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overnment of China has started taking highly vital intuitive of improving the quality of people's lives. the Chinese government, under the CCP leadership is following the policy of treating everyone equally no matter he lives in remote areas or in the city. Unprecedented urbanization is taking place in China and will continue over decades. It is estimated by the United nations that the rate of China's urbanization has increased 18 percent since 1978 to reach about 51 percent. According to China's official population statistics, by 2020, the urbanization rate is expected to exceed 60 percent. China has lifted over 510 million people out of poverty since 1990, and has seen the proportion of the population living on less than $1.25 a day fall from 60.2 percent in 1990 to 13.1 percent in 2005. the country has achieved the millennium Development Goal target of halving poverty relative to 1990 levels three years before the 2015 deadline. According to the newly launched report by UnDP, China’s HDI increase to 0.699 (up from 0.695 in 2011) sees the country remains above regional and BrICS averages, which come in at 0.683 and 0.655 respectively. It is really a good omen that the Chinese leadership has now started paying maximum attention towards improving the standards of living of its people without any prejudice and is following the policy of treating everyone on the basis of equality. We believe that this is a very health sign of governance and the Chinese leadership has set an amazing example for many regional and global leaders to follow.

Editor Islamabad Office: mail House, Shakeel Chambers 01 Khayban-e-Soharwardy, Islamabad email: editor@ccedigest.com newseditor@ccedigest.com webeditor@ccedigest.com ads@ccedigest.com


in this issue April 15, 21, 2013 04

Cover Story

Opening up on autism BeIJInG-World Autism day was on April 2, and to commemorate the occasion, buildings in Shanghai and Beijing lit up for the cause...

06

New look of Beijing medical staff BeIJInG-100,000 medical staff members from 21 hospitals in Beijing will put on new uniforms from April 2013...

China Unicom adopted WCDMA technology to deploy its 3G network in 2009.


in this issue 09

Equity in urbanization key to human development

Detailed property BEIJING-A month of heated debate, guesswork and worrying has ultimately come to an end with cities across China confirming details of planned property curbs that have loomed large over the market. Beating the buzzer at the approaching deadline, municipalities including Beijing, Shanghai and Chongqing, along with Hefei of Anhui Province and Xiamen of Fujian Province, on Saturday announced precisely how they will implement the central government's regulatory plan set earlier this month. Homeowners who sell will face income tax as high as 20 percent of the profit they make on the transaction. With no firm timeline set for the imposition of the measure, which is designed to cool the red-hot property sector, many are racing to sell....

12

Xi hails ChinaCongo ties as 'model of co-op'

Apple alters policies in China

"We have always respected China and Chinese consumers have always been our priority among priorities"


Society

Opening up on autism

CED Monitoring BeIJInG-World Autism day was on April 2, and to commemorate the occasion, buildings in Shanghai and Beijing lit up for the cause In China, the autism community has reason to cheer as more and more effort is invested to understand more about the condition. one 32-millionYuan ($5.15 billion) project was launched in november last year, by the ministry of Health and the Children's Hospital of Fudan University in Shanghai, to estimate the prevalence of autism in China and create universal protocols for screening and treat04

ment. Since the first reported autism case in the Chinese mainland in 1982 (need to confirm with experts on monday), society's understanding and acceptance of the disorder has been evolving, making life for families with autistic members easier, but still far from ideal. Zhang Zhengwei, a mother to a 20-year-old autistic son in Beijing, finds life now very different from what she imagined it to be. the family's first priority is the safety and happiness of their only child, and her sacrifices are too many to list. Still, Zhang is at peace. "things have been much bet-

ter than in the past," Zhang says. "People know about autism, and, there are a lot of centers offering help." When her son was little, there was still widespread ignorance about autism, Zhang says, and the family did not get an accurate diagnosis until the child was 5 years old. Zhang is not alone. Autism, one of the world's fastest growing developmental disorders, has no cure. the only way to reduce damage is to get children programmatic education and intervention as early as possible, which may help to teach them self-help skills and lessen dis-


ruptive behavior. only one or two decades ago, autistic children in China usually failed to get an early diagnosis. even when parents had their child diagnosed with autism, they were clueless as to how to deal with the situation, because there were few institutes providing education and intervention. Zhang Zhuo, in his 40s and a native of Jiujiang, Jiangxi province, knows this from experience. Within a few months of his son's birth, Zhang Zhuo realized something was wrong. the baby seemed indifferent to his parents' attention, refused eye contact, and showed no signs of language development. Aged 5, the son was diagnosed with a disorder Zhang Zhuo had never heard of. Autism. the diagnosis changed Zhang's life. "the first time I knew what autism meant, I felt as if the sky had fallen on me," Zhang says. He enrolled his son in a costly private institute in Wuhan, Hubei province, and traveled every weekend to see him. In 2004, motivated by the inconvenience of traveling and the economic burden, Zhang established his own training center in Jiujiang, which grew fast. Zhang got help from Star and rain, now one of the most celebrated private autism facilities in China, founded in 1993, by the mother to an autistic son. Zhang Zhuo's success was bittersweet. "Parents like me founded training centers and other facilities. We had no choice. there were no support elsewhere, and we had to help ourselves out," Zhang says. through the relentless effort of parents like Zhang, the situation has changed for the better. Hundreds of facilities for autistic children have sprung up all over China and many local governments now subsidize families of children with autism. the public is also more tolerant and compassionate towards the autistic, Zhang Zhuo says. Fang Jing, mother to a 22year-old autistic son, and founder

of elimautism, an autism facility in Qingdao, Shandong provinc, agrees. "People used to be ignorant of the disease," Fang recalls. "most people blamed the parents for their children's autism." many thought autistic children became that way because their parents spoiled or abused them, or because they did something indecent and fate worked its course. Parents of autistic children were afraid to take them out in public because of the stigma. now, with easy Internet access, and the effort by the government and autism community to spread autism-related knowledge, more and more people know about the disorder. But there is some concern about the number of privately run autism institutes in China. Jia meixiang, one of the most reputable experts in autism diagnosis and intervention in China, says government should be the prime service-provider to autistic people, not society. many private institutes lack sufficient resources and expertise, and may end up doing more harm than good. Besides, with parents willing to pay any cost for their children, this is also fertile ground for fraud, Jia notes. She fells that the government should at least establish strict admission criteria for service

providers, and enforce standards on fees, if it cannot provide the service through a public system, Jia says. It is hoped that the recently launched national survey will help form the foundation of a national database, and enable the government to better support the autistic population, according to Wang Yi, the director of the survey.

