But now, the country, which holds the world’s largest foreign exchange reserves, is looking for better ways to keep the vast amount of assets safe and maximize investment returns.

The world’s second-largest economy’s foreign exchange, or forex, reserves stood at about US$3.1 trillion by the end of last month, up by US$31 billion, or 1 percent, from the beginning of this year, according to the People’s Bank of China, the central bank. Last year, the reserves fell by US$67 billion from a year earlier, after rising by US$129 billion in 2017.

The reserves stabilized at just over US$3.07 trillion, about 24 percent of GDP, by the end of last year, and comprised nearly 27 percent of such assets globally, according to the International Monetary Fund.

Foreign exchange reserves refer to any overseas financial assets held by a central bank and can include bank notes, deposits, bonds, treasury bills and other government securities.

Zhao Qingming, chief economist at the China Financial Futures Exchange’s Institute for Financial Derivatives, said: “Safety and liquidity are the two major goals for foreign exchange reserve management in China, with safety being the primary goal. Holding such a huge amount of foreign exchange reserves, it is reasonable that the managers are highly risk-averse, preferring to invest most of the reserves in safe assets.”

Some 60 to 70 percent of the nation’s forex reserves are held as sovereign debt from advanced economies, as well as financial and corporate bonds with high credit ratings. Other investment targets include equities, bank deposits and financial derivatives, Zhao said.

Supported by the large accumulation of forex reserves, the country has seen stable and fast economic growth in the past four decades, with lower inflation. Thanks to the reserves, China can also benefit from a favorable international trade and financial environment in the long term, Chen Yuan, a former deputy governor of the central bank and former vice-chairman of the Chinese People’s Political Consultative Conference, said at a forum on Aug 10.

“Previously, we identified the foreign exchange reserves as an important milestone for economic development and society’s core wealth. Now, we have to reposition the foreign exchange market,” he added.

According to Chen, faced with new challenges, including foreign exchange rate issues raised by the United States recently, the priority is to keep these reserves safe, and strengthen the renminbi’s position globally.

Chen sees potential in foreign exchange rate risks, as the majority of China-reserved foreign assets are in US dollars.

Currency composition

Late last month, the State Administration of Foreign Exchange, or SAFE, China’s forex regulator, said the country’s foreign exchange reserves held in US dollars accounted for 58 percent of the total by the end of 2014, down from 79 percent in 1995.

Among global foreign exchange reserves, assets held in US dollars comprised 65 percent of the total by 2014, up from 59 percent in 1995, according to SAFE’s annual report last year.

For the first time, SAFE made public the currency composition of the forex reserves, after first reporting data to the Currency Composition of Foreign Exchange Reserves, or COFER, an International Monetary Fund database, in 2015.

According to COFER, which keeps quarterly data on the currency composition of official foreign exchange reserves, the world’s forex reserves reached US$11.59 trillion in the first quarter of this year. Some 58.14 percent of the total was in US dollars, compared with 1.8 percent in renminbi.

Zhao said the currency composition of the reserves in China “almost” matches the global trend.

Chen warned that given the large proportion of global reserves held in US dollars, “the US, to some extent, can influence the foreign exchange market through affecting the dollar’s value, which could also result in adverse impacts on China amid the escalating trade dispute.”

On Aug 5, the US designated China “a currency manipulator”. Immediately after the announcement by the US Treasury Department, the dollar and stocks fell sharply and gold strengthened. Fears then rose in global financial markets, triggering increased volatility.

According to economists, forex reserves are usually seen as cushions against drastic fluctuations in foreign exchange rates. The value of the renminbi can be stabilized through selling or buying foreign exchange, and the country’s ample reserves can prevent short-term foreign debt risk.

After assessing the situation last year, the IMF concluded in a report that estimates suggested there had been little foreign exchange intervention by the PBOC. The report, issued on Aug 9 in Washington, was quoted by analysts to support China’s objection to being labeled a currency manipulator by the US.

“(China’s) reserves remain adequate and there were no indications of large-scale foreign exchange intervention despite renminbi depreciation against the US dollar,” the report said. “China’s foreign currency reserves remain more than adequate to allow a continued transition to a floating exchange rate.”

Patience urged

In addition to currency disputes, global investors expect that if the United States Federal Reserve announces more rate cuts in the coming months, it could drive down US dollar-denominated asset prices and weaken the value of most forex reserves.

