China to tighten control over direct sales
The State Administration of Industry and Commerce (SAIC) said it would respond to recent cases of direct sales problems and cheating by regulating the direct sales market, China News reported. An official with SAIC’s direct sales bureau said local industry and commerce administrations would tighten monitoring of direct sales branches and service points, product sales, recruitment, training, payment and bonus systems and information reporting and disclosure. SAIC also planned to draft more detailed guidelines to further regulate direct sales activities, including information disclosure, the establishment of new branches, sales activities and bonus systems.
Power consumption exceeds expectations
The China Electricity Council (CEC) has urged the government to take further measures to save energy in industrial production after higher-than-expected growth in first-quarter power consumption, China Economic Times reported. The CEC said in its latest report that China's secondary industry used 540 billion kilowatt-hours of electricity in the first quarter this year, up 16.8% year-on-year, and accounting for 75.12% of China's total electricity consumption. Electricity consumption in light and heavy industries rose 11.5% and 18.1% respectively, up 2.1% points and 6.31% year-on-year. CEC said the government should employ economic, legal and administrative measures to regulate the development of energy-intensive and high-pollution industries through raising industry, market and export thresholds.
Imbalance in nonferrous metal supply and demand continues
The national social development and technology forum hosted by the Ministry of Science and Technology last week concluded the gap between supply and demand of nonferrous metals would continue to grow over the next 15 years, China Business News reported. The forum estimated China’s demand for cooper would rise to 6.5 million tons, aluminum 14.4 million tones, lead 2.6 million tons and zinc 5 million tons by 2020 if current consumption volumes persisted. The forum also said China’s nonferrous metal resources were inefficiently mined with a great waste ratio. The current recovery rate is just 60%, which is 10-20% lower than in developed countries. The overall metal utilization rate of 30-50%, is just half that found in developed countries’.
CIRC to strengthen comprehensive operation
The China Insurance Regulatory Commission (CIRC) said it would gradually ease regulations over insurers investing in bank stakes and equity to facilitate strategic cooperation between the banking and insurance sectors, Xinhua reported. The regulator would select insurance firms with good core business performance and internal controls to follow in the footsteps of Ping An and China Life Insurance. By the end of 2006, the insurance sector had invested US$5.94 billion (RMB46.06 billion), or 2.59% of total outstanding employed insurance capital, in acquiring bank stakes, including A-shares, H-shares and stakes in non-listed banks. An official with CIRC’s development and reform bureau added that allowing insurance companies to offer comprehensive financial services would increase their internal risks and make regulating the market more difficult.
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