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China Is Number One Exporter to the World


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Guest Schmidt

CHINA'S INVESTMENTS IN AMERICAN COMPANIES

 

COMPANY CONFORMED NAME: CHINA INVESTMENT CORP

 

BUSINESS ADDRESS:

STREET 1: NEW POLY PLAZA

STREET 2: NO. 1 CHAOYANGMEN BEIDAJIE, DONGCHENG

CITY: BEIJING

STATE: F4

ZIP: 100010

BUSINESS PHONE: 86 10 64086277

 

MAIL ADDRESS:

STREET 1: NEW POLY PLAZA

STREET 2: NO. 1 CHAOYANGMEN BEIDAJIE, DONGCHENG

CITY: BEIJING

STATE: F4

ZIP: 100010

 

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

 

Report for the Calendar Year or Quarter Ended: December 31, 2009

 

Institutional Investment Manager Filing this Report:

 

China Investment Corporation

New Poly Plaza

No. 1 Chaoyangmen Beidajie

Dongcheng

Beijing 100010

People's Republic of China

 

 

NAME OF ISSUER TITLE OF CLASS CUSIP (x$1000) PRN AMT PRN CALL DISCRETION MANAGER SOLE SHARED NONE

-------------- --------------- --------- --------- ----------- --- ---- ---------- --------

 

Abbott Labs COM 002824100 2,700 50,000 SH SOLE 50,000 0 0

Aetna Inc New COM 00817Y108 3,170 100,000 SH SOLE 100,000 0 0

American Eagle

Outfitters NE COM 02553E106 3,396 200,000 SH SOLE 200,000 0 0

American Intl Group

Inc UNIT 99/99/9999 026874115 11,330 1,000,000 SH SOLE 0 0 1,000,000

American Intl Group

Inc COM NEW 026874784 2,998 100,000 SH SOLE 100,000 0 0

AMR Corp COM 001765106 2,324 300,700 SH SOLE 300,700 0 0

Anadarko Pete Corp COM 032511107 6,242 100,000 SH SOLE 100,000 0 0

Anglogold Ashanti Ltd SPONSORED ADR 035128206 4,018 100,000 SH SOLE 100,000 0 0

Apple Inc COM 037833100 6,326 30,000 SH SOLE 30,000 0 0

Arcelormittal SA

Luxembourg NY REGISTRY SH 03938L104 9,150 200,000 SH SOLE 200,000 0 0

A123 Sys Inc COM 03739T108 3,478 155,000 SH SOLE 155,000 0 0

Bank of America

Corporation UNIT 99/99/9999 060505419 19,888 1,333,000 SH SOLE 1,333,000 0 0

Blackrock Inc COM 09247X101 713,805 3,074,094 SH SOLE 3,074,094 0 0

Burlington Northn

Santa Fe C COM 12189T104 4,931 50,000 SH SOLE 50,000 0 0

Chesapeake Energy Corp COM 165167107 5,176 200,000 SH SOLE 200,000 0 0

Citigroup Inc COM 172967101 29,790 9,000,000 SH SOLE 9,000,000 0 0

Coca Cola Co COM 191216100 9,012 158,100 SH SOLE 158,100 0 0

Comerica Inc COM 200340107 2,957 100,000 SH SOLE 100,000 0 0

CSX Corp COM 126408103 1,455 30,000 SH SOLE 30,000 0 0

Cummins Inc COM 231021106 4,586 100,000 SH SOLE 100,000 0 0

D R Horton Inc COM 23331A109 2,436 224,100 SH SOLE 224,100 0 0

Expeditors Intl Wash

Inc COM 302130109 421 12,125 SH SOLE 12,125 0 0

Fidelity National

Financial CL A 31620R105 2,692 200,000 SH SOLE 200,000 0 0

Freeport-McMoran

Copper & Go COM 35671D857 4,736 58,991 SH SOLE 58,991 0 0

Gold Fields Ltd New SPONSORED ADR 38059T106 4,589 350,000 SH SOLE 350,000 0 0

Goodyear Tire & Rubr

Co COM 382550101 1,410 100,000 SH SOLE 100,000 0 0

Hartford Finl Svcs

Group Inc COM 416515104 4,652 200,000 SH SOLE 200,000 0 0

Health Net Inc COM 42222G108 2,329 100,000 SH SOLE 100,000 0 0

Ingersoll-Rand PLC SHS G47791101 6,147 172,000 SH SOLE 172,000 0 0

iShares Inc MSCI JAPAN 464286848 58,440 6,000,000 SH SOLE 6,000,000 0 0

iShares TR Index FTSE XNHUA IDX 464287184 105,675 2,500,000 SH SOLE 2,500,000 0 0

iShares TR Index MSCI EMERG MKT 464287234 186,750 4,500,000 SH SOLE 4,500,000 0 0

iShares TR Index MSCI EAFE IDX 464287465 207,375 3,750,000 SH SOLE 3,750,000 0 0

iShares TR Index RUSSELL 2000 464287655 108,955 1,750,000 SH SOLE 1,750,000 0 0

 