05


Society

New look of Beijing medical staff

CED Monitoring BeIJInG-100,000 medical staff members from 21 hospitals in Beijing will put on new uniforms from April 2013. Beijing municipal Administration of Hospitals held an exhibition monday to show 61 new dresses for medical staff, patients and bedding. "Humane care, standardized administration, warmhearted services" is the theme of this event. new uniforms for medical staff are more practical, professional and fitting; patients' dresses have also undergone big changes. For example, puerpera's dress is more suitable for breastfeeding, and child patient's dress becomes colorful. 06


07


Society

Equity in urbanization key to human development

Khalid Malik, the director of Human Development Report Office CED Monitoring BeIJInG-“to improve the quality of people's lives, we must first treat everyone equally no matter he lives in remote areas or in the city�, Khalid malik, the director of Human Development report office said in an interview with media when talking about China’s urbanization. China's urbanization is a far more complex issue since economic growth does not automatically translate into a human development progress. Unprecedented urbanization is taking place in China and will continue over decades. It is estimated by the United nations that the rate of China's urbanization has increased 18 percent since 1978 to reach about 51 percent. According to China's official population statistics, by 2020, the urbanization rate is expected to exceed 60 percent. China has lifted over 510 million people out of poverty since 1990, and has seen the proportion of the population living on less than $1.25 a day fall from 60.2 percent in 1990 to 13.1 percent in 2005. the country has achieved the millennium Development Goal target of halving poverty relative to 1990 levels three years before the 2015 deadline. It is shown in Human Development report 2013 by Un Development Program (UnDP) that 08


China's Human Development Index (HDI) represents a remarkable increase of 72 percent from 0.407 in 1980 although its ranking remains the same at 101 in 187 countries. HDI is a tool introduced by UnDP since 1990 to measure both social and economic development of countries. Urbanization is an inevitable and indispensible part of economic growth. the report suggests China’s education, healthcare and equity have been lagged far behind of its economic development. there is no denying that the overheating urbanization might bring crisis to China. First, employment problem is pushed forward by the influx of people countryside to cities. millions of young people are flocking into cities to pursue higher standard of living which intensifies the shortage of employment. the number of jobs a city can provide is limited; when an increasing amount of people are jobless, the stability of society is at stake. Second, the blind expansion of cities has both damaged the environment and taken over agrarian land. trees have been torn down and grasslands have been paved with cement. With the standard of living rising significantly in China, the number of people who own cars has been soaring dramatically. In some cities like Beijing and Shanghai, emission made the sky looks grey; moreover, traffic congesting is a common phenomenon because of the skyrocketing number of cars in the city. third, the infrastructure construction does not match the growth of population. Health care and social security are not fully covering migrant workers who are making a living in cities. Due to the shortage of good universities, every student in high school has to strive to outperform others in the college entrance examination. Urbanization does not simply mean the increase in the population of city; it is far more complex.

the key message contained in the report that economic growth alone does not automatically translate into human development progress would be seen as a warning for China’s eagerness for quick success and instant benefit in the course of urbanization. therefore, in the next few years’ urbanization, efforts should be made to the transition to service economy. Propoor policies and significant investments in people’s capabilities - through a focus on education, nutrition and health, and employment skills - can expand access to decent work and provide for sustained progress. the Human Development report 2013 by UnDP suggests four important aspects to facilitate a sustainable development for developing countries such as China: enhancing equity, enabling voice and participation, confronting environmental challenges and man-

aging demographic change. According to the newly launched report by UnDP, China’s HDI increase to 0.699 (up from 0.695 in 2011) sees the country remain above regional and BrICS averages, which come in at 0.683 and 0.655 respectively. Among the underlying indicators that comprise HDI, China's life expectancy at birth has increased by 6.7 years since 1980, mean years of schooling by 3.8 years and expected years of schooling by 3.3 years. China’s Gross national Income per capita has increased 1,416 percent since 1980. "over the past decades, countries across the world have been converging towards higher levels of human development, as shown by the HDI," the report says. "All groups and regions have seen notable improvement in all HDI components, with faster progress in low and medium HDI countries. on this basis, the world is becoming less unequal.”

09


Finance

Detailed property curbs announced with local features

BEIJING-A month of heated debate, guesswork and worrying has ultimately come to an end with cities across China confirming details of planned property curbs that have loomed large over the market. Beating the buzzer at the approaching deadline, municipalities including Beijing, Shanghai and Chongqing, along with Hefei of Anhui Province and Xiamen of Fujian Province, on Saturday announced precisely how they will implement the central government's regulatory plan set earlier this month. Homeowners who sell will face income tax as high as 20 percent of the profit they make on the transaction. With no firm timeline set for the imposition of the measure, which is designed to cool the red-hot property sector, many are racing to sell. South China's Guangdong Province was first to detail its implementation of the measures on Tuesday, 10

and the rumor spread that other big cities would publicize curbs on Sunday. All the announcements basically followed the central measures aimed to cool down the abnormally expanded property market, while the specific plans made by individual cities aroused great public interest. Beijing ruled that single adults with a permanent Beijing residence registration, who have not made purchases in the city before, are allowed to buy only one apartment. Shanghai said banks will be banned from giving loans to local residents who are buying a third apartment or more. The two mega-cities both vowed to strictly implement the 20-percent tax on capital gains from property sales. Southwestern municipality Chongqing said the


rate of growth in home prices will be kept slower than per capita income, and pre-sell permits will be suspended in the case of overpriced houses or those with surging prices. Hefei and Xiamen also attached importance to stabilizing home prices and slowing increases to a level citizen can bear. Yin Zhongli, a finance researcher with the Chinese Academy of Social Sciences, spoke highly of the Bei-

jing measures as stricter ways to cool the market and make home and land prices stable. "The measures, except those of Beijing, turned out to be less detailed but just more of the same," A microblogger with the screen name "Yanghongxu" wrote on Sina Weibo, a Chinese Twitter-like microblogging platform. Microblogger "Laoaiguancha," a financial columnist of Sina.com, regarded the measures as still too

mild, sufficient to fulfill the central government's requirements but not to cut down home prices. Famous microblogger "Ren Zhiqiang," president of a real estate company in Beijing, stayed true to form in never missing a chance for online discussion, reiterating his opinions against applying administrative tools to interpose the market. Jia Kang, a researcher with the Ministry of Finance, said the regulations need a clearer definition of how to calculate the property gains from transaction profits.In fact, the situation in Beijing topped all the topics discussed because of its measures to tackle profiteering, with the capital specifically imposing a limit involving marriage. "Caijingwang" borrowed a joke about a couple with permanent Beijing residence registration decid-

ing to divorce on Friday, simply so they could buy another house, only to find their bold move in vain when the measure of "allowing a family with a single adult to have one apartment" was introduced on Saturday. Under the current policy, each Beijing family is entitled to have at most two homes, which has created a "fake divorce" phenomenon every time a regulation on the property market appears. The official Sina Weibo microblog of the People's Daily worried of the "fake divorce" trend in recent weeks that those "divorced" to take advantage of loopholes will have to remarry as soon as possible. However, real estate agents like Zhongyuan and 5i5j both said such a phenomenon was rare, and people investing in real estate are unlikely to choose such complicated and risky way to do so.(Agencies) 11


Finance

Xi hails China-Congo ties as 'model of co-op'

12


"The state visit also serves as an impetus for expanding the scope of the China-Africa relationship" CED Monitoring BrAZZAvILLe- Chinese President Xi Jinping has recently paid a visit to the republic of Congo, making the first State visit to the country by a Chinese President since diplomatic relations were established 49 years ago. "the ties between China and the republic of Congo can be called a model of South-South Cooperation," Xi said in a written statement on his arrival in Brazzaville, the country's capital. Xi said the rapid development of bilateral ties has witnessed fruitful pragmatic cooperation in various dimensions and brought tangible benefits to people of both nations. Later on Friday, he met the President of the republic of Congo, Denis Sassou nguesso. they witnessed the signing of a series of agreements dealing with economics, trade and finance. Xi, who visited russia, tanzania and South Africa on his first foreign trip as president, is on the final leg of his journey. He was scheduled to deliver a speech to parliament in Brazzaville, vice-minister of Foreign Affairs Zhai Jun said. Sassou nguesso told reporters on Wednesday Xi's visit to his country will be historic. Bilateral cooperation is longstanding and the two nations will celebrate the 50th anniversary of their diplomatic ties next year, he said.

