Cash China Economic Digest

Issue No. 123

China targets

20%

growth in installed

nuke power capacity

importance to the issue, and we'll lay more emphasis on it; we've worked hard, and we'll work harder," Ji, a former vice-mayor, said.

The government is launching four mega-projects to set up periphery power generation and heating centers on the four sides of the city, he said.

These projects, fueled by natural gas, will be built by relocating or upgrading existing coal-burning plants and will be completed by 2015, he said.

"Money pooled to the projects may amount to several billion yuan each, and the cost of operation will be higher than using coal," he said.

In addition, the city will replace traditional coal-burning stoves with electric radiators for 44,000 families. The efforts will go some way toward making Beijing free of coal, he said.

"I can tell you the scale and multitude of investment in anti-pollution measures exceeds that for the Beijing Olympics," Ji said.

With the service industry contributing 76 percent to the local economy, Beijing is endowed with a solid foundation to pursue a healthier development model, according to Ji. "Combating air pollution and protecting the environment will also contribute to GDP growth." In recent years the city has used more electric buses and has promoted new-energy cars.

The city plans to phase out at least 180,000 outdated automobiles this year and encourages more government organizations and public transport service providers to use new-energy cars and buses, he said.

With hazy skies usually shrouding vast swathes of northern China and wind sweeping pollutants from place to place, Ji said it is important for the capital to work with its neighbors in tackling the issue.

The excellent air quality during the 2008 Olympics was partly brought about by neighboring cities working together with Beijing to curb pollution under a coordinating mechanism, he said.

"There should have been an authoritative department invested with the power of making trans-regional anti-pollution strategy," Ji said.

Beijing's Vice-Mayor Li Shixiang was quoted by the Beijing News as saying that on average a quarter of Beijing's PM2.5 pollutants came from its neighbors.

The proposed authority to coordinate anti-pollution measures in Beijing and neighboring areas could be designated by the State Council. For example, such an authority could be delegated to the National Development and Reform Commission, or the Ministry of Environmental Protection, Li said.

Zhang Qingwei, governor of Hebei, said his province is keen to cooperate with Beijing, Tianjin, Shanxi and the Inner Mongolia autonomous region to reduce air pollution.

"We've been very successful in controlling PM10 particles in the air; we are stepping up surveillance and control of PM2.5 particulates," the governor said.

chilDRen DeSeRve a

SpoRting chance

children find an outlet for their energy at a school in Shanghai.

Monitoring Desk Report

tion playing second fiddle to academic pursuits, a common occurrence in elementary and high schools. "The increasing pressure on students to attend the very best colleges is the major reason," said Zhong Binglin, a member of the CPPCC National Committee and president of the Chinese Society of Education.

BEIJING-In recent years, China has demonstrated its position as one of the world's most competitive sporting powerhouses. The improvement has been signaled through success at the Olympic Games, highlighted by China's highest gold medal tally of 51 at Beijing 2008 and 38 at London 2012. However, in contrast with the nation's prowess in athletics, the overall fitness of the general public, and children in particular, has become a cause for concern.

"When I was a school student, there was less pressure academically and society as a whole valued a more-rounded development mode for students, including their physical condition.

But now the standards by which we judge schools and students have changed, becoming more score-oriented and leading students and teachers to spend more time improving examination results," he said.

The problem is twofold: Most of the participants of a nationwide program to promote fitness are retirees with no academic or work pressures to contend with; and the emphasis on academic excellence, coupled with the rigors of the gaokao, the nation's university entrance exam, mean that it's not unusual for schools to replace physical education classes with extra tuition or examinations.

The issue, which has attracted wide public attention, has been a hot topic at the annual sessions of national legislative and political advisory bodies.

Members of the Chinese People's Political Consultative Conference National Committee, the country's top advisory body, have suggested a range of measures.

One suggestion is that physical education should be listed as a part of the gaokao, an initiative that could be backed by policies and regulations to ensure the quality of sporting education.

The physical condition of university students has been declining for some time, according to an investigation by the Ministry of Education and General Administration of Sport in 2010, which covered 31 provinces and regions and 995 schools. The probe found that the cardiopulmonary functions of undergraduates had fallen by 10 percent since 1985, according to People's Daily.

Meanwhile, although the overall level of fitness of elementary- and middle-school students has shown signs of improvement after a 25-year decline, conditions such as obesity and myopia continue to increase within the target groups. Forty percent of elementary school students are myopic, a rise of 9 percent from 2005, while more than 80 percent of college students have the condition, which many observers attribute to overzealous attention to schoolwork and computer screens.

The deterioration in fitness levels has been highlighted by a number of tragically young deaths. In November, Chen Jie, a 21-year-old student, died of cardiac arrest as he finished the Guangzhou Marathon. A few days later, a sophomore at Shanghai Donghua University died at the finishing line

of a 1-km physical test, and in December, a student at Shanghai Sanda University died after fainting during a basketball class.

"The deterioration in the physical constitution of college students has been ongoing for a long time," said Liu Bo, head of the sports department at Tsinghua University.

"If students were to begin running at elementary school and maintained the habit until university age, there would be far less chance of accidents such as these occurring," he said. "It is impossible to rapidly improve the cardiopulmonary functions of students who have lacked exercise since childhood when they enter university, so there is now a risk that things will go wrong when these students undertake strenuous exercise."

academic performance The increasing pressure to gain entry to the best higher education institutions is seen as one of the dominant factors leading to a lack of exercise among students.

The concept of academic excellence is drummed into Chinese children. The country's huge student population means that competition for places at the best universities is fierce. Only the very best performers in the gaokao stand a chance of being selected by the most prestigious colleges and enjoying the benefits that accrue from attending an elite establishment, such as easier access to the best jobs.

This has led to physical educa-

A number of members of the CPPCC National Committee have called for reform of the gaokao selection criteria at the body's ongoing session.

Liu Changming, president of Beijing No 4 Middle School, one of the capital's best-rated schools, urged China to learn from the education systems in the United States and Japan, where sports are an integral part of the curriculum from elementary school through to college.

"Japanese schools invest great efforts in improving the physical condition of their students. We should learn from them and adopt measures, such as setting up extracurricular sports clubs of various kinds to attract students, and also establish criteria by which we can judge students and schools that are not simply oriented toward exam results," said Liu. Li Yuanyuan, president of Jilin University, suggested that physical education should be included as part of the university entrance examination.

"Basic education is always geared in the direction of the national examination, which has led to physical education being neg-

lected most of the time," he said.

"But now we are exploring reforms of the examination to make it more reasonable, scientific and beneficial to raise the profile of physical education in basic education."

Facilities, faculties, quality In addition to the neglect of sports classes, a shortage of facilities and trained physical education teachers, especially in rural and under-developed areas, has further exacerbated the problem.China has a shortfall of 300,000 physical education teachers in its elementary and high schools.

Some rural schools don't employ professionally trained sports teachers, relying instead on teachers of other subjects to take care of physical education, which inevitably affects the quality of the activities on offer.

