New batch of US$90bn ‘special bonds’ to be issued
The Finance Ministry will issue a new batch of 600-billion-yuan “special bonds,” as the former special bonds issued in 2007 are due at the end of August. Previously, the Finance Ministry had issued a total 1.55 trillion yuan of the so-called special bonds, which are used to conduct foreign exchange intervention and smooth the volatility of the yuan exchange rate. Sun Binbin, an analyst from Tianfeng Security, predicts that the Ministry will reopen the bonds in full, since it is unlikely for the Treasury to repay in yuan funds amid a shrinking fiscal income, Securities Daily reported.
Li touts role of innovation in economic prosperity
During an inspection of the Ministry of Science and Technology on Tuesday, Premier Li Keqiang said that innovation should play a bigger role in facilitating the structural transformation of the nation’s economy and the benefits of innovation should be shared by all, the Paper reported. Li said that breakthroughs in innovation have played a key role in supporting a steady economy, shifting the country’s growth momentum and expanding employment.
CIRC issues advisory to insurance firms
Chen Wenhui, deputy chairman of China Insurance Regulatory Commission (CIRC), said insurance products must better reflect their social security nature, instead of turning into financing tools, Caixin reported. Chen also suggested in the interview that insurance companies can improve their liquidity by selling assets which are irrelevant to the main business, so as to avoid liquidity risks.
SPP intensifies crackdown on financial crimes
The Supreme People’s Procuratorate (SPP) said it will reinforce its crackdown on financial crime, Sina Finance reported. The SPP said prosecutors should target “financial crocodiles” who sabotage the order of financial markets and “insiders” who trade power for money and funnel investor benefits for their own gain. Prosecutors will also strengthen a clampdown on illegal fundraising, known as pyramid scams, together with other web-borne financial frauds.
‘Chengdu industry groups’ to launch in Hong Kong
Southwest China’s Chengdu government and Hong Kong Stock Exchanges and Clearing have struck a deal on promoting Chengdu companies in the Hong Kong market to enable the launch of “Chengdu industry groups,” Caixin reported. Sixteen companies from Chengdu have been listed in the Hong Kong stock market by the end of June, raising funds of more than HK$30.9 billion (US$3.95 billion), for a total market value of HK$47.6 billion.
R&F aims to boost profits at 77 Wanda hotels
R&F Properties, a Guangzhou-based property developer, said it will continue to work with Wanda Group in an effort to boost profits at its 77 newly-purchased Wanda hotels by 30% to 50%, Caixin reported. Li Silian, chairman of the company, said a well-managed hotel should profit more than 100 million yuan, far above the current average profit of 11.5 million yuan. Previously in July, the company acquired the hotels from Wanda for 20 billion yuan, sparking doubt among insiders about the company’s profit viability following the acquisition.
Ministry reveals China’s rich mineral wealth
For only the second time since 2014, the Ministry of Land and Resources has released data on the nation’s recoverable shale gas reserves, China News Services reported. While shale gas reserves recorded a total of 122.4 billion cubic meters, coal reserves reached 1.6 trillion tonnes in 2016, increasing by 31.7 billion tonnes from a year earlier. Recoverable oil and natural gas reserves were confirmed at 3.5 billion tonnes and 5.44 trillion cubic meters, respectively.
Bid to increase salaries of low income earners
China’s progress report on the implementation of the 2030 Agenda for Sustainable Development said that the country will focus on increasing salaries for low income workers in the next stage, Sina Finance reported. Poverty alleviation and infrastructure construction will work jointly to minimize the 2.72-time income gap between urban and rural areas. The overall Gini ratio is expected to be reduced, an indicator of more equitable distribution of income.