The New Dominion

The New Dominion.net’s Economic News Roundup for 4-10 March 2008

Housing prices in Ürümchi shot up 25% year-on-year in January, leading an overall 11.3% increase in housing prices across China for the same period, as several sources have reported. (There seems to be some confusion in these articles over what, exactly, “year-on-year” means. It means that housing prices were 25% higher than they were the previous January. It was news to me, too.)

Well, housing prices may be skyrocketing, but seafood prices are dropping as supply outstrips demand. Ürümchi, being famously the city in the world furthest from the ocean, is dependent on regular shipments of live or frozen fish from places like Guangdong, Fujian, and Jiangsu. During the recent snowstorms that swept southern China, that supply was cut off, and now the city’s fish markets are seeing a flood of seafood from fishermen eager to make up their losses. Note that this is mostly a problem of supply — overall, seafood sales are up 10% from last year.

Seafood prices aren’t the only ones rising, however. As is known by any native of the XUAR, food prices in Xinjiang have been increasing pretty rapidly since this past autumn. The issue has now received attention from the government, including proclamations from Wen Jiabao. The East, they say, must support the West, and the economies of the cities and the countryside, of the farms and the factories, should not be treated separately. (That is so Marx.) Only slightly more concretely speaking, the central and regional governments are going to take action to keep the rate of the rise of the consumer price index at 4.8%. Representative Äskär Tursun assures the public that the price increase is just a matter of the imbalance of supply and demand, suggesting that “market methods” may be used to control the rise. Legal action may also be taken against those who engage in practices such as hoarding consumer goods (including housing) in order to increase future profits.

The unusually cold winter has affected Xinjiang’s own agriculture, as well. Frost has touched 7.03 million mu (4921 square km) of land, causing direct economic losses of 2.94 billion RMB. In response, a reseller of agricultural chemicals at Ürümchi’s North Train Station’s agricultural goods market, Cui Feng, has donated thirty boxes of anti-freezing products, valued at over 10 000 RMB each, to farmers in the Kashgar area on behalf of a factory.

A new wild variety of lavender, meant to be more economically viable than others, has been discovered in the Tianshan Mountains. It will soon be exploited by a pair of chemical companies. Apparently in celebration, Xinjiang Xiangxiren Lavender, Ltd. will be holding a contest in December. In this contest, 30 selected contestants will test the company’s “spot-removal” skin products. The winner will receive 20 000 RMB worth of Xiangxiren lavender-based cosmetics. I strongly encourage The New Dominion readers to sign up by sending an e-mail to szwlmq@163.com by 31 March.

On to imports and exports. In January 2008, imports into Ürümchi totaled 32.75 million USD, up 75.3%, and exports totaled 305.06 million USD, a 106% increase from the previous month. Imports included mostly agricultural products, raw steel products, electronics, and machines. Exports included clothing, auto parts, machines, and household appliances.

But what about the quality of those products? The Ürümchi Industrial and Commerce Bureau reports that its consumer hotline received 243 500 complaints about products in 2007. A plurality of complaints dealt with cellular phones and clothing, followed closely by food and drink.

Oil news. The Xinjiang oil field company EPC is going to begin construction on China’s largest oil storage unit, to be based in Shanshan County. The facility, which is planned to have a capacity of eight million cubic meters, will store oil from both Xinjiang and from Kazakhstan, which will then be sent eastward on Shanshan-Lanzhou Pipeline.