auto manufacturers are asking for government assistance to boost flagging demand for cars. Executives told the paper that rather than asking for a massive bailout similar to that sought by US auto makers, Chinese car companies are mainly asking for lower taxes on sales of cars with smaller engines or that use environmentally friendly technology. Passenger-car sales in October rose 11% year-on-year, up from about 6% in August and about 2% in September. But analysts cautioned against reading too much into the rebound. Passenger car sales in the first 10 months of 2008 grew by about 10%, down from the 21% rise seen in 2007 or the 30% growth seen in 2006.

Source: Wall Street Journal

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Two real estate funds will raise a combined US$1.7 billion to invest in the mainland property market, saying that prices had dropped to a “realistic level.” Kenneth Gaw, president of Gaw Capital Partners Hong Kong, said his firm would raise US$950 million to invest in prime properties and distressed assets in first-tier cities. He added that the mainland property market would recover in the next 12 to 18 months and that now was a good time to invest. Meanwhile, ING Real Estate is raising funds for its second China Opportunity Fund. Richard Van den Berg, managing director of ING Real Estate Investment Management (Hong Kong), said the firm hoped to attract US$750 million, though he admitted now is a “challenging” time for fund-raising.

Source: South China Morning Post

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Spending for advertising time on China’s top television network next year suggests companies are confident Chinese consumption will remain robust despite the economic slowdown. Local and international advertisers pledged almost US$1.4 billion on Tuesday during CCTV’s live auction of prime-time slots. This was up by 15% from last year, though the numbers are not directly comparable due to new inventory of air time and the end of the Olympics. Nonetheless, media buyers said that the higher number reflected about a 10% increase in ad rates. Multinational firms accounted for a quarter of the money spent in the auction. A representative from CCTV said the network did not lose a single major multinational client.

Source: Wall Street Journal

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An executive from one of China’s largest telecom equipment vendors said international mobile network operators have expressed interest in the country’s homegrown third-generation (3G) mobile technology, TD-SCDMA. Isaac Liang, international marketing director of TD-SCDMA at ZTE, claimed that at least 10 overseas carriers have shown interest in the technology. Some have already signed agreements for the procurement of TD-SCDMA equipment. Liang declined to name the carriers or their countries but said they were in Asian markets surrounding China, as well as in Africa and Latin America. He said these operators were interested in the technology because of its low cost and the opportunity to cooperate with China Mobile, which is currently running trial TD-SCDMA networks and will likely receive a TD-SCDMA 3G license.

Source: South China Morning Post

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Consumer-focused conglomerate China Resources (SEHK: 0291) warned of a tougher operating environment after seeing third-quarter profit drop by 12.3% to US$86.6 million. “Looking forward, [the] retail market will inevitably be affected by the reversal in market sentiment following the recent financial [turmoil],” Mark Chen, the firm’s managing director, said. The company’s retail, food-processing and distribution and textile businesses all posted a decline in profits. China Resources, which operates more than 2,500 supermarkets in Hong Kong and the mainland, saw earnings from these operations fall by 12.3% to US$8.3 million in the third quarter, mostly due to poor performance in Hong Kong. However, Francis Kwong, deputy managing director of China Resources, said there would be no change in the firm’s medium term plan of achieving 15% yearly growth in sales through new store openings on the mainland.

Source: South China Morning Post

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Peru and China have completed negotiations on a free trade agreement (FTA) and will sign an accord at “top speed”, according to Peru’s President Alan Garcia. Garcia made the comments after meeting with Chinese President Hu Jintao, who arrived in Lima for a meeting of the 21-member Asia-Pacific Economic Cooperation. Trade between Peru and China totaled US$5.5 billion last year, mostly in minerals and fishmeal. Garcia said trade between the two countries was “growing substantially” and would surpass the goal of US$20 billion by 2015. China Minmetals Corp and Jiangxi Copper also signed a letter of intent with China Development Bank and Peru’s Banco de Credito to finance the Galeno copper project, Peru’s fourth largest copper deposit.

Source: Bloomberg

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Two police officers have been arrested for allegedly beating a college student to death in a nightclub in Harbin, the capital of Heilongjiang province. Harbin police announced the arrests of Liu Linan and Qi Xin, who were identified as officers with the Harbin police’s railway division. Four other officers were investigated for their role in a fight outside of the city’s Candy Bar disco on October 11 that led to the death of Lin Songling, a 22-year-old student at a physical education university. One of Lin’s classmates, Yang Sen, was also arrested. Anger over Lin’s death has been fueled by the release, by police, of security camera footage that showed the fight between students and the off-duty policemen at the club.

Source: AP

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Protests in Longnan, Gansu province over the forced demolition of homes and eviction of tenants escalated into violence as demonstrators broke windows of the local Communist Party headquarters and destroyed nearby cars. About 30 people were protesting the evictions early Monday morning, but the crowd grew to about 2,000 people throughout the day. Few details were available from state media reports on the incident, including more information about the dispute, though a posting on the internet from a person claiming to be a Longnan resident said the crowd dispersed on Tuesday morning after police arrived.

Source: AFP

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China and Russia will continue talks over a proposed US$25 billion loan package for cash-poor Russian energy companies in exchange for long-term crude oil deliveries. Talks reportedly broke down last week after disagreements on interest rates and state guarantees. The loans under consideration include US$15 billion to Rosneft, a major Russian state-owned oil firm, and US$10 billion to oil pipeline monopoly Transneft. Both firms are struggling to secure financing due to the global financial crisis and falling oil prices. In return Russia is promising to supply 15 million tons of oil per year over 20 years through a pipeline project agreed to during Chinese Prime Minister Wen Jiabao’s visit to Moscow in October.

Source: AP

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China Mobile may buy phone companies in emerging markets once the reorganization of China’s telecom sector finishes in June. China Mobile Chairman Wang Jianzhou said the company would be “rational” and not “aggressive” in its overseas acquisition strategy. The valuations of emerging-market operators have dropped sharply this year - the MSCI Emerging Markets Telecommunications Services Index has declined 49% since January. Wang said in April that China Mobile, the world’s largest telecom company by market value, is interested in expanding in Asia, Africa and the Middle East. It will likely face competition for buys from Singapore’s SingTel and Telekom Malaysia. In 2007 the company bought Pakistan’s Paktel, its first overseas buy, for US$460 million. Separately, China Mobile said it will release a handset made by Nokia compatible with TD-SCDMA, China’s homegrown 3G standard.

Source: Bloomberg

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