Yu Yongding, a senior economist at the Chinese Academy of Social Sciences, said the PBOC has suggested allowing a more flexible floating of the renminbi exchange rate, and has continued to push for market-oriented reform of the foreign exchange rate regime.

The central bank should be patient and stick to reform, Yu said, adding that there has been no intervention in the forex market through sales of such reserves for a long time, even though the renminbi may be under depreciation pressure amid global monetary easing.

According to SAFE, the major task for foreign exchange management this year is to enhance midand long-term asset allocation and optimize and adjust investment strategies.

Xie Yaxuan, chief analyst at China Merchants Securities, said there is a global trend where countries with large holdings of reserves tend to focus on long-term and relatively stable investments, such as infrastructure construction, to hedge against potential fluctuations in bond and equity markets.

“A shift toward using domestic currency is another trend,” he added.

Profitability is generally accepted by the world’s major central banks as the prime objective for reserve management, in addition to safety and liquidity. The emphasis on the return objective has generally increased over time, according to experts.

SAFE said in its annual report that China had achieved a 10-year return rate of 3.68 percent on average on its foreign exchange reserve investments from 2005 to 2014.

Wang Chunying, a spokeswoman for SAFE, said the investment return rate was at a relatively good level compared with those of global peers.

“China’s forex reserve currency structure is diversified, even more diversified than the global level on average,” Wang said. “It is in line with the requirements of China’s economic and trade development, as well as the demand for international payments.”

Prospective returns on China’s vast foreign exchange reserves are likely to remain stable at more than 3 percent, and the regulator is optimizing investment strategies this year to increase asset values and reduce the adverse impact of foreign exchange rate fluctuations, according to economists.

Zhao, from the China Financial Futures Exchange, said it is also a trend for global monetary authorities, including the PBOC, to increase gold in their reserve portfolios to prepare for any shocks resulting from financial risks and foreign exchange rate fluctuations.

China needs to hold more gold when external uncertainties are increasing, Zhao added.

SAFE said the country’s gold reserves rose to US$87.27 billion by the end of June, up from US$79.32 billion in January. China had the world’s sixth-largest gold reserves by the end of last year, with a total of 1,852 metric tons.

In China, official reserve assets cover five items: foreign exchange reserves; gold; IMF reserve position; Special Drawing Rights and other reserves.

The amount and structure of the country’s foreign exchange reserves are changing dramatically, along with the global and domestic economic development situations, economists said.

Alternative investments

From 2000 to 2014, a significant amount of global capital went into emerging market economies, resulting in a surge in foreign exchange reserves, from US$154.7 billion at the start of 2000 to a record high of US$3.99 trillion in June 2014, representing an annual increase of more than 26 percent.

Since July 2014, along with outflows of global capital from emerging market economies, China’s forex reserves have dropped gradually, according to SAFE.

To manage forex reserves of more than US$3 trillion, SAFE set up a special investment entity－the SAFE Investment Center－which is responsible for operating and managing the foreign exchange and gold reserves.

The center has five offices for offshore investments: Singapore, (under the name Huaxin); Hong Kong, (Hua’an); London, (Huaou); New York, (Huamei); and Frankfurt, according to SAFE. These offices form a global network, which can operate round-the clock.

According to a former SAFE official, these overseas offices have “special missions” for investing the reserves, but little information about their detailed investment strategies can be disclosed due to security issues.

“But they are increasing alternative investments, to diversify the type of assets,” the former official said. Alternative investment generally refers to real estate, securitization assets, hedge funds and private equities.

Diversification and decentralization are the priorities for China’s foreign exchange reserve strategy, according to the SAFE annual report last year. “Putting such a large bulk of reserves into different baskets, and building optimized asset portfolios, can hedge risks and secure the assets’ value and profit,” the report said.

To better control potential risks, SAFE has introduced “counter-cyclical” policies to prevent adverse situations arising. According to the report, the major risks are listed as “credit”, “market”, “liquidity” and “operational”.

TAIPEI (The China Post) – Political organization Demosisto said Friday that Hong Kong democracy activist Joshua Wong was arrested in Hong Kong earlier today on unknown charges.