iShares TR Index S&P GBL ENER 464287341 106,862 2,995,000 SH SOLE 2,995,000 0 0

iShares TR S&P GLB MTRLS 464288695 254,293 4,087,000 SH SOLE 4,087,000 0 0

Johnson & Johnson COM 478160104 9,339 145,000 SH SOLE 145,000 0 0

Kar Auction Svcs Inc COM 48238T109 6,640 481,500 SH SOLE 481,500 0 0

Keycorp New COM 493267108 1,110 200,000 SH SOLE 200,000 0 0

Kinross Gold Corp COM NO PAR 496902404 4,600 250,000 SH SOLE 250,000 0 0

KLA-Tencor Corp COM 482480100 2,518 69,626 SH SOLE 69,626 0 0

Lilly Eli & Co COM 532457108 3,571 100,000 SH SOLE 100,000 0 0

Lincoln Natl Corp Ind COM 534187109 5,125 206,000 SH SOLE 206,000 0 0

Market Vectors ETF TR GOLD MINER ETF 57060U100 116,357 2,518,000 SH SOLE 2,518,000 0 0

MEMC Electr Matls Inc COM 552715104 1,362 100,000 SH SOLE 100,000 0 0

Merck & Co Inc New COM 58933Y105 7,308 200,000 SH SOLE 200,000 0 0

Metlife Inc COM 59156R108 2,298 65,000 SH SOLE 65,000 0 0

Morgan Stanley COM NEW 617446448 1,772,761 59,890,576 SH SOLE 59,890,576 0 0

Motorola Inc COM 620076109 3,880 500,000 SH SOLE 500,000 0 0

Navistar Intl Corp New COM 63934E108 7,730 200,000 SH SOLE 200,000 0 0

News Corp CL A 65248E104 4,107 300,000 SH SOLE 300,000 0 0

New York Cmnty

Bancorp Inc COM 649445103 4,353 300,000 SH SOLE 300,000 0 0

Noble Corporation BAAR NAMEN- AKT H5833N103 4,070 100,000 SH SOLE 100,000 0 0

Pfizer Inc COM 717081103 2,821 155,100 SH SOLE 155,100 0 0

Potash Corp Sask Inc COM 73755L107 5,425 50,000 SH SOLE 50,000 0 0

Powershares QQQ Trust UNIT SER1 73935A104 137,760 3,000,000 SH SOLE 3,000,000 0 0

Precision Castparts

Corp COM 740189105 2,594 23,509 SH SOLE 23,509 0 0

Pulte Homes Inc COM 745867101 3,000 300,000 SH SOLE 300,000 0 0

Research in Motion Ltd COM 760975102 1,013 15,000 SH SOLE 15,000 0 0

Select Sector SPDR TR SBI CONS DISCR 81369Y407 89,310 3,000,000 SH SOLE 3,000,000 0 0

Select Sector SPDR TR SBI CONS STPLS 81369Y308 52,940 2,000,000 SH SOLE 2,000,000 0 0

Select Sector SPDR TR SBI HEALTHCARE 81369Y209 93,240 3,000,000 SH SOLE 3,000,000 0 0

Select Sector SPDR TR SBI INT-ENERGY 81369Y506 235,446 4,129,901 SH SOLE 4,129,901 0 0

Select Sector SPDR TR SBI INT- FINL 81369Y605 129,510 9,000,000 SH SOLE 9,000,000 0 0

Select Sector SPDR TR SBI INT-INDS 81369Y704 97,265 3,500,000 SH SOLE 3,500,000 0 0

Select Sector SPDR TR SBI MATERIALS 81369Y100 82,500 2,500,000 SH SOLE 2,500,000 0 0

Smith Intl Inc COM 832110100 5,434 200,000 SH SOLE 200,000 0 0

Shanda Games Ltd SP ADR REPTG A 81941U105 1,529 150,000 SH SOLE 150,000 0 0

SPDR Gold Trust GOLD SHS 78463V107 155,600 1,450,000 SH SOLE 1,450,000 0 0

SPDR Series Trust S&P OILGAS EXP 78464A730 4,121 100,000 SH SOLE 100,000 0 0

SPDR TR UNIT SER 1 78462F103 139,300 1,250,000 SH SOLE 1,250,000 0 0

Sprint Nextel Corp COM SER 1 852061100 1,468 401,100 SH SOLE 401,100 0 0

Teck Resources Ltd. CL B 878742204 3,542,617 101,304,474 SH SOLE 101,304,474 0 0

Terex Corp New COM 880779103 4,796 242,100 SH SOLE 242,100 0 0

Tesoro Corp COM 881609101 2,710 200,000 SH SOLE 200,000 0 0

Textron Inc COM 883203101 5,643 300,000 SH SOLE 300,000 0 0

UnitedHealth Group Inc COM 91324P102 3,048 100,000 SH SOLE 100,000 0 0

United States Oil

Fund LP UNITS 91232N108 78,560 2,000,000 SH SOLE 2,000,000 0 0

Valero Energy Corp New COM 91913Y100 1,675 100,000 SH SOLE 100,000 0 0

Vales S A ADR 91912E105 200,207 6,896,562 SH SOLE 6,896,562 0 0

Vales S A ADR REPSTG PFD 91912E204 297,840 12,000,000 SH SOLE 12,000,000 0 0

Visa Inc COM CL A 92826C839 353,815 4,045,455 SH SOLE 4,045,455 0 0

Weatherford

International LT REG H27013103 3,582 200,000 SH SOLE 200,000 0 0

Wells Fargo & Co New COM 949746101 31,039 1,150,000 SH SOLE 1,150,000 0 0

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Guest Good Thoughts

http://www2.goldmansachs.com/citizenship/philanthropy/publications-and-resources/gsf-annual-reports/2003-annual-report.pdf

 

World Links

 

With a rapidly growing economy and more than 100 million students, the Chinese government is reexamining the country’s curriculum and educational approach. In a step toward more interactive, student centered learning, the country has invested heavily in outfitting schools with updated technology and Internet connectivity. This effort is complemented by an official policy by the Chinese government mandating in-service teacher training in the application

of Information Communications Technology (ICT) in the classroom for all Chinese schools.