Take Wuzhong, a city in the Ningxia Hui autonomous region, as an example; the city's schools have 1,260 physical education faculties which employ 559 part-time staff, but still has 444 vacant posts, according to a report by China Sports Daily in June.

"The number of graduates in the field is very limited each year and most of them are reluctant to work at schools in the countryside," Niu Fumin, education head of Yanchi county in Wuzhong told the paper. "We had four vacant posts for sports teachers in 2010, but only two candidates applied and we had no other choices."

The education authorities aim to fill the gap within three years via a number of measures, including training retired athletes to assume control of instruction."The rural areas lack the funds to attract talent and build the facilities. Some of them even don't have school buildings, let alone a sports ground," said Zhong. "There is still a long way to go to make education really equitable across the nation, especially in terms of bridging the gap in providing the rural areas with sufficient capital." Meanwhile, the quality of most school sports is far from desirable, according to

Duan Shijie, deputy director of the General Administration of Sport.

"Although most of the schools have physical education classes, the effects are not satisfactory," he said. "It is common for the content of the classes to vary from the syllabus - some (schools) ignore parts of the course, while others just let the students play among themselves.

"The main reason is that society hasn't realized the importance of exercise to young people, and we also lack the rules (to regulate schools)," he said.

Yang Hua, president of Beijing Sport University, said policies and rules should be implemented to ensure the quality of physical education classes.

"The school regulations and the national syllabus should attach the same importance to sports as they do to academic courses," said Yang. He suggested that the authorities should specify exactly what proportion of the education budget should be spent on sporting facilities and the construction of venues. He also urged that physical education classes and extracurricular activities should be well organized and designed.

"Schools must enable students to exercise their bodies and hone their willpower through a well-organized curriculum en route to improving the quality of the classes. If not, the classes will go to waste and the students will be left with a poor understanding of the importance of sports," Yang said.

soccer, basketball and volleyball.

To increase the number of soccer players, the Chinese Football Association has sought cooperation with the education authorities to promote the sport in schools.

Meanwhile, the retired basketball star Yao Ming, who now serves as a member of the CPPCC National Committee, suggested during the annual session that sports and education should be combined further and proposed the foundation of school basketball leagues.

"Physical education should be part of general education, and basketball, which was born on campuses, should return to the schoolyard," said the 32-year-old former Houston Rockets center.

"That combination would enable young students to improve their physical health and allow the development of well-educated athletes." Yao's view was echoed

by Yang Liguo, an official at the Ministry of Education, who works in school sports.

"School leagues should be a method of molding the morality and personalities of the participants and play a part in boosting the development of the country's basketball talent to ensure the sport's long-term and sustainable development," he said.

team players?

The Ministry of Education's Students Athletic Association has signed an agreement with the US National Collegiate Athletic Association.

Improving the physical fitness of students and promoting sporting activity in schools could help to expand the talent pool for athletics and resolve a growing dichotomy in China's sporting life.

It aims to promote the development of school basketball leagues in China throughout the education system via a number of exchange programs between the two countries, according to Yang.

While the country has achieved great success in individual events, there has been a dramatic decline in the results and reserves in team sports, including

Monitoring Desk Report

Driver slips

into coma after stopping vehicle

BEIJING-Colleagues and passengers of a bus driver in East China who managed to pull over his vehicle on an expressway before slipping into a coma have flocked to his bedside.

Song Yang is in critical condition at the Second Hospital of Shandong University.

"He's not in good shape," said his physician, Ma Cheng'en,, adding that Song is unable to breathe unaided.

The 34-year-old had been driving a bus carrying 33 passengers from Liaocheng to Jinan when he suddenly fell ill at about 10:20 am. Witnesses said he instinctively pulled the vehicle to the side of the road and opened the doors for passengers to evacuate.

In hospital, doctors found a large amount of blood on his brain stem and he was admitted to intensive care.

"I believe my son will protect others even though it will put him in danger," his mother, Song Xia, said.

Many passengers who were on the bus have visited Song in the

Family members watch over Song Yang, a bus driver in Shandong province, in Second Hospital of Shandong University.

On Saturday, Song managed to pull over on an expressway before falling into a coma. He is in a critical condition

hospital to express their appreciation.

"The surveillance video shows he was in great pain, but he did his job and made sure everything was safe, which was hard for him," said Jia Xiangming, an instructor who worked with Song.

He said the company has donated more than 34,400 Yuan ($5,530) to help the family after the company covered the cost of his treatment.

The incident was the third case of a bus driver falling ill behind the wheel in China in three days.

Doctors say the incidents demonstrate that the health of drivers needs more attention.

"Drivers work with continuous and intense stress for a long time, about eight hours a day.

In addition to their unfavorable working environment, chaos from the crowds and high or low temperatures in the vehicles, you can see the reason why their health is not OK," said Liu Yahua, an emergency room doctor at the General Hospital of Armed Police Forces in Beijing.

Many of them are unable to keep regular eating and exercise patterns because of their busy

schedule, which may become worse because of the traffic jams, she said.

"For people in their 40s and 50s, this may lead to serious diseases involving their stomach, heart and spine, which is quite common among the drivers," she said, adding that some may not take medicines regularly during work.

She suggested drivers pay more attention to daily healthcare.

Many bus companies share her opinion on regular care.

Peng Zilin, a publicity official from the first branch company of Beijing Public Transport Holdings Ltd said all the drivers of the company have regular physical examinations and daily checks from their team leader to confirm that they are in good health.

"We do everything to make sure our drivers can work healthily and the passengers are safe," he said, adding that their priority is to put on the brakes when such instances occur, but no such incident has happened in his company.

Many people have suggested that the drivers should benefit from early retirement considering their exhausting daily work.

Xi uRgeS Armed Forces loyalty, discipline Xi Jinping, geneRal SecRetaRy oF the centRal coMMittee oF the coMMuniSt paRty oF china (cpc) anD chaiRMan oF the cpc centRal MilitaRy coMMiSSion, DeliveRS an iMpoRtant Speech while attenDing a plenaRy Meeting oF the people'S libeRation aRMy (pla) DeputieS who attenD the FiRSt SeSSion oF the 12th national people'S congReSS (npc) in beiJing, capital oF china (Xinhua) BEIJING-Xi Jinping, General Secretary of the Communist Party of China (CPC) Central Committee, on Monday urged the country's armed forces to be "absolutely loyal" to the Party, sharpen fighting capacity and abide by disciplines.

While joining a plenary meeting of the People's Liberation Army delegation at the ongoing legislative session, Xi, also chairman of the CPC Central Military Commission, called on the armed forces personnel to bring the country's defense and army building to new high.

Xi said soldiers must be absolutely loyal to the Party, and maintain their purity and reliability.

They should be at full military readiness to ensure victories in any wars, he urged.

Meanwhile, the armed forces must be ruled by law to maintain the good reputation they have earned over the years, according to the leader.

Xi said the forces should uphold frugality and oppose extravagance and waste, so as to make full use of military spending.

According to a government budget report submitted to the national legislature last Tuesday, China plans to raise its central government defense budget by 10.7 percent to 720.2 billion Yuan (114.3 billion U.S. dollars) in 2013.

