Beijing’s new mega airport will challenge Air China’s dominance

Like ancient warlords, China’s three biggest airlines have dominated their regional cities: Air China Ltd. controlling Beijing, China Eastern Airlines Corp. holding sway in the financial center of Shanghai, and China Southern Airlines Co. ruling the roost down in export gateway Guangzhou. Until now.

Rising on a plain south of Beijing is a mega airport that is about to change the balance, bringing all three head to head in the capital as it becomes the world’s biggest aviation hub.

The new airport, due to open in 2019, has been designated by authorities as the hub for members of the SkyTeam alliance, a global group of airlines that includes China Eastern and China Southern. The two Chinese carriers will each be allowed to capture 40 percent of the airport’s passengers, gaining coveted time slots to Europe and the U.S. in Air China’s backyard.

“This is an absolute game-changer for China Eastern and China Southern,” said Corrine Png, chief executive officer of Crucial Perspective in Singapore. “Having all the SkyTeam alliance members under one roof will enable seamless flight connections.”

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The invasion of Air China’s regional rivals has repercussions beyond China. As well as dominating their home bases, the big three Chinese players have each carved out a position abroad. Air China, through its Star Alliance ties with Deutsche Lufthansa AG and United Continental Holdings Inc., commands many of the routes to Europe and North America. China Eastern is the biggest carrier to Japan and South Korea. And China Southern is strong in Australia and Southeast Asia.

With access to more slots in Beijing, China Southern and China Eastern would potentially get more access to lucrative North American routes while their SkyTeam partners would get better access to the Chinese capital. In addition, China Southern, the nation’s biggest airline, would be able to draw traffic from its Southeast Asian links to fly via Beijing to the U.S.

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#Panama switches to #China, cuts ties with #Taiwan

BEIJING – Panama and China announced Tuesday they were establishing diplomatic relations, as the Central American nation became the latest to dump Taiwan for closer ties with the world’s second-largest economy.

The move prompted an angry response from Taiwan and will likely further strain ties between Taipei and Beijing, which considers the self-ruled island a renegade province awaiting reunification with the mainland.

Taiwan is recognized by around 20 countries worldwide and its status is one of the most politically sensitive issues for Chinese leaders who pressure trade partners to accept its “one China” principle.

Panamanian President Juan Carlos Varela said in a nationally televised message “to the country and the world” that “Panama and China establish diplomatic relations today”.

The two countries issued a joint statement saying: “In light of the interests and wishes of both peoples, the Republic of Panama and People’s Republic of China have decided to grant each other, from the date of this document’s signing, mutual recognition, establishment of diplomatic ties at the ambassadorial level.”

After decades of siding with Taiwan in the disagreement over its status, Panama now “recognises that there is only one China in the world” and that Taiwan is part of Chinese territory.

 Chinese Foreign Minister Wang Yi and his Panamanian counterpart Isabel Saint Malo de Alvarado signed the communique in Beijing.

“This is a historic moment, China-Panama relations have opened a new chapter,” Wang said, adding that Panama’s decision was in “complete accordance” with its people’s interests and “in keeping with the times”.

Saint Malo said Panama and China had made an “important step” and started a “new page in our strategic relations”

The announcement comes after Beijing began construction last week of a container port, with natural gas facilities, in Panama’s northern province of Colon.

Panama had long stressed it had diplomatic ties with Taipei and commercial ones with Beijing.

Chinese ships, after those from the United States, are the number two users of the Panama Canal, the Central American country’s main source of budget revenue.

Taiwan’s anger 

Panama is the latest country to cut ties with Taiwan.

In December China signed an agreement to restore diplomatic relations with Sao Tome and Principe after the African nation ditched the island.

Taiwan reacted furiously to the latest move.

“We strongly condemn Beijing for manipulating the so-called ‘one China’ policy to continue to suppress Taiwan’s international space through various means,” the presidential office said.

