• China’s Hanlong Mining has agreed to raise its offer price for Sundance Resources to secure an agreed takeover, valuing the Australian miner at more than USD1.5 billion. A successful deal would give Hanlong control of a major iron ore mine in West Africa. Hanlong already owns 18.6% of the company and increased its offer, worth about USD1.5 billion under its original approach, by 14%.
• Kazakh miner ENRC is continuing to see strong demand for iron ore from its Chinese clients. “We have not seen any issues on demand in China for anything … The government is making a big investment in the interior, our customers are in the interior [and they] have plans to more than double their production,” Jim Cochrane, ENRC’s Chief Commercial Officer said, referring to demand for iron ore. ENRC is a major producer of ferro-chrome.
• Vale is expected to lose market share in China, as Chinese steelmakers will step up iron-ore purchases from BHP. Vale’s prices are based on a three-month average, while those of BHP are based on monthly contracts that more closely reflect the metal’s decline. The price of ore fell to a one-year low of USD142.60 a ton on October 21. Iron-ore prices for immediate delivery have fallen about 20% in the past six weeks on concern the expansion in China is slowing and Europe’s debt crisis is worsening. Vale sold about 42% of its iron ore and pellets to China in the second quarter,
• Citic Resources and Citic Group are selling their combined 25% stake in Australian miner Macarthur Coal to Arcelor Mittal and Peabody Group. Macarthur is one of very few big acquisition targets still available in an Australian coal market dominated by global mining giants including BHP Billiton and Xstrata.
• China’s monthly coal imports rose 25% on an annual basis to a record 19.1 million tons in September as power utilities built up stocks to meet higher demand during the winter. Imports in the first nine months totaled 123.4 million tons, up 1.88% from a year earlier. Imports may fall in the fourth quarter of the year,  analysts said.

On the occasion of the largest trade mission ever sent to any country – headed by HRH Prince Philippe – and on the 40th anniversary of the establishment of diplomatic relations between Belgium and China, the Flanders-China Chamber of Commerce (FCCC) publishes a book with interviews of famous Flemish, Chinese and other personalities covering a wide range of topics related to China.

The Chamber asks them how many times they have visited China and what major changes they have witnessed in that emerging Asian power. Some have visited China only a couple a times and are amazed at what they have discovered, eager to visit the country again at the earliest opportunity. Others lost count as the number of visits runs into the hundreds, and they still can’t get enough. One thing everybody agrees on is that China is changing at an extraordinary speed and to keep up with it one cannot postpone the next visit for too long.

Following a foreword by Steven Vanackere, Vice Premier of the Belgian federal government and Minister of Foreign Affairs; and an introduction by Bert De Graeve, Chairman of the Flanders-China Chamber of Commerce and CEO of Bekaert, famous  personalities talk about their experiences in China, the successes and pitfalls of doing business there and what we could learn from the Chinese. The “Voices on China” presented here are diverse: from Chairman of the European Council Herman Van Rompuy and EU Trade Commissioner Karel De Gucht to CEOs of Flemish companies who have proven to be successful in China. Bert De Graeve, CEO of Bekaert; Christian Reinaudo, CEO of Agfa-Gevaert Group; Marc Van Sande, Executive Vice-President Energy Materials of Umicore; and Wim Buyens, Senior Vice-President Entertainment Division at Barco; talk about the differences in business culture between Belgium and China, about measures to further improve trade and investment between the two countries; and about what it takes to be successful in China.

Jonathan Holslag, Research Director at the Brussels Institute of Contemporary China Studies, in a wide-ranging interview, covers China’s rise as a world power and the challenges it faces to become No 1. He also gives his informed insights into the next generation of Chinese leaders, which will assume office following next year’s 18th Congress of the Chinese Communist Party.