 

Enter World Links.

 

With support from The Goldman Sachs Foundation and the Accenture Foundation, World Links leverages technology to enhance teaching and learning and connect China’s classrooms locally, nationally, and internationally. More than 57 schools from both eastern and western China—including the Shanghai Jiading No. 1 Senior School—participated in the first year.

 

With the World Links approach, teachers like Wenjuan Zhu learn from core trainers how to use technology creatively and effectively to enhance any lesson through tele-collaborative projects

that connect teachers and students all over the world; these teachers then train their peers, and so on. Amid excellent reception from students, teachers, and China’s Ministry of Education, the World Links program is capturing considerable interest and support, and will continue the expansion of its programs to other parts of China.

 

Junior Achievement International, Inc. atlanta, ga

To launch a business education program for college students in Johannesburg,

South Africa, and Beijing, Hong Kong, and Shanghai, China.

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If a visitor touches the statue of the money god from head to toe and then puts his hands in his pockets, it is believed he will accumulate wealth. If a visitor can throw a coin into the open mouth of a fish statue, he will receive good fortune.

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Since 2006, China is trending toward a less open trade regime with diverse new measures that signal new restrictions on market access and foreign investment in China.

 

In 2008, U.S. stakeholders have pointed to further evidence of such a trend, including the setting of unique Chinese national standards, the tremendous expansion of the test market for China's home-grown 3G telecommunications standard, China's government procurement practices, an array of policies promoting and protecting "pillar industries," the promotion of famous Chinese brands of merchandise using what appear to be prohibited export subsidies, the continued and incrementally more restrictive use of export quotas and export duties on a large number of raw materials, additional restrictions on foreign investment in China, and the continuing consideration of "national economic security" when evaluating mergers and acquisitions, among other significant restrictive practices.

 

In addition to the new restrictions indicated above, several areas of past concern continue to cause concern for the United States and U.S. stakeholders.

 

First, the lack of effective IPR enforcement remains a major challenge, as counterfeiting and piracy in China remain at unacceptably high levels and cause serious economic harm to U.S. stakeholders across the economy. U.S. industries hesitate to market leading edge technology in China due to the high probability of piracy.

 

Second, in a number of sectors, China has continued resorting to industrial policies that limit market access for non-Chinese origin goods and foreign service providers, and that offer substantial government resources to support Chinese industries and increase exports.

 

Third, arbitrary practices by Chinese customs and quarantine officials can delay or halt shipments of agricultural products into China; SPS standards with questionable scientific

bases and a lack of transparency in the regulatory regime frequently cause confusion for traders in agricultural commodities.

 

Fourth, while improvements have been made in some areas, in others such as banking, insurance, telecommunications, construction and engineering, legal, and other services, Chinese regulatory authorities continue to frustrate efforts of U.S. providers to achieve their full market potential in China through overly burdensome licensing and operating requirements. China has also so far failed to open up its market to foreign credit card companies and resisted calls to further liberalize in many other service sectors.

 

Fifth, transparency remains a core concern across virtually all service and industry sectors, as many of China's regulatory regimes continue to lack the necessary transparency, frustrating efforts of foreign and domestic businesses to achieve the full potential benefits of China's WTO accession.

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China is continuing to quietly acquire gold reserves and plans to acquire the gold sold by the IMF in the open market. It was last reported that China's gold reserves are now 1,054 tons, equaling just over 1% of its total foreign currency reserves. In order to ensure the stability of their foreign currency reserves with a declining U.S. dollar, China needs to rapidly increase its gold holdings. The Chinese newspaper China Youth Daily recently quoted Ji Xiaonan, chairman of the supervisory committee overseeing large state-owned enterprises under the State Council, who said, "We recommend China increase its gold reserves to 6,000 metric tons within three-to-five years and possibly to 10,000 tons in eight to 10 years."

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Dear Secretary Geithner and Secretary Locke:

 

We write to express our serious concerns about China’s continued manipulation of its currency. By pegging the renminbi (RMB) to the U.S. dollar at a fixed exchange rate, China unfairly subsidizes its exports and disadvantages foreign imports. As we work to promote a robust U.S. economic recovery, it is imperative that we address this paramount trade issue with all available resources. We urge your agencies to respond to China’s currency manipulation with the actions outlined in this letter. Doing so will allow American companies and workers to compete fairly against their Chinese counterparts and will boost U.S. economic recovery and growth.