Xi said economic development and defense construction should be coordinated so as to achieve integration of a wealthy nation and strong armed forces.(Agencies)

Xi Jinping, geneRal SecRetaRy oF the centRal coMMittee oF the coMMuniSt paRty oF china (cpc) anD chaiRMan oF the cpc centRal MilitaRy coMMiSSion, talkS with DeputieS to the 12th national people'S congReSS (npc) FRoM the people'S libeRation aRMy (pla) in beiJing, capital oF china, MaRch 11, 2013. Xi attenDeD a plenaRy Meeting oF pla DeputieS who attenD the FiRSt SeSSion oF the 12th npc, anD DeliveReD an iMpoRtant Speech heRe (Xinhua)

Monitoring Desk Report

beiJing pRoteStS

Tokyo's one-China policy violation

BEIJING-China has lodged strong protests to Japan over violations of the one-China policy related to Tokyo's anniversary commemoration of its devastating earthquake.

"After the major earthquake and tsunami hit Japan on March 11, 2011, the Chinese government and people conveyed its sympathy and support to the Japanese people," Foreign Ministry spokeswoman Hua Chunying said in an interview on Monday.

During Monday's ceremonies, the Japanese government invited representatives from foreign countries and regions, media organizations reported.

Staff members of the Taipei Economic and Cultural Representative Office in Japan were also invited.

Tokyo arranged the personnel from Taiwan to attend the ceremony as part of a diplomatic delegation and international organization's staff, the spokeswoman said.

The move is against principles and the spirit of the 1972 Joint Communique of the Government of the People's Republic of China and the Japanese government, as well as Japan's promises on upholding the oneChina policy, Hua said.

Japan has made promises to endorse the one-China policy in key bilateral political documents with China, including the Joint Communique, which both countries signed on Sept 29, 1972.

The Japanese government "fully understands and respects" the Chinese government's position that Taiwan is an inalienable part of the territory of the People's Republic of China, according to the Joint Communique, a landmark of the two Asian neighbors' decision to normalize diplomatic ties in 1972.

"We have lodged solemn representations to Japan and are strongly dissatisfied with Japan's acts," Hua said in a statement.

She reiterated that the Chinese government resolutely opposes any attempt by word or deed to create "two Chinas" or "one China, one Taiwan".

"We urge Japan to correct the mistake and keep its promises," Hua said.

Ties between China and Japan have been severely strained since the Japanese government illegally "purchased" part of China's Diaoyu Islands in September, a provocation that prompted strong protests from China and an enduring standoff regarding the islands in the East China Sea. Experts said Tokyo's ceremonial arrangement on Monday added to the strain between the two countries.

Feng Zhaokui, a senior fellow on Japanese studies at the Chinese Academy of Social Sci-

ences, said the relationship now desperately needs to "lower the fever".

In another development on Monday, the Foreign Ministry denied Japanese media reports that a former Chinese senior diplomat is planning to visit Japan. Japanese media reported that Tang Jiaxuan, a former state councilor, plans to visit Japan during the fourth session of the fifth China-Japan Friendship Committee for the 21st Century in late March to chair a committee meeting.

"The reports are untrue," Hua said.

Both countries have maintained communication about the committee's fourth session, Hua said. But "as far as I'm concerned, the schedule for the meeting has not been settled", she said.

Family planning policy to remain intact Monitoring Desk Report BEIJING-There will be no change to the country's family planning policy, a public sector reform official said one day after a key government restructuring plan was unveiled.

"The pressure facing residents and resources still persists in our country with such a huge population," said Wang Feng, Deputy Head of the State Commission Office for Public Sector Reform.

The country will keep its basic state policy on family planning after the creation of a new commission through the merging of the health ministry with the National Population and Family Planning Commission, Wang told a news conference in Beijing.

Following the restructuring, work in the field of family planning will be beefed up, not weakened, as implementation of the policy continues to be a chief responsibility of Party and government heads, he said.

The proposed national health and family planning commission will strengthen implementation of the family planning

policy regarding institutions, personnel and functions, he added.

Without the policy, launched more than 30 years ago, the Chinese population could be 400 million higher than the current level.

In his last Government Work Report at the opening of the annual legislative session on Tuesday, Premier Wen Jiabao said that in response to changes in the size and structure of China's population, the country should solve problems related to the size, health, structure and geographical distribution of its people and promote long-term, balanced population development.

Sunday's restructuring plan axes the National Population and Family Planning Commission and shifts its population policy-making functions to the influential National Development and Reform Commission.

There has been speculation that reforming the family planning commission will bring about a relaxation of the policy.

But officials and experts were quick to dampen such expectations.

"I don't see there is any necessary link between the two,"

Vice-Minister of Health Huang Jiefu told the media when asked if the governmental overhaul intimates loosening of the population policy.

Zhu Lijia, a professor at the Chinese Academy of Governance, said he didn't think that shifting the National Population and Family Planning Commission's policy-making function meant the country would relax its policy in the short term, China Business News quoted him as saying.

Speaking at the news conference, Wang Feng also said that the introduction of private capital in railway construction and operations will help break the monopoly in the industry and bring in competition.

Wang said it has been difficult for private capital to enter the railway system as the existing Ministry of Railways functions as a government department and an enterprise.

Under the restructuring plan, the Ministry of Railways will be split, with its regulatory powers going to the Ministry of Transport, while its operations go to a commercial

we are now seeing some signs that chinese games companies are not just aware of this potential...

Monitoring Desk Report

Finance tech shift in chinese games industry

BEIJING-The Chinese game companies have so far focused on two segments; simple mobile games (usually games that work well even on older phones), and browser based computer games.

While these have the benefit of working quite well with older hardware, they are limited in terms of what type of game experience they can deliver to the user.

If you look internationally, the games industry is more diverse, in fact many companies focusing on browser games are showing signs of limited staying power such as Zynga (NASDAQ: ZNGA). Whereas the companies that have shown more long-term results have been focusing on richer games that offer richer experiences.

This has been a potential concern for investors in Chinese games companies, both in terms of international growth potential and a concern that Chinese gamers might follow a similar trend away from these simpler games. We are now seeing some signs that Chinese games companies are not just aware of this potential, but are indeed looking to develop in that direction.

The technological switch that is happening is that companies are changing their development towards already existing game engines, such as Unity, which will enable them to develop more complex games.

Something which seems to be in

line not just with the overall development trends in the market, but also with a switch within the country to better hardware, both with computers and mobiles.

What this switch means in real terms is that Chinese companies will be able to compete with western ones in the mid-level game development sections, whilst still being some ways off the true top end of graphics and game complexity. This also has implications internationally, as Chinese companies using this technology to lower their development costs for these games are more likely to develop for an international market. However, they will also find it much easier to “adapt� international titles for their domestic audience.