Qu Xing, president of the China Institute of International Studies, said the republic of Congo is a relatively less-developed nation among African countries, and Xi's trip there marks far more than major progress for bilateral ties. "the state visit also serves as an impetus for expanding the scope of the China-Africa relationship," Qu said. Liu Guijin, former Chinese special representative on African affairs, said the two countries have an enduring friendship, and Sassou nguesso is a good friend of the Chinese people. Sassou nguesso has made 12 trips to China. "President Xi's trip to the African nations sends a clear signal that China ensures the consistency of its policies toward Africa. China, as a developing country, still puts its ties with developing countries among the priorities of its foreign policies," Liu said. Bilateral trade jumped to $5.08 billion in 2012 from $290 million in 2002, and China has become the republic of Congo's largest trading partner. China's exports to the country are mainly mechanical and electrical equipment, textiles and new technology products, while imports from the African nation are mainly timber and crude oil. Li Anshan, director of the Center for African Studies at Peking University, said Xi's three-stop African tour has comprehensively

covered three symbolic parts of the continent. "tanzania stands for east Africa, South Africa represents the southern part, while the republic of Congo is a symbol of the coastal nations of West Africa," Li said. Guan Jian, Chinese Ambassador to the republic of Congo, said both countries have made remarkable achievements in cooperation on economy and trade, culture, education, healthcare and media, which "have not only facilitated the development of the republic of Congo but also brought benefits to China". "Under the framework of the Forum on China-Africa Cooperation, China will intensify cooperation to improve the livelihoods of the Congolese people and the country's capability in self-development," Ambassador Guan said. China provided aid to the republic of Congo after a weapons depot exploded in Brazzaville in march last year and the African nation donated $1 million to China after the devastating earthquake in Sichuan province in 2008. to further bilateral cultural and educational exchanges, China has opened a Confucius Institute at marien ngouabi University in the republic of Congo. Beijing has been offering college scholarships to Congolese students every year since 1975. (Agencies) 13


It

Apple alters policies in China

CED Monitoring SHANGHAI-Apple CEO Tim Cook apologized to Chinese customers in a statement in Chinese posted on the company's website, denying the company was arrogant and saying it had adjusted some of its after-sales services to meet China's requirements. Apple has been criticized for treating Chinese customers differently from others in a China Central Television program about its iPhone and iPad repair policy on the eve of Consumer Rights Day. The People's Daily published a series of stories criticizing what it said was Apple's arrogant attitude and double standards. In the statement, Cook said Apple had received many comments about its repair and warranty policies in China and had reflected on them. "We are aware that due to insufficient communication, the public holds the idea that Apple is arrogant, disregards or pays little attention to the feedback of consumers," the statement said, according to media reports. "Therefore, we want to express our sincere apology for any 14

concern or misunderstanding arising from the process." "We have always respected China and Chinese consumers have always been our priority among priorities," Cook noted, saying Apple had studied the warranty policies in China with authorities, examined the way it communicated over warranties and reviewed management standards of Apple Authorized Service Providers. The CCTV report said Apple's authorized services centers had declined to replace the backs of iPhones being repaired. Now, according to Cook's statement, Apple will upgrade their repair services for the iPhone 4 and iPhone 4S to use all new parts, including backs, when repairing iPhones from this month. Repaired iPhones will also have another year's free warranty added from the date parts are replaced. Previously, repaired iPhones could only enjoy the remaining days of its warranty or 90 days if the warranty period was less than 90 days, the TV program said. Apple was also said to provide a one-year guarantee for iPads where national policy dic-

tates that all computers and their components should have a twoyear guarantee, the program said. In other adjustments, Apple has provided simple and clear repair and warranty policy instructions on its website and strengthened training for its authorized service suppliers in China. The apology comes after the China Consumer's Association asked Apple to "sincerely apologize" and "correct its problems," Xinhua reported. Complaints about after-sales service accounted for 25.6 percent of 2,170 complaints the association had received about Apple products, the CCA said. Data from iiMedia Research Group showed Apple has only 7.7 percent of China's smartphone market, behind 22.5 percent of Samsung, 10.7 percent of Lenovo and three other domestic brands.


"We have always respected China and Chinese consumers have always been our priority among priorities"

15


It

Mobile messaging apps may be threat to

Facebook

CED Monitoring BeIJInG-that might sound precisely like Facebook, but hundreds of millions of tech-savvy young people have instead turned to a wave of smartphone-based messaging apps that are now sweeping across north America, Asia and europe. the hot apps include Kik and Whatsapp, both products of north American startups, as well as Kakao Inc's Kakaotalk, nHn Corp's LIne and tencent Holdings Ltd's WeChat, which have blossomed in Asian markets. Combining elements of text messaging and social networking, the apps provide a quick-fire way for smartphone users to trade everything from brief texts to flirtatious pictures to Youtube clips — bypassing both the SmS plans offered by wireless carriers and established social networks originally designed as websites. Facebook Inc, with 1 billion users, remains by far the world's most popular website, and its stepped-up focus on mobile has made it the most-used smartphone app as well. Still, across Silicon valley, investors and industry insiders say there is a possibility that the messaging apps could 16

threaten Facebook's dominance over the next few years. the larger ones are even starting to emerge as full-blown "platforms" that can support third-party applications such as games. to be sure, many of those who are using the new messaging apps remain on Facebook, indicating there is little immediate sign of the giant social media company losing its lock on the market. And at a press event this week, the company will unveil news relating to Android, the world's most popular smartphone operating system, which could include a new version of Android with deeper integration of Facebook messaging tools - or possibly even a Facebookbranded phone. But the firms that can take over the messaging world should be able to make some big inroads, investors say. "true interactions are conversational in nature," says rich miner, a partner at Google ventures who invested in San Francisco-based messageme, a new entrant in the messaging market. "more people text and make phone calls than get on to social networks. If one company dominates the replacement of that traffic, then by definition that's very big."

