Highlights from the Economic Observer, issue no. 350, January 14th 2008

Sinopec to Raise Salaries
Cover story
Sinopec, the massive state-owned oil monopoly, is looking into raising salaries across the board. This would be a first for the firm, which says it is paying its staff far less than competitors.
Original article: [Chinese]

Interview: On China's Soil Pollution
From News, page 4
On January 8th, China's state environmental watchdog agency SEPA held a conference on China's soil pollution problems. Last year theagency began preparing a report on the matter involving research in 26 provinces, and which is slated for release later this year. Early on in the report's preparation, SEPA announced that it had already ascertained that more than 1/10 of China's cultivated land, or 30 million acres, is polluted. The EO interviews Zhou Shengxian, head of SEPA.
Original article: [Chinese]

Special: Rural Property Rights
From Nation, page 9
On January 8th the State Council issued a notice reiterating that rural property rights will be strictly enforced, and hinting at more in the pipeline. Housing in China is classified into two types; those registered with certificates issued by the central government are called 大产权房 (da4chan3quan2fang2) or greater property rights, and those issued by local governments at the town level are called 小产权房 (xiao3chan3quan2fang2) or minor property rights. Urban residents cannot buy the latter, and farmers cannot sell them. In this issue of Nation, the EO discusses the pros and cons of this policy. Among others, the EO interviews professor Cai Jiming of the China Association for Promoting Democracy, who will push for privitization and reform of rural land policy at the next party consultative conference.
Original article: [Chinese]

Morgan Stanley to End Its Passive Ownership in CICC
Money & Investment, page 17
Morgan Stanley’s recent announcement to sell its entire 34.3% stake in China International Capital Corporation (CICC) was prompted by dissatisfactions over years of passive involvement in it. Besides this, a new regulation on Jan 1st that further opens up China's financial industry to foreign players has allowed the Wall Street-based company to find a new partner in China Fortune Securities for future expansion into the Chinese capital markets. CICC is the first joint-venture securities firm in China, established in 1995 by Morgan Stanley and China Construction Bank, but the former has failed to gain a foothold or dominant say in the partnership these years.
Original article: [Chinese]

Winners in the High-Speed Railway Project
Corporation, page 25
China Railway Construction Corporation is the big winner in the Shanghai-Beijing high-speed train project’s bidding process, gaining 40% or 33.74 billion yuan worth of contracts. The remaining contracts were given out to China Railway Group Limited, Sinohydro Corporation and China Communication Construction Company. The bidding outcome may affect the ranking of various state-owned enterprises in the construction industry and also future plans for listing.
Original article: [Chinese]

Impasse in China Eastern Airlines Deal
Corporation, page 26
While shareholders have voted against China Eastern Airlines selling a 24% stake to Singapore Airlines, a new plan has yet emerged for the earlier to raise more funds. Air China, a major shareholder and the main detractor against the pack, has offered a higher price and proposed the idea of "consolidation and exchange of shares". However, China Eastern Airlines spokesman had said: "we want cash, we are not interested in Air China’s shares."
Original article: [Chinese]

Calm Before Storm for the Chinese Online Video Sites
Corporation, page 28
Chinese websites hosting video contents are scrambling to look for partnerships in state-owned institutions following a government’s announcement to regulate online broadcasts. The new regulation requires online audio and video sharing sites – such as Youku and Tudou – to obtain an operation permit, which will only be issued if the sites are wholly state-owned or part of a state-holding group.
Original article: [Chinese]

Exclusive Interview: Labor Law
Observer, page 41
Labor Economics expert Wang Yijiang looks into the shortcomings of the Labor Contract Law, which commenced on Jan 1st of this year, from a global perspective in an exclusive interview with EO.
Original article: [Chinese]

From Romantics to 798
Lifestyle, page 49
Beijing has always been the Mecca for aspiring artists from all corners of the country, who've often set up bases for collective living to ease alienation and create supportive network in the fast growing city. Over the years, these bases have evolved from the romantic era of the Yuanmingyuan artists' village into suave, commercially viable and internationalized art districts like 798.
Original article: [Chinese]