From an investor standpoint this type of switch is interesting from a couple of standpoints. It implies potential international upside potential, and perhaps expansion plans in the not too distant future. While this may sound all well and good, investors need to take a cold hard look at whether or not they think the company’s finances can handle such a strain. Going international, while to my mind almost a necessity in the long term, is also unlikely to be free or easy. It will take some tinkering to get it right as well, as we have seen with many other Chinese international expansion efforts. Look for some stability with a decent war chest and promising free cash flow to help stave off panic responses should the first efforts fail.

china's financial might take healthy shape Monitoring Desk Report BEIJING-The US magazine Worth published a report recently analyzing the 100 most powerful people in global finance. Four were from China: Shang Fulin, chairman of the China Banking Regulatory Commission; Zhou Xiaochuan, governor of the People's Bank of China; Lou Jiwei, chairman and CEO of China Investment Corp; and Jiang Jianqing, chairman of the Industrial and Commercial Bank of China.

They were ranked 14th, 15th, 27th and 31st.

That only four of China's top financial figures were included in the list shows how much understanding of the power of China's financial and banking system still lags behind its reality.

To grasp the underlying dynamic of the global financial industry it should be noted that it is a mistake to understand the strength of China's economy by statistics (such as the facts that China produces as much steel as the next 38 countries combined; more cement than the rest of the world put together; that it is the world's largest market for TVs, refrigerators, mobile phones, cars; or that it has more than twice as many Internet users as the US).

These figures are impressive but far from illustrate the real core of China's economic power. The real center of its economic strength, which determines both its domestic and global expansion, is unparalleled financial strength.

China has yet to overtake the US in GDP, but the annual sum of China's finance available for global or domestic investment - its savings - is already twice that of the US. As the chart shows, China's savings in 2011, the last year for which comprehensive figures are available, were $3.6 trillion (2.8 trillion euros), double that in the US. But savings are the raw material of the financial system. It is

this huge flow passing through China's banking system that is making China the world's financial superpower. China's $3.3 trillion foreign exchange reserves, easily the world's largest, are a powerful adjunct but it is the yearafter-year generation of domestic finance on a scale that has no international parallel which is the unmatched core of China's economic strength.

To see the dynamic this is creating in the global finance industry it is useful to compare the main indices for banks in China and the US. When this year's figures are published they will further reinforce these trends.

US banks reporting last year were still ahead of China's on revenue - $550 billion compared with $404 billion, and on assets $10,079 billion compared with $9,895 billion. But on profits China's banks had already overtaken their US competitors, $105 billion compared with $68 billion. China's banks also held the lead in stock market valuation, $992 billion to

$847 billion.

At the beginning of this year, both China (ICBC, China Construction Bank, Agricultural Bank of China, Bank of China), and the US (Wells Fargo, JPMorgan Chase, Citigroup, Bank of America) had four out of the world's top 10 banks by market capitalization.

But the total valuation of the Chinese banks was $706 billion compared with $620 billion. ICBC is the world's largest bank by both profit and capitalization.

In other financial fields - insurance, mortgage lenders and credit cards - the US still maintains a lead over China. But in core banking strength there is essentially no difference between China and the US. But by every indicator the rate of growth of China's banks is many times higher than that of their US competitors. By revenue China's banks were 16 percent as large as US banks in 2007, and by last year they were 74 percent as large. By assets the corresponding figures were 30 percent and 98

percent, by market valuation 43 percent and 117 percent, and by profit 17 percent and 155 percent. China's far more rapid buildup of domestic finance means that the balance will progressively and rapidly move in favor of its institutions. So before long China's banks will overtake US banks on all measures. China's underlying financial strength is rapidly being transformed into institutional strength in its banking system.

Where US banks traditionally held a strong lead over China is that China's were essentially domestic banks but US banks operated globally. However, this is beginning to change as China's banks go global.

First to globalize were China's development banks. During 2005 and 2011 China Development Bank and Export-Import Bank of China provided more than $75 billion in loan commitments to Latin America.

But now globalization of China's commercial banks is pro-

ceeding rapidly. By the beginning of this year, ICBC operated in 39 countries with overseas assets of $170 billion, a 30 percent increase on 2011. The stability and state guarantee of China's banks is attractive compared with the continued scandals from US and European competitors, making it clear that developing the necessary management skills is now the primary difficulty in expanding China's banks' overseas operations.

China's banks have so far concentrated on developing countries. For example, key acquisitions were ICBC's purchase of a 20 percent stake in Standard Bank, South Africa and Africa's largest bank. The advantage of the combination of Standard Bank's local knowledge throughout Africa and ICBC's huge financial firepower is evident. ICBC's shareholding in South Africa Standard Bank also made it easy to buy Standard Bank's Argentinian subsidiary, consolidating ICBC's position in Latin America.

But the financial strength of China's banks gives them the opportunity to directly expand operations in developed economies.

Last year ICBC carried out China's first takeover of a US bank with Bank of East Asia. The international expansion of yuan operations - with the world's largest foreign exchange dealing center, London, trying to compete as an offshore operator with Hong Kong and Singapore - centrally involves China's banks.

Globalization of China's banks cannot be instantaneous.

But the problems involved are time in acquiring permits, training management, creating infrastructure and other things, rather than fundamental financial strength.

Overcoming these difficulties, given the unparalleled financial muscle that can be applied, is simply a matter of time.

How should the situation be summarized? It is sometimes assumed manufacturing is China's strongest industry. This is a mistake.

China is the world's largest manufacturer and largest manufacturing exporter. But a substantial part of China's manufacturing output, and half its exports, are still by foreign companies. It will take significant time to build the power of China's own manufacturing companies. But the foundations of China's banks are already those of an emerging financial superpower. It is only a matter of time, a rather short one, before that translates into an equivalent strength of China's global finance companies.

Within a decade a list of the 100 most influential people in world finance will not contain four from China. It is likely to be dominated by figures from China.

The author is a senior fellow at Chongyang Institute for Financial Studies, Renmin University of China, and former director of economic and business policy for the mayor of London. The views do not necessarily reflect those of China Daily.

Advisory body

sharpens focus

Monitoring Desk Report BEIJING-The top political advisory body elected a smaller but more diversified new generation of leaders to guide its development for the next five years.

Yu Zhengsheng, born in April 1945, was elected to lead the National Committee of the Chinese People's Political Consultative Conference.

Another 23 vice-chairpersons were elected at the plenary meeting of the first session of the

12th CPPCC National Committee, two fewer than five years ago for the 11th CPPCC National Committee.

Notably, two influential financial figures - Zhou Xiaochuan, governor of the People's Bank of China, and Chen Yuan, chairman of the China Development Bank are among the newly elected vice-chairpersons. No members of the previous leadership of the CPPCC National Committee had a comparable background.

Other vice-chairpersons in-

clude representatives of eight non-Communist parties, leaders of some Communist Party of China central departments and provincial committees, former chief executives of special administrative regions and leaders of ethnic autonomous regions.

CPPCC members said a more concise leadership is in line with the call for fewer leaders, and two new vice-chairmen with a financial background may help the political advisory body offer more detailed advice for the

The downsizing of the CPPCC leadership is a positive response to the call by the CPC for fewer leaders and greater efficiency

country's economic development.

