Petrol prices

China raised the price of petroleum, diesel and aviation fuel by about 10 per cent, or 500 yuan (US$62.4) per ton, as of last Wednesday.

Officials from the National Development and Reform Commission said fuel prices were increased mainly because the country's previous prices were far below those of the international market. This discrepancy had hurt the profitability of mainland oil refineries.

The commission has asked all local governments to strictly implement a series of subsidies in the wake of the fuel price increase, and to take measures to protect the income of taxi drivers.

Poverty alleviation

China's poorest citizens will all have enough food and clothing by 2010, the government promised last week.

The 23.65 million poorest people in the country will be fed and clothed under a village-based poverty alleviation campaign, said Liu Jian, director of the Leading Group Office of Poverty Alleviation and Development, which is under the State Council.

He said the government would focus its poverty-reduction efforts in the coming years on people living in the country's poorest 148,000 villages.

Raw deal

Lenovo Group, which acquired IBM's personal computer business in 2004, expressed deep concern last week over what it said were unfair measures taken by the US Congress on a recent contract it had won.

The company successfully bid for a US State Department contract in March to provide 16,000 Lenovo Thinkcentre M51 desktop computers and other equipment worth US$13 million through its US distributor, CDW Government Inc.

Several members of the US Congress, however, claimed that the Chinese Government holds Hong Kong-listed Lenovo. They argued that procurement of its computers could lead to intelligence leaks. The State Department said it would reallocate 900 of the computers.

Sino-German ties

China and Germany signed 19 agreements last Monday to intensify collaboration in areas such as railways, finance, telecoms, and energy at a ceremony attended by Premier Wen Jiabao and visiting German Chancellor Angela Merkel.

The partnership between the two countries in the magnetic levitation field "has been fruitful", as demonstrated by the operation of the 30-kilometre railway between downtown Shanghai and Pudong International Airport, Wen said.

Buyouts encouraged

China's securities regulator issued new draft rules last Monday aimed at encouraging more buyout activities for publicly traded companies.

The draft rules, issued by the China Securities Regulatory Commission, are part of a series of measures for the government to establish a new system for the reformed securities market.

The commission said the new rules demonstrate the government's determination to encourage more acquisitions among listed companies and will be more in line with the new Securities Law, enacted on January 1 this year.

IPO plans submitted

The Shenzhen Small and Medium-sized (SME) Enterprises Board is soon expected to list the first group of companies since the government lifted a year-long ban on initial public offerings (IPOs).

Sources close to the securities regulator said last week that five SMEs including Hengdian Group DMEGC Magnetics Ltd Co, Shenzhen Tongzhou Electronic Ltd Co and China CAMC Engineering Co Ltd have submitted their IPO plans to the China Securities Regulatory Commission.

Commission Chairman Shang Fulin said last week that the government would continuously build up the Shenzhen SME Board, also called the second board, as a long-term strategy for bringing China's securities market up to international standards.

Environmental standards

China has launched ambitious plans to make its residential and office buildings more energy efficient. In the first five months of the year, industrial standard makers announced three sets of new national standards: regulations on energy efficiency for civil buildings, standards for residential buildings and standards for technical evaluations of residential buildings.

Another new guideline regarding the assessment of green buildings will take effect on June 1. Although not compulsory, the standard calls for stricter criteria for energy consumption and other environmental indices.

According to Minister of Construction Wang Guangtao, these standards have formed a basic framework for industrial regulations on energy efficiency in buildings.

Oil production

China can expect oil production to steadily increase throughout the 11th Five-Year Plan period (2006-10), with crude oil output estimated between 185 and 195 million tons. This momentum will continue until 2020, but national petroleum consumption will also continue to rise as a result of increasing production demands.

Consumption will hover around 330 million tons and 350 million tons by the late 11th Five-Year Plan period, said Pan Derun, vice-chairman of the China Petroleum and Chemical Industry Association. Pan added that the country has discovered between 800 million tons and 900 million tons of new oil reserves every year since 1984, largely due to continuous technical developments.

New bank

China's cabinet, the State Council, has given the go-ahead to the establishment of the country's fifth largest bank, China Postal Savings Bank. The move was a result of restructuring initiatives in the postal system.

Cai Esheng, vice-chairman of the China Banking Regulatory Commission, said last week that the postal savings bank would focus on retail banking and intermediary services.

The commission gave the green light to the launch of a postal savings bank last July and reported the plan to the State Council.

Economic growth

The Chinese economy grew 10.3 per cent in the first quarter of this year, a tenth of a percentage point higher than what had been earlier reported by the National Bureau of Statistics.

A circular released by the bureau last Tuesday said that China's gross domestic product (GDP) in the first three months had reached 4.339 trillion yuan (US$542 billion), 7.7 billion yuan (US$962 million) more than data released last month showed. The preliminary check was made according to the statistics bureau's GDP accounting and releasing procedures, said the circular.

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