TODAY'S BRIEFS Daily News Update - 4 July, 2008

TODAY'S BRIEFS
Daily News Update - 4 July, 2008

Direct flight to Taiwan takes off from mainland
The first regular direct flight from the mainland to Taiwan since 1949 took off today, Reuters reported. The China Southern Airlines flight departed from the southern city of Guangzhou early this morning, in the first wave of tourism that could see millions of mainland residents visit the island. Negotiators from the mainland and Taiwan agreed last month to let as many as 3,000 mainland tourists visit Taiwan each day. The so-called weekend charter flights, which actually run regularly from Friday to Monday, fly between Taiwan and Beijing, Guangzhou, Nanjing, Shanghai and Xiamen. Opening direct flights between Taiwan and the mainland is seen as one sign of warming relations between the cross-straits rivals. Cross-strait flights are required to take detours into Hong Kong airspace, which can add significantly to total flying time on certain routes.

Ping An denies tax investigation
Ping An Insurance (Group) Co of China denied that it is being investigated for tax irregularities, the Wall Street Journal reported. The insurer said the State Administration of Taxation was engaged in a "routine check" of the company and said the firm had nothing to disclose at this time. Nonetheless, the insurer's shares dropped by 5.8% to RMB40.55 (US$5.92) on Thursday, after plunging by the 10% daily limit in morning trade. The insurer, one of China's largest by premiums, blamed the selling of shares on speculation over the tax investigation. Analysts said Ping An's planned US$119 million purchase of more shares in Dutch-Belgian financial services group Fortis NV wil also likely lead investors to dump Ping An shares.

Taiwan to relax China investment restrictions
Taiwan's government will relax restrictions governing mutual fund investment in China-related stocks, the Wall Street Journal reported. Taiwanese president Ma Ying-jeou's cabinet agreed to allow mutual funds sold in Taiwan to invest as much as 10% of their assets directly in stocks listed in China, up from the current 0.4% limit. The cabinet will also remove a 10% ceiling on mutual funds' investments in H-shares and red chip companies. No details were provided as to when the changes would take effect. The move is part of an effort to develop Taiwan into a regional asset-management hub, the paper said.

Footwear maker shelves Hong Kong listing
Footwear maker Xdlong International scrapped its plans yesterday for a HK$900 million (US$115.4 million) Hong Kong initial public offering amid a dismal market, the South China Morning Post reported. A source told the paper that Xdlong failed to draw enough orders from both institutional and retail investors in what one investment banker called "a disastrous year for the IPO market." In addition, two other Hong Kong listing candidates, Macau casino operator SJM Holdings, and mainland advertising firm SinoMedia Holdings were forced to price their IPOs at the bottom of their offering ranges. SJM fixed its shares at HK$3.08 (US$0.39) while SinoMedia fixed its shares at HK$2.63 (US$0.33). SinoMedia Holdings is unrelated to Sinomedia, the parent company of China Economic Review.

Brazil seeks to triple trade with China
Brazil wants to triple its exports to China, AP reported, citing Brazilian officials. Speaking in Brasilia at the launch of Agenda China, an initiative aimed at boosting Brazil's trade presence in China, Brazilian Foreign Trade Secretary Welber Barral said the organization will seek to boost sales to China of a wide range of Brazilian products, including pharmaceuticals, chemicals and shoes. Trade between Brazil and China rose tenfold from 2000-2007, according to Brazilian government figures. Brazil's exports to China stood at US$10.7 billion at the end of 2007, 74% of which were low-value commodities such as soybeans. Imports from China in 2007 stood at US$12.6 billion, 96% of which were high-value manufactured goods.

China says willing to discuss emissions targets
China is willing to discuss setting goals for reducing emissions at the G-8 summit next week in Japan, AP reported. "On medium- and long-term goals, China is open. We are ready to discuss all issues related to climate change," said Su Wei, director general of the climate change group at the National Development and Reform Commission, China's top economic planning body. But Su reiterated China's view that the main responsibility for tackling climate change still rests with the world's developed nations. Leaders from the G-8 nations will meet in Hokkaido on July 7-9. Chinese president Hu Jintao will attend the conference.

Qingdao gov't promises to clear algae from Olympic venue
The municipal government of the Olympic port city of Qingdao reiterated yesterday its promise to clear Qingdao's waters of green algae by July 15, the South China Morning Post reported. More than 10,000 workers are working to remove green algae that covers 32% of the sea area set aside for Olympic sailing competitions. The algal bloom began on June 1 and thus far 170,000 tons of the algae have been removed. The algae poses no health risk, but has blocked sailing routes and threatens Olympic planning. An official with Qingdao's Ocean and Fishing Bureau denied any "substantial link" between the algal bloom and environmental conditions or water quality.