Facebook spokespeople declined to comment for this article, citing this thursday's planned announcement. Facebook's big challenge is reeling back users like Jacob robinson, a 15-year old high school student in newcastle upon tyne in the U.K., who said the Kik messaging app "blew up" among his friends about six months ago. It has remained the most-used app on his Android phone because it is the easiest way for him to send different kinds of multimedia for free, which he estimated he does about 200 times a day. robinson said he trades snapshots of his homework with friends while they stay up late studying for their exams — or not. "We also stay up in bed with our phone all night, just on Youtube searching for funny videos, then you quickly share it with your friends," he added. "It's easy. You can flip in and out of Kik." Facebook "has really started to lose its edge over here," said robinson, who found his interactions on Facebook less interesting than his real-time chats. Waterloo, ontario-based Kik has racked up 40 million users since launching in 2010.


17


It

Silicon valley entrants in the race include Whatsapp, funded by Sequoia Capital, and messageme, launched earlier this month by a group of viral game makers. messageme has received seed-stage funding from true ventures and First round Capital, among others, and claimed 1 million downloads in its first week. meanwhile, Asian companies are producing some of the fastest-growing apps in history. tencent's WeChat boasts 400 million users - far more than twitter, by way of comparison while LIne and Kakaotalk claim 120 million and 80 million users, respectively. Both have laid the groundwork to expand into the U.S. market. the growth in the messaging apps reflect the dramatic shift in Internet usage in recent years, as Web visits via desktop computers have stagnated while smartphone ownership and app downloads have skyrocketed. Chief executive mark Zuckerberg has publicly called Facebook a "mobile company" to emphasize the company's priorities. Last year, he splashed $1 billion for photo-sharing app Instagram, which has remained red hot, while Facebook also launched its own messenger app, offering a suite of smartphone communication tools. Still, Facebook has also been forced to play defense. earlier this year, the company cut off its data integration with a young startup called Snapchat and then mimicked its feature with a new messaging tool called Poke, which sends messages that self-destruct. It has also shut off its integration with messaging apps like messageme and voxer. At the same time, Facebook has also hired graphic artists to draw emoticons and 18

graphics for messenger that emulate features of the wildly popular Asian apps like LIne, according to people with knowledge of the matter. Dave morin, an early Facebook employee who left to found the "private" social network Path in 2010, said he recognized last summer the critical role of messaging functions in smartphone apps, and quickly began working to incorporate them. Since Path released a new version of its app earlier this month, the number of Path's daily users has risen 15 percent, which morin attributed to the new messaging features. "What's the number one reason why people have this thing?" said morin, holding up his iPhone. "It's to call, to text, to communicate." messaging, morin added, is "the basis for the mobile social network." While established social networks move to incorporate messaging features, the newwave messaging apps are looking to grow into social networking platforms that support a variety of features and enable innovations from outside developers. "the tried and true approach for a social network is first you build a network, then you build apps on your own, then you open it up to third party developers," said Charles Hudson, a partner at early stage venture capital firm Softtech vC. the moves mirror Facebook's younger days, when its user growth and revenues were boosted by game publishers like Zynga Inc, which made popular games like Farmville for the Facebook platform. In the South Korean market, for instance, eight of the top ten highest grossing Android apps are games built on top of

Kakaotalk. tencent announced in november that it would introduce a mobile wallet feature enabling payment for goods with WeChat. And tencent also makes money in China by using the app's location data to displaying nearby merchants' deals to potential customers. If the messaging apps reach a certain scale, they could form networks that rival Facebook's "social graph," the network of user connections and activities that enable highly targeted delivery of content and advertising. "the folks on your address book are very different from your Facebook friends and your LinkedIn contacts, and that's a natural place for a very powerful graph to be created," said Jim Goetz, a partner at Sequoia Capital. ted Livingston, the 25-year old chief executive of Kik, said he developed the capability for his service to support external features in november, and he plans to open the platform to outside developers in the near future. Livingston said Kik and Whatsapp were "in a race to see who's the first to build a platform." Whatsapp, which has been the most widely downloaded communication app for both ioS and Android in recent months, according to analysis firm App Annie, has been profitable by selling subscriptions to its service for $1 a year. Although it has remained mum about its platform plans, the company has been rumored to be in talks with Asian game publishers about hosting games, according to news reports in South Korea. Goetz declined to address the reports, saying only that because it relied on a subscription business model, Whatsapp did not need to sell games or ads to make money. Still, he said, the Whatsapp team "spends a lot of time thinking about the developer community."


WeChat dominance attacked CED Monitoring SHANGHAI-As more and more Chinese smartphone owners start to use mobile Internetbased messaging applications instead of short messages and voice calls, local Internet companies are vigorously seeking opportunities to challenge WeChat, the most-used voice-

messaging app in the country. Longmaster Information and Technology Co, an Internet enterprise based in Guiyang, Guizhou province, said it is the first company ready to erode WeChat's marketshare. "WeChat cannot take over the entire market and those who provide differentiated services will thrive and eventu-

ally create as big a user base as Wechat has done," said Wang Wei, chairman and chief executive officer of Longmaster. User numbers of WeChat, known in Chinese as Weixin and developed by global Internet giant Tencent Holdings Ltd, hit 300 million in less than two years since its release, the 19


It

Shenzhen-based company said in January. Earlier this year, Longmaster predicted its Phone Plus, a competing product with WeChat, will generate 100 million users in two years, with the company's market value reaching 50 billion yuan ($8 billion) by 2015. The company was listed on Shenzhen's growth enterprise board, a Nasdaq-style market in China, in February last year. On Friday it stood at 87.2 yuan a share, up 21.2 yuan compared with the beginning of this year. The market cap of Tencent, listed in Hong Kong, was nearly $60 billion earlier this year. On Friday, its shares were listed at HK$247, down from HK$257 at the beginning of this year. "Phone Plus is providing a different user experience compared with WeChat. It combines some key features of Skype and Facebook," said Wang. The "different user experience" includes a traceless messaging system in which messages exchanged only between friends will be automatically deleted after reading. "It's like something used in James Bond movies," said the 41-year-old. How precisely will Wang's

"burn-after-reading" messaging platform really affect WeChat's No 1 position remained unknown as Phone Plus' current user number is currently just a relatively mere 5 million Longmaster expects the number could reach 50 million by the end of this year. Phone Plus' advantage against WeChat has a little to do with user experience. Its developer's long-time partnership with local telecommunications carriers is the real master plan for Phone Plus. Longmaster has always been willing to share its profit with local carriers since its establishment in 1998. The company's most profitable product, a long-distance calling service, was a result of teaming up with local carriers in about 30 provincial level regions across the country. It had joined hands with 45 provincial level telecom carriers as of this year. "I think it was a good idea to surrender part of the profits to telecom companies because such a move ensures they also join the game and are willing to help us push our products," said Wang. Larger Internet companies, such as Tencent, however, are disinclined to let telecom carriers share profits.