"The downsizing of the CPPCC leadership is a positive response to the call by the CPC for fewer leaders and greater efficiency," said Huang Changyuan, vice-chairman of the Xinjiang committee of the CPPCC. The CPC's top decision-making body - the Standing Committee of the Political Bureau of the CPC Central Committee - was trimmed to seven members from nine in November.

Sun Taili, a CPPCC National Committee member and president of Qingda Group, a private investment company in Tianjin, said he felt excited that two influential financial figures had joined the body's leadership.

"Financial reform is crucial for the success of China's reform," he said. "I believe they can give and inspire high-quality proposals for financial reform and promote a fair

environment for small and medium-sized companies."

Yang Yuanqing, chairman and CEO of the world's major PC maker, Lenovo Group, also said it's great to see more financial experts become top CPPCC leaders as the economy is crucial to State affairs.

Yang said he expects the body's new leadership can give more advice to the government to maintain stable economic growth and boost domestic demand.

The CPPCC serves as a key mechanism for multiparty cooperation and political consultation under the leadership of the Communist Party of China and is a major symbol of socialist democracy.

Yu, the newly elected chairman of the CPPCC National Committee, was elected to the Party's seven-member top decision-making body in November.

"The new leadership (of the CPPCC) shows great diversity in their ages, academic background and walks of life," said Alsuyara, a Uygur member of the National Committee of the CPPCC. "I hope the new leadership, with Yu as chairman, can carry on the good practices of their predecessors and make the CPPCC a better platform for socialist democratic consultation, a hub for good ideas, and get more firsthand information (on major issues) via in-depth research at the grassroots level," she said.

The first session of the 12th CPPCC National Committee is scheduled to close on Tuesday.

But the country's leadership transfer will continue as the top legislature - the National People's Congress - is expected to elect the country's new president, vicepresident, cabinet, top judge and procurator this week.

china taRgetS growth in installed

20%

nuke power capacity

beiJing-china's plan to raise its installed nuclear power capacity by 20 percent this year shows that the country is developing nuclear power in a safe and efficient way. in 2013, 3.24 gigawatts of nuclear power will be added to the country's existing capacity, according to a report on national economic and social progress by the national Development and Reform commission, china's top economic planner. the planned installation indicates that china is making greater efforts to develop nuclear power in a safe and efficient way, said he yu, chairman of the china guangdong nuclear power group. according to a government white paper on energy released in october, china had 15 nuclear power generating units in operation, with a total installed capacity of 12.54gw. he said china has another 30 units currently under construction, which will add an extra 32.81gw. china will have the third-largest number of nuclear power generating units in operation in the world by 2020, after the united States and France, according to he. when the installed capacity of the units amounts to 58gw by 2020, it will account for less than 4 percent of china's total power gen-

erating capacity, compared with more than 50 percent in France at present, he said. the october white paper stated that nuclear power accounts for just 1.8 percent of china's total power output, far below the global average of 14 percent. china's nuclear power development came to a halt after the Fukushima nuclear crisis in Japan in March 2011. china suspended approvals for new nuclear plants and carried out a nationwide safety review after the crisis. the approvals were cautiously resumed in october. authorities have vowed not to build any nuclear power plants in inland regions during the 2011-2015 period, and they have demanded that the world's strictest safety requirements be applied to new plants. luo Qi, director of the china nuclear power Research institute, said china has made substantial progress in raising safety standards for nuclear power plants in operation and for those that have been domestically designed. luo said china has actively accelerated the development of its acpR1000 nuclear power technology, which features all chineseowned intellectual properties. it has met the world's most advanced technical standards for nuclear power development.(agencies)

china seeks new competitive edges for exports BEIJING-"Made in China" goods have long-dominated the global market, but rising costs are weakening China's price edge and strengthening the country's resolve to come up with "new edges," analysts say.

Calls to create new competitive edges in technologies, brands, quality and service have appeared in a government work report delivered by Premier Wen Jiabao to the ongoing annual session of the National People's Congress, China's top legislature.

The government report said China should raise the quality of, and returns on, foreign trade, rather than just increase the foreign trade volume. Instead of relying solely on cost and price advantages, it should also raise its overall competitive advantages.

Analysts say all of this signals a shift in China's export policy, in which it hopes to export more high-quality goods and those with a higher profit ratio.

The shift is also a timely response to dramatic changes in both domestic and overseas markets, which used to serve China's export industry and its overall economy well.

According to data released Friday, China's exports jumped 20.6 percent year on year in February, well beyond analysts' expectations for single-digit growth as companies shut down for the Spring Festival holiday, which fell in February this year.

Commerce Minister Chen Deming also announced last

week that the country's export volume in 2012 is expected to constitute 11 percent of the world's total.

However, the increased total export volume and an apparent rebound trend in February are not representative of the entire situation.

The annual East China Fair, a major barometer of China's trade situation, closed in Shanghai a week ago. Numbers of overseas customers and deals dropped 5.3 percent and 9.9 percent, respectively, year on year.

Wang Tingge, president of a trading company in east China's Zhejiang Province, attributed trade difficulties to weak overseas demand and a decline in the competitiveness of Chinese goods in terms of price. He said the monthly income of a typical textile worker in Zhejiang was around 600 U.S. dollars, four times that of a Cambodian worker.

Cai Hongbin, director of the Guanghua School of Management, Peking University, said China's exports had grown at an average annual rate of over 20 percent for the past decade, reflecting China's industrial competitiveness, "but this competitiveness is fading fast."

This is evidenced in the fact that exports expanded by just 6.2 percent last year, he added.

The General Administration of Customs surveyed 2,000 export companies in the latter part of 2012. It found that 50 percent said orders decreased, and 70 per-

cent said overall production costs had risen from the first half of the year.

Zhang Xiaoji, an economist with the Development Research Center of the State Council, said the cost factor at the core of China's export competitiveness was falling further, and companies need to create new competitive edges through technology, equipment and marketing.

China's foreign trade will continue to struggle in 2013, with sluggish overseas demand, currency quantitative easing and trade protectionism all posing barriers, the Ministry of Commerce has cautioned.

Cai Hongbin warned that exports could fall if companies fail to raise their competitiveness in technology and innovation and produce goods with higher added value.

The Commerce Ministry has set fostering new competitive edges as a priority. Specific measures include the internationalization of strategic emerging industries, the establishment of overseas sales networks and support for companies in building brands and R&D centers.

In coastal Jiangsu Province, an export base, efforts to create new competitive edges have paid off for some companies.

Clothing orders that had gone to Southeast Asian countries offering lower production costs have returned because Chinese workers surpassed their Southeast Asian counterparts in skill and work stan-

dards.

At a recent press conference, Li Yining, a distinguished economist, said China should speed up industrial upgrading to sell higher-quality goods, as well as quicken economic restructuring at home to manage the threat posed to China's exports by the devaluation of foreign currencies.

China's economy is currently

re-balancing, with plans to shift from relying on trade and investment to domestic consumption to drive growth.

Nevertheless, trade will remain important for China's economy.

