XINHUA

Numbers of the Week

84.7 percent

China Petroleum and Chemical Corp. (Sinopec), the country's largest oil refiner, reported that its first-quarter net profit grew a dizzying 84.7 percent year on year.

$10.6 billion

Chinese and U.S. firms signed 32 trade and investment contracts worth around $10.6 billion in Washington on April 27.

TO THE POINT: Pork prices in Beijing remained relatively stable despite the swine flu outbreak in Mexico. China's job market is still in the doldrums with the registered urban jobless rising slightly in the first quarter. The government is preparing to issue the third tranche of its stimulus package. China Minmetals Corp. received approval from the Australian Treasury to buy the assets of Oz Minerals Ltd. There were signs that international hot money has started to leave China. Surveys indicate that new Chinese parents are shunning foreign baby-care products.

By HU YUE

Pork Demand Unaffected

Pork prices and consumption remained stable in Beijing despite the swine flu outbreak in Mexico as the Chinese Government assured people that pork was safe to eat.

The average pork price at Xinfadi, Beijing's largest wholesale food market, was 12.25 yuan ($1.8) per kg on April 27. This was a slight increase given the average price has fluctuated between 11.9 yuan ($1.75) and 12.85 yuan ($1.89) per kg since April.

On the same day, the Ministry of Agriculture assured the public that Chinese pigs were safe. Meanwhile, Premier Wen Jiabao required related ministries to remain on high alert and work out emergency plans at a State Council meeting.

While the epidemic's outbreak has not affected demand for pork in China, there has been increasing concern that the disease could hurt the global hog-raising industry and pork exporters. This has prompted investors to undersell feedstuff futures in China. Soybean and corn futures, two products used in feedstuff, dropped sharply on April 27. Soybean meal for September delivery fell by 4.98 percent to close at 2,632 yuan ($385) per ton and September corn dropped 1.72 percent to close at 1,659 yuan ($243) per ton on China's Dalian Commodity Exchange.

Job Campaign

With the serious headwinds blowing through the economy, China's employment landscape looks sparse right now.

According to the Ministry of Human Resources and Social Security, China's registered urban jobless rate, the only official measure of unemployment in the country, had risen to 4.3 percent at the end of March from 4.2 percent three months earlier, the highest rate since 2007. The rate excludes tens of millions of migrants who work in cities.

But the new urban jobs created from January to March amounted to 2.68 million, an increase of 51.4 percent from the fourth quarter last year, according to the ministry. Earlier this year the government had set a target of creating 9 million urban jobs in 2009.

The figure points to a better-than-expected outlook for the job market, although it will still take more policy moves to ride out the downturns, said Yin Chengji, a ministry spokesman, at a recent news conference.

Hit especially hard are rural migrant workers displaced by massive factory closures and university graduates who lack work experience. Even before the economic downturn, a surge in college enrollment had sent a chill through the job market.

The ministry's data indicate that most of the jobless migrant workers have reentered the workforce either in cities or in the countryside, Yin said. But a large number of university graduates are facing severe difficulties in landing their first jobs because fewer companies are recruiting on campuses, he added.

The government will press ahead with a series of support measures to warm up the job market, including encouraging graduates to start their own businesses and relieving enterprises of their financial burdens so that they can retain more jobs, Yin said.

New Stimulus

China may spend about 70 billion yuan ($10.2 billion) on the third tranche of the government stimulus package, an amount that is much lower than the first two tranches, according to an article in the Economic Observer.

So far, China has released 100-billion-yuan ($14.6 billion) and 130-billion-yuan ($19 billion) tranches of the overall 4-trillion-yuan ($586 billion) package announced last November. The latest spending would mainly go to livelihood and infrastructure projects, the article said.

While increasing spending in sectors that usually do not receive enough funds, the government would cut back on its investments in competitive sectors that have good expectations of returns, the article said.

The newspaper cited an unnamed official at the National Development and Reform Commission (NDRC) who did not confirm whether the third round of spending was connected to the soaring number of bank loans in the first quarter.

Stephen Green, an analyst at Standard Chartered Bank, told the newspaper that the lower amount of the third tranche indicates the government is aiming to bring more private-sector investment into play.

The NDRC official was quoted as saying that the Central Government would continue to mobilize more investment from the private sector with government investment.

Going Australian

China Minmetals Corp., the country's largest metal trader, made a step forward on its twisted path of investing in Australian companies when it received green light from the Australian Treasury for its revised $1.2-billion bid to buy a bulk of assets of Oz Minerals Ltd.

Earlier this year, Minmetals launched a $1.7-billion takeover bid for the debt-laden Australian miner, only to have it scuppered by the Australian Government. The Australians said the Prominent Hill gold and copper mine owned by Oz Minerals was located in a security zone.

In response, Minmetals gave up its takeover plan and proposed a fresh bid for a number of mines of the Australian company, excluding the Prominent Hill copper and gold mine.

But the approval came with strings attached. The Australian Treasury required Minmetals to operate the acquired mines as a separate business headquartered in Australia and managed by a predominantly Australian team. The Chinese group also must retain all workers at the loss-making Century zinc mine and reopen the Avebury mine that was closed last year.

Minmetals welcomed the decision and said in a statement that the deal would mark a significant milestone in Sino-Australian cross-border investment.

Oz Minerals shareholders and Chinese authorities must approve the deal.

Hot Money Pullout

Concerns abound that international hot money is leaving China, which could stir up instability in the country's financial markets.

According to the State Administration of Foreign Exchange (SAFE), the country's short-term external debt fell 4.23 percent year on year to $210.8 billion in 2008. Short-term external debt is one of the channels through which hot money enters a country.

But Hu Xiaolian, Administrator of the SAFE and vice governor of China's central bank, tried to calm worries about capital outflows, saying that China is less likely to suffer a massive capital outflow thanks to a resilient economy and a strong currency.

The drop in short-term external debt was mainly because the country extended fewer loans to its trade partners, a SAFE official was quoted by Shanghai Securities Journal as saying.

To ensure financial stability, the government will continue to keep a close watch over international capital flows and tighten risk controls and its supervision of the financial system, Hu said.

Hold the Baby Shampoo

New Chinese parents are shunning foreign brands of baby-care products because of health concerns, according to an online survey by the news website Ifeng.com.

Three quarters of nearly 120,000 consumers surveyed said they had stopped buying Johnson & Johnson products because a U.S. consumer group, the Campaign for Safe Cosmetics, announced in March that it had found traces of elements linked to cancer in the American giant's baby-bath products.

The survey indicated 68.4 percent of those surveyed said they believed Johnson & Johnson products were poisonous. Only 10.9 percent said they would continue to buy the products.

But Johnson & Johnson is not alone. Some baby powder produced by German company NUK was recently found to contain asbestos, a known carcinogen.

There are worries that recent health scares could make some Chinese consumers turn their backs on baby care products altogether and thus affect the industry's overall sales growth this year, similar to last year's baby formula scandal. Johnson & Johnson accounted for 68.6 percent of all baby care products sales in China last year.

According to Euromonitor International in Shanghai, the baby-care product market in China is estimated to be worth 3.11 billion yuan ($455 million) this year. It is a lucrative market because Chinese parents spend around 30 percent of their household income on their children up to 14 years of age, according to government statistics.