Friday - May 16

Skill gap could derail economy: govt official

China's skill gap could derail its economic upgrade, according to a member of a cabinet-level think tank.

Filling the gap is strategically important for China as it tries to leave behind its role as the "world's factory" and move up the global value chain, said Long Guoqiang, director-general of the general office of the Development Research Center of the State Council.

Long's comments came amid concerns that China is rapidly losing its comparative advantages, such as being a source of low-cost labor that drove the nation to be the world's second-largest economy and biggest merchandise trader.

The advantages have faded. Millions of manufacturers in China have seen their international competitiveness erode. (Photo 1)

Court denies parents son's frozen embryos

In China's first case on the inheritance of frozen embryos, two parents were told they could not inherit their deceased son's frozen embryos, at a court in East China's Jiangsu province.

The couple's son and their daughter-in-law, both only children, died in a car accident on March 20, 2013, five days before they planned to transfer a fertilized egg via in vitro fertilization to the daughter-in-law's uterus.

The young couple did not have a child and were trying to conceive baby. They started the process in Feb 2012 and had four of their frozen embryos stored at a local hospital.

The four embryos became the only hope for the two pairs of grandparents to have a biological grandchild.

The hospital refused to give the families the embryos since surrogate motherhood is banned in China.

Monday - May 19

Empty housing units put at 10.2 million

China has about 10.2 million units of empty housing, and that number could rise by 3 to 4 million a year, according to Credit Lyonnais Securities Asia Ltd.

In first-tier cities, which it defines as Beijing and Shanghai, the rate was 10 percent. The rate in second- and third-tier cities as a group was 16 percent, CLSA said.

Ordos, Inner Mongolia - sometimes cited in media reports as a ghost city - has the highest vacancy rate, 23 percent.

CLSA's vacancy estimate is among the more conservative, with other estimates ranging from 20 to 30 percent. A study by Peking University in 2013 says an average Chinese family owns 100 square meters of living space, and 10 percent of households own two or more residences.

E-commerce boom pushes need for warehouses

Alibaba Group Holding Ltd's plans for a giant initial public offering highlight the weak link the logistics industry must fix - warehousing

Less than 20 percent of China's warehouses are categorized as modern, with fully computerized tracking systems and the latest in retail technology, according to Global Logistic Properties Ltd, the biggest foreign builder of logistic facilities in China.

By 2020, China's e-commerce sector will be larger than those of the United States, Britain, Japan, Germany and France combined, KPMG reported. To cope with this surge, as much as $2.5 trillion may need to be invested in land and warehouses over the next decade and a half, one builder said.

Last year, Alibaba announced plans to lead a consortium to invest $16 billion in the first phase of building a national logistics business. (Photo 2)

Tuesday - May 20

Russia gets $1b in deals through fund with China

The Russia-China Investment Fund has put about $1 billion into three infrastructure, tourism and logistics deals, and investing in agriculture and natural resources sectors will be next.

"China is Russia's largest trading partner," said Kirill Dmitriev, CEO of the Russian Direct Investment Fund.

"With deals in infrastructure, tourism and logistics made, we will pay attention to opportunities in sectors including agriculture and natural resources," he said.

Together with China Investment Corp, the Russian Direct Investment Fund set up RCIF in 2012, a private equity fund in which both parties committed $1 billion each, with another $2 billion coming from additional Chinese institutional investors.

In addition to 70 percent of investment in Russia, 30 percent of the fund will go toward China.

Some local governments to issue direct debt

China will allow 10 provinces and cities to make direct bond issues starting this year, a move that financial experts said might signal full rights for all local governments to issue debt to support the urbanization drive.

The central government will announce the plan later this month, and bonds will likely be issued in early July, the Wall Street Journal reported on Monday, citing an anonymous source. A source with the Ministry of Finance confirmed the report to China Daily, saying that the ministry will set a ceiling for each government, but he declined to give further details.

The reported plan is in line with a move last month, when the national legislature proposed a draft amendment to the budget law, suggesting that local governments should be able to sell municipal bonds under narrow parameters.