WeChat is accused of taking a large amount of telecom carriers' bandwidth resources but failing to increase their profits in return. The number of text messages sent by mobile phone users declined by 10.6 percent year-on-year in the first two months of 2013, a report from the Ministry of Industry and Information Technology showed. The growth rate of messages sent via telecom networks also slowed to 0.7 percent, markedly lower than 5.7 percent in the same period of 2011 and 7.6 percent in 2012, said the report. Industry analysts speculated earlier in March that telecom carriers may charge extra operating fees to WeChat for the app's extensive use of mobile network resources. Looking forward, Wang said Longmaster will focus on research and development and continue to expand its business alongside telecom carriers. The company has a 100-strong R&D force in Beijing and another 200 in Guiyang. The company may also speed its expansion process through mergers and acquisitions, said Wang, adding Phone Plus will enter the overseas market this year, another attempt to boost its user base.

“I think it was a good idea to surrender part of the profits to telecom companies because such a move ensures they also join the game and are willing to help us push our products� 20


21


It

China Unicom to promote

3G smartphones

China Unicom adopted WCDMA technology to deploy its 3G network in 2009. 22


CED Monitoring HonG KonG-China Unicom (Hong Kong) Ltd, the nation's second-largest telecom carrier by subscribers, announced on thursday that all of its future 3G smartphones would support the high-speed mobile network with a download speed of up to 21mbps. the company expects to fulfill the target starting from the second half of this year, said Zhou Youmeng, general manger of China Unicom's marketing department. Currently, almost all the high-end WCDmA 3G flagship smartphones promoted by China Unicom already support the 21mbps network, she said. China Unicom adopted WCDmA technology to deploy its 3G network in 2009. the company is now upgrading the WCDmA network into a faster HSPA plus network, which may reach a download speed of up to 21 mbps. "the next step for China Unicom is to include affordable smartphones costing 1,000 yuan in this class," Zhou said. nokia has already launched the Lumia 520, the first entry-level Windows Phone 8 device supporting China Unicom's high-speed HSPA plus network, indicating that Windows Phone devices had started to enter the 21mbps network era. Before that, Zte and CoolPad, two Chinese mobile phone vendors, released two affordable Android handsets, which were compatible with China Unicom's high-speed network. As of February, China Unicom had 83.5 million 3G subscribers, an increase of 82 percent year-on-year. the company sold more than 21 million WCDmA devices in the first two months of this year, up 87 percent year-on-year. 23


Industry

Boeing delivers

1,000th airplane to China 24


SEATTLE,) – Boeing Company has delivered its 1,000th airplane to China, making the country its first market outside the United States to pass the one-thousand threshold. "This is a very, very big deal for us," Ihssane Mounir, senior vice president of sales and marketing of Boeing Company Northeast Asia told Xinhua at the delivery ceremony. The 1,000th airplane, a Next-Generation 737-800 with the Boeing Sky Interior painted in special peacock livery, will join China Eastern Yunnan Airlines. "We will fly to Yunnan (a province in southwestern China) tomorrow after the delivery," Shi Fukang, general manager of the China Eastern Airlines Yunnan Company said. The Next-Generation 737 uses an advanced system called Head-up Display, which comprises a transparent glass display positioned between the pilot's eye and

flight deck window to show critical information such as airspeed, altitude and attitude, and flight path. China has become one of the world's most dynamic markets for commercial planes. Boeing forecasts that China will need 5,260 new airplanes, valued at about 670 billion U.S. dollars, in the next 20 years. "This year we will be delivering over 170 airplanes to China. This year we increase our delivery to China by 60 percent compared to last year. So if you look at 170 (airplanes) a year and in five or six years, even seven years we will reach the next milestone," Mounir said. Cooperation between Boeing and China's aviation industry traces back to 1916. The first engineer that Bill Boeing hired was China-born Wong Tsoo, who helped design the company's first commercial success -- the Model C bi-wing air-

plane. In 1972, the historic visit by U.S. President Richard Nixon to China led to the introduction of Boeing aircraft to the market. More than 7,000 Boeing airplanes operating throughout the world use major parts and assemblies from China. Chinese suppliers contribute parts and components to every current Boeing commercial airplane model, including 737, 747, 767, 777 and 787. "In fact the airplane behind me has the horizontal stabilizer that was built in China ... We have more than 7,000 airplanes flying with parts and systems built in China," Mounir said. Boeing airplanes comprise more than half of the commercial jetliners operated in China, providing service to more than 20 Chinese airlines. As one of the three major airlines in China, the China Eastern Airlines currently operates the largest 737 fleet among Chinese airlines. 25


Automobile

Geely cars’ sale starts in Belarus 26


MINSK -- Chinese car manufacturer Geely started selling its Belarus-assembled cars in Minsk. The first batch of Belarusian-Chinese cars made by the Borisov- based company BelGee are already available in dealers' stores in Minsk. Set up in 2011, the Belarusian-Chinese joint venture BelDzhi first launched the Geely SC7, a sedan that costs approximately $12,990. "We've chosen a car. After comparing prices and quality, Geely is the best choice," Sergey Lazovskiy, who bought a Geely SC7, told Xinhua. BelGee is owned 50 percent by dumptruck manufacturer BelAZ, 32.5 percent by China's Geely Automobile and 17.5 percent owned by Soyuzavtotekhnologii. Both BelAZ and BATE are state-owned companies. The enterprise can use semi-knocked down kits to assemble 10,000 cars per annum. It employs 57 people. The company plans to market the Belarusian-Chinese cars in Kazakhstan and the European Union in the future.(XINHUA)

27


Automobile

Restyled Cadil China Aut CED Monitoring SHAnGHAI-In an effort to capture a bigger chunk of the country's growing appetite for luxury vehicles, the largest US automaker is putting a trio of Cadillac sedans at the head of its pitch to buyers in China. the redesigned Cadillac CtS that will go into production later this year and Cadillac's AtS and XtS are expected to drive a 50 percent jump in sales of the luxury brand in China, Cadillac brand chief Bob Ferguson said. US Cadillac sales are expected to rise a less robust 32 percent. Ferguson's remarks, made tuesday as Gm unveiled the restyled CtS ahead of the new York International Auto Show, followed his statement in February that he expected Cadillac sales in China to triple to 100,000 by 2015. Boosting Cadillac's standing in China has been one of Ferguson's goals since taking over as brand chief in october. the restyling of the CtS into a larger, more dramatically styled, and far more powerful vehicle reflects