The impact of China’s currency manipulation on the U.S. economy cannot be overstated. Maintaining its currency at a devalued exchange rate provides a subsidy to Chinese companies and unfairly disadvantages foreign competitors. U.S. exports to the country cannot compete with the low-priced Chinese equivalents, and domestic American producers are similarly disadvantaged in the face of subsidized Chinese imports. The devaluation of the RMB also exacerbates the already severe U.S-China trade deficit. Statistics show that between January 2000 and May 2009, China’s share of the U.S. trade deficit for non-oil goods grew from 26% to 83% -- an untenable pattern for American manufacturers. And finally, China’s exchange-rate misalignment threatens the stability of the global financial system by contributing to rampant Chinese inflation and accumulation of foreign reserves. For these compelling reasons, we ask your agencies to pursue the course of action below.

 

First, we urge the Department of Commerce to apply the U.S. countervailing duty law in defense of American companies who have suffered as a result of the currency manipulation. The U.S. is permitted to respond to subsidized imports where the elements of a subsidy are met under the countervailing duty law. The countervailing duty law outlines a three-part test to identify the presence of a countervailable subsidy: 1) that it involves a financial contribution from the government; 2) that it confers a benefit; and 3) that is specific to an industry or a group of industries. China’s exchange rate misalignment meets all three parts of this test and therefore merits the WTO-permitted application of countervailing duties.

 

Second, we ask the Department of Treasury to include China in its bi-annual agency report on currency manipulation. Since 1994 Treasury has not identified China as a country that manipulates its currency under the terms of the Omnibus Trade and Competitiveness Act of 1988 (“Trade Act of 1988”), but Secretary’s Geithner testimony to the Senate acknowledging that fact surely justifies the inclusion of China in the report. After labeling the country as a currency manipulator, Treasury should enter into negotiations with China regarding its foreign exchange regime. These combined actions will signal the government’s willingness to take decisive action against China’s currency manipulation, including the potential filing of a formal complaint with the World Trade Organization.

 

The recommendations identified above must be done in concert with intense diplomatic efforts, not only with China but also with the IMF and multi-laterally with other countries. Through a combined strategy of legal action and international pressure, it is possible China will revisit its undervaluation of the RMB. If these efforts are not successful, we ask the Administration to consider all the tools at its disposal, including the application of a tariff on Chinese imports, to respond to China’s currency manipulation. The economic impact of the RMB undervaluation on American businesses and workers is too great for the Administration not to pursue a comprehensive effort.

 

This economic downturn has underscored the pressing need to promote policies that protect U.S. jobs and U.S. businesses. Addressing China’s manipulation of its currency must be a critical part of our strategy to rebuild our economy and establish safeguards against future financial crises. The Administration has the legal ability and resources to protect American businesses in the face of China’s RMB devaluation, and we urge you to exercise this authority expeditiously.

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I would invest in US Steel. American manufacturing is going to rise.

 

Fourth quarter results for the Flat-rolled segment improved from the third quarter, primarily due to the benefits of higher average realized prices, increased shipments, and reduced facility restart costs. These favorable effects were somewhat offset by increased facility repair and maintenance costs as we completed maintenance work at a number of our steelmaking locations to improve available capacity in anticipation of increasing demand. Shipments improved by 18 percent to 3.2 million tons while average realized prices increased by five percent to $633 per net ton. In response to increased customer order rates, at the end of the fourth quarter, we were operating all of our available North American blast furnaces, except the #14 Blast Furnace at Gary Works and the one blast furnace at our Lake Erie Works, and we restarted our Keetac iron ore operations. Our Lake Erie Works is not operating because our labor agreement has expired and we have not yet reached a successor agreement. Raw steel capability utilization rates for the quarter increased to 64 percent versus 58 percent in the third quarter. Fourth quarter results reflected continuing employee and other costs for idled facilities totaling approximately $80 million, primarily at our Lake Erie Works, compared to $165 million in the third quarter of 2009.

 

Contact Information -- Individual Investors

Shareholder Inquiries

 

Office of the Secretary

600 Grant Street, Room 1500

Pittsburgh, PA 15219-2800

(412) 433-4804 (412) 433-4804 (Phone)

(412) 433-2811 (FAX)

email: shareholderservices@uss.com

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The best undeveloped iron ore deposits in the world

 

http://www.baffinland.com

 

Baffinland Iron Mines Corporation (TSX: BIM) ("Baffinland" or the "Company") reports outstanding sinter test results. The results are laboratory-based testwork on sampled material from the Company's fine iron ore trial cargo shipped to ThyssenKrupp Steel ("TKS") in October 2008.

 

Studien Gesellschaft fur Eisenerz-Aufbereitung ("SGA") conducted a series of laboratory based pot grate sintering tests to evaluate the productivity of increasing amounts of Mary River sinter fines in a standard sinter mix used in European blast furnace operations. The mixture is very similar to the sinter mixture used in the TKS sinter plant trial, as discussed in a news release issued April 20, 2009.

 

Results were exceptional with productivity consistently increasing the more Mary River fine iron ore was added to the mixture.

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  • 3 weeks later...
Guest U.S. Chamber of Commerce

As we can all agree, the U.S.-China economic and commercial relationship is the most important relationship of its kind in the world today.

 

Our companies are major investors in China, employing tens of thousands of Chinese citizens in manufacturing, services and research and development.

 

We are therefore strong and long-standing advocates for enhanced cooperation among our governments and private sector stakeholders in the fields of information technology, energy and environment, and life sciences to advance human progress and the welfare of our two peoples.

