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China: Apple Expands Presence in China, and GM Enjoys Healthy Sales Bump


ConocoPhillips and Chinese airlines are also in the news.

MINYANVILLE ORIGINAL All eyes in China were turned toward the possible public offering of China National Nuclear Power, which aims to raise an eye-popping 173.5 billion yuan (US$27 billion) with a Shanghai IPO, an amount that will far exceed the $16 billion IPO of Facebook (FB).

The firm, which is China's largest nuclear developer, aims to use the cash to fund five projects, though it did not specify the nature of the projects. Its plans, approved by China's Ministry of Environmental Protection, now await clearance by the China Securities Regulatory Commission. If the China National Nuclear Power IPO goes ahead as planned, it would surpass Agricultural Bank of China's Hong Kong-Shanghai dual listing to become China's biggest IPO ever.

Here is more business news that's making headlines:
Chinese economy: For the first time in over three years, China cut interest rates in an effort to lower the cost of borrowing and boost its slowing economy.

On Thursday, the People's Bank of China cut the benchmark interest rate by 0.25%, bringing the one-year lending rate down to 6.31% and the one-year deposit rate to 3.25%.

China's central bank also made a step towards reform, announcing that it will also allow banks to offer deposit interest rates up to 10% higher than the benchmark rate and lend at rates of up to 20% lower.

"Reform-minded officials are taking advantage of political and economic circumstances to push forward financial and other reforms. Giving banks more flexibility in setting rates above or below the official benchmark rates on both loans and deposits is a significant step toward the ultimate goal of interest-rate liberalization," Eswar Prasad, an economist at the Brookings Institution, told the Wall Street Journal.
Apple (AAPL): Apple is looking to expand its presence in China. Reuters reports that the Cupertino-based company plans to open two more flagship stores in two big Chinese cities, Shenzhen and Chengdu. Government officials from both cities confirmed that the company has obtained approvals for its plans.

Currently, Apple has five stores in China, with three in Shanghai and two in Beijing. China has become one of Apple's most important markets, with the mainland having accounted for a whopping 26% for the company's first-quarter revenue.

General Motors (GM) received good news: The auto company saw sales in China go up 21% in May to 231,183 vehicles. The Wall Street Journal reports that SAIC-GM-Wuling - the auto maker's microvan joint venture with Shanghai Automotive Industry Corp. and Liuzhou Wuling Motors Co. - was the driving force behind the increase, as sales there jumped up 34%. Cadillac sales, in contrast, fell 2.2% in May from a year earlier to 2,205 cars. That has to be welcome news to GM, which faces steep losses in Europe.

Other major auto firms also saw strong May sales growth. BMW (BMW.DE) sales increased by 32% to 27,185 cars while Volkswagen AG's (VOW.DE) Audi brand notched up an impressive 44% sales rise to 36,278 cars. Toyota (TM) sales also rose more than threefold to 79,000, as the company bounced back from last year's earthquake and tsunami-affected sales environment.

ConocoPhillips (COP): A year after a major oil spill in the Bohai Sea, ConocoPhillips China revealed that another oil spill occurred at the same oil field on June 3. UPI reports that 0.6 tons of crude oil, or less than five barrels, was leaked at the Penglai 19-3 field, which is co-owned by ConocoPhillips China and China National Offshore Oil Corp, or CNOOC.

The spill occurred during an oil transfer but automatic isolation valves were shut quickly to limit the damage, said CNOOC, which added that there wasn't evidence of an oil sheen on the site.

Meanwhile, ConocoPhillips China has replaced its president, Georg Storaker, who is heading back to the US, with Jim Taylor coming in from an Indonesian post in a bid to improve the company's public image after last year's spill.

Chinese Airlines: With China's aviation industry continuing to enjoy robust growth, Chinese airlines are now looking abroad to hire new crew members, reports China Daily, as they seek a more international crew for their growing number of flights out of China.

Air China, which currently has the most foreign flight attendants at about 40, have 50 more incoming South Korean attendants, while China Southern Airlines and China Eastern Airlines have crew members from India, France, Germany, and Australia, among others.

Forbes suggested that American Airlines flight attendants who face layoffs as the company heads into bankruptcy restructuring should starting taking Mandarin classes and apply for openings at Chinese airlines.

Twitter: @sterlingwong
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