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Salary restructuring for top SOE officials soon

Senior executives of State-owned enterprises may soon face pay cuts that will trim their salaries from 12 times to eight times the average salary of common workers. A plan for SOE executives' salary reform has now been distributed to State-owned enterprises recently. Each company will formulate detailed regulations based on general requirements and its actual conditions, market sources told China Business News, a Shanghai-based newspaper. According to the plan, the basic salary of senior executives will be two times the average salary of staff workers for 2013. Their performance-related pay should not exceed two times their basic salaries, and incentive pay should not exceed 30 percent of their annual salaries during their term in office. Apart from salaries, China will also impose strict control over SOE executives' benefits, such as housing provident fund, said Su Hainan, deputy director of the China Association for Labor Studies.

PetroChina, Gazprom to expand cooperation

China National Petroleum Corp, the parent company of China's top oil and gas producer PetroChina, and Russian energy giant Gazprom are planning to further expand strategic cooperation between the two companies, especially in natural gas. The two sides held the 10th session of bilateral joint coordinating committee, co-chaired by Wang Dongjin, president of PetroChina and Vitaly Markelov, deputy chairman of Gazprom management committee in Shanghai on Tuesday and decided to expand their scope of cooperation by adding coalbed methane and LNG into the bilateral technology and science cooperation program for the next two years. A joint working group will also be established to study and advance technologies on building and operating underground storage bases.

Minmetals to set up rare earth conglomerate

State-owned metal producer China Minmetals Corp has been allowed to form a rare earth conglomerate to further consolidate resources in the strategic industry. The company will lead the restructuring of rare earth industries in southern provinces of Hunan, Yunnan, Jiangxi, Fujian, Guangdong and the Guangxi Zhuang autonomous region, newspaper reports said on Thursday. The approval was part of Beijing's plan to better develop and integrate the country's rare earth industry through mergers and acquisitions by encouraging six major resource companies to form conglomerates. China Minmetals Corporation was the first company to conduct rare earth business in China. The Ministry of Industry and Information Technology earlier gave three other rare earth producers, namely Inner Mongolia Baotou Steel Rare-Earth Hi-Tech Co, Xiamen Tungsten Co Ltd, and Aluminum Corporation of China, the green light to form conglomerates.

Sound projections for online audio-visual enterprises

The online audio-visual market in China is expected to post a record revenue of 37.8 billion yuan ($6 billion) this year, said a report released during the Sixth China Network Audio-Visual Industry Forum in Shanghai on Thursday. Of this, 53 percent will come from online video, 21 percent from online music and 13 percent from mobile phone TV, the report said. As of July this year, China's online video audience reached 439 million, covering more than 70 percent of the total Internet users in the country. The mobile phone video audience topped 300 million during the same period, the report said. The forum was hosted by the State Administration of Press, Publication, Radio, Film and Television and the Shanghai municipal government.

New official for central leading financial group

A Zhejiang provincial official has been appointed as the deputy director of the Central Leading Group on Financial and Economic Affairs, according to Xinhua News Agency. Shu Guozeng, former deputy secretary-general of Zhejiang Committee of the Communist Party of China, was appointed the deputy head of the top economic policymaking body. The appointment followed Han Jun, former deputy director of the Development Research Center of the State Council, who was also appointed as a deputy director of the group in October. Now the body has Liu He as the director and five deputy directors.

Yield on 10-year govt bonds surges to two-week high

The country's 10-year government bonds fell for a fourth day, pushing the yield to a two-week high, on signs some investors are switching to stocks. The yield on the notes due September 2024 rose four basis points to 3.68 percent in Shanghai, the highest level since Nov 21, data from the National Interbank Funding Center show. The yield has increased 17 basis points, or 0.17 percentage point, this week. "Bonds are under selling pressure partly because funds are diverted to the booming stock market," said Frank Sun, a Shanghai-based analyst at Shanghai CFETS-ICAP International Money Broking Co. "Interbank liquidity continued to improve."

Morgan Stanley sees more interest rate cuts in 2015

The nation is expected to cut the benchmark interest rates twice by 25 basis points each time in 2015, Morgan Stanley said in a research report on global economic outlook. Market sources have indicated that China may cut interest rates again, after the central bank cut the one-year benchmark lending rate by 40 basis points to 5.6 percent and the one-year benchmark deposit rate by 25 bps to 2.75 percent on Nov 22. Other benchmark deposit and lending rates were lowered accordingly. Morgan Stanley lowered its forecast for China's economic growth by 0.1 percentage point to 7 percent because the growth in fixed-asset investment has been below market expectations, although the government had taken measures to boost domestic consumption and stabilize infrastructure investment.

Telecoms company set for infusion of private capital

China Tower Co Ltd, a telecommunications tower company jointly established by the Big Three carriers - China Mobile, China Telecom, and China Unicom - is expected to kickstart its plans to absorb private capital next year, the Economic Information Daily reported on Thursday citing a source close to the matter. The report said if everything goes well, China Tower will open some parts of its business to private investors in 2015. Bai Yingzi, director of China Tower's coordination office, said China Tower will be included in the pilot State-level program for reforms in the ownership of State-owned assets.

Homegrown standard gains acceptance within industry

The TD-LTE 4G mobile telecom business of China Mobile has developed swiftly after one year of commercial operations and the carrier's converged communications business will start commercial operations next year, IT news portal Tech.sina.com said on Thursday. An industry insider said that during the first year of 4G commercial operations, China Mobile has infused strong confidence into the system and equipment manufacturers and even the whole TD-LTE industry. By the end of this year, the number of TD-LTE base stations will total 700,000 and the terminal models will reach 617.

NDRC issues new guidelines for public-private projects

The National Development and Reform Commission, China's top economic planner, announced detailed guidelines for public-private partnerships in China on Thursday. PPP refers to long-term cooperation between governments and private companies on infrastructure or public services. The guideline offered more clarity to local governments on how to implement the often complicated financing model. The central government has championed this model for a year now as China is grappling with huge local government debt due to its rapid urbanization. The guideline has recommended various PPP modes for different projects according to its profitability, which range from authorizing franchising, including build-operate-transfer, and build-own-operate. It offered a format for a PPP project's general contract, and required local governments to build a PPP project catalog, and update the progress information on each project to Beijing every month since next year.

Parent drafts plan for CNOOC to cut costs

Offshore oil and gas producer China National Offshore Oil Corporation, said on Thursday that it has completed research on the oil and gas output plan for 2016-20 for its subsidiary CNOOC Ltd. The company has found acceptance. CNOOC can now go ahead with the exploration and development plan for 2016-20, the company said, as it needed a proper assessment of the risks and potential of its gas and oil fields and effective measures for reducing production costs.

Melamine exports facing headwinds in United States

The US Commerce Department said on Wednesday that it was imposing antidumping duties and launching countervailing duty investigations into melamine imports from China and Trinidad and Tobago. Melamine is a crystalline powder or granule that is typically used in the production of melamine resins used in laminates, surface coatings, adhesives, molding compounds and paper treatment, the department said in a statement. The investigations are in response to a petition filed by Cornerstone Chemical Company based in the US state of Louisiana. The company alleged that melamine from China and Trinidad and Tobago were sold below the fair value of the products in the US market with dumping margins of 255.44 percent to 363.31 percent and 166.9 to 189.1 percent respectively, while producers and exporters from these countries also received government subsidies.

China Daily-Xinhua

(China Daily USA 12/05/2014 page18)