China has recently suspended imports from several U.S. frozen meat companies due to contamination concerns. .

China Suspends Imports of Certain U.S. Frozen Meat Products

Officials of China’s General Administration of Quality Supervision, Inspection and Quarantine have repeatedly announced recently that certain food imports from the U.S. are not secure. Officials claim frozen poultry and pork from Tyson Foods Inc., the world’s largest meat processor, are contaminated with salmonella. Problems were also found in products of six other American food companies. Frozen pork ribs from Cargill Meat Solutions Corp. contained a leanness-enhancing additive, while frozen pig ears from Van Luin Foods Inc. were found to contain the leanness-enhancing additive ractopamine. Sausages from Thumph Foods were also found to contain ractopamine. Officials said Cargill and Van Luin were given 45 days to correct the contamination problems, while the other companies were suspended from importing, though officials did not say for how long.

Readjustments to China’s housing market are predicted to last more than a year.

Shortfall in the Supply of Housing Loans Predicted for 2008

According to statistics provided by real-estate advisor DTZ, in the first half of this year the amount of housing sales in 10 major Chinese cities, including Beijing, Shanghai, Shenzhen and Guangzhou, dropped by 41 percent, while housing sales in Shenzhen plunged by 56 percent. Housing prices across China have decreased by 31 percent. Yet the same report shows that the ratio between housing prices and the average annual income of an urban family is still 6.98. Three to six is generally considered a reasonable range. According to Jiang Shangli, manager of the Comprehensive Housing Service of DTZ China, the Central Bank’s recent raising of the deposit reserve ratio and other tighter monetary policies mean that the capital equivalent of two years’ worth of loans is frozen. Jiang adds: “Around two-thirds of the annual credit quota for housing purchases was used up in the first half of 2008. An estimated RMB 880 billion will be loaned out this year, leaving an estimated shortfall of RMB 300 billion.” The report, therefore, predicts the housing market readjustment would last more than a year.

China Has 15 Million Teenage Smokers

The Ministry of Health has issued its 2008 China Tobacco Control Report, which claims about 15 million of the country’s 130 million teenagers are addicted to nicotine, around 40 million have tried smoking, and as many as 65 million are exposed to the harmful effects of secondhand smoke. The number of female students who have tried smoking or who smoke regularly is increasing. The report says tobacco advertisements are partly to blame for the rising rate of young tobacco addicts, because the ads target youths by associating smoking with energy, glamour, independence and sex appeal. The National Center for Disease Control and Prevention investigated eight popular TV dramas and 10 films in 2003 and found that actors smoked in an average of 165 scenes per TV drama series, while the films featured an average of 26 smoking scenes each.

China’s machinery, equipment, chemicals, textiles and base metals sectors are frequent targets of anti-dumping investigations.

China Becomes Main Target of Anti-dumping Probes

According to a report released by the World Trade Organization (WTO), China was targeted in 40 of the 101 anti-dumping investigations launched by WTO members worldwide last year, making it the most frequent target of anti-dumping probes. The machinery and equipment sector was the main focus of investigation, followed by chemicals, textiles and base metals, the report said. Chinese products were also the most frequent target of other countervailing measures, including anti-subsidy campaigns, market access disputes and import quotas.

Li Xiaochao, spokesman of the National Bureau of Statistics and chief of the Department of National Economy Comprehensive Statistics of the NBS, answering questions from reporters.

NBS: National Economy Facing Two Major Pressures

According to official statistics, China’s gross domestic product (GDP) for the first half of this year was RMB 13.06 trillion, a year-on-year growth of 10.4 percent. This represents a 1.8 percent drop in the growth rate compared to the same period last year. At the same time, the consumer price index (CPI) rose by 7.9 percent. According to Li Xiaochao, chief of the Department of National Economy Comprehensive Statistics at the National Bureau of Statistics (NBS), the Chinese economy is facing major pressures on two fronts: inflation and unemployment. Maintaining a rapidly developing economy will most likely increase employment, but as Li points out: “This also tends to push up prices. We need to seek balance between the two ends.”

Vice-minister of Commerce Gao Hucheng.

Gao Hucheng: China to Adjust Foreign Trade Policy

“Appreciation of the yuan and changes in international markets have made the export of textiles, garments and other products in labor-intensive industries more difficult,” says Gao Hucheng, vice-minister of commerce. At present, the Ministry of Commerce and other relevant government departments are monitoring the situation. “We will formulate new policies based on timely investigations,” says Gao. At the end of 2007, the Chinese government cut tax rebates for many export industries in an effort to curb China’s swelling trade surplus. The surplus did shrink in the first six months of this year. China Customs data shows that the trade surplus was down by 11.8 percent year-on-year, a net decrease of US $13.21 billion. The trade surplus in June was US $21.4 billion, a decrease of 20.5 percent compared to the US $26.9 billion in June 2007.

Zhou Zhengqing, former chairman of the China Securities Regulatory Commission.

Zhou Zhengqing: Ensuring Stable Growth of the Stock Market

At the forum “China’s Asset Pricing Under Global Inflation” Zhou Zhengqing, former chairman of the China Securities Regulatory Commission, noted that China’s economy is not suffering any fundamental problems. However, referring to the recent slump in the stock market, Zhou argued it is necessary for the government to adopt economic, legal and administrative measures to promote stable and sound growth of the capital market. He emphasized that the government does not need to interfere when the market runs in order. However, if there are unusual fluctuations which affect the stable development of the economy and society, the government needs to make necessary adjustments. This is a view shared by many governments around the world. He suggested that China should construct a mechanism for market security and emergency responses. “We need to proceed from the reality of our situation, and should not blindly compare our market with the mature ones of developed countries. It will lead us to make wrong judgments and mislead our market,” says Zhou.