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Strategies & Market Trends : Mish's Global Economic Trend Analysis -- Ignore unavailable to you. Want to Upgrade?

To: RealMuLan who wrote (19238)	12/21/2004 3:18:20 PM
From: RealMuLan	Respond to of 116555

China encourages green food The biggest ever logistics center for green food in China has been launched in Zhengzhou recently, the capital city of Henan Province in central China. The project covers 370,000 square meters of construction area and is invested by Wenzhou Hengha Food Company with 690 million yuan. The company is specialized in processing and exports of ecologically friendly food. The center will offer a platform for information sharing and a five-layered network covering the whole country. It will facilitate one-stop procurement service for agricultural enterprises and help to build a national supply chain for green food. Organic food which is safe, free from pollution, rich in nutrition and of good quality is called green food. Food producers have to apply to the Ministry of Agriculture for labeling their products as green food. By 2003, there were 2047 green food producers in China which sold 72.3 billion yuan of food to the domestic market and more than 1 billion USD to the overseas market. Farm products labeled "green food" are available at higher prices in supermarkets but more popular. The market demand is still expanding rapidly. Shannxi Province in northwest China is the largest base for organic food in China. It also supplies one-third of the world's total condensed apple juice which is up to the international standard. Buyers are from Europe, North America, Middle East and Japan. China is the six largest exporter of farm produces in the world. In October this year, the Ministry of Agriculture, the Ministry of Finance and the People's Bank of China, together with other 3 government departments, issued a document designed to encourage agri-produces exports. But China's agri-exports face"green barriers" on the overseas market especially in the developed countries. Pesticide residue is one of the barricades. Statistics shows that 90 percent of Chinese food products have had to deal with green barriers set by foreign markets. In a recent speech Mr. Wei Jianguo, Vice Minister of Commerce, declared a three-dimensioned strategy including pre-emptive actions, defense and prevention system, for China's exports of farm produces. He said China would firmly fight against any unreasonable barriers set by foreign trade partners on one hand. On the other he urged Chinese exporters of farm produces to improve their quality control and engage in clean production so that their products would be accepted by foreign buyers. Green barriers are normally used by importing countries which restrict or ward off foreign products by imposing a package of standards and tariffs for environmental protection. By People's Daily Online english.people.com.cn

To: RealMuLan who wrote (19238)	12/21/2004 3:24:14 PM
From: RealMuLan	Respond to of 116555

China reforms to go full speed ahead in '05 BEIJING - The central economic work conference held toward the end of this year to fix major economic policies for the new year has defined 2005 as a year of reform, that is, the country will press full steam ahead with reforms in order to improve its international competitiveness and solve underlying problems. 2005 is of great significance in China's economic development. It is not only the last year of the 10th five-year plan period but also the run-up to the 11th five-year plan, the expiry of the three-year transitional period for China's access to the World Trade Organization and the first year to open the market to foreign capital. Chinese industries, state sector enterprises, agriculture and administrative departments that lead the reforms will all face major steps of reform in 2005. It has become imperative to push the reforms at all levels of economic activities. First of all, the price paid by China's economic growth is a big problem. Since 1999, China has always fixed the economic growth objective at about 7%. But the actual figure has always been higher than this and it has been achieved at the price of high energy consumption. Such sustained high growth has brought about mounting inflationary and environment pressures. Second, the three-year transition period for China's access to the WTO ends this year. By its commitments, China has to open some sensitive areas, such as finance, insurance, securities, wholesale, retail sales, construction, logistics and other major industries. The tariffs on agricultural products, motor vehicles, paper products, textiles and wines have been cut sharply and the tariffs on furniture and toys have been reduced to zero. All non-tariff barriers have to be removed. More than 90 sub-departments, including books, newspapers and other publications, drugs, chemical fertilizer, finished oil, crude oil, communications, telecommunications and tourism will also gradually open to foreign capital. Agricultural products will meet the challenges by foreign quality products at low prices; the financial industry has to coordinate steps of opening up with security; banks, securities and insurance industries have to cope with such problems as to how to improve management levels and shorten the gaps with developed countries; the retail sale industry has to come out with ideas of how to complete with advantageous foreign giants; the automotive industry that lacks its own technologies has to think of ways to create its core competitiveness; the country has to cope with increasing anti-dumping investigations and with the accusations concerning intellectual property rights protection. Third, a series of reforms centering around market opening will be carried out under the direction of the government. The management system will have to undergone further reforms in such areas as organizational set-up of administrative departments and thinking and methods for guiding enterprises. The Chinese government has already raised the problem of how to improve the capabilities of riding over the market economy and improve its governance. This means that compared with the economic, legal and administrative means employed in the macroeconomic control in 2004, macroeconomic policy will employ more market forces. The nearly 7-year activist fiscal policy will give way to a prudent fiscal measures and prudent monetary policy. This is a major shift in policy orientation. A significant signal is to contract the issue of treasury bonds. In the six years from 1998 to 2003, China issued 800 billion yuan (US$97 billion) of long-term construction bonds and between 1998-2002, each year witnessed an additional issue of treasury bonds, increasing from 100 billion to 150 billion yuan. Such activist fiscal policy pulled the economic growth by 1.5-2 percentage points every year. But the total size of treasury bonds issued has reached nearly 2,000 billion yuan, increasing the pressure on deficits. That has given rise to voices for phasing out the activist fiscal policy. China issued 150 billion yuan of treasury bonds in 2002, 140 billion in 2003 and 110 billion in 2004, showing a decreasing trend. Some experts pointed out that the 2005 issue of treasury bonds will be kept at about 80 billion yuan. The prudent fiscal and monetary policies would screen out a large amount of investment initiated by administrative departments so as to realize the effect of interest rate rise. Macroeconomic control will come down on institutional arrangements. China has experienced overheated development on three occasions since 1978. The control measures for the first two were quite strong, resulting in big falls. This year, the government hopes to adopt institutional arrangements instead of administrative means, with credit and land use as the breakthrough points. This has been revealed by the fact that China's land policy since the latter half of 2004 has become rarely so strong. "Recycling economy" will become key words in the economic development of 2005. Over the past year, the strong economic growth has been greatly strained the energy supply. This problem has to be resolved by the development of a recycling economy as put forward by the government in a bid to seek a sustainable development. It has been revealed that the recycling economy will be a guideline for compiling the 11th five-year plan. It is likely that the state will promulgate a recycling economy law. Despite the accelerated pace in institutional reform, it still lags behind economic reform. The overgrowth of fixed assets investment, too big a pressure on prices and strained energy supply, all reveal institutional drawbacks that has made the reforms in 2005 even more pressing. (Asia Pulse/XIC) atimes.com