“Wong was forcefully pushed into a private minivan on the street,” the group said as the activists were walking to a subway station at about 7.30 a.m. He was reportedly taken to police headquarters in Wan Chai.

The group did not immediately reveal any further information but said their lawyer is in contact with Hong Kong authorities.

Hong Kong Free Press also reports that Hong Kong pro-democracy activist Agnes Chow has also been arrested. Her Demosisto party colleague Jeffrey Ngo told the media about the incident.

The State Council, the country’s Cabinet, outlined 20 measures to help promote consumer spending such as liberalizing car-buying restrictions, encouraging the purchase of new energy vehicles and expanding cross-border e-commerce imports to more cities, according to a document released on Tuesday.

Experts said the new plan will better satisfy people’s growing demand for high-quality products and services, promote industrial upgrading and further boost the economy

Experts said the new plan will better satisfy people’s growing demand for high-quality products and services, promote industrial upgrading and further boost the economy.

The document said the distribution and consumption sectors still face bottlenecks and have shortcomings in development, such as insufficient supply of goods and services.

It said there is plenty of room for traditional companies to innovate and more efforts are needed to unleash the public’s consumption potential.

New measures also include encouraging the merger of new technologies and business platforms, upgrading aging shopping centers, improving pedestrian shopping areas, supporting trade-ins for household appliances, promoting night markets and encouraging activities for public holidays.

The announcement came amid slowing economic growth in China and the mounting Sino-US trade dispute.

China’s economic growth weakened to 6.2 percent year-on-year in the second quarter this year, compared with 6.4 percent growth in the first quarter.

With a focus on key areas and weak links of the national economy, the new plan shows the government’s determination to take more measures to boost growth, and it is also in line with the national economic restructuring away from overreliance on exports and investment to generating growth through consumption and domestic demand, experts said.

“Consumption remains the main driver of growth, contributing 60.1 percent of China’s economic growth in the first half,” said Tang Jianwei, chief researcher at the Financial Research Center of the Bank of Communications. “The key is to use measures to strengthen the weak links and improve people’s incomes. There’s certainly a lot of room for growth in consumption.”

According to eMarketer’s worldwide retail and e-commerce forecast, China is poised to surpass the United States to become the world’s top retail market in 2019. The report said China’s overall retail sales will rise 7.5 percent this year to US$5.64 trillion, compared to US$5.53 trillion in retail sales in the US.

Tang added that there are two main shortcomings in domestic consumption.

“First, incomes need to grow faster. Second, household consumption is rising and demand for high-quality goods and services is growing. However, there is still insufficient domestically made high-end products and services to meet demand.”

With a key focus on the weak links, the new measures will help fulfill people’s hopes for better lives and promote industrial upgrading in the nation, Tang said.

The State Council’s new measures to promote commerce also include encouraging financial institutions to innovate consumer credit products and services. Dong Ximiao, a researcher at the National Institution for Finance and Development, spoke highly of the move, saying it will help improve service efficiencies, fend off risks and offer better customer experiences.

“China has come to a critical period of upgrading and transformation,” Dong added. “The domestic consumer market is entering a new era driven by technology, high quality and services. The generation born in the 1980s and 1990s has become the main force of consumption, and those born in the 2000s will also become new consumption drivers.”

The world’s top five vendors are Samsung, Huawei, Apple, Xiaomi, and OPPO. Among the top 5, Huawei and Samsung saw the biggest growth, with sales increases of 16.5 and 3.8 per cent, respectively.

Huawei’s sales surged 31 per cent in the second quarter of 2019 compared to the last quarter in the greater China area.

Samsung sold 75 million smartphones worldwide, with market share rising to 20.4 per cent in the second quarter of this year, up from 19.3 per cent in the same period last year.

Appple’s iPhone sold 38 million units in the second quarter of 2019 — a 13.8 per cent year-on-year decline — and market share accounted for 10.5 per cent of the world’s total, a slide of 1.4 percentage points from 11.9 per cent last year.

Total smartphone shipments in the Chinese market were 101 million units in the second quarter, up 0.5 per cent year-on-year. The figure was 10.8 million units in Brazil, a growth of 1.3 per cent year-on-year.

India sold 35.7 million smartphones in the second quarter, down 2.3 per cent year-on-year, with market share reaching 9.7 percent.

