THIS WEEK ECONOMY

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THIS WEEK ECONOMY

Helicopter Purchase

A Chinese consortium has ordered 100 H135 twin-engine helicopters from Airbus Helicopters and will build a final assembly line in Qingdao，east China's Shandong Province，Airbus said on June 13.

In a press release，Airbus said that the consortium is made up of China Aviation Supplies Holding Co.，Qingdao United General Aviation Industrial Development Co.and CITIC Offshore Helicopter Co.Ltd.

This fulfills a commitment to purchase 100 H135s made in 2015，the company said.

“With the further opening up of the Chinese skies and the increasing growth in the civil and parapublic segments，China is gearing up to be the biggest market for helicopters in years to come，” said Norbert Ducrot，head of Airbus Helicopters in the China and North Asia region.

The final assembly line is expected to start operations by 2018 and assemble 100 H135s over the next 10 years.

The H135 is popular in China for emergency medical services，law enforcement，firefighting and corporate transportation.

Cash Replenishment

Chinese car-hailing company Didi confirmed on June 13 that it had secured $600 million from China Life Insurance as part of its ongoing financing round that its president says will exceed $3.5 billion.

The investment is made through China Life Investment Holding Co.Ltd.，Didi said in a statement.

As its rival Uber announced the end of a funding round worth $3.5 billion earlier this month，Didi's President Jean Liu said that the company is looking to surpass that amount in its current funding round，which also includes $1 billion from Apple.

This round of funding could result in the Chinese start-up being valued at over $25 billion，analysts say.

Didi said it will also work with China Life on insurance and other financial services and corporate car services.The two will also seek investment opportunities in transportation services both in China and abroad.

According to Didi，its platform has mobilized 15 million drivers to deliver rides for 300 million registered users，with daily orders reaching over 14 million.

Foreign Investment

For the first five months，foreign direct investment （FDI），which excludes investment in the financial sector，rose 3.8 percent year on year to $54.2 billion，with the growth decelerating from the 4.8 percent registered in the January-April period，the Ministry of Commerce said on June 12.

The service sector attracted $38.2 billion of FDI in the five months，70.4 percent of the total.

FDI into the manufacturing sector declined 3.2 percent during the period to $15.5 billion，accounting for 28.8 percent of the total.

Among the 10 major investors，FDI from the United States surged 140.2 percent year on year in the first five months，while that from Britain soared 110 percent.

Investment from countries relating to the Belt and Road Initiative was up 1.3 percent to $3.1 billion during the period.

In May alone，FDI fell 1 percent year on year to $8.89 billion，compared to a 6-percent increase registered in April.

Price Indexes

China's consumer price index （CPI），a main gauge of inflation，grew 2 percent year on year in May，official data showed on June 9.

The May data narrowed from the 2.3-percent growth rate registered in the previous three consecutive months，when the CPI remained at its highest level since July 2014，data from the National Bureau of Statistics （NBS） showed.

China's producer prices continued to fall in May，but the contraction narrowed from April in a sign of improved aggregate demand in the industrial sector.

The producer price index （PPI），a measure of costs for goods at the factory gate，dropped 2.8 percent year on year in May，narrowing froma 3.4-percent drop in April and a 4.3-percent decline in March.The reading marked the 51st straight month of decline.

HSBC attributed the easing PPI contraction to extended gains for bulk commodity prices and increasing infrastructure and property investments during the period.

New Bank Approved

A new private lender backed by eight Chinese firms including smartphone maker Xiaomi has been approved by China's banking regulator，Xiaomi confirmed on June 13.

The bank，to be headquartered in Chengdu，capital of southwest China's Sichuan Province，has a registered capital of 3 billion yuan（$456 million），and counts New Hope Group，a Xiaomi subsidiary called Yinmi，and Sichuan-based convenience store operator Hongqi as its biggest stakeholders，with 30 percent，29.5 percent and 15 percent stakes，respectively，in the bank.

The new lender is evidence of further inroads by Chinese Internet firms into the country's statedominated financial sector.The country's banking regulator has sought to extend financial services to a broader range of companies and individuals that have been underserved by the country's established，state-backed lenders.

The bank will extend financial services to young people and small companies，according to a press release by Xiaomi.Chinese Internet giants Tencent and Alibaba also launched their own lenders，WeBank and MYbank，respectively，last year，offering online-based financial services such as wealth management products and loans.

Tackling Zombie Companies

China will regulate dormant firms to ensure they either re-start operation or file for liquidation，according to an official statement released on June 13.

Dormant companies that have failed to submit annual operation reports or tax declarations for at least two consecutive years must do so or they will have their business licenses revoked，according to a statement jointly released by the State Administration for Industry and Commerce and the State Administration of Taxation.

The move will force nonperforming “zombie enterprises，”which waste resources，to shut down，as they distort the general economic picture，the statement said.

The two government agencies will warn dormant firms before taking any measures.

The reduction of overcapacity in sectors such as steel and coal is high on China's reform agenda this year and plans have been announced to shut down non-performing plants and reemploy laid-off workers.

More Stringent Measures

China has vowed more stringent oversight of its listed companies to protect investors and curb speculation in the stock market，the stock regulator said.

Authorities will enhance regulatory supervision of public companies listed on China's domestic A-share market by improving information disclosure and corporate governance，said Jiang Yang，Vice Chairman of the China Securities Regulatory Commission （CSRC） at the 2016 Lujiazui Forum in Shanghai on June 13.

Regulators will strengthen supervision of activities related to listed firms' major shareholders and asset restructuring，and urge listed firms to deliver returns to investors through organic growth，Jiang said.

He added that the authorities will roll out tougher regulations and enhance their monitoring of market activities to identify problems at an early stage，though he did not elaborate.

In May，the Shanghai and Shenzhen bourses set time limits on trading suspension for listed firms subject to mergers and acquisitions，and private placements，in the latest move to strengthen their oversight of listed firms and foster a more value-driven investment sentiment in China's stock markets.

XINHUA

Shopping Spree

Employees work hard at an intelligent logistics center of e-commerce company JD.com in Gu'an，Hebei Province，in preparation for the mid-year online shopping carnival day on June 18.

The Gu'an intelligent logistics center came into operation in April 2015.It's the largest and most advanced of its kind among JD.com's logistics centers.

Trade Fair

Business people visit the Vietnamese Hall at the Fourth China-South Asia Expo held in Kunming，Yunnan Province，on June 12.

The Expo attracted about 5，000 company exhibitors，half of which are from abroad.

XINHUA