Overseas banks have seen their business steadily expanding in China since last December, when the country fully opened its banking sector to foreign competitors, a senior official with the China Banking Regulatory Commission (CBRC) said Tuesday. Total assets of overseas banks in China had hit 153.9 billion US dollars by the end of October, up 41 percent from the same month last year. By the end of October, more than 90 overseas banks had operations on the Chinese mainland, running about 230 branches. In addition, there were three joint-venture banks.

Economics

China and the United States have agreed upon specific steps for foreign companies to enter China's financial service industry following two-day high-level economic dialogues. China said it would complete a study of foreign equity participation in the banking sector by the end of 2008 and make relevant policy recommendations. Foreign-invested companies, including banks, will be allowed to issue RMB-denominated stocks and bonds, while mutual funds administered by Chinese banks will be allowed to invest in the US stock market, according to a statement from the US government.

China's retail sales hit their highest level in nearly 11 years in November, rising 18.8 percent above the same period a year earlier, the National Bureau of Statistics (NBS) reported on Wednesday. The November figure was also higher than the 18.1 percent recorded for October, a time which included the "golden week" holiday when people tend to make more purchases. Analysts said recent price increases and continued negative real interest rates were behind the accelerated retail sales growth.

Economics

The Chinese economy will grow by 11.6 percent this year, the fifth consecutive year for the country to achieve double-digit GDP growth since 2003, according to the annual "blue book" on economic forecasts by the Chinese Academy of Social Sciences (CASS). The book was released Monday. China's consumer price index (CPI), the main gauge of inflation, has risen strongly in recent months, reaching a decade high of 6.5 percent in both October and August.

The Chinese Ministry of Land and Resources (MLR) is seeking to improve land reserve system amid intense concerns over a 9.5-percent year-on-year housing price rise in 70 major Chinese cities this October. Experts hold that robust demand, tight supply, and higher land development costs drove up housing prices and the government's new move is a bid to regulate the real estate market and curb rises in housing prices.

China is likely to produce nearly 500 million mobile phones in 2007, or more than 40 percent of the world's total, according to a prediction by the Ministry of Information Industry on Tuesday. The forecast figure is 41 percent higher than the output in 2006. Of the total production, around 400 million mobile phones will be exported.

Most European businesses are doing well in China despite increasing competition, says the latest survey of the European Union Chamber of Commerce in China. The annual European Chamber business confidence survey also found that China's biggest attraction is its domestic market rather than its relatively low labor and sourcing costs. In fact, over 80 percent of the respondents to the survey said they were in China primarily to access or serve the Chinese market. Conducted jointly with international consulting firm Roland Berger Strategy Consultants, the survey is based on interviews with about 200 European companies.

Economics

Pollution costs China around 5.8 percent of its gross domestic product each year, according to the World Bank. This is a figure far higher than past official Chinese estimates. Absenteeism due to health and other pollution-related problems is costing about US$100 billion a year, or about 5.8 percent of GDP. Air pollution alone is costing about 3.8 percent of GDP according to the figure of World Bank.

China, the world's most populous nation, will remain 95-percent self-sufficient in grain in the future by expanding both output and reserves, according to the National Development and Reform Commission. To ensure adequate supply and improve the quality of farm produce, China will boost large-scale production rather than production by scattered, small farms. Large production bases would be built to raise the country's production capacity of staple agricultural products such as grain, oil, sugar, meat, and milk, while farmers who grow grain or raise hogs will get financial support from the government.

Housing prices in 70 major Chinese mainland cities jumped 9.5 percent in October from the same period last year, according to a survey by the National Bureau of Statistics and the National Development and Reform Commission. The rise, 0.6 percentage points higher than that of September, hit a new high despite the government's efforts to curb surging property prices. In the 70 cities, prices of newly-built commercial housing units were up 10.6 percent in October, while prices of low-cost housing rose 3.3 percent. Prices of luxury homes went up 12.3 percent. The survey found Ningbo, Urumqi, Beijing, and Beihai on top of the list of cities where the survey was carried out. Housing prices went up 19.1 percent in Ningbo; 18.5 in Urumqi, capital of the northwest Xinjiang Uygur Autonomous Region; 17.8 percent in Beijing; and 17.7 percent in Beihai.

Chinese banks had issued more than 1.3 billion debit, credit, and semi-credit cards by the end of September, roughly one for every person in China, according to China UnionPay. Bank card consumption as a percentage of China's total retail sales exceeded 18 percent in the first nine months as more Chinese opt for cards over cash. China had 183 banks issuing cards that could be used at 1.08 million points of sale for 650,000 specially endorsed outlets and 120,000 automatic teller machines.

Chinese businesses have accumulated an abundance of capital in the economic boom over the past 30 years, leading to a strong desire to invest overseas, especially in Southeast Asian Nations' (ASEAN) infrastructure projects. The ASEAN is becoming the main destination of China's growing overseas investment in the future. So far more than 1,000 Chinese companies have made investments in ASEAN member countries, mainly in such sectors as agriculture, manufacturing, mining, tourism, electricity, and infrastructure construction.

China's registered small and medium-sized enterprises (SMEs) have exceeded 4.3 million and contributed 58.5 percent of gross domestic production, according to the SMEs association. The 4.3 million SMEs, more than 95 percent of which are privately owned, contributed to 50.2 percent the country's total tax revenue. SMEs also make 66 percent of the country's patent applications and develop about 82 percent of its new products.

China's largest international trade fair opened in Guangzhou on Monday, with organizers expecting an increase in the number of exhibiters from overseas. The 102nd China Import and Export Commodities Fair, commonly known as the Canton Fair, has attracted a total of 15,054 businesses, including 480 from 57 other countries and regions for the event, which will last until October 30.