28

Gm's effort to win over the Chinese luxury vehicle buyer, who currently tends to favor German brands BmW, Audi and mercedes-Benz. Ferguson has said he believes Chinese car buyers will embrace American luxury. "I think some people intuitively felt the way to sell Cadillacs there is somehow to make Cadillac have more of a Chinese aura," he told the Detroit Free Press in February. "In fact, I think we're learning the opposite, which is that they're interested in the product because it is American luxury." With more than 200 dealerships in China, Cadil-

lac is on pace to sell 45,000 to 50,000 cars in China this year, compared with more than 187,000 US sales, Gm said. the automaker, which is vying with Germany's volkswagen AG for the title of largest foreign automaker in China, plans to start making its smaller, entry-level AtS in China later this year. Production of the XtS at a Shanghai plant started in February. David Zoia, editorial director of WardsAuto, an automo-


lac CTS to aim to market bile information website, said Gm is on the right track in its bid to win over luxury vehicle buyers in China by offering a restyled version of the CtS. "no matter what market you're talking about, new product typically is what drives sales growth," Zoia said in an interview. "the China market continues to grow at a relatively healthy rate, a n d

sales of luxury models, in particular, are expanding," Zoia said. "With its new AtS and XtS models and an even more competitive CtS on the way, Cadillac appears well positioned to take advantage of that," Zoia said. In February, Gm reported an 8.1 percent rise in Cadillac sales from a year earlier, helped by surging sales of its SrX luxury utility vehicle. those results followed a study by global management consulting firm mcKinsey & Co, predicting that China's economic boom puts it on track to become t h e

world's second-largest luxuryvehicle market by 2016 and the market leader by 2020. mcKinsey projects deliveries to China of luxury cars - defined as priced at $50,000 and up - should reach 2.25 million by 2016 in China, surging to 3 million by 2020. By comparison, luxury car sales in China totaled 675,000 in China last year, representing 5 percent of overall passenger vehicle sales. meanwhile, volkswagen, Gm's chief rival in China, is stepping up its assault on the Chinese market. two weeks ago, Ceo martin Winterkorn said that over the next five years, vW would build new plants and increase production capacity in China to meet demand. Winterkorn said vW would build "a minimum" of 10 additional plants, including seven in China. "We will be increasing our production capacity in China to more than four million vehicles a year - in line with the boom in demand there - in the period to 2018," the Ceo said.

29


Automobile

Chengdu gears up to become auto industry hub

CED Monitoring CHenGDU-Chen Xiaoming doesn't want the name of either of the world's most famous automobile cities tied to Chengdu, Sichuan province. "We want to make Chengdu a unique internati ona l a utomob i l e hub i n our own way," said Chen, deputy officer of the auto industry department of Chengdu economic Development Zone. though many Chinese cities - including Changchun in Jilin province, Wuhu in Anhui province, and Shanghai - have 30

made huge efforts and investment in the competition to be the center of China's automobile industry, Chengdu was the first to establish an independent promotion commission specifically for the automobile industry. Five years on, it remains the only such commission in China. the latest figures show that total output last year in the Chengdu economic Development Zone reached 375,000 vehicles, 1.4 times the number the year before, creating revenue of 105 billion Yuan ($16.9 billion) and taxes of 17.1 billion Yuan, surging 67.5 percent and 33

percent year-on-year respectively. this is a dramatic increase from 2011, when only 150,000 vehicles were produced in the city, contributing total revenue of 55 billion Yuan. the city's target for 2013 is to produce 600,000 units with an annual growth of 64 percent year-on-year. the actual output is expected to be 650,000 units, according to the current growth rate. When the local government set up the special promotion commission for the automotive industry in 2008, volkswagen's flagship model


Jetta rolled off the production line with an annual output of only 40,000 units in the Chengdu zone. In 2009, FAW-volkwagen initiated the second phase of its sedan production program in Chengdu, when the State Council approved the city as the automobile manufacturing base. In January 2013, the third phase of FAW-volkswagen's Chengdu factory was complete, and is now in full operation. every 60 seconds, a brand-new vehicle rolls off the a s s emb l y l i ne i n the fa c tory . As the second production base for FAW-volkswagen after its headquarters in Changchun, Chengdu has attracted a total investment of 16.3 billion Yuan from FAW-volkswagen. the annul output of FAWvolkswagen's factory in Chengdu also increased from 50,000 units in the beginning to 250,000 units in 2012. A few kilometers from FAWvolkswagen's Chengdu manufacturing base, volvo Cars' local facility is another important indicator of the fast development of Chengdu's auto industry. In 2011, volvo Cars China Group announced it would build its first localized plant in Chengdu, following Chinese homegrown automaker Zhejiang Geely Holding Group's takeover of the Swedish luxury brand. By end of 2012, the four workshops in volvo Cars' Chengdu factory were complete and had already started localization of volvo S60L models in China. the first volvo model produced in Chengdu has been sent to europe for testing, and will be ready for mass production this year. there are currently 10 vehi-

cle manufacturing factories and seven engine plants located in Chengdu. Another four vehicle manufacturing factories are a b out to b e comp l eted a nd put into production within the y ea r. In addition to vehicle production facilities, having a complete supply chain is also key to a strong and sustainable automobile industry. In Feb 2012, the world's top automobile parts supplier, robert Bosch GmbH, laid the foundation in Chengdu for its chassis manufacturing plant. It has been reported that Delphi Corp, Bosch's main competitor, is expected to run its business in Chengdu soon. According to Chen Yudong, president of Bosch (China) Investment, Chengdu is one of the German company's most important strategic manufacturing bases in China, where the company also set up two production facilities for packaging technology and power tools. moreover, in october, the company opened its Communication Center in Chengdu. the call center expands Bosch's international network and provides support to its clients in China. "our moves in Chengdu are in line with the Chinese government's 'go west' strategy, with the hope it will bring more investment and job opportunities to Chengdu," Chen said. "Compared with other cities, Chengdu has competitive edges in its talent and business environment, which the local government put a lot of effort in to improve," he told China Daily. "Last and most importantly, Chengdu's strong commitment to becoming China's automobile hub and even an international auto city has attracted

many vehicle oems to set up their production facilities. As a parts supplier to the automotive industry, it's important for Bosch to develop together with our clients here in Chengdu," Chen added. According to its plan, the Chengdu economic Development Zone hopes to have a production capacity of 1.4 million units of vehicles in 2015 and realize an annual output of 900,000 units. In order to realize its ambition, the Chengdu economic Development Zone plans three specific phases. the first is helping promote the current vehicle factories to reach its production capacity, introducing key auto parts manufacturers so as to expand the auto industry in a fast and efficient way. the original plan to have an annual production capacity of 1 million units is already complete. Future targets include revenue of 390 billion Yuan from the auto industry and a GDP of 105 billion Yuan by 2015. From 2016 to 2020, the Chengdu economic Development Zone plans to promote a new-energy auto industry, an auto electronics industry and an auto service industry while further expanding the scale of its whole vehicle manufacturing industry. By then, the zone plans to manufacture 1.25 million units vehicles a year, as well as generate a revenue of 900 billion Yuan with a GDP of 226 billion Yuan. moreover, Chengdu hopes to turn tianfu new City, which contains Chengdu economic Development Zone, into an international model district not only for business, but also for residents, with modern manufacturing industries and a highend service sector. 31


Automobile

plate License rule easy to bypass

32


CED Monitoring BeIJInG-A new government policy to hold down the price of second-hand license plates will face challenges from scalpers and car owners who have already figured out how to circumvent the rules, experts told the media. to control the number of cars on the road, the municipal government requires new car owners to bid for a new set of license plates at a monthly auction. otherwise, they have to turn to the secondhand market, where they can pay another vehicle owner for his or her plates. the municipal government implemented a regulation Saturday that capped the price that license plate owners can charge to transfer ownership of their plates, according to a report in the Shanghai morning Post. the regulation stipulated that car owners couldn't charge a price that exceeded the average bid price at the most recent auction for new license plates. the average bid price at the march auction on Saturday rose to an all-time high of 91,898 Yuan ($14,791), an increase of 8,327 Yuan over the previous month, the report said. the problem with the new regulation is that the government has no way of knowing for sure how much a set of secondhand license plates actually sells for, according to Gao Shen, an automobile industry consultant. It's true that the buyer and seller have to disclose the transaction price when they go to transfer the plate registration. But there is nothing stopping the buyer from handing over an amount of cash larger than what ends up written on the official paperwork, Gao said.