Chinese investments in Flanders are increasingly important. Li Shufu, Chairman of Geely Holding, which recently took over Volvo, talks about the future of green cars and how to solve China’s traffic problems. Liao Liqiang, the Ambassador of the People’s Republic of China to Belgium, who only took up his post a few months ago, covers all aspects of the relations between the two countries. He recalls the visit to Beijing by Queen Elisabeth in 1961, a decade before the establishment of diplomatic relations. Two Chinese captains of industry, Chairman Jiang Jianqing of the Industrial and Commercial Bank of China (ICBC) and Chairman Chen Feng of Hainan Airlines, talk about the financial and aviation industries respectively.

Rounding out the book, Belgian Ambassador to China Patrick Nijs, says in his afterword: “Concluding such an impressive compilation of highly informed comments on China is a great honour.” The Ambassador points out that Belgium was one of the first countries to establish diplomatic relations with the People’s Republic of China following the first unofficial visit to China by then U.S. National Security Adviser Henry Kissinger. Ambassador Nijs notes that “We have been at the forefront, setting up joint ventures with a genuine commitment to their ‘joint’ nature.”

The “voices” assembled in this book shed a new light on China. “We hope you enjoy listening to them,” concludes FCCC Chairman De Graeve.

The book is bilingual English-Chinese.

Members can obtain a copy of the presentation by sending an e-mail to info@flanders-china.be.

Prince Philippe is leading a Belgian trade mission to China, in which about 400 businesspeople are participating. On Friday, October 21 he met and held talks with Vice Premier Wang Qishan.

On October 22, the Flanders-China Chamber of Commerce (FCCC) and the Federation of Industries of Belgium organized a breakfast meeting, attended by H.R.H. Prince Philippe and H.E. Deputy Prime Minister and Minister of Foreign Affairs Steven Vanackere of the Federal Government of Belgium, and CEOs of Belgian participating companies. David Hoffman, Vice President and Managing Director of The Conference Board China Center for Business and Economics, presented an interesting insight in the 12th Five Year Plan from the outside.

The world’s first offshore yuan-denominated spot gold market was launched in Hong Kong, opening a new window for trading the Chinese currency and enabling the city to strengthen its role as a global gold market. The contract traded at CNY346.47 per gram, or the equivalent of USD1,690.80 an ounce, according to data on the Chinese Gold & Silver Exchange Society’s website on October 17. Individual investors can trade kilobar gold, which is priced at CNY347,000 per unit, by paying a deposit as low as CNY16,000. The Chinese Gold & Silver Exchange has 27 members who are designated traders for yuan bullion. The practice is similar to the margin trading of London gold in Hong Kong, but may carry higher risks as investors also bear the risk of yuan trading. “The risk of leveraged trading on yuan bullion is twofold – the fluctuation in gold prices and yuan movement,” said Robert Lee, Executive Committee Member of the Exchange. Yuan deposits in Hong Kong surged to CNY609 billion in August, accounting for 10% of total deposits in the city’s banking system. These yuan deposits usually sit idle in the bank since there are not enough investment channels apart from dim sum bonds, or yuan bonds issued in Hong Kong. It is estimated that yuan bullion transactions could hit CNY100 million per day at the start and surge to CNY300 million in Hong Kong over the next six months. Hong Kong is the world’s third-largest gold-trading center, with average daily transactions at 10 million ounces, after London and New York, the South China Morning Post reports.

Some foreign banks in China struggle to collect enough yuan deposits to meet revised loan-deposit ratios effective at the end of the year. Many of the larger commercial banks, such as HSBC Holdings and Citigroup, say they have already met the requirements, but some smaller players may fail to meet the standard, bankers say. The Chinese Banking Regulatory Commission (CBRC) is requiring all domestic and foreign banks to have a ratio of 75% or less – meaning loans should not exceed 75% of deposits with the banks – as of December 31. The difficulties are most acute at some foreign banks lacking retail operations. Competition for deposits is heating up, said Bank of Tokyo-Mitsubishi UFJ (China) President Eichi Yoshikawa, adding his bank has met the target. The commission has not made clear what the repercussions will be if banks fail to meet the requirement, but analysts suspect applications for new branches may be delayed. About 40 foreign banks have set up locally incorporated units in China since 2007. While business has been profitable for many, expanding retail deposits has been a struggle for most.