 

We have promoted these objectives by enhancing cooperation with NDRC, MOFCOM, MOST, and SIPO as well as with leading Chinese science and technology and business organizations.

 

These efforts culminated in numerous high-level innovation and intellectual property fora, including two under the U.S.-China Strategic Dialogue in 2007 and 2008.

 

These programs provided an important platform for our governments and industry to discuss global innovation trends, effective mechanisms for fostering innovation, and the importance of protecting and enforcing the intellectual property that drives it.

 

Underlying these efforts is our firm belief that the private sector on both sides has an essential role in ensuring that our governments continue to move forward to bring real solutions to bilateral and global challenges, and these solutions can only be developed by protecting the ideas and technology that can solve collective problems.

 

We believe that China should play a critical role in developing the ideas and technologies that will be at the forefront of solving some of these shared challenges.

 

Regrettably, however, China’s intensifying regulatory approach of shielding domestic companies from competition and restricting the market access of foreign companies is calling into serious question the long-term place of foreign investors in many sectors of its economy as well as the role of market competition in promoting innovation.

 

These developments have the potential to seriously erode the foundations of China’s relationship with its largest trading partners, which have been rooted historically in a shared commitment to resist protectionism, promote free and open competition, and strive for win-win opportunities.

 

Global Innovation Best Practices & Infrastructure

 

At the center of this concern is the web of policies underlying China’s drive for “indigenous innovation,” a term which the foreign business community has consistently noted since it was first used in the 15-Year Science and Technology Plan, which suggests opposition to open, collaborative, transnational innovation.

 

In the United States and around the world, innovation has come from less government direction attempting to engineer specific innovation outcomes, not more.

 

The strength of global innovation networks is a reality today as many products, especially high-tech products, incorporate technologies from many different companies and countries. Such complex products are rarely based solely on the intellectual property of a single company, or even a single country.

 

The shrinking life cycle of technology products requires companies to innovate faster.

 

Therefore companies increasingly partner with customers, suppliers, competitors, and academia around the world with complimentary expertise.

 

These new partnerships or “innovation networks” as they are called are spread out across the globe and require interoperability of standards, secure networks, and market oriented regulations and policies to ensure companies have the flexibility to quickly innovate and meet consumer demands globally.

 

It is the use of technology throughout an economy, not just the creation of technology that brings the real benefit to society and consumers.

 

Widespread application of technology across all industry sectors in manufacturing and services creates far greater economic growth than the initial development of the technology in a particular company or industry.

 

Government policies should promote the rapid adoption and diffusion of innovative technologies throughout the economy, regardless of the source of the innovation, especially since no single economy can produce the best innovations in every product and service.

 

Policies that block access to foreign innovations may provide limited benefits for an individual company or industry sector in the short-term, but these benefits come at a huge cost to the rest of the economy. Such policies amount to a self-imposed economic handicap that will reduce economic growth and diminish global competitiveness.

 

Indigenous Innovation Concerns

 

China’s recent joint circular that would implement an Indigenous Innovation Product Accreditation system is but one of a series of policies that span an array of other substantive areas—for example, those related to standards setting, antitrust, information security, patent protection and tax—that have generated deep concern across the global business community over where China is headed generally.

 

The criteria currently laid out in the circular, combined with the preferences afforded to accredited products, would make it virtually impossible for any foreign invested enterprise to participate in China’s government procurement market—even those that have made substantial and long-term investments in China, employ Chinese citizens, and pay taxes to the Chinese government.

 

If implemented without change, this policy would essentially make local IP ownership and brand registration conditions for access to the government procurement market, amounting to an unprecedented step by the Chinese government and one that clearly contradicts the shared goal of combating protectionism and the government’s commitment to rebalance trade flows.

 

Further, this approach would be counterproductive considering foreign invested enterprises’ major contributions to the modernization of the Chinese economy and infrastructure.

 

A closed, discriminatory approach to indigenous innovation would also invite similar discriminatory policies in China’s vital export markets, putting additional pressure on export job creation and growth.

 

Additionally, even as we recognize that China is negotiating to join the WTO’s Government Procurement Agreement, these rules clearly move China further away from international practice and undermine its commitment to a more open government procurement market, a market which carries unique importance to business because of the large role occupied by the State and state-owned enterprises in China’s economic system.

 

The Impact of Indigenous Innovation Policies on China’s IP System

 

Moreover, we are concerned about the impact of these policies in the IP system.

 

First, we question whether the high quantity of low quality patents—subsidized by the State—threatens to burden the courts and innovative companies?

 

Second, we are anxiously awaiting the long-debated rules on the handling of IPR issues in antitrust matters and are growing increasingly concerned about the disproportional scrutiny given to mergers involving foreign companies.

 

Third, we are worried by the growing track record of high-damage claims and awards brought by Chinese frequently for patents that are not subject to substantive examination and seem to be biased against foreigners.

 

Fourth, we are concerned that the rights, choice and safety of Chinese consumers continue to be harmed by inadequate IP protection and enforcement, including with respect to fighting counterfeiting and piracy in both the physical and online environments. The challenges in protecting creative expressions on the Internet and in other mediums are a disincentive to artists to turn their ideas into new tools that connect, inform, protect our environment and entertain us.

