China Unicom launched lower priced 3G smart phones to attract consumers. China's 3G mobile phone users reached 19.3 million by March. An Xin / for China Daily

Chinese manufacturing growth slows

A key gauge of Chinese manufacturing growth edged lower in May but remained stronger than analysts had expected, suggesting that the world's second-largest economy was gliding towards a soft landing.

China's official purchasing managers' index, designed to provide a snapshot of conditions in the manufacturing sector, dipped to 52.0 last month from 52.9 in April. However, that was a touch ahead of most forecasts. A similar survey sponsored by HSBC registered 51.6 in May, also softer than last month but well ahead of a preliminary reading of 51.1 that spooked markets last week.

A reading of above 50 in PMI surveys indicates expansion, while a reading below that level indicates contraction.

China's CPI growth to linger above 5.3%

Soaring food prices caused by

China's worst drought in half a century have triggered worries that inflation will climb to a new high in May. Jing Ulrich, managing director of JPMorgan China, predicts that China's May CPI will grow by between 5.3 percent and 5.5 percent.

"China still faces inflationary challenges. The May figure will be released in the second half of June," Ulrich said.

"We think the May figure will stay above 5 percent, mainly driven by higher food prices. Food accounts for about 30 percent of China's CPI basket.

"The drought in southern parts of China will affect commodity prices. In the second half of the year, we're expecting China's CPI to peak. So starting for the third and fourth quarter, we may see CPI beginning to moderate."

Industry

China industrial

profits rise 29.7%

Newly released figures from China's National Bureau of Statistics show industrial profits across the country rose nearly 30 percent in the first four months of this year, compared with the same period of last year.

The growth marks a modest slowdown from an annual increase of 32 percent in the first quarter. The statistics agency notes profits in the ferrous metal mining industry rose more than 72 percent from a year ago, while firms in the chemical fiber sector reported 77.5 percent growth in combined profits. However, the petroleum refinery, coking and nuclear fuel procession industry reported a 36 percent drop in profits.

Market

Coca-Cola considers listing in Shanghai

Coca-Cola Co, the world's largest soft-drink company, is considering a possible listing in Shanghai and is in talks with government officials, said Geoff Walsh, Coca-Cola's Hong Kong-based public affairs and communications director for Asia-Pacific.

"We are interested in exploring the opportunity of listing our stock on the Shanghai exchange," he said.

"We continue to have positive discussions with Chinese government officials as we look at this opportunity," Walsh said.

HSBC, Unilever and Standard Chartered Plc have said they want to list on the proposed international board on the Shanghai Stock Exchange.

Securities

RBS to tap into Chinese IPO market

Royal Bank of Scotland (RBS) has launched a Chinese securities joint venture, Huaying Securities, the first of its kind for a UK bank.

The partnership follows similar tie-ups for European and American banks in China and will give RBS a platform to underwrite share and bond issues in the world's biggest market for initial public offerings (IPO).

RBS will hold a one-third stake in the Wuxi-based venture, the maximum a foreign firm can own under Chinese rules. Its partner, Guolian Securities, will control the rest.

John McCormick, RBS Asia-Pacific chairman, said the deal would let it "participate fully in the opening-up of China's securities market".

Aviation

China Southern buys Boeing cargo planes

China Southern, the country's largest airline, said that it would purchase six Boeing B777F cargo planes.

China Southern said the catalogue price of each Boeing B777F is $264 million (183 million euros), but the airline's actual purchasing price is "significantly lower than the catalogue price" because of "certain price concessions granted by Boeing".

China Southern said the transaction will be paid in cash and partly by financing arrangements with banking institutions. The six planes will be delivered in stages to China Southern between 2013 and 2015.

HNA buys 60% of Turkish MRO firm

HNA Group Co Ltd, a diversified services provider, has acquired a majority stake in a Turkish maintenance, repair and overhaul (MRO) company to facilitate China's fourth-largest airline Hainan Airlines to penetrate the aviation networks in Europe, Asia and North Africa.

HNA's MRO division, Grand China Aviation Technik Ltd Co (GCA Technik), has taken a 60 percent stake of the company, in an agreement along with Bravia Capital, an advisory, structured financing and investment company that focuses on transportation projects in Europe and Asia.

Telecommunications

China Unicom launches budget 3G smart phone

China Unicom, the country's second-largest mobile telecom operator by user base, rolled out its first model of lower priced 3G smart phones on May 31.

Lu Yimin, general manager of China Unicom, said the launch of the new product was designed to popularize 3G mobile phones throughout the country.

Statistics show that in the first quarter of this year, China's 3G mobile phone users had reached 19.3 million, accounting for 32.7 percent of the total mobile phone users.

China Daily-Agencies