Last year, Commerce Minister Chen said over 80 million workers were employed in China's foreign trade sector, and over 60 percent of them were from rural

areas. Stable exports are essential to supporting growth and employment, as well as balancing urban-rural development and sustaining domestic consumption.

Still, Li Qingyun, an economist with Peking University, held that China should no longer pursue overly high export targets, adding that a large trade surplus will not help China's efforts to drive domestic consumption.(Agencies)

Samsung dominates china smartphone market Monitoring Desk Report SHANGHAI-South Korean electronics giant Samsung took top spot in China's smartphone market in 2012, after sales of its devices nearly tripled from 10.9 million in 2011 to 30.06 million last year.

Citing figures from Strategy Analytics, Yonhap News Agency said Sunday Samsung held 17.7 percent market share in 2012, which was a jump of 5.3 percent from the year before. This also marked the first time it topped the Chinese smartphone market since entering the market in 2009, thanks to global brand recognition and increased cooperation with Chinese carriers, the report added.

Samsung's rise in China was at the expense of rival phonemaker Nokia. The Finnish phonemaker, which was No. 1 in 2011 with 29.9 percent market share, plunged to 3.7 percent last year to take seventh place, according to the research.

The No. 2 smartphone brand in China for 2012 was PC maker Lenovo, with 13.2 percent market share, which represented a 4 percent growth from the year before. Apple was third with 11 percent, followed by Chinese telecom equipment manufacturer Huawei with 9.9 percent, the report said.

Samsung's continued dominance of the China market is not certain, though. Earlier this month, the Chinese government publicly expressed its concern over the dominance of the Android operating system, saying it is strictly controlled by Google despite being open source. The majority of Samsung's most popular smartphones are powered by Android.

The Ministry of Industry and Information Technology (MIIT) said in a whitepaper then that domestic handset makers were "heavily dependent" on Android, which means risking paying royalties for patent licensing or litigation.

(MCF), said in the press release: “We welcome USAID’s interest in our country’s ICT sector. Opportunities like this will help pave the way for possible collaboration to promote greater innovation and entrepreneurship to transform our country’s future development.”

Dr Shah participated in the technology fair, hosted by the MCF, as part of his USAID mission to Myanmar from March 7 to 8.

He met local entrepreneurs, industry leaders and students engaged in the country’s ICT sector.

“Myanmar’s internet penetration rate stands at about seven to eight percent. The global assumption is that this makes it very difficult to have vibrant aspirations in the ICT sector, but to see this

uSaiD, cisco partner

up for ICT development Monitoring Desk Report BEIJING-A new partnership between American networking giant CiscoSystems and the US Agency for International Development (USAID) was presented by USAID’s administrator, Dr Rajiv Shah, at an information and communication technology fair at Yangon’s ICT Park.

The aim of the partnership is to provide information and communication skills training in an emerging information and com-

munication technology (ICT) market. Cisco and USAID plan to open two Cisco Networking academies in Myanmar.

It has not yet been decided where or when the academies will be built, but Cisco has committed to donating networking equipment for labs in the academies and provided career skills training for up to 15 university faculty staff to support the program.

Cisco has already established over 10,000 networking academies in 165 countries.

“Cisco has a long track record of supporting the development of emerging economies through education, and the Cisco Networking Academy program will equip students in the country with industry relevant skills for the 21st century workforce, as they transform their country and their communities,” said the regional director of Cisco’s Social Innovation Group in Asia Pacific, Sandy Walsh, in a press release.

U Khun Oo, president of the Myanmar Computer Federation

work is very inspiring and I know the ICT sector here has a lot of potential,” Dr Shah said.

“Just last week, USAID helped facilitate a group of technology companies. We are now hearing from these companies that they are eager to commit to partnerships. Just so you can get a sense of how rapidly progress can be made, Cisco’s partnership was announced just a week after their visit to Myanmar,” he added.

It was also announced at the technology fair that other IT companies from the USAID-led delegation are already interested in forming local partnerships. The delegation explored a range of opportunities to help accelerate affordable access to the internet,

strengthen transparent and efficient government and expand digital literacy.

HP, Intel and Microsoft are all eager to expand a range of partnerships, Dr Shah announced.

“These kinds of partnerships represent the future in developing real economic infrastructure and support that development. But I also think that there will be a lot of natural partnerships, which hopefully will emerge from this. We hope that as a part of the development, these partnerships will improve online access and online learning, but also create real business opportunities for the entrepreneurs in the country,” Dr Shah said at the fair.

indonesian workers go on strike Monitoring Desk Report

ST-Ericsson announces change in Executive Management Monitoring Desk Report BEIJING-Following the STMicroelectronics' announcement issued earlier today, ST-Ericsson, a joint venture of STMicroelectronics (NYSE:STM) and Ericsson (NASDAQ:ERIC), announced today that Didier Lamouche, president and chief executive officer, has

decided to resign from the Company to pursue other opportunities.

Hans Vestberg, Chairman of the ST-Ericsson's board of directors, said: "Didier Lamouche came into ST-Ericsson when the company was in a very challenging situation and has been instrumental in bringing the company to the

point where it is more focused on strategy execution, a much lower breakeven point and positive momentum where the new LTE modem-based products are ready for market introduction this year. On behalf of ST-Ericsson's board, I thank Didier for his strong contribution to ST-Ericsson."

BEIJING-Indonesians working for Chinese telecom firm Huawei joined a strike Friday over claims their employer broke labour laws, in the latest industrial action to hit a foreign company in Indonesia.

Some 150 workers in the capital Jakarta and the eastern Java city of Surabaya took part over claims Huawei has illegally hired foreign workers and has sought to disrupt the work of labour unions. Huawei denies the claims.

Indonesians working for US mining giants Freeport McMoran Copper & Gold and Newmont Nusa Tenggara, and French retailer Carrefour, have gone on strike in recent years seeking better pay and conditions as the economy booms.

"The strike is an escalation of several labour issues at Huawei," Huawei Tech Investment Indonesia Union chairman Heru Waskito Krisnamurti told media.

West 'looking for China to play greater role' Monitoring Desk Report BEIJING-The West is expecting China, under its new leadership, to play a greater world role as Beijing's involvement is essential in resolving the economic downturn and creating new order for the global financial system, according to former French Prime Minister Michel Rocard.

"Dysfunction of the current world financial system is so deep that the classic recipes do not work. The West cannot conduct strategies to resolve the economic crisis without the Chinese," Rocard told media.

He was speaking while observing the ongoing National People's Congress in Beijing, which will elect the new State leadership.

Rocard said China already

has about 9 to 10 percent of world trade and he thinks the figure will double in 10 years. He added that the country will be the most active player in international organizations such as the World Trade Organization and International Monetary Fund.

Rocard said China is shouldering increasing international responsibility and could contribute substantially to the improvement of world governance. "My wish is that China's new leadership can acknowledge it and act," he said.

While European governments are looking for more investment from China to help regenerate growth and jobs, China is experiencing an economic transformation with a focus on consumption and sustainability, for which Europe has rich ex-

perience to share.