“This kind of action is not only an open threat to Taiwanese people’s survival and welfare but also an open provocation to peace and stability in the Taiwan strait and the region.”

Diplomatic tussles between Taiwan and Beijing eased under the island’s previous Beijing-friendly government.

But relations have deteriorated since President Tsai Ing-wen’s China-sceptic Democratic Progressive Party was swept to power in a landslide election victory last year.

Tsai has refused to acknowledge the concept that Taiwan is part of “one China”, unlike her predecessor Ma Ying-jeou.

Cross-strait tensions have been further exacerbated by a highly unusual call from Tsai to congratulate then US President-elect Donald Trump, who questioned Washington’s policy towards the island, including its decision to not formally recognize its government.

Source – TheNation

Residents yet to get Myanmar-China pipeline compensation

Despite the fact that the Myanmar-China pipeline has started to import oil, local residents have yet to receive the compensation due to them for damage to their crops arising from digging works on the pipeline.

Crops had been pressed down by soil and landslides have occurred on cultivated fields near the Myanmar-China oil pipeline in the Ngape township of the Magwe Region due to extension of the oil pipeline. Aggrieved farmers said that they had not received compensation even though they have been waiting for more than five years.

“More than 10 letters have been sent and letters have also reached Nay Pyi Taw. We sent letters twice to the current government. We have also been called to meet officials once. But, nothing has come out of it,” said farmer Daw Hla Yi from Gote Kyi village in Ngape township.

Another farmer, U Yan Naung Tun said although the Magwe Region land and crops compensation group, township land records department and ward and village land committee made a field trip in February 2012 they did not visit the areas where the crop was damaged.

“Two years after this field trip, we were given money as assistance for our damages. But we don’t want assistance money, we want full compensation. They have to compensate us at these rates – K20,000 for a coffee plant and K120,000 for a lime plant or lemon plant and so on. But they just paid us K3.99 million per acre. Now, some places cannot be cultivated anymore,” said Daw War War from Gote Kyi village.

The Myanmar-China oil pipeline cuts through plantations and villages in the Magwe Region. (Nay Aung/The Myanmar Times)

Although some financial assistance had been given on June 10, 2016 for damages suffered, 7 farmers refused to accept this assistance as they claim it was 10 times less than the amount of damages suffered.

One of the farmers, Daw Hla Yi, said some of the farmers took the money as they had no choice because they were flat broke.

The Myanmar-China oil pipeline cuts through the following plantations; the Gote Kyi, Bone Baw, Soon Tet, Lin Tet and Pa Bae villages in Ngape township.

U Nay Myo Kyaw, a minister in the Mandalay regional government, told The Myanmar Times that the regional government should push for compensation and read the farmers reports.

“Whether the amount of compensation will cover the loss or not will depend on how they negotiate. If the farmers are not satisfied with the amount then we [the government] have a duty to urge the compensation team. Myanmar and Chinese governments signed an MoU for compensation. The compensation team has a responsibility,” he said.

Source – mmtimes

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#Cambodia – Ground broken for oil refinery

After years of delays and setbacks, the Cambodian firm set to operate the Kingdom’s landmark oil refinery finally broke ground yesterday on a $1.62 billion project with an updated completion date set for the middle of 2019.

The oil refinery, which will be built on 365 hectares across Kampot and Sihanoukville provinces, was first expected to be completed in 2014 after receiving full financial funding from the Export-Import Bank of China in December 2013.

Developed by private firm Cambodia Petrochemical Company (CPC), the refinery plans did not move forward until May of last year when the company granted a $620 million first phase construction contract to the state-owned Chinese National Petroleum Company. Construction was then outsourced to China’s Sino Great Wall International Engineering Group.

When all phases of the project are finally completed, the facility is expected to have an annual refining capacity of 5 million tonnes of crude oil, according to Vinh Hour, chairman of CPC. He added that the refinery would reduce the need for imports and improve national security by creating domestic reserves.

