Economy
The PRC State Council recently issued an opinion that aims to further liberalize China's service sector and seeks to have service industries generate 50 percent of economic output by 2020. According to the PRC National Bureau of Statistics, China's service sector currently accounts for roughly 40 percent of GDP, compared to 80 percent in the United States.
China's urban middle class is projected to number 612 million and urban per capita income to hit $3,284 by 2025, according to a report by the McKinsey Global Institute. The same report estimates that urban consumption as a percentage of GDP will rise to 45 percent in 2025 from 37 percent in 2005.
The top 20 percent of urban Chinese saw their average income rise by nearly 40 percent between 2004 and 2006, while the average income of urban residents in the lowest 20 percent rose by only about 27 percent over the same period, according to a recent Gallup poll.
Hong Kong Chief Executive Donald Tsang won a landslide but unsurprising victory over challenger Alan Leong in late March to retain his post as the head of Hong Kong.
Macao recently surpassed Hong Kong in per capita GDP for the first time, according to Macao government statistics. In 2006, Macao's per capita GDP stood at $28,259, while that of Hong Kong was $27,469.
Statues of former Taiwan President and Kuomintang Party Chair Chiang Kai-shek were dismantled around the island on the order of current President Chen Shui-bian. The move is part of Chen's efforts to remove all vestiges of Chiang's authoritarian rule.
Aviation
United Airlines Inc. launched its new capital- to -capital service on March 28. The flight, from Dulles International Airport to Beijing Capital International Airport, took about 13 hours. United was awarded the new route in February.
China recently began the final assembly of the ARJ-21, the country's first indigenously developed regional jetliner. With a seating capacity of about 100, the ARJ-21 is a step toward China's goal of building commercial jets that could rival those of the Boeing Co. and Airbus SAS by 2020.
|
Environmental Protection
Chinese personal computer manufacturer Lenovo Group Ltd. shot up to first from last place in the latest Greenpeace Green Electronic Guide, which ranks 14 large high-tech companies on their "green" efforts. The guide, which was published in April, shows Apple Inc. at the bottom of the list.
The PRC National Reform and Development Commission in April released a five-year plan for energy. Though the plan aims to reduce the country's dependency on coal and oil and reform energy pricing to encourage efficiency, it also calls for greater investment in oil and gas exploration and production to meet rising demand.
Energy
Exxon Mobil Corp., Saudi Arabian Oil Co., and China National Petrochemical Corp. in April signed a $5 billion deal to expand oil refineries and build petrochemical facilities in Fujian, one of the biggest projects of its kind in China.
China's power consumption in the first two months of 2007 jumped 16.6 percent over the same period last year, according to the China Electricity Council. The country's power consumption is projected to grow 12.5 percent in 2007.
IPR
In a move to further combat rampant piracy, the PRC Supreme People's Court issued a judicial opinion in April that lowers some criminal thresholds for the manufacture and sale of counterfeit products. Manufacturers of 500 or more counterfeit copies of DVDs, software, or CDs could face up to three years in prison.
The United States in early April launched two World Trade Organization (WTO) challenges of PRC laws.
One case argues that elements of China's laws on intellectual property rights (IPR) protection do not meet the country's obligations as a signatory of the WTO Agreement on Trade-Related Aspects of IPR. The second case says that restrictions China places on the import and distribution of media products violate China's WTO commitment to allow foreign companies to import, export, and distribute their products freely.
China also released its 2007 IPR Protection Action Plan in early April. To improve transparency, the plan calls for IPR court cases to be opened to the public, including representatives of international organizations and foreign governments.
|
Foreign Relations
PRC President Hu Jintao paid an official three-day state visit to Russia at the end of March to strengthen bilateral economic and diplomatic ties. During the visit, Hu and Russian President Vladimir Putin inaugurated the "Year of China" in Russia, and contracts worth $4.3 billion were signed.
Japanese Prime Minister Shinzo Abe in March stirred controversy when he publicly declared that Japan will not formally apologize for its alleged coercion of Chinese and Korean "comfort women" during World War II. PRC Foreign Minister Li Zhaoxing condemned Abe's comments. Nevertheless, as the CBR went to press, PRC Premier Wen Jiabao was visiting Japan.
Trade
The US Department of Commerce decided at the end of March to apply countervailing duty (CVD) laws on imports of coated free sheet paper from China, thereby reversing a long-standing US bipartisan policy of not applying CVDs to nonmarket economies.
Despite a steep drop in March, China's trade surplus for the first quarter stood at a mammoth $46.4 billion, twice the amount over the same period in 2006.
Laws & Regulations
The full PRC National People's Congress (NPC) in March finally passed the Enterprise Income Tax Law, which effectively unifies China's tax regimes for domestic and foreign-invested enterprises. The new tax rate for all enterprises is 25 percent.
The NPC also passed the Property Rights Law, the first piece of legislation to specifically protect private property in China since 1949.
|
