Chinese walker

Here we are yet again in the midst of another “global economic crisis.” From the hilltops of Davos, Switzerland, Morgan Stanley’s permabear Stephen Roach has shouted warnings of potential economic “Armageddon.” Superinvestor George Soros designated the current state of the global economy “the worst market crisis in 60 years.” Bill Clinton labeled it “the biggest financial crisis since the Great Depression” —— even as global stocks responded by slumping 7.7% in January —— the worst start to an investing year since Morgan Stanley began publishing data in the 1970s.

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Among the emerging markets, Asia is in the best position to absorb the shocks of the recent financial crisis, said Gerard Lyons, chief economist of Standard Chartered in his recent analysis report.

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The National Meeting on Commercial Works which lasted two days was held in Beijing on December 23 and December 24. The meeting emphasized the general requirements on the commercial requirements of 2009, which are: fully implementing the spirits of the 17th CPC National Congress and the Third Plenum of the 17th Party Congress, taking the Deng Xiaoping Theory and the important thoughts of “Three Represents” as guidance, deeply implementing and fulfilling the scientific outlook on development, taking “expanding of domestic demands and maintaining steady development of foreign trades” as the focuses, improving the policies, enhancing the services, wholly planning both the domestic and international markets and resources, accelerating the structural readjustment and transition of development modes, and achieving a effective and rapid development of commercial businesses.

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Commerce Minister Chen Deming said on Tuesday that he expected China’s foreign trade to grow about 18percent to 2.6 trillion U.S. dollars for 2008 as a whole, despite the downturn in foreign demand during the second half.

He also estimated that foreign investment had exceeded 90 billion U.S. dollars, up about 20 percent.

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Profits of China’s state-owned enterprises declined for four consecutive months since August, due largely to high stockpiles and weaker demand during the global financial crisis, sources with the Ministry of Finance said on Sunday.

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Chairman LIU’s speech at the Caijing Magazine Annual Meeting

The year 2008 is an eventful year in the world financial history. The US subprime crisis has evolved into a global financial storm, which, in turn, has caused a downturn in the real economy that has reinforced the strains in the financial system. So far, the negative impact is universal and China is not immune to it. One year ago, when there was a huge debate on whether China could decouple from the world, I said it was only a myth. Now, the Caijing Magazine is offering us a valuable opportunity to look from the hindsight and lay a solid foundation for the future.

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The central and local governments will act to prevent further falls in sugar prices, Guo Shengkun, Communist Party head of southwest Guangxi Autonomous Region, told reporters in Beijing on Tuesday.

Guo, speaking at a press conference held by the State Council’s Information Office, said some governments have started to build a sugar stockpile with the goal of keeping prices at 3,000 yuan ($435) to 4,000 yuan per tonne.

On Tuesday, prices in Yunnan and Guangxi, China’s major sugar-producing area, dropped below 3,000 yuan per tonne.

The government will also establish a mechanism to link sugar prices to those of sugar cane to avoid sharp price falls, Guo said.

Guo said the region’s government would urge sugar producers to find more ways to use the crop, such as making grain alcohol, to reduce supply.

The government would also advise farmers to be cautious in expanding sugar cane planting and to pay close attention to market prices, he said.

Guangxi produced 9.71 million tonnes of sugar last year, or about two-thirds of China’s total. There are 13 million farmers in Guangxi who make a living by planting sugar cane.

Guo admitted that falling sugar and non-ferrous metals prices had reduced farm incomes, government revenue and corporate profits.

However, he said, these declines would have a limited impact since the region had a diversified industrial base that included sugar, mining and vehicle and machinery production.

He attributed depressed conditions in Guangxi to the global financial crisis. But he said he remained optimistic on the region’s economy since the central government’s economic stimulus program would provide business opportunities.

“The central government’s policy to increase domestic demand will help the region,” Guo said. As an example, he said, the region’s mini-van production had not been affected.

“For our machine-making industry, the central government plan to increase infrastructure construction revealed in the stimulus will also provide more sales for us,” he said.