“Any country that does not have a stockpile of petroleum can be in a dangerous situation because if there is uncertainty in the international market and supply stops, the economy will grind to a halt,” he said.

Hour said that the refinery project was delayed for numerous years because of a prolonged environmental impact assessment process and a long wait for Chinese financial backers to give the go ahead for construction.

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The refinery would be dependent on crude imports from the Middle East in the near term and would initially be used for domestic distribution, though Hour claimed that once Cambodia produces its own oil, the facility would help the country become a net exporter.

KrisEnergy, the Singaporean firm with full rights to Cambodia’s Block A oil field in the Gulf of Thailand, is close to finalizing a revenue sharing agreement with the Cambodian government to begin the first domestic crude oil production. Extraction could begin within 24 to 26 months of the agreement.

Cheap Sour, director general of the general department of petroleum at the Ministry of Mines and Energy, said the refinery would fulfill domestic demand while lowering prices at the pump.

“We hope that the oil refinery project will lower the price of petroleum in the market and benefit consumers,” he said, adding that the waste from the factory can be used to produce plastic and fertilizer.

“This refinery will help us to gain energy independence,” he said.Danish petroleum expert Tommy Christensen said that while the refinery could add “national value” to Cambodia’s energy supply chain, it would be difficult for the company to be profitable as long it relied on large amounts of crude imports.

“Cambodia’s national interest is to have their own crude production and possible refining capacity, but as long as they have to import crude oil in competition with neighboring countries, in particular Thailand, then the economics might not work for Cambodia,” he said.

He added that once Block A finally begins production, having domestic capabilities could place Cambodia on the global energy trade map.

However, he said the refinery was built with a fundamentally flawed business model as it was not a Cambodian state-run initiative, which would have created more value for the economy.

“This is not a Cambodia initiative, but a private sector and Chinese strategic interest initiative,” he said. “And due to [strict] regulations in [China], Cambodia is the nearest country they can invest in.”

“If Cambodia was really the owner of the refinery, with its own crude oil production in years to come, then taxation and revenue from this refinery would benefit the economy on a larger scale.”

Han Phoumin, an energy economist for the Economic Research Institute for Asean and East Asia, said the venture could occupy a unique and lucrative place in the domestic market due to the fact that oil imports to Cambodia are heavily monopolized.

However, he noted that if the refinery was primarily built to feed China’s energy appetite, it could struggle with established competition.

“Of course, any refinery in Southeast Asia will find it difficult to compete with Singapore’s refineries which can produce efficiently with the best quality products at a fair price,” he said. “It should be cautioned that many refineries in Asia cannot make profit.”

Source – PhnomPenhpost

#AirAsia opens new routes from Indonesia to Mumbai, Macau

AirAsia has opened new international routes to Mumbai, India, and Macau, China, to tap into high demand among tourists from the two countries.

“The growing number of Chinese and Indian tourists coming to Indonesia boosts our spirit to launch the new routes,” said AirAsia Group CEO for Indonesia Dendy Kurniawan on Wednesday, as quoted by tempo.co.

Dendy added that the company was committed to supporting the government’s efforts to develop Indonesian tourism by extending its route network and offering services at affordable prices.

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AirAsia Indonesia is set to operate the direct flight from Jakarta to Macau three times per week in a first phase starting on Aug. 7 and four times per week starting on Sept. 1 for the second phase. With promo fares starting from Rp 888,000 for the period of Aug. 7 to June 5, the new service will use an Airbus A320-200 that can accommodate 180 passengers.

Meanwhile, the Mumbai route will start on May 19 and connect to Bali – with a transit of 65 minutes in Kuala Lumpur. AirAsia X Indonesia plans to serve the flight seven times per week using aircraft that can accommodate 377 passengers.

Source – TheJakartaPost

Read also: AirAsia to launch Denpasar-Tokyo route

Top 10 most attractive Chinese cities for foreigners

Shanghai ranked as the “most attractive” city for foreign residents due to its international atmosphere and multicultural environment, according to an annual survey.