 

In short, China’s closed, discriminatory approach to indigenous innovation and inadequate IP protection threatens to:

 

* Impede innovation in China and reduce the competitiveness of Chinese companies;

* Cut off Chinese companies from vital global partnerships in collaborative innovation, placing these companies at a competitive disadvantage in global markets; and

* Reduce competition and limit access to advanced technology.

 

Taken together we see a variety of issues which undermine growth opportunities within China’s economy, therefore the U.S. Chamber and QPBC will continue to work with Chinese authorities in an effort to better improve the overall environment for foreign and Chinese companies and for consumers.

 

We encourage the Chinese government to engage in a dialogue with foreign stakeholders involved in China’s procurement process as the Indigenous Innovation Product Accreditation System and accompanying catalogues are revised. We would welcome an opportunity to discuss ways to modify the IP requirements while improving the system for companies, government entities and consumers.

 

The U.S. Chamber hopes going forward that the Chinese leadership will focus on reforms that result in increased competition that values equally the contributions of domestic and foreign companies to China’s economy.

 

Conclusion

 

As an officer of an organization that has been at the forefront of strengthening this important relationship over many years, and as we approach the 10th anniversary of China obtaining permanent normal trading relations status by the U.S. Congress, I would be doing a disservice to both sides if I did not speak candidly about the risks before us.

 

Put simply, ongoing policy approaches by China are eroding the support of China’s long-standing advocates in the United States, diminishing the many good arguments we have used historically in support of this relationship.

 

As we have always, the Chamber pledges to resist protectionist approaches in the United States.

 

But make no mistake; pressures are mounting, particularly in this election year.

 

Nevertheless, we will do everything in our power to ensure that both governments continue to work through challenges in a constructive manner.

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It is becoming quite popular to say that China's bubble is about to burst. Not a chance. Like Mark Twain said, "reports of my death have been greatly exaggerated."

 

Signs of China prosperity are busting out all over. In just the last week:

 

* The World Trade Organization reported that China has now overtaken Germany as the exporter in the world. In 2009, China exported $1.2 trillion worth of merchandise last year while Germany sold $1.1 trillion. The WTO said China was a "light at the end of a tunnel" for the global economy. What about the U.S.? The United States was third with $1.06 trillion.

 

* Two of China's most important economists are expecting the Chinese economy to return to its 10%-plus growth days. Yu Bin, head of macroeconomic research at the State Council Development Research Center, said China's economy will grow by 12% this quarter and Fan Jianping, a senior economist with the State Information Center, is also expecting 12%.

 

* To put that in perspective, China's GDP expanded by 10.7% in the fourth quarter of 2009 and 8.7% for the full year. As you can see, China's economy is getting better and at an accelerating pace.

 

* China's industrial output, an accurate proxy for the export industry, jumped by 20.7% in the first two months of 2010.

 

* China Construction Bank, China's second-largest bank, just reported its Q4 results and they were fantastic — profits more than doubled from the same period a year earlier. The reasons that I mention CCB — established in 1954 to fund roads, railways, bridges and dams — is that it is the largest mortgage lender in China today and is therefore a pretty good indicator of the Chinese real estate market. If CCB is thriving, it is a very good sign that the Chinese real estate market is NOT the bubble that other China "experts" are claiming.

 

* The government-run newspaper, China Daily, reported that employers are raising wages, aggressively working job fairs, and even soliciting migrant workers at train stations to fill their urgent job openings. The city of Dongguan, where most of the world's toys are manufactured, is estimated to be one million workers short of what it needs.

 

The fundamentals just keep getting better and better for China, but the problem with fundamentals — whether you're talking about a country or an individual stock — is that it can take months or even years for investors to recognize the good news and push stock prices higher.

 

It often takes some sort of catalyst to get things moving and one giant catalyst is about to happen and potentially send the Chinese stock market to the moon. The catalyst I'm talking about is the Chinese government's decision to allow stock index futures trading on the Shanghai Composite Index.

 

Investors will be permitted to trade futures contracts on the Shanghai Composite 300 beginning on April 16. The first contracts to trade will be for May, June, September and December.

 

The reason I expect this to be such a positive for Chinese stocks is that investors only have to put up a cash deposit of 15% for the May and June contracts and 18% for the longer contracts. That 6-to-1 leverage represents a mountain of potential buying pressure.

 

Of course, that leverage can work in the opposite direction too but what I expect to happen is for these new futures contracts to exaggerate the moves in both directions. Rallies will be more powerful and profitable while corrections will be deeper and shorter-lived than in the past.

 

And since the fundamentals of the Chinese economy are so positive, I expect the next major move to be upward and for these futures contracts to add some accelerant to what could be a melt-up.

 

What I'm telling you is to get on board the Chinese rocket before it takes off — and you only have a short time to do so.

 

You could buy some ETFs as I explained in my March 17th and March 24th articles, but I believe you'll do much better by targeting some of China's most successful companies. I'm talking about companies like:

 

* New Oriental Education (EDU), the largest college admission prep course and English language school in China.

 

* Mindray Medical (MR), one of the world's fastest growing medical equipment companies that specializes in monitors.

 

* Duoyuan Global Water (DGW), a Chinese manufacturer of valves, filters, aerators, monitors, compressors, and everything else you need to deliver clean drinking water.

