China has warned a top member of the US Federal Reserve that it is increasingly disturbed by the Fed’s direct purchase of US Treasury bonds.

Richard Fisher, president of the Dallas Federal Reserve bank, said “Senior officials of the Chinese government grilled me about whether or not we are going to monetise the actions of our legislature.”

“I must have been asked about that a hundred times in China.  I was asked at every single meeting about our purchase of treasuries.  That seemed to be the principal preoccupation of those that were invested with their surpluses mostly in the Unites States.” He told the Wall Street Journal.

His recent trip to the Far East appears to have been a stark reminder that Asia’s “Confucian” culture of right action does not look kindly on the insouciant policy of printing money by Anglo-Saxons.

Daily Telegraph – 25th May

Talk that Rio Tinto’s $19 billion (£12.4 billion) deal with Chinalcvo is about to be ditched in favour of a rights issue sent the Anglo-Australian miner’s shares into the red, putting an end to the stock’s 20 per cent rally of the past two weeks.

When Tom Albanese , the chief executive, rose to his feet at a mining conference in Barcelona to give a presentation about Rio’s future, those watching noted that his tone was less enthusiastic about the Chinalco deal than it had been in the past.

Times – 13th May

A rarefied ‘white’ tea enjoyed by the Chinese since the days of the Ming Dynasty could play a crucial role in fighting obesity in the West, new research has shown.

Naturally occurring chemicals in white tea – which is made by plucking the youngest, tenderest buds of the tea plant – are capable of breaking down fat cells and preventing new ones from forming.

White tea has previously been linked to the creation of stronger bones, lowering blood pressure and reducing the risk of some cancers.

The new research, published in the journal Nutrition and Metabolism and was conducted by the German health foods company Beiersdorf AG, now claims that anti-fat properties can be added to that list.

Daily Telegraph – 1^st May

THAT’S BETTER THAN DIETING, SHAME IT IS NOT ALCOHOLIC!

Baidu, China’s largest internet search group, reported a 23.5 per cent increase in first-quarter net profits as it took advantage of continued growth in the number of web users in Asia’s second largest economy.

But the Nasdaq-listed company warned that the global downturn was affecting online advertising. The company registered a rare drop in the number of of active online marketing customers – companies bidding for paid search listings or keywords or buying ads on Baidu’s pages – and in the revenue per online marketing customer from the fourth quarter.

Financial Times – 28^th April

The soyabean and vegetable oil markets are heating up – prices have jumped to a six-month high and traders are warning of a further spike this summer on the back of strong Chinese demand and low supplies from key exporting countries.

“The rally has legs,” says Richard Feltes, head of commodities research at MF Global, a brokerage, in Chicago. “It could be potentially explosive.”

Soyabean prices in Chicago recently rose above $10.70 a bushel, the highest level in six months, outperforming other food commodities such as wheat and corn.

Although prices fell earlier this week on the back of swine flu, they have recovered quickly and traders believe they could rise above $12 a bushel soon, a further 15 per cent gain.

Yesterday, CBOT May soyabean traded at $10.65 a bushel.

Financial Times – 30^th April

Continued strong demand from the telecommunications industry helped China Shoto, the Aim-quoted lead acid battery maker, to increase revenues 70 per cent to £183.1m last year. The company said that at constant currency rates revenues were up 50 per cent.

Pre-tax profits jumped from £7.2m to £11.6m, £1m ahead of February’s revised forecast from Seymour Pierce, its broker. The forecast for this year has been increased from £11.5m to £12.5m.

Back-up batteries for the transmitters of the rapidly expanding Chinese mobile phones market accounted for £164.8m of total revenues. The company is concentrating on that market, which produces better margins. Meanwhile its sales of batteries for electric bicycles fell from £29.5m to £18.3m.

Financial Times – 28^th April

When China Mobile, the world’s largest mobile operator by subscribers, announced this week that it intended to buy a 12 per cent stake in FarEasTone, Taiwan’s number three operator, it caught most in the industry by surprise.

The Chinese market leader had expressed the intention to look for acquisitions abroad, focusing on developing markets with big growth potential. Now, in its first deal following the sector’s restructuring last year, it has opted for one of the world’s most saturated telecoms markets.