Beijing remained second, thanks to its advantages in healthcare and educational resources, while Hangzhou also held onto third place.

The rankings, released on April 15, are based on a survey of about 25,000 expatriates nationwide in December and January.

The criteria ranged from living environment and local culture to administrative services and favorable policies for foreign residents.

The China Society for Research on International Professional Personnel Exchange and Development launched the annual survey in partnership with International Talent magazine in 2010 as a way to promote the nation’s cities.

Let’s take a look at the top 10 cities for foreigners.

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  1. Shanghai
  2. Beijing
  3. Hangzhou
  4. Qingdao
  5. Tianjin
  6. Shenzhen
  7. Suzhou
  8. Guangzhou
  9. Nanjing
  10. Changchun

This article appeared on the China Daily newspaper

#Shanghai may build new airport for business flights

Shanghai is considering building a new business aviation airport to meet the rising demand for business jets in the city, an official from the Shanghai Airport Authority said on Tuesday.

“In addition to the existing business aviation bases, Shanghai is also planning a new business aviation base elsewhere in the city,” said Jing Yiming, president of the Shanghai Airport Authority, at the opening of the three-day Asian Business Aviation Conference & Exhibition.

“The market potential of Shanghai’s business aviation is huge, where we’ve seen more than 20 percent year-on-year growth in the sector during the past few years. So far, a total of 67 general aviation enterprises and 371 general aviation aircraft have been registered with the Civil Aviation Administration of China’s East China Regional Administration,” Jiang Huaiyu, an official from the administration was quoted as saying by the Shanghai Observer.

“So it is necessary for Shanghai to have an independent airport handling business and general aviation,” Jiang added.

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Currently, the second business aviation base at Shanghai Hongqiao International Airport is under construction, and is expected to become operational in 2018.

There were 900 turbine helicopters and 450 business jets in China as of 2016, with compound annualized growth rates of around 6 percent and 9 percent, respectively, over the past decade, said Charles Park, director of marketing analysis and planning of Honeywell Aerospace.

Read also: Top 10 world’s busiest airports

Wang Qi, vice-president of China sales and chief representative of ATR, said the development of general aviation will create opportunities for less populated airports.

“About 92 percent of passengers are concentrated in the top 50 of the nation’s 219 airports, while the bottom 100 airports only handle 1.6 percent of the total passenger flow, where general aviation can play their role,” said Wang.

The concept of general aviation is not limited to business needs, said Liao Xuefeng, chairman and CEO of China Business Aviation Group. “A variety of non-commercial actives including agricultural aviation and rescue can benefit from it.”

According to Bill Schultz, senior vice-president of business development in China for Textron Aviation, China’s general aviation market offers diversified jet demand.

The 13th Five-Year Plan (2016-20) has a similar supportive trend in areas including tourism, air mapping and emergency rescue, he said.

According to the guiding rules of the State Council on promoting the development of the general aviation industry, issued in 2016, China plans to build around 200 new general aviation airports between 2016 and 2020, bringing the nation’s total to about 500.

This article appeared on The China Post newspaper website, which is a member of Asia News Network and a media partner of The Jakarta Post

Max Verstappen on stage in China

Lewis Hamilton dominates Chinese Grand Prix ahead of recovering Sebastian Vettel and charging Max Verstappen

Lewis Hamilton scored his fifth Formula 1 career Chinese Grand Prix victory with a commanding performance in Shanghai to come home ahead of Ferrari’s Sebastian Vettel and Red Bull’s Max Verstappen.

The British driver moved level with Vettel at the head of the drivers’ championship as a result, while Verstappen scored Red Bull’s first podium finish of the season.

After much of Friday’s practice running was lost when low cloud prevented the medical helicopter from operating as required, there was much speculation that the race could be disrupted as it took place in similar conditions.