 

* China Housing & Land (CHLN), a developer of moderately priced condominiums Xian, China; the home of the terra cotta warriors.

 

* General Steel (GSI), the largest Chinese manufacturer of one of the most important basic building blocks of every road, bridge, dam, and high rise: Rebar.

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Guest Grant

The dragon is an all-pervading force, where fortune rules and everyone is happy.

 

That would be true if China did not manipulate the yuan so that their exports to the United States are priced lower than goods made here, and products exported by U.S. firms to China cost more for Chinese consumers to buy.

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SCHUMER: SOUTHERN TIER MANUFACTURING HAS BEEN DEVASTATED BY UNFAIR CHINA CURRENCY MANIPULATION; SCHUMER TO LEAD BIPARTISAN LEGISLATION TO LEVEL THE PLAYING FIELD, PUT THOUSANDS BACK TO WORK

 

China's Currency Manipulation Undermines U.S. Manufacturing Base By Making U.S.-Made Goods More Expensive Relative To Foreign Goods

 

Southern Tier Manufacturing Sector Has Shrunk By Nearly 46% In Last Decade And Chemung Has Lost Over 500 Manufacturing Jobs In The Last Year Alone - In Good Part Because Of Artificially Cheap Chinese Imports

 

Schumer Stands With RepRepresentatives of Company Facing Ever Growing Pressure From Artificially Cheap Chinese Imports

 

U.S. Senator Charles E. Schumer announced that he is pushing new legislation to vigorously address China’s currency manipulation that unfairly and negatively impacts U.S. trade. If passed, the legislation would provide less flexibility to the Treasury Department when it comes to citing countries for currency manipulation. It would also impose stiff new penalties on countries that manipulate their currency, including possible tariffs on the countries’ exports and a ban on any companies from those countries receiving U.S. government contracts. Schumer discussed his legislation in the Southern Tier today at Silicon Carbide Products Inc, a Horseheads, New York based company that sees its sales and supply chains undercut by Chinese imports that are made cheaper by currency manipulation.

 

"We are sending a message to the Chinese government: if you refuse to play by the same rules as everyone else, we will force you to,” Schumer said. “China’s currency manipulation would be unacceptable even in good economic times. At a time of 10 percent unemployment, we simply will not stand for it. There is no bigger step we can take to promote U.S. job creation, particularly in the manufacturing sector, than to confront China’s currency manipulation. This is not about China bashing; it’s about defending the people of New York and of the United States.”

 

By manipulating currency exchange rates, countries can gain an unfair advantage over U.S. manufacturers by effectively lowering the price of their exports. This hurts U.S. manufacturers forced to compete at home with artificially cheap imports. Currency manipulation also imposes a direct cost on U.S. exports, making American goods sold in China more expensive and making it more difficult for U.S. exporters to compete with artificially cheap Chinese goods around the globe. This creates an unfair trade advantage, which ultimately harms New York’s manufacturers, workers, and farmers, and contributes significantly to the U.S. trade imbalance.

 

Currency manipulation and the continuing trade imbalance with China has severely impacted the U.S. manufacturing sector in relation to both domestic sales and exports. The U.S. has lost over 5.3 million manufacturing jobs in the last decade. And in the last ten years, New York State has lost over 300,000 manufacturing jobs. Specifically, during the last decade in the Southern Tier the manufacturing sector has declined by 46%, and in the last year alone Chemung County has lost 500 manufacturing jobs. Since the beginning of the recession, millions of Americans have lost their jobs and unemployment has been hovering around 10 percent for several months.

 

Schumer has long worked to pressure China to allow its currency to float. In a previous Congress, Schumer authored and passed China trade legislation, but the bill died in the House of Representatives. The legislation Schumer is discussing today, however, has 16 bipartisan cosponsors and combines several separate bills into a single, strong bill that can pass the Senate and the House.

 

Specifically, Schumer’s bipartisan legislation, the Currency Exchange Rate Oversight Reform Act of 2010 would:

 

• Create a new approach to identifying currency manipulators by requiring that the Treasury Department base its determination strictly on objective measures related to currency exchange rates. Under current law, Treasury also has to determine that the misalignment is a willful attempt to gain a trade advantage before it can cite the country. The new legislation would eliminate the need to show intent.

 

• Establish important consequences immediately upon designation, moderately severe consequences if talks with the offending country have not resulted in appropriate policies and identifiable actions to eliminate misalignment after 90 days, and more severe consequences if consultations have not resulted in appropriate policies and identifiable actions to eliminate misalignment after 360 days.

 

• Establish two tracks by which the Department of Commerce can take action should a foreign country refuse to adjust its currency. One path would be to utilize anti-dumping laws to enable Commerce to counter the effect that a manipulated currency has on pricing. The other path would allow Commerce to apply countervailing duties, intended to offset foreign government subsidies, to goods coming into the United States from nations that misalign their currency.

 

Schumer added, “The number one issue for the people of New York is jobs and bringing back our economy. Getting the Chinese government to play by the rules of our economic system would be a huge step forward towards securing our economy and the manufacturing jobs of New Yorkers. It’s vital that we get this done.”

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Guest Peter

China would still be a gigantic slum and nothing to fear if we hadn’t handed them the keys to the kingdom in order for a handful of elites to reach incalculable new heights of wealth.

 

Anyway, my argument is never going to win. Americans are mindless bovine. Things are too far gone.

