Highlights from the EO print edition, issue no. 442, November 2, 2009

How to Respond to Overseas Criticisms of China's Currency Policy
Nation, page 2
~ In an essay especially written for EO, Professor Guo Tianyong, director of the Research Center of the Chinese Banking Industry at China's Central University of Finance and Economics (CUFE), discusses what measures China should take to actively respond to recent overseas claims that the Renminbi (RMB) is under-valued.
~ He noted that the RMB's exchange rate issue was not a new topic, and that the fundamental solution to this issue depends on China building up its economic and political strength and maintaining steady and sustainable economic growth.
~ He also outlined four measures that China could pursue in order to reduce the likelihood that China's trade partners would raise the issue of China's newly-pegged exchange rate: expand domestic demand, increase export tax rebates, strengthen trade laws and regulations and further internationalise the RMB.
Original article: [Chinese]
China Reveals State Firms' Business Performance for First Time
News, page 4
~ China's state-owned assets regulator - State-owned Assets Supervision and Administration Commission (SASAC) - recently published the business performance of 118 centrally-owned enterprises (COE) over the past two years.
~ This is the first time that the commission has unveiled the business performances of the country's state firms.
~ Of the 118 COEs, eleven firms' total assets reached over 100 billion yuan in 2008. These firms are all involved in a monopoly industry such as petrochemicals, electric power and telecommunication. 
Original Article: [Chinese]

Anti-trust Law: One Year On
News, page 5
~ Despite China's Anti-monopoly Law being in effect for over one year, some lawyers are far from satisfied by the way it is being implemented.
~ According to legal experts interviewed by EO, some companies are avoiding being taken to court on accusations of breaching anti-monopoly law on the basis that their business is related to national security and that business confidentiality maybe compromised. ~ Li Fangping, a lawyer who has handled several anti-monopoly cases, said it's hard for a court to accept anti-monopoly cases, hold a hearing or make a judgement.
Original Article: [Chinese] 
 
Inner Mongolia - The New Shanxi
Nation, page 9
~ In the wake of a wave of consolidation of Shanxi coal mines that has swept small private coal firms from the province, it seems that Inner Mongolia is heading in the same direction.
~ The news that Inner Mongolia is the next target of the consolidation mover, has disappointed many former Shanxi coal bosses who originally planned to shift to Inner Mongolia.
~ The Inner Mongolia Autonomous Region has officially required that new single-shaft coal projects should produce no less than 1.2 million tons a year and that new open-cut coal mines should extract more than three million tons per year.
Original Article: [Chinese]

Shenzhen Special
Nation, page 10-15
 ~  This week's Economic Observer has a special report on how Shenzhen is attempting to establish itself as not only a economically well-developed city but also a financial hub of China.
 ~  As a pilot city of market economy, Shenzhen has experienced rapid economic development over the past 30 years, thanks to the loose regulatory environment, close ties with outside world and vibrant entrepreneurship.
 ~ However, as trading on China's new start-up board, ChiNext, begins, there is fear among the locals that Shenzhen, China's first Special Economic Zone, is losing its vitality.
Original Article: [Chinese]

Chinese Banks Shun Local Projects
Market, page 20
~ Financing for local government projects, which was once pursued by Chinese being eschewed by China's banks.
~ Given concerns over local government credit rating and possible financial risks, China's banking regulator recently released another risk warning to local governments and financial institutions.
~ In recent weeks, Chinese banks and trust companies have begun to stop offering loans to local infrastructure projects backed by local governments.
Original Article: [Chinese] 
 
Multinationals do Battle in China's Grain Market
Corporation, page 30
~  As China lacks strong domestic brands in the grain sector, international grain and oil processing giants are attempting to establish as large a market share as possible.
~  Since 2006, Yihai Kerry, a Singaporean company that controls 50% of  the Chinese cooking oil market, has signed contracts with Chinese farmers to grow 280,000 hectares of rice.
~  Yihai Kerry's move has given rise to fierce competition between it and its Chinese counterpart, COFCO. As China's leading grain, foodstuffs and oils importer and exporter, the state-owned COFCO has invested a large sum of money in advertising and is now attempting to source more rice.
Original Article: [Chinese]

Geely on Track to Take Control of Volvo 
Industry, page 35
~  On Oct. 28, Ford Motor company formally confirmed that the consortium led by the Zhejiang Geely Holding Co.Ltd, a rapidly-expanding private Chinese auto firm, as its preferred bidder for Volvo.
~  Li Shufu, Geely's board chairman, has promised to maintain Volvo's status as a leading global brand and will further promote its reputation for safety and environmental-friendly technology. The company's headquarters will also remain in Goteborg, Sweden.
Original Article: [Chinese]