the price cap was one of four measures that the Shanghai municipal transport and Port Authority proposed in 2012 to curb the skyrocketing price of license plates. the other measures included increasing the number of plates up for bid each month and prohibiting plate owners from transferring ownership of the license plates to another party for three years. the municipal transportation authority is now considering other measures to keep license plate prices in check, including only allowing new car

buyers to participate in the monthly license plate auction, according to the report. Still, the measures do not address the root cause of the price increase - surging demand for cars, said Li Keping, a professor of traffic engineering at tongji University. Li supports restricting the use of private cars through higher purchase fees and parking charges. Gao suggested that half of the license plates up for auction each month should be given away through a lottery system, which cities like Beijing have done. 33


Construction

Cities urged to step up drainage

improvements

34


“Cities have emphasized construction above road level in the past. It is now urgent to intensify the building of efficient underground infrastructure too, including drainage systems” CeD monitoring BeIJInG-the State Council has issued a notice urging cities to step up the construction of drainage networks to prevent flooding during the country's traditional rainy season. the notice said cities should complete a plan to carry out necessary work before the end of 2014, and that the building of functional systems should be completed within 10 years. they are also required to submit updates on any work being done to separate rainfall from sewage within five years, it said. Cities should identify any potential dangers in their networks before this year's rainy season — which runs normally from may to october — to avoid casualties and property loss, it said. Specifically, the notice requires governments to collect information on surface runoff, drainage facilities and water storage. Designs should include drainage and flood-prevention plans that take into account local rainfall records and any potential risks that rainstorms could trigger. Any construction of a drainage system should be arranged to minimize the ecological effects on local water supplies. the notice requires authorities to increase investment, improve law enforcement and

establish contingency mechanisms. It also demands that flood prevention work should be included in future government performance evaluations, and requires the replacement of roads which do not have high water permeability. Xie Yingxia, the deputy director of the Institute of Urban Water and engineering under the China Academy of Urban Planning and Design, said flooding is very common in Chinese cities during the rainy season, and that the deadly floods that happened in Beijing last summer had emphasized the importance of updating drainage systems. torrential rain in July triggered floods in the capital that killed 77 people, and affected 1.9 million. Poor drainage systems were largely blamed for the disaster. "Cities have emphasized construction above road level in the past. It is now urgent to intensify the building of efficient underground infrastructure too, including drainage systems," Xie said. She said building functional drainage systems will be complicated, especially in big cities. State Council plans of this scale normally take two years to complete a blueprint and another seven to eight years to implement, she said. Some provinces, such as Jiangsu and Anhui, started

making plans in 2011, Xie said. "the national plan reveals the central government's determination to tackle flooding problems brought about by rapid urbanization," she said. Xie said the update of drainage networks that separate rainfall from sewage may take longer because in many places there is only one underground canal, which carries rainfall together with sewage to sewage disposal plants. In some cities, rainfall directly runs into rivers and is wasted, she said. Xie believes it would be effective to build roads with high water permeability to help mediate water logging. rainfall collection systems could be built under parking lots, squares and sports venues to store water, she suggested. Yang Hongshan, an urban planning expert at renmin University of China, praised the inclusion of drainage construction in overall city planning. He said that governments have often been too politically driven and real estate developers have focused too heavily on profit, without taking urban development into account, he said. the central government's notice would guarantee the investment of construction of drainage systems when developing land, said Yang. "to some extent it's the government's self-correction in this matter." 35


Construction

CHiNA M

blueprint to harn

36


MApS OUT

ness Yellow River

37


Construction

ZHenGZHoU-- China will build three more large-scale reservoirs on the troublesome Yellow river, the nation's second-longest river, after authorities gave a green light to a harnessing plan earlier this month. After six years of programming, the State Council, or China's cabinet, has approved the Comprehensive Plan for the Yellow river Basin (2012-2030), focusing on solving the problems of the Yellow river from now to 2030. According to the plan, the three new reservoirs will be Heishanxia, Qikou and Guxian. the Guxian reservoir is expected to be completed around 2020. the Qikou reservoir will be built after Guxian and construction plans for the Heishanxia reservoir are still in the making. the newly approved plan will mainly focus on water and silt control, flood prevention, water and soil erosion prevention, water resource allocation and utilization, water resource and water ecology protection and the drainage areas' comprehensive management. the further development of the Yellow river, as well as programs for irrigation and shipping, are also part of the plan. the Yellow river, known as China's "mother river" and the cradle of early Chinese civilization, runs through nine provinces and autonomous regions and empties into the Bohai Sea in east China's Shandong Province. With a length of 5,464 km, the Yellow river waters 12 percent of China's 1.3 billion population, 15 percent of its farmland and generates about 38

14 percent of its GDP. "the Yellow river lacks water resources and the water supply obtained from the river at present is beyond its capacity," said Chen Xiaojiang, director of the Yellow river Conservancy Commission of the ministry of Water resources. Statistics show that nearly 160 million tones of sand is washed into the Yellow river each year. records have shown that the Yellow river dried up frequently between the 1970s and 1990s. In 1997, statistics from a hydrological station indicated that a 704-km section of river had dried up for 226 days. the government, experts and other relevant organizations have taken action since 1999 to prolong the life of the river. "the key to bringing the river under control is to control its water and sand," said Chen. the development, protection and management of the Yellow river will have strategic significance for the promotion of China's sustainable development and environmental protection efforts, Chen added. Because of excessive exploitation and a rapidly growing population in the past, the river has been plagued by droughts, water and soil erosion disasters in its middle and upper reaches, as well as sediment, floods and a rising riverbed caused by heavy silt in its lower reaches. So far, four water reservoirs have been built on the main stream of the river. ocated on the upper reaches of the river, the Longyangxia and Liujiaxia

reservoirs have helped to improve water management and electricity production, as well as reduce the number of icerelated natural disasters, on a section of river stretching between the ningxia Hui and Inner mongolia autonomous regions. However, a shrinking riverbed and increasing silt in recent years have exerted a negative impact on flood relief efforts. the establishment of the Heishanxia reservoir will help the two overburdened reservoirs regulate water and silt in the upstream section of river. the Guxian and Qikou res erv oi rs w i l l extend the l i fe of the previously built Xia ol a ngd i res erv oi r a nd w ork with it to control sand and provide water for industries, ci ti es , tow ns a nd a gri cul ture in the middle section, as well as ensure safety in the downs trea m ri v er s ecti on. All three reservoirs will help to relieve the burden on the Sanmenxia reservoir, the first to be built in the river's downstream area. the reservoir has played an important role in protecting the lives and property of people in the provinces of Hebei, Henan, Shandong, Anhui and Jiangsu. Another two reservoirs, the Haibowan and Hekoucun reservoirs, are under construction. the Dongzhong reservoir, which is still being planned, will help form water and sand control system for the river. the reservoirs are expected to reduce the amount of silt washed into the river by half to 80 million tones by 2030, as well as prevent water levels from rising.(XInHUA)


