China's Export Industry under Pressure
Chinese exporters see tougher days ahead as overseas orders shrink.
Chinese exporters see tougher days ahead as overseas orders shrink.
Overseas orders showed significant decline at the recently concluded Canton Trade Fair, China's largest and most well-known fair for international buyers. The total value of contracts signed at the fair was $31 billion, down 17.5% from the fair held this spring and down 16% from the autumn fair last year. The last time export orders declined was in 2003, when China was hit by the SARS epidemic.
According to a survey at the fair, many overseas customers are concerned about the global economic slowdown, which has led them to either cancel the orders or only make purchases for the short term. Because most of the foreign buyers at the fair placed orders for next spring's delivery, we expect more exporters will find themselves in trouble in 2009.
Market Recap
Following movements in the United States and in other Asian markets, major indexes remained under pressure in China for the week. Thanks to news about a massive investment plan in China's public transportation sector to boost domestic demand, the Shanghai Composite Index eventually ended the trading week up 1.0% to 1748, while the Shenzhen Composite Index dropped 1.5% to 5753.
Agricultural Bank of China Gets $19 Billion from Government Agency
After the capital injection, Central Huijin--an investment arm of the government--will have a 50% stake in the bank, while the rest is owned by the Ministry of Finance. The next step for the bank's reform is to address bad loans on its books and prepare for a public listing in late 2009.
China to See $1 Billion Investment from PepsiCo (PEP)
The beverage and snack giant announced that it will make the investment in manufacturing capacity (mainly in central and western China), R&D, and sales in China over the next four years. In September, its rival Coca Cola (KO) offered $2.4 billion in cash to buy Huiyuan, China's top fruit-juice maker.
China to Sell Five Regional Jets to General Electric (GE) Commercial Aviation Services
GE announced the firm order of five jets and options for another 20 at a recent international air show held in southern China. These regional jets, made by the Commercial Aircraft Corp of China, can seat 70-90 passengers. They are built with GE-powered engines as well as technologies developed in China. Delivery of the jets will begin in 2013.
Iris Tan, Peter Liu, and Feliz Li contributed to this article.
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