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Guest Greenzen

East Asia has recovered from the economic and financial crisis. Largely thanks to China, the region’s output, exports and employment have mostly returned to the levels before the crisis. Leading the global economy, real GDP growth in developing East Asia is poised to rise to 8.7 percent in 2010 after slowing from 8.5 percent in 2008 to 7.0 percent in 2009.

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Guest World Bank

For China, rebalancing the economy as emphasized in the 11th five-year plan will be key. Rebalancing has several dimensions, including restructuring the composition of economic

growth by enabling a larger role for the service sector and private consumption, away from investment-heavy export-led growth, and encouraging more environmental sustainability.

 

This remarkable recovery has been due to a large and timely policy stimulus, renewed inventory restocking, and the return of buoyant demand abroad and consumer sentiment. Even with the large stimulus, fiscal deficits and debt are contained and for most countries pose no dangers to debt sustainability. Solid economic fundamentals, including high foreign exchange reserves, well-capitalized banks and modest levels of household, corporate and government debt have also been key factors for the recovery. Capital flows have roared back, even as tight global financial conditions and ample spare capacity prompt worries that the “new normal” will

be characterized by slower global growth. But large capital inflows have also raised alarms about new asset bubbles in some countries. Authorities in the region are confronting these risks at the same time they are returning to a reform agenda needed to secure strong and sustained growth.

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Guest Ivailo Izvorski

The Chinese authorities swiftly implemented a large monetary and fiscal stimulus starting in the last quarter of 2008 (through 2010) that exceeded the one introduced after the 1997-98 Asian financial crisis. The package helped boost government-led investment by nearly 6 percent of GDP in 2009, accounting for the bulk of the 8.7 percent growth in real GDP. The surge in investment, in turn, led to a sharp increase in imports for domestic use, notably from East Asia. This surge was most pronounced in the first half of 2009, when import demand among the advanced economies was contracting fast.

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Guest Greenzen

China’s market, moreover, became the largest in the world in 2009, overtaking the U.S., even though automobile ownership in China is still rather modest.

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Guest Human

Okay, I am back "Briefly". California should stop being jealous of Chinas success.

 

As to how I came to that conclusion? Folks do your home work. For I will not.

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  • 3 weeks later...
Guest nguyenvuminh

I live and work in Asia now and the extent of copying by Chinese companies (big and small, private and state-owned) are beyond one's imagination. From food items, to packaging, to brand name, to advertisement (TV and Radio), to music, to fashion, to cars and whatever else you can think of. What's so sad is that the Chinese have no sense of shame, they see ABSOLUTELY nothing wrong with that, and WORSE YET, their copies are not improvements but made of inferior quality and standards (performance and safety). And if you think I'm harsh, jog your memory to phony drugs and milk products which killed their own people/children, on their own soil. And yes, I do place a lot of blame on Walmart on their cost-reduction pressure tactics.

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The World Bank recognized China's growing economic influence and agreed Sunday to elevate Beijing's voting power to behind only the U.S. and Japan in the 186-nation lending organization.

 

Lifting China above a number of Western powers, including Germany, France and Britain, also gives other nations with emerging economies more voice and say in how the bank operates and lends money.

 

Bank members also decided to increase the institution's capital by US$3.5 billion; it was the first increase in more than 20 years.

 

China's stake at the bank, in terms of voting power, climbs from 2.78 percent to 4.42 percent. The U.S., the world's largest economy, remains No. 1 spot at 15.85 percent, effectively giving it veto power, followed by Japan at 6.84 percent.

 

Chinese Finance Minister Xie Xuren welcomed the shift, saying the change “represents an important step towards equitable voting power between developing and developed members,” according to China's official Xinhua News Agency.

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Guest August

Looks like Goldman Sachs financiers are switching jobs to the Bank of China.

 

Under the auspices of the "Thousand Talents Scheme," the Chinese government is actively recruiting successful Chinese finance executives to return to China and work for either state-owned banks or financial regulators. In December the government hired PIMCO's Zhu Changhong to be the Chief Investment Officer of the State Administration of Foreign Exchange (SAFE).

 

The highest profile "returnee" recruit is Lee Zhang (张红力), who just joined Industrial & Commercial Bank of China as a vice president. Most recently he was China chairman and Asia regional head of global banking at Deutsche Bank. Prior to DB he worked for Goldman Sachs. Zhang already has political experience as a delegate to the China People's Political Consultative Conference and as an economics advisor to Heilongjiang Province.

 

There are also uncomfirmed reports that Fred Hu (胡祖六), who recently stepped down as Greater China Chairman of Goldman Sachs, may become a vice-governor at the People's Bank of China or a top executive at a large state-owned financial institution. These types of appointments are approved at very high levels of the Chinese government and take a long time to go through. This issue of Caixin's Century Weekly has an article on Lee Zhang's appointment that describes the selection process. The story makes no mention of Fred Hu.

 

http://blogs.forbes.com/china/2010/04/27/will-china-hire-goldman-sachs-alumni/

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Guest Franco

China has dramatically raised living standards and pulled hundreds of millions of its people out of poverty. Now it is a global economic player, following the reform and opening up policy launched by Deng Xiaoping. The very scale of China's economy, and its geostrategic importance, means that what China does will affect the rest of the world.

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