Records have shown that the Yellow River dried up frequently between the 1970s and 1990s

39


Construction

China Railway’s

net profits up by 9.9 %

40


BeIJInG-- China railway Group Limited (China railway), the listed subsidiary of the China railway engineering Corporation, announced that its net profits surged 9.94 percent year on year in 2012 thanks to increasing orders. the Beijing-based company, whose parent company is China's largest civil construction company directly supervised by the cabinet, saw its net profits, rise 9.94 percent year on year to 7.35 billion Yuan (1.17 billion U.S. dollars), according to its annual report filed with the Shanghai Stock exchange. the company's total business revenues increased 5 percent to 482.69 billion Yuan, with basic earnings per share up 12.9 percent to 0.35 Yuan, the company said. the value of the company's total assets amounted to 550.73 billion Yuan, an increase of 17.49 percent from the previous year. China railway attributed its rising revenues to growing new orders and the timely completion of its projects. the new contracts the company signed in 2012 were valued at 731 billion Yuan, up 28.1 percent year on year, according to the annual report. Industry insiders said robust fixed-asset investment in railways during the second half of last year greatly improved the company's performance from the first half, when its net profits dipped 2.18 percent year on year. During the second half, the now-defunct ministry of railways raised the sector's yearly target for fixed asset investment three times. In December alone, the railway sector received a total fixed asset investment of 124 billion Yuan, according to calculations done by the Shanghai Securities news based on ministry data. China railway predicted it will earn 455.3 billion Yuan of operating revenues in 2013, buoyed by the recovering economy and favorable policies, including a strong urbanization drive.(Agencies) 41


Construction

42


The 4,211-meter cableway to the west peak of Mount Huashan was put into trial operation on Monday after four years' construction. There are two cableways on Mount Huashan so far, one to the west peak and the other to the north peak. 43


real estate

Beijing, Shanghai announce detailed property curbs

real estate

44


BeIJInG-Li Yu, a 27-year-old while collar, said most single adults who have a proper job cannot afford to buy a house in Beijing. the average price of Beijing's used house reached 25,475 Yuan (4,101 U.S. dollars) per square meter by the ďŹ rst half of January, according to a survey done by Bacic5j5j Group. Like many of her colleagues, Li rushed to buy a house this month before property curb measures were detailed. on march 22, She bought a 57-squaremeter house near Beijing's Second ring road for 2.15 million Yuan. "even the tax was as high as 100,000 Yuan," said Li. "I don't think the rules can impose any restrictions on those who have two or more houses. And those who in need of a house still cannot afford one," she said. Li Wenjie, director of Beijing real estate Agent Association, said the rules may be effective in the short term, but increasing land supply and collecting property tax from house owners can yield better result. "the purchase limit policy will not last forever. It should be replaced by long-term effective measures," said economist ma Guangyuan. Shanghai said besides enforcing the capital gains tax, it would apply greater scrutiny to borrowers who come from other cities, or are foreign or divorced. Beijing said those who provide fabricated materials to buy apartments will not be registered for property ownership and will be banned from buying apartments in Beijing within 5 years. the rules came after the central government rolled out a plan on march 1 to tighten control over the property market amid expectations of rising housing prices. Among the measures, the central government announced a new capital gains tax of 20 percent on used home transactions, a move that has triggered widespread panic among both buyers and sellers. the new tax replaces the previous transaction tax of 1 to 2 percent of the ďŹ nal sale price. the property market, particularly the used house sector, has since seen a large number of transactions amid worries that the new tax will push housing prices even higher. "the curbing policies are designed to optimize the allocation of housing resources," said Chen Zhiwu, secretary general of the Beijing real estate Association. the impact of buying control and differentiated credit policy will be limited but it will help stabilize the market expectation, said Zhang Dawei, chief market analyst with Beijing-based Zhongyuan real estate. 45


real estate

plans devised to cool housing sector 46


CED Monitoring BeIJInG-the Guangdong provincial government has unveiled rules to curb rising housing prices, and promised to strictly enforce the country's new 20 percent income tax on home sellers' capital gains. early this year, the State Council, or China's cabinet, announced that property owners who sell their homes will have to pay an income tax equivalent to 20 percent of the profit they make on the transaction. the income tax for such sales is currently 1 to 2 percent of the sale price. the new measure is intended to cool the property market. According to a notice issued by the

Guangdong provincial government late monday night, all Guangdong cities are required to introduce their own specific measures to help bring rising property prices to reasonable levels while strictly enforcing the central government's policies on curbing real estate prices. Guangdong's major cities - Shenzhen, Zhuhai and Foshan - are required to make public their targets and specific rules on curbing home prices before the end of

march. meanwhile every city is asked to speed up construction of affordable houses for lowincome families, the notice said. Guangdong will complete construction of at least 116,000 affordable apartments in 2013, with construction of another 78,400 to be under way. those officials who fail this year to bring their cities' property prices to reasonable levels and to construct affordable houses will be held accountable, the notice said. Guangdong has become the first province to introduce specific rules on curbing property prices in the mainland after the State Council announced the new capital gains tax. Chen rugui, executive vice-mayor of Guangzhou, said the increase of property prices in Guangdong's provincial capital will not be more than the city's gross domestic product growth rate this year. the GDP growth rate this year is projected to be about 8 percent. the average price of properties in the southern metropolis was about 14,000 Yuan ($2,250) a square meter last year, up 14 percent year-on-year. Guangzhou's property price witnessed another 14 percent growth in January and February, with the highest price coming to more than 30,000 Yuan a square meter in the city's busy downtown areas, Chen said. He urged city departments to introduce measures to help achieve the goal of cooling the local property market. Peng Peng, a senior researcher with the Guangzhou Academy of Social Sciences, said local cities still have to introduce more detailed rules to help curb soaring property prices while strictly implementing the central government's capital gains tax. "the tax is not a complete cure to the soaring property market," he said. Peng urged the introduction of a house tax to help fight property speculation. Han Shitong, a local property expert, said he found nothing new in Guangdong's specific rules. "Guangdong's specific rules only repeated and reaffirmed the central government's measures in cooling the real estate market," he told local media. many residents are waiting to see what the coming months hold before they decide to buy real estate. "I really do not know whether the prop47


real estate

erty price in Guangzhou will go down, or not, when the provincial government introduces the specific rules on curbing home prices," said Wang Hongwei, a

48

white-collar worker in Guangzhou. "I will wait for several months when the property prices have become somewhat

stable before I buy an apartment," said the 30-year-old, now working in a logistics company in Guangzhou's tianhe district.

Cash China Economic 31  

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