PPI

In August, the producer price index (PPI) for manufactured goods increased 3.4 percent over the year-earlier period, according to the National Bureau of Statistics (NBS). Of the total, purchasing prices of raw materials, fuels and power jumped 6.7 percent year on year.

Producer prices of production materials registered a growth rate of 4.5 percent from a year ago, while those of consumer goods inched up 0.3 percent (see graph 1).

In August, producer prices of crude oil went up 25.9 percent over a year ago. Among refined oil products, prices of gasoline, kerosene and diesel edged up 15.8 percent, 10.7 percent and 14.6 percent, respectively, year on year.

During this month, producer prices of raw coal climbed 2.4 percent from a year ago. Prices of smelting and pressing of ferrous metals saw a decline of 2.4 percent compared with the same period last year, while those of smelting and pressing of non-ferrous metals climbed 24.5 percent.

In August, purchasing prices of fuel, non-ferrous metal materials and chemical materials grew 12.4 percent, 37.4 percent and 2.9 percent, respectively, year on year, while those of ferrous metal materials slid 1.6 percent from a year ago.

From January to August, the PPI went up 2.9 percent compared with the same period last year and purchasing prices of raw materials, fuels and power climbed 6.2 percent over a year ago.

Green GDP

Pollution caused losses of 511.8 billion yuan in 2004, which accounted for 3.05 percent of the country's 16 trillion yuan of gross domestic product (GDP) that year, according to a report jointly released by the NBS and the State Environmental Protection Administration (SEPA). This report is the country's first Green GDP, which deducted the environmental costs of economic activities.

Estimated pollution treatment costs in 2004 were 287.4 billion yuan, or 1.8 percent of GDP. Of the total, losses brought by water contamination, air pollution, as well as solid waste and pollution accidents, held at 286.28 billion yuan, 219.8 billion yuan and 5.74 billion yuan, respectively, accounting for 55.9 percent, 42.9 percent and 1.2 percent of the total costs of environmental pollution, said the report.

However, the figures mark "only the beginning of our efforts in calculating the Green GDP," said SEPA Vice Minister Pan Yue.

Wang Jinnan, Vice President of the Chinese Academy for Environmental Planning and head of the Green GDP accounting expert group, explained, "Because of the shortcomings in basic data and the technical approach, the results for 2004 represent only the environmental pollution cost. Even the estimate of environmental pollution is not complete for a lack of data on groundwater, soil and indoor air pollution."

NPLs

According to the China Banking Regulatory Commission (CBRC), the first six months of this year witnessed a continued decline in both the volume and ratio of non-performing loans (NPLs) in China's commercial banks.

As of the end of June, the outstanding balance of NPLs declined by 29.75 billion yuan, and the ratio of NPLs dropped 0.5 percentage point from the first quarter to 7.53 percent, or 1.28 trillion yuan, in China's commercial banks (including state-owned commercial banks, joint stock commercial banks, city commercial banks, rural commercial banks and foreign-funded banks).

Statistics showed that, in terms of the composition of NPLs, the outstanding balance of loan losses was reduced by 8.66 billion yuan from the first quarter to 472.16 billion yuan, accounting for 36.8 percent of the total NPL, that of doubtful loans increased 360 million yuan from the first quarter to 503.89 billion yuan, accounting for 39.3 percent of the total NPL, and that of substandard loans decreased 21.47 billion yuan to 306.67 billion yuan, accounting for 23.9 percent of the total NPL.

The NPL volume and NPL ratio in major commercial banks (state-owned commercial banks and joint stock commercial banks) were reduced by 28.96 billion yuan and 0.46 percentage point from the first quarter to 1.18 trillion yuan and 7.8 percent. Particularly, the NPL volume and NPL ratio in state-owned commercial banks declined 3.06 billion yuan and 0.31 percentage point from the first quarter to 1.051 trillion yuan and 9.47 percent, and the NPL volume and ratio in joint stock commercial banks dropped 2.59 billion yuan and 0.83 percentage point from the first quarter to 122.12 billion yuan and 3.09 percent. The NPL volume and NPL ratio in city commercial banks were reduced 1.61 billion yuan and 0.87 percentage point from the first quarter to 84.54 billion yuan and 6.72 percent, the NPL volume in rural commercial banks increased 830 million yuan from the first quarter to 16.64 billion yuan and their NPL ratio fell 0.32 percentage point to 6.64 percent, and the NPL volume and NPL ratio of foreign-funded banks dropped 1 million yuan and 0.08 percentage point to 3.66 billion yuan and 0.87 percent.

Bank Assets

The first half of 2006 saw a surge in the total assets of banking institutions in China, said the CBRC. By the end of June, the renminbi and foreign currency assets of all of China's banking institutions had totaled 40.95 trillion yuan, a rise of 18.5 percent compared with the same period last year. Of the total, the assets of state-owned commercial banks amounted to 21.57 trillion yuan, up 17.5 percent year on year, those of joint stock commercial banks totaled 6.44 trillion yuan, up 22.8 percent, those of city commercial banks aggregated 2.3 trillion yuan, increasing 27.8 percent, and those of other banking institutions amounted to 10.64 trillion yuan, rising 16.1 percent.

During the first six months, China's banking institutions also witnessed a rapid increase in their total liabilities. By the end of June, the aggregate renminbi and foreign currency liabilities reached 39.03 trillion yuan, a year-on-year increase of 17.9 percent. Of the total, the liabilities of state-owned commercial banks were 20.49 trillion yuan, up 16.7 percent, those of joint stock commercial banks totaled 6.21 trillion yuan, rising 22.8 percent, those of city commercial banks amounted to 2.2 trillion yuan, increasing 27.2 percent, and those of other banking institutions stood at 10.12 trillion yuan, up 15.5 percent.