The Top 10 China Economic Stories of 2009
Written by Elena Luk'yanenko   
Monday, 01 February 2010 17:04
The top 10 economic stories of 2009 as selected by senior editors, media agencies and domestic economists.

1. The Chinese economy leads the recovery from the economic downturn
  • China's economy leads the economic recovery from the financial crisis worldwide, and the target of 8% GDP growth planned for this year is achievable as a result of a proactive fiscal policy, moderately loose monetary policy and extension of the economic stimulus package.
  • From January 14, the Chinese government launched a series of plans to adjust and reinvigorate key industries including autos, steel, shipping, petrochemical, textile industry, nonferrous metal, equipment manufacturing, IT and logistics. The government measures also include subsidies for autos, motorcycles, home appliances.
  • The unemployment rate was consistent below 4.6%.

2. Investment in reforming the medical system
  • On January 21, China's State Council passed a long awaited medical reform plan which promised to spend 850 billion Yuan ($123 billion) by 2011 to provide universal medical services to the country's 1.3 billion people.
  • According to the restructuring plans, within the next three years the authorities will provide basic medical security to all Chinese in urban and rural areas, improve the quality of medical services, and make medical services more accessible and affordable for ordinary people.

3. Cross-border Yuan settlement begins
  • On April 8, China's State Council announced a pilot program to allow exporters and importers to settle cross-border trade deals in Yuan in five cities including Shanghai, Guangzhou, Shenzhen, Zhuhai and Dongguan.
  • In July, the central bank issued detailed measures to regulate the pilot program for cross-border trade settlement and 365 companies in the five cities formally agreed to operate the business of cross-border settlements in Yuan by the central bank.

4. China Nasdaq-style GEB launched
  • The 10-year wait for China's Nasdaq-style Growth Enterprises Board (GEB) finally became a reality on October 23 when it was launched in Shenzhen. The first batch of 28 companies started trading on October 28.
  • By December 28, a total of 36 companies met the requirements of high gross margins, high rates of return (ROE) and high growth of operating revenues and high technological innovation, and were listed on the GEB.

5. Shanxi Province undergoes massive restructuring of coal industry
  • In 2009, Shanxi Province started massive restructuring of the coal industry by allowing small coal mines merge into large-scale companies, mostly State-owned.
  • By the middle of November, 95 percent of coal-mining companies have signed official transfer protocols and the total number of coal mines was cut to 1,053 from 2,598. Also, the number of coal-mining companies was reduced to 130 from about 2,000.

6. Chinese mainland, Taiwan signs financial cooperation agreement
  • On November 16, the Chinese mainland signed three memorandums of understanding with Taiwan with regard to the cooperation of banks, securities and futures, and insurance, practical step for cross-strait financial cooperation.

7. China's auto sales, output makes it No.1 in the world
  • China's auto sales and output both exceeded 12 million units in the first 11 months and the sales and output for the whole year is expected to exceed 13 million units to overtake the US to become the largest car manufacturing and consuming market, according to figures released by the China Association of Automobile Manufacturers (CAAM) on December 7.

8. New loans in 2009 hit record high
  • In the first 11 months, China loaned out 9.21 trillion Yuan, 5.06 trillion Yuan more than the same period last year, according to the figures released by People's Bank of China on December 11. Both the loan amount and the growth pace of loans this year hit a record high.

9. China to curb rising housing prices
  • China's State Council said on December 14 that the government will take measures to rein in excessive growth in property prices.
  • The government also said that it will seek to speed up building houses for the low-income population, aiming to help 15.4 million more poor households solve their housing problems by 2012. Moreover, the government will reinforce regulations and stabilize market expectations.
  • In addition, a sales tax break on homes bought over two years earlier will expire and the full taxation period will return to five years from the start of the next year.

10 Chinese enterprises step out in international mergers
  • On December 23, Ford Motor said that the company has reached an agreement on some key aspects with Chinese Geely Automotive on the latter's bid for Volvo; Geely also claimed that the final buying agreement will be signed in the first quarter of next year.
  • Wuhan Iron and Steel (Group) Corp., a major iron and steel company in central China, signed an agreement with Australian Centrex Metals Ltd (CXM) in July for a joint development of iron ore mines in southern Australia and other projects.
  • Yanzhou Coal Mining, China's fourth-biggest coal producer, takes over Australian coal miner Felix Resources at an acquisition price of A$3.5 billion for all of Felix Resources' shares.

Source: Golden View's News