Industry insiders say China Mobile, resigned to the fact that it will lose out on 3G due to its uncompetitive technology, is now fully focusing on making TD-SCDMA a core part of the emerging global 4G standard Long-Term Evolution, or LTE.

This is where the Taiwan investment comes in. Jimmy Cheong, an analyst at JPMorgan, says China Mobile’s investment decision had an industrial policy element to it as Far EasTone is to set up a trial TD-SCDMA network in Taiwan. “Getting this support to promote TD-SCDMA through the Taiwan manufacturing value chain was likely an important consideration for China Mobile,” he says.

He adds that there were increasing signs that LTE, rather than Wimax, a technology in which Taiwan’s government and companies have made major investments, will be the dominant 4G technology.

Financial Times – 30^th April

China recorded a month of record car sales in March, underlining the country’s rise in the world just as carmakers in the United States are scrambling to avoid bankruptcy.

Chinese people, eager to leave behind the age of the bicycle bought 1.1 million vehicles in March, up 5 per cent from the previous record of 1.06 million in March last year, data from the China Association of Automobile Manufacturers showed. The figure cemented China in its position as the world’s largest car market, outstripping even the United States.

Times – 10^th April.

US first lady Michelle Obama has caused a surge in sales of exported shoes from China

Reoblan Footwear, a manufacturer based in the Sichuan province, is working overtime to churn out the high-heeled Bandolino Berry, which she has been photographed wearing this year.

Orders for the shoe have soared on the back of the seal of approval given by the trendsetting wife of US President Barack Obama, a company official said.

“Sales of Bandolino shoes increased rapidly after the US first lady wore them,” said Chen Xiang, Reoblan export manager.

“Our company received a letter of congratulations from our partner (in the United States) and also a new order for shoes.”

The manufacturer was given a three-month order for 200,000 pairs of the shoe in March alone, after producing and exporting only 500,000 pairs in all of 2008.

Chinese exports have fallen since late last year as the world financial crisis hit overseas demand for products.

The slowdown has led to the closure of thousands of factories, while at least 25 million migrant workers from poor rural areas are now unemployed.

Daily Telegraph – 29^th April

MangistauMunaiGaz is a name to conjure with, but the sale last week of Kazakhstan’s fourth-largest oil company probably did not rock your world. The Central Asian firm controls reserves of about half a billion barrels of crude and output of 113,000 barrels per day – big, but not hugely significant. It might have raised an eyebrow, however, had you known that the successful joint purchaser was China National Petroleum Corporation (CNPC) and that the competing investors were Oil and Natural Gas Corporation, of India, and Gazprom Neft, the oil unit of the Russian gas giant.

In the West we wring our hands over the collapse of capitalism, but in Central Asia they are fighting over the spoils. The economy of Kazakhstan was badly beaten by the credit crunch and its banking system came close to collapse. This month President Nazarbayev of Kazakhstan went cap-in-hand to Beijing and came back with a $10billion (£6.8billion) loan.

Half of the money will be used to diversify the Kazakh economy, but the other half will bolster the energy sector and make possible the $3.3billion acquisition of MangistauMunaiGaz, to be shared equally between CNPC and KazMunaiGas, the state-controlled energy company. In return for propping up the Kazakh Government’s investment, the Chinese get half of the oil. The Chinese loan will also help to build a pipeline to take gas from the Caspian region to the south of Kazakhstan, a strategic move that brings gas closer to the Chinese border.

This is the moment that China has been waiting for – global financial mayhem, commodity price weakness, governments in disarray and a war chest of $2trillion in foreign currency reserves. Recession has not distracted the officials who manage China’s sovereign wealth funds. Half of China’s oil is imported and the need will rise to two thirds by 2020. This is the time to buy cheap reserves of oil, gas, copper and iron ore and they are busy scooping up every spare tonne, ounce, barrel within reach.

In February China propped up the finances of Russia’s debt-burdened oil exporters with $25billion in loans secured against 20 years of oil exports. China is promised 300,000 barrels per day and included in the deal is a new pipeline that will deliver crude to China’s northern refineries. In the same week, China agreed a similar credit-for-oil deal with Brazil under which Petrobras, the Brazilian state oil company, would receive $10billion in loans in return for delivery of up to 100,000 barrels a day to Sinopec and 60,000 barrels per day to PetroChina.

Times – 30th April