Rocard said, "So there is a fantastic opportunity for Mr Xi Jinping and China's new leadership to explain to the Chinese people that Europe and China share a common future."

Rocard, 83, served as French prime minister from 1988 to 1991 under the presidency of Francois Mitterrand. He is also the cofounder of the China-Europe Forum, a platform for dialogue among European and Chinese officials and scholars, initiated in 2005.

He has been a frequent visitor to China, demonstrating his keen interest in what is happening in the country.

While applauding the nation's rapid development, Rocard warned about real estate bub-

bles and relying too heavily on exports, which could endanger China's economy.

"China can no longer play the card of exports," he said. "The problem you face is to redirect

your economy toward internal demand and to create a mechanism for that."

Commenting on Sino-French relations, Rocard said the expected visit by French President

Francois Hollande to China is "symbolically very important" as it will prepare for improvement in cooperation between the two countries to resolve the economic crisis

now things have changed.

Despite the growth slowdown for chinese shipments amid the european union debt crisis, some chinese manufacturers are challenging their european counterparts and gaining popularity in the region, thanks to their growing sophistication in manufacturing, advanced technology and quality. in his 20-square-meter office in the oxford university hospitals nhS trust in london, wu Feng, a professor of surgery, receives many patients with different types of tumors every day. "i am always proud of my job", which "offers me the opportunity to show people here how excellent made-in-china medical devices are", wu said, referring to the huge, tumor-treating medical devices he works with every day. lying in the center of wu's office, the devices are produced by chongqing-based haifu Medical technology co ltd.

chinese manufacturers gain credibility in EU market

"the hospitals introduced the hiFu machine in early 2002, and at that time, the british doctors and professors were surprised that chinese companies were capable of making such high-end machines, some of which were considered years ahead of their european counterparts," wu said. in the past decade, the hiFu machines have cured hundreds of patients around the uk, and in 2005, chongqing haifu received the european economic area's ce certificate, in a signal that the european market will open to the chinese medical-device supplier without barriers. currently, nine european countries, including italy, have adopted 23 hiFu machines. "i am hugely impressed with the hiFu," said David cranston, consultant urological surgeon and senior clinical lecturer in surgery at the university of oxford, who also works in the hiFu unit in

oxford. "we think it is three to five years ahead of everybody else worldwide, and it has a lot of advantages." besides the medical treatment, "the price of the machine is less than half of those from other companies, like ge", he said.

For years, china has had the image of being a low-cost workshop where quality is inferior and ideas are always copied — or stolen — from the west. but while the chinese government enhances its efforts to assist domestic companies on innovation and as their globalization process accelerates, companies like hiFu are gradually shifting the global preconception. "absolutely, hiFu has completely changed my mindset of made-in-china goods. before hiFu, i thought chinese brands were cheap and maybe not so good," cranston said.

au to m o b i l e

Qoros debuts new sedan with more in the pipeline

Monitoring Desk Report GENEVA-Qoros Auto Co Ltd, the new independent carmaker from China, made its public debut at the Geneva Motor Show by unveiling the first in a series of new models aimed at discerning young buyers in China and Europe.

The 50-50 joint venture established in 2007 by Chery Automobile, China's biggest automaker by sales, and Israel Corp, the largest holding company in its namesake country, is the only Chinese automaker at the show, after China's battery and car maker BYD Co Ltd exhibited its

models at the event in 2010 and 2011.

Qoros is presenting the world premiere of its first production vehicle, a four-door compact car, the Qoros 3 Sedan.

The company is also presenting two concept models the Qoros 3 hybrid and Qoros 3 estate - at the show.

It's been a busy period for the fledgling car company after it prevailed in a legal tussle last week in Switzerland filed by German luxury vehicle producer Audi AG, which claimed the Qoros name violates its right in using the letter Q on vehicles.

A Geneva court ruled

that Audi must pay 15,000 Swiss francs ($15.880) in costs to Qoros and rejected a temporary injunction requested by the German auto giant.

"Debuting our first car at the Geneva Auto Show indicates Qoros' confidence and commitment to producing high quality cars," said Guo Qian, chairman and chief executive of the Changshu, Jiangsu province-based company.

"Being accepted by the European media and customers here, which are among the most critical for cars, will mean real success for Qoros," he added.

Guo said the Qoros 3

sedan has entered pre-production after two years of extensive testing at key locations around the world.

The model will hit the Chinese market in the second half of this year, with the first European sales expected by the end of the year. It is aimed at competing with similar models from Volkswagen and Toyota.

The company will produce the sedan in Changshu with an initial annual production of 150,000 units, rising to 450,000 units a year in future.

"We expect to launch other new model at intervals of six to eight months," said Guo.

The Qoros has been created by an international team with major design input from nine different automotive brands.

Klaus Schmidt, Qoros' executive director for automotive engineering, who joined the company from German giant BMW AG, said: "The Qoros team has had complete control over the design of the vehicles, their branding and the technology involved, without having to make compromises, which has given me a unique opportunity to start from scratch, with a blank sheet of paper."

Guo added that the company, which has its engi-

neering, commercial and purchasing functions based in Shanghai, is also building operations in Munich, Germany and Graz, Austria, "to make Qoros a truly international brand".

He said the basis of its design is quality and styling, combined with safety and fuel economy.

Everything involved in the evolution of the brand has been geared toward making a product that appeals to a modern, metropolitan customer from China and Europe, added Guo.

Monitoring Desk Report SHANGHAI-China's passenger vehicle sales in February dipped 4.7 percent year-on-year, due to fewer working days as a result of the week-long Spring Festival holiday.

However, analysts said taking the holiday out of the equation, February's sales figure is much higher than the same month last year.

China delivered 1,040,495 cars, sports-utility vehicles, multipurpose vehicles and minivans last month, diving 39.1 percent from the previous month, the China Pas-

senger Car Association said. "The total number could not represent the actual situation because of the holidays. In terms of average sales per working day, market performance in February surged 23 percent year-on-year," said Rao Da, the association's secretarygeneral. "We have witnessed a stable recovery of the domestic automobile market since last August," he added.

In the first two months of this year, total sales leapt 21.6 percent year-on-year to 2.76 million vehicles, promising a "good start" for the sector after the market experienced three years of lackluster

growth. "And we expect a high growth rate in March, as the new investment plan made by the authorities will definitely spur domestic consumption confidence and drive vehicle sales," said Rao. In addition, "the three-day Tomb Sweeping Day holiday at the beginning of April, which is perfect for short driving trips, will also bring a sales boom at the end of March", he added.

As China's automobile market, the largest in the world since 2009, has entered a period of lowspeed but healthy development, Rao warned that some small domestic players may face severe

challenges or even bankruptcy in the near future. "In the past years, many local governments worked hard to make the automobile sector a pillar industry in a bid to drive local economic growth, especially when vehicle prices were high due to deficient production capacity," said Rao. However, as the industry catches up with mature markets in Europe and the United States, led by several giant auto groups, but with reasonable single-digit growth, "China will no longer see output shortage problems", said Rao. "Mergers and acquisitions in the industry are welcome, to make

China's automobile sector strong and competitive, not only big in terms of sales," he said.

