Many argued the half-year-long stock market plunge was mainly due to the irresponsible refinancing plans of listed companies. For instance, Ping An of China Co. Ltd.'s huge plan of refinancing 120 billion yuan ($17.14 billion), Pudong Development Bank's 20-billion-yuan ($2.86-billion) plan, as well as other rumors about refinancing irritated investors, who showed their anger by dumping shares.

Major indexes in Chinese mainland stock markets are down to nearly half of last October's peak. The benchmark Shanghai Composite Index nose-dived 42 percent from 6,124 on October 16 last year, to 3,579 on May 7.

On May 6, Tongling Nonferrous Metal Group Holdings Co. Ltd. claimed it had readjusted its refinancing scheme with a lower price and increased number of shares. The price was cut from 27.46 yuan ($4) per share to 14.34 yuan ($2), while the number of shares was raised to 150 million, 36.36 percent more than the company's previous plan. The New Hope Group gave up its refinancing efforts in the stock market and turned to raise money in the bond market.

Hua Sheng, President of Yanjing Overseas Chinese University, said refinancing should be more marketized. The refinancing price should be the average price of the 20 trading days before the final price is set by the board of the company. "If investors can vote by foot, if they don't buy the plan, they can simply sell the shares," said Hua.

Fiat Rally in China

After a failed cooperation with Nanjing Automobile (Group) Corp., the Italian auto giant Fiat Group is seeking a joint venture in China, Shanghai Securities News reported.

"Fiat will launch domestically made vehicles in the future, importing complete vehicles is not a long-term plan after all," said Jack Cheng, Vice President and Chief Procurement Officer at Fiat Group China.

"China is Fiat's important target market, and Fiat will establish a foothold there," said Paolo Arpellino, Chief Representative Officer of Fiat Group Automobiles' Chinese operations, adding that the automaker will introduce more models to China and also realize mass production.

The Fiat Group has recorded its largest-ever trading profit of 3.2 billion euros based on a turnover of 59 billion euros in its 2007 annual results. These figures are up 12.9 percent on 2006.

The cooperation with Nanjing Automobile in 1999 was during a time Fiat suffered huge losses globally. However, now that Fiat global operations are taking off, the new joint venture may be able to avoid past failures.

Checking Illegal Grain Exports

Customs authorities strengthened efforts to prevent illegal grain exports cashing in on surging international rice prices.

Expensive rice lured many to attempt to smuggle it out of China. Customs officials in Hangzhou, capital of Zhejiang Province, stopped four such attempts in the past several weeks, preventing nearly 7 tons of rice and 33 tons of wheat from being smuggled out of the country. Officials in Ningbo, also in Zhejiang, blocked more than 130 tons of wheat from being shipped out.

In March, international rice prices rose to their highest level in 19 years, and wheat prices rocketed to a record 28-year peak. However, domestic grain prices only experienced mild rises, up 5.7 percent in January and 6 percent in February.

To promote agricultural production and ensure food security and market stability, the Ministry of Commerce recently issued a notice requiring local departments to strengthen supervision of the circulation of agricultural products and materials.

Numbers of the Week

85.46 %

The Civil Aviation Administration of China reported China Eastern Airlines ranked first in flight punctuality with 85.46 percent of flights on time, while Hainan Airlines ranked last.

72 %

Statistics provided by China Automobile Trading Co. Ltd. showed the number of imported cars surged 72 percent in the first quarter year on year, mainly driven by luxury brands.