China Economy Weekly: Beijing Moves on Trade and Investment; Soaring Property Market; Labour Activism Against Apple?

Hu Reiterates China's Economic Policy: Chinese President Hu Jintao has said that the government should stick to the pro-active fiscal policy and moderately loose monetary policy in the second half of this year to ensure a stable and relatively rapid economic development.

More efforts should be made to strengthen economic forecasts and warning systems, as well to coordinate economic policies, Hu added.

China Seeks Trade Balance, Not Surplus: China will continue to seek balance instead of surplus in trade and it will oppose any form of protectionism, Chinese Premier Wen Jiabao said at a joint news conference with visiting German Chancellor Angela Merkel.

China This Week: Drills In The Yellow Sea; China’s Energy Progress; Dalian Pipeline Blast

These efforts should be praised and not criticised, particularly when compared with any major country that claims to double its exports to alleviate unemployment pressure, Wen added.

Wen made the remarks amid growing concerns that China's export growth would gradually drop despite the strong momentum in June.

China will continue to stimulate domestic demand as well as stick to an appropriately loose monetary stance and pro-active fiscal policy, Wen said, declaring that policy stability will be the government's economic priority in the second half of this year.

China Sticks to Opening-up Policy: Chinese Premier Wen Jiabao has denied that the investment environment in China is worsening, as he invited more foreign companies to put money into the country.

Foreign firms have voiced concern that China's indigenous innovation policy might provide incentives for government bodies to purchase products developed by Chinese companies. The World Bank in a July report gave China a low investment environment ranking.

But the amount of foreign direct investment (FDI)  that flowed into China in the first half of the year rose 19.6% year-on-year, according to data from the Ministry of Commerce (MOC). China attracted $12.51 billion in FDI in June alone, up 39.6% year-on-year.

Wen said, "Foreign investment will not pour into a country where the investment environment is worsening." He asserted that China has relatively good infrastructure as well as a fair and stable market environment.

China's 2010 Foreign Trade Trend: A "high-low" trend was emerging for China's foreign trade in 2010, as growth in the first half would be stronger than in the second half of the year, Yao Jian, a spokesman with Ministry of Commerce told a briefing Tuesday.

China's exports will only moderately increase in the next half of the year, since tightening monetary policies in emerging economies, such as Brazil and India, and the European sovereign debt crisis will curb overseas demand, Yao said.

The country's total value of imports and exports jumped 43.1% percent year-on-year to $1.35 trillion in the January-to-June period, but the trade surplus was down 42.5% to $55.3 billion U.S. dollars.

"Wrong" to Hit at Outbound Investment: Countries including the United States and India should not politicise outbound investment by Chinese enterprises or abuse investment protection tools to shield their own industries and jobs from the financial crisis, the Ministry of Commerce said on Tuesday.

China's outbound direct investment (ODI) surged by 24% from a year earlier to $55.18 billion during the first six months, the ministry said. The investment mainly went to sectors such as mining, commercial services, manufacturing, wholesale, and retail.

Despite the rapid growth, Chinese investment abroad has been frequently blocked by other countries, especially the US and India, during the past few months.

China May Reform Yuan Exchange Rate Calculation: China may calculate the yuan's exchange rate against a basket of currencies, instead of only against the US dollar, Hu Xiaolian, deputy governor of the People's Bank of China said in a signed article published on the PBOC website.

There should be various currencies in the effective exchange rate basket to reflect the diversity of China's trade and investment activities, Hu added.

Agreement for Business with Hong Kong: The People's Bank of China, and Hong Kong's Bank of China (Hong Kong) Limited, signed a revised Settlement Agreement on the Clearing of Renminbi (Yuan) Business in Hong Kong.

"There will no longer be restrictions on banks in Hong Kong in establishing renminbi accounts for and providing related services to financial institutions; and individuals and corporations will be able to conduct renminbi payments and transfers through the banks," said Norman Chan, the chief executive of the Hong Kong Monetary Authority.

Foreign Investors Eye China's Real Estate: China's property market has seen soaring investment from foreign institutional investors, driven by strong expectations of currency appreciation this year.

According to international real estate advisor Richard Ellis, the value of en bloc property transactions in 15 Chinese cities has hit 49.9 billion yuan ($7.36 billion) in the first-half of this year, among which 19.4 billion yuan came from foreign institutional investors, 10.2 billion yuan from Hong Kong, Taiwan, and Macao, and the remaining 20.3 billion yuan from mainland investors.

Total investments in the first six months of this year were almost five-fold those from the same period of last year.

China Honors All WTO Entry Commitments: China has honoured all the commitments it made when entering the World Trade Organization (WTO), said Yao Jian, spokesman of Ministry of Commerce, on Tuesday.

"China has set up economic and trade mechanisms in line with WTO rules and requirements, and become one of the most open markets in the world," he said.

Yao added that China will further cut tariffs on agricultural and industrial products by about 30 percent according to the latest Doha round of talks.

US Labour Group Offers Help with Apple: A San Francisco-based labour council wants to help its counterparts in Guangdong Province press IT giant Apple to allocate more profits to its scandal-hit Chinese manufacturer to improve the treatment of Chinese workers.

Apple Inc is a major brand customer of Foxconn Technology Group, which employs more than 800,000 people on the Chinese mainland, mostly in Guangdong.

The latest offer came after a dozen Foxconn workers committed suicide by jumping off buildings in the company's premises in the first six months of this year.

A 19-year-old intern from the Dongfang Vocational School of Technology in Hebei province died on Tuesday morning after he fell from his sixth floor dormitory at the plant in Foshan of Guangdong, Chimei said in a statement on Wednesday.

Police are still investigating the case.