General Motors, the largest foreign automaker in China in terms of sales, reported this week that its sales in China were down 10.6 percent year-on-year to 215,070 vehicles due to the Spring Festival holiday.

However, with all-time monthly record sales in January, the US automaker's China sales in the first two months totaled 525,835 vehicles, an increase of 7.9 percent year-onyear and a record. Japanese automaker Nissan Motor Co reported a 46 percent year-on-year sales de-

cline in February. "As the Chinese New Year holiday's dates are different between this year and the previous year, it's difficult to compare figures," the company said.

The cumulative figures in the first two months of 2013, down 14.1 percent year-on-year, indicated a steady recovery from the 31.3 percent year-on-year decline between October and December 2012, when tensions were high in the Diaoyu Islands row.

Moreover, Nissan said that sales of the new Teana, one of its flagship models, starting on March 18, will add momentum to this recovery trend.

Geely looks to IP boost in London cab maker deal

Jianghuai Auto to compete overseas with quality Monitoring Desk Report BEIJING-Jianghuai Automobile Co Ltd (JAC) said the company will keep improving the quality of its products and bring satisfactory cars to overseas buyers, said An Jin, chairman of JAC. An said Chinese auto companies cannot compete with low prices any more as the cost of labor, the environment and other costs have all increased in China.

He said his company will now compete with good quality and let their customers know the value of their cars.

In addition to improving quality, An said the company has been setting up maintenance outlets overseas to provide postsale service.

“We will not rush to export, with orders but without a maintenance network, in a country,” An said.

“Without a maintenance network, a Chinese auto company’s presence overseas will not last long,” he said, adding that JAC’s full-service dealerships in South Africa are even better than those in China.

JAC exported 9,673 cars in the first two months of this year, up

38.2 percent year-on-year, according to data released by the company on March 4. An said the company sells about 450,000 autos overseas annually and accounts for 15 percent of its entire revenue. JAC has the largest market share in Brazil and Chile.

An said his company has established cooperation with other Chinese companies that have presence abroad to explore the markets there. He said it would be very hard for a single company to explore the overseas market by country, but the risks will be greatly lowered if related companies cooperate.

Monitoring Desk Report BEIJING-Following its acquisition of Swedish luxury vehicle brand Volvo two years ago, Geely Group has made another strategic transaction that analysts say will bring benefits from intellectual property rights.

Zhejiang-based Geely recently announced it bought Manganese Bronze Holdings, manufacturer of the iconic London black cab, for 11.04 million pounds ($16.7 million), China Intellectual Property News reported.

The acquisition covers all business and core assets of MBH including patents and trademarks as well as a manufacturing plant and equipment.

It also includes MBH's stock of unsold vehicles, according to the announcement.

Geely said it will rebuild the globally known brand while gaining a more robust foundation for technological innovation and brand promotion through MBH's patented technologies.

"I am delighted that Geely has successfully secured the fu-

ture of the London Taxi Company, ensuring the continuing manufacture of a world famous, fully accessible and instantly recognizable vehicle synonymous with London," Boris Johnson, the city's mayor, told media.

After the acquisition, Geely said innovations will focus on research and development of "green" and mid-size cars.

Geely is now a patent giant in China's auto industry with about 14,000 Chinese and international applications, more than 8,000 of which have been granted.

Geely's takeover of Volvo also enlarged the company's patent inventory for safety and environmental protection technologies.

The wide range of intellectual property rings is fueling the company's rapid growth, said Geely.

But it is not the first Chinese carmaker to value IP in an overseas acquisition.

In 2009, Beijing Automotive Industry Holdings Co bought the IP assets of Saab Automobile for $200 million, including whole-vehi-

cle and parts design standards, turbocharged engine designs, gearbox technologies, and test measures and standards.

BAIC brought the assets back to China on two 1,000-gigabyte hard disks and paper documents weighing 3.5 tons.

Overseas mergers and acquisitions in China's auto industry have increased in recent years, and all have a common core value - continuously rising attention to IP, said industry insiders.

Merger and acquisition experts said it illustrates improvements in the capacity of local automakers as well as the quickening pace of the nation's "goingout" policy of international acquisitions. "To learn, digest and absorb the world's advanced technologies is an urgent need for Chinese vehicle producers," said Huang Yonghe, an expert at the China Association of Automobile Manufacturers "China's automakers lag behind their foreign competitors in technological accumulation, so transactions of IP assets is a very good way of narrowing the gap," he added.

Monitoring Desk Report beiJing-the central government will increase financial investment to boost the construction of special nursing homes for rural elderly people, Jiang li, vice-Minister of civil affairs, revealed here. the civil affairs Ministry and the Ministry of Finance will allocate 1 billion yuan ($160.7 million) each year until 2015 for rural areas, and the funding will be mainly used for building more facilities that can enable left-behind senior residents to help take care of each other in rural areas, Jiang said at a news conference during the annual sessions of the top legislature and political advisory body. the funding comes from the revenue of welfare lottery sales, said Jiang, a member of the 12th national committee of the chinese people's political consultative conference. taking care of the elderly in

rural areas has become the most prominent problem facing china, said chen chuanshu, deputy director of the china national committee on aging and an npc deputy. "the problem of supporting senior citizens in rural areas is not about money, but the fact that there is no one by their side to attend to their needs," he said. there were 112 million residents aged 60 or older in countryside at the end of 2012, accounting for 17 percent of china's permanent rural residents, chen said. "a lot of the elderly live on their own, and their grown-up children have moved to cities," he said. this group of senior citizens faces the biggest difficulty. "if they fall ill, no one will know," he said. at present, the government can take care only of senior citizens who cannot work to support themselves and have no children to support them. they live in rural

homes built to provide basic needs for the elderly. "but it is impossible for the government to take care of this group whose children are not by their side, because this group of people is too big in number," he said. wang Suying, deputy head of the ministry's department of social welfare and charity promotion, told china Daily that the construction of facilities is the first step in establishing the social support network for rural elderly. "we have noticed that many villages have become ‘hollow' as the working-age migrant workers have left for cities with their spouses and children but left their old parents in rural areas," she said.

She also pointed to the worrying trend of an increased suicide rate among rural elderly who live on their own and feel overwhelmed by loneliness. "the facilities can create more chances for those old vil-

lagers to mingle with their peers and help each other," she said. wang Ming, a cppcc member who is the director of the ngo Research center at tsinghua university in beijing, said he agreed with premier wen's strategic thinking of establishing the social support network for aging, which was pinpointed in his government work Report.

wang said after in-depth studies on aging in Zhejiang and Jiangsu provinces last year, he realized that even in china's most developed eastern areas the supporting network is yet to be built. "it's not about the government pouring lots of money into building nursing homes for seniors. aging requires joint efforts from the government, enterprises, fam-

ilies and even senior people," he said. the veteran political adviser said that based on the survey results of more than 1,000 questionnaire interviews, about 80 percent of the elderly respondents said they will turn to their children for help if they meet any trouble.