That situation was avoided as the FIA arranged for the necessary neurosurgery staff to be transferred to a hospital closer to the circuit, but rain had fallen in the build up to the start and all the drivers – except Carlos Sainz – set off on intermediates.

Hamilton held his lead from pole position on the run to Turn 1 as Vettel, who had lined up strangely to the side of his grid box, defended hard from Valtteri Bottas through the long right-hander, while Daniel Ricciardo passed Kimi Raikkonen for fourth place.

Verstappen, who had started down in 17th after he suffered an engine problem in qualifying, had made it well into the top ten by the end of the first lap, which was disrupted by a collision between Lance Stroll and Sergio Perez at Turn 10 that ended the Canadian driver’s race.

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Cambodia – Microlender in monster deal

Hong Kong financial giant The Bank of East Asia and Sri Lanka’s LOLC announced on Friday that they have jointly acquired a majority stake in Prasac Microfinance, Cambodia’s largest microfinance institution (MFI) by assets, in what could be the largest acquisition of a Cambodian lender to date.

According to a joint company release, The Bank of East Asia (BEA) and LOLC acquired a controlling share of Prasac by purchasing minority stakes held by Dragon Capital Group Ltd, Belgian Investment Company for Developing Countries SA (BIO) and the Netherlands Development Finance Company (FMO).

The acquisition raises LOLC’s existing holding from 22 percent to 70 percent, with BEA holding 21 percent. Prasac retains the remaining 9 percent stake.

The deal was valued at $186 million by Sri Lankan media. Prasac and its shareholders could not be reached yesterday for confirmation, nor was the National Bank of Cambodia (NBC) available to confirm whether it had approved the acquisition.

Prasac is Cambodia’s largest deposit-taking MFI with an asset portfolio of $1.3 billion and over $660 million in deposits, according to the joint statement, which added that the deal would help pave the MFI’s path toward becoming a licensed commercial bank.

Sim Senacheert, CEO of Prasac, was quoted in the release as saying that BEA was a strategic investor that would “further contribute to sustainable economic development and financial inclusion in Cambodia”.

David Li, chairman and chief executive of BEA, said the deal marked the financial group’s first foothold in Cambodia and would help it expand its reach to the ASEAN Economic Community (AEC).

“Through Prasac, our bank will further strengthen its presence in Southeast Asia. This strategic investment will enable us to better capitalise on the opportunities arising from China’s ‘Belt and Road Initiatives’,” he was quoted as saying.

This is not the first time Prasac has worked toward securing a strategic investor, a move widely seen as the central bank’s requirements for commercial bank licence eligibility.

In August 2016, the NBC scuttled a deal between Prasac and South Korean financial giant Woori Bank for a 50 percent stake, claiming that the Korean lender was not one of the preferred bidder’s acknowledged by the independent regulatory body.

Cambodian MFIs have attracted the interest of international investors, with several large mergers and acquisitions announced in recent years. In January 2016, Thailand-based Bank of Ayudhya reached an agreement to acquire the local MFI Hattha Kaksekar – a deal that was valued at upwards of $140 million.

BEA’s stake in Prasac would mark the entry of Hong Kong’s third-largest bank into the Cambodian market. The financial group reported $98.7 billion in consolidated assets as of the end of last year.

Source – PhnomPenhPost

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Wayne Rooney has no appetite for China’s millions

Wayne Rooney waives an interim departure to China. The captain of Manchester United late in a statement to remain faithful to his club.

Rooney: I’m staying at United

Manchester United captain Wayne Rooney has addressed speculation about his future by releasing the following statement.

“Despite the interest which has been shown from other clubs, for which I’m grateful, I want to end recent speculation and say that I am staying at Manchester United,” declared the Reds’ record goalscorer.

“I hope I will play a full part in helping the team in its fight for success on four fronts.

“It’s an exciting time at the club and I want to remain a part of it.”

Rooney is still until mid-2018 under contract at Old Trafford. The chance that he leaves next summer still remains high.