1. China needs further reform to foster domestic innovation

     The R&D intensity - the ratio of GERD to gross domestic product (GDP) - of China`s economy has increased spectacularly. It reached 1.43% of GDP in 2006, up from 0.6% in 1995, according to the report. However, China`s spending on R&D remains heavily focused on experimental development; only 5.2% of all R&D in 2006 was aimed at basic research, compared to 10-20% in OECD countries.

      However, China`s spending on R&D remains heavily focused on experimental development; only 5.2% of all R&D in 2006 was aimed at basic research, compared to 10-20% in OECD countries.

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2. USA Made Final Ruling on Off-the-Road Tires

     In this August, USA made a final ruling on new pneumatic off-the-road tires originated from China. The anti-subsidy tax rates are 2.45% for Guizhou Tyre Co., Ltd.; 14% for Hebei Starbright Tire Co., Ltd.; 6.58% for Tianjin United Tire & Rubber International Co., Ltd. and 5.62% for other Chinese companies. The antidumping tax rates are 5.25% for Guizhou Tyre Co., Ltd., 28.69% for Hebei Starbright Tire Co., Ltd., 8.44% for Tianjin United Tire & Rubber International Co., Ltd., zero for Xuzhou Xugong tyres Co., Ltd., 12.58% for 23 tire companies replied and 210.48% for others un-replied.

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3. Sinochem International Acquires 51% Equity in Singapore's GMG

      PetroChina Lube Oil Co., Ltd. and Wuxi Gaorunjie Chemical Co., Ltd. formed a joint venture Wuxi PetroChina Lube Oil Co., Ltd. in Wuxi on July 29th.

      Sinochem International Co., Ltd. (SH: 600500) announced on September 5th the company has finalized the acquisition of the 51% equity in GMG Global Ltd. through its wholly-owned subsidiary Sinochem International (Singapore), for a consideration of Singapore dollar 267.98 million (equivalent to RMB1.28 billion).

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4. Any New Coal Liguefied Project Unapproved

      China has discontinued to grant any new coal-to-oil projects nationwide, except for the two facilities conducted by Shenhua Group, according to the National Development and Reform Commission (NDRC) released on September 4th.

       Beijing-based Shenhua Group is building a coal-to-petrochemicals facility in Erodos, Inner Mongolia, which is scheduled for startup in the second half of 2008.

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5. Rapid Development of the Radiation Curing Sector

     With mankind paying greater attention to the environmental protection in recent years, radiation curing technology has developed rapidly. Compared with traditional curing technologies, radiation curing has the advantages of rapid filming, room-temperature curing, no solvent and low energy consumption. The technology has already been extensively used in coatings, ink and adhesive sectors.

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