Global smartphone sales will remain weak for the rest of the year, Gartner said. In 2019, global smartphone sales will reach 1.5 billion units.

Moreover, sales of high-end smartphones will decline faster than other types, and smartphone makers are copying the high-end features of their flagship phones to lower-end models to attract users to renew their phones, Gartner said.

Ranong Thani School, one such Myanmar school that was shut down, is situated in Banong Ward, Ranong Province. Mostly Myanmar migrant children are attending the school which conduct its lessons in both Myanmar andThai versions.

The school is owned by Thai citizens but the Myingyan Sayadaw manages the school.

“The schools were raided on August 24th by the order of district officials from the Thai Labour Ministry. It is learnt that the schools were closed in accordance with the Foreign Labours Management Law. There are over 1,290 Myanmar students and 45 teachers in Ranong Thani School. Thai authorities arrested 32 teachers out of 45. The remaining teachers are now on the run.

The school is the biggest Myanmar school in the whole of Thailand. The remaining 11 schools were also closed in the following days. When Thai authorities raided the Ranong Thani School, teachers in other schools also scattered. Some monks that were managing the Ranong Thani School also were hiding,” said one of the Myanmar migrants from Ranong.

Thailand already grants 24 kinds of job permits to the foreign labours in accordance with the Management of Foreign Workers Employment -2017 Law. However, the detained teachers were arrested due to illegal job permit, according to the Thai officials.

“A Myanmar school also was closed last month. As 12 more schools were shut, there have been totaling 13 Myanmar school shutdowns in Ranong province. The sayadaw who is supervising the children studying at the Ranong Thani School lacks the participation with the Thai authorities. I think that the schools may be complained because Thai authorities assumed that the schools were illegal one. Moreover, the schools didn’t close at the Thai holidays. That’s why the Thai authorities raided the schools,” said a person who is now monitoring Myanmar-Thai affairs.

The 32 detained teachers must be fined from Baht 5,000 to 50,000 as lowest punishment and then they may be deported back to their countries.

The detained teachers are now holding the temporary border passports but they were arrested due to illegal job permit.

Currently, over 3,000 Myanmar students are now studying at the school shutdowns. If the students will lose their learning chance, the drug related cases, child labours and human trafficking cases may appear.

The detained teachers are now being kept in Immigration Detention Center in Immigration Department in Ranong. Later, the Thai authorities will be handing over the detained teachers to Myanmar near soon.

https://elevenmyanmar.com/news/thai-authorities-raid-12-myanmar-schools-in-ranong

Philippine President Rodrigo Duterte will head for Beijing today, his fifth visit to China since he took office in 2016. While his previous visits have been more or less a love fest between him and Chinese President Xi Jinping, this time their meeting promises to be less cordial.

Duterte has said he will raise a 2016 ruling by an international tribunal on a case filed by the Philippines invalidating China’s claim over most of the South China Sea.

He has resisted calls to press this victory in the first three years of his presidency, opting instead to curry favour with China. But now he is determined to bring it up, even if it touches a raw nerve in Beijing.

“Whether you like it or not, will make you (China) happy or not, angry or otherwise, I’m sorry. But we have to talk about the arbitral ruling,” he said in a speech last week.

He revealed that certain quarters had pleaded with him to keep the ruling off the table. “They said not to talk about it. I said ‘no’… Do not control my mouth because that is a gift from God,” he said.

It is unclear just exactly what he hopes to achieve by bringing up the ruling now, midway into his six-year term. China’s top envoy in Manila, Mr Zhao Jianhua, has said Beijing’s position on the matter – which is to ignore the ruling – is unlikely to change.

Predictably, Mr Duterte has said he does not want to pick a fight with China. “We do not go to war. I will just feed my army and the military and the police to the mouths of hell,” he said.

Get exclusive insights into Asia from our network of correspondents

Keep up with the latest in the region with the ST Asian Insider newsletter, delivered to your inbox every weekday

But this time, he wants China to go beyond just talk when it says it wants to resolve conflicts over the South China Sea peacefully. “You just cannot talk air,” he said.

Specifically, he wants to kick-start joint oil and gas exploration in contested waters. “Let us talk about what is there. You have to share with us,” he said.

They said not to talk about it. I said ‘no’… Do not control my mouth because that is a gift from God.

China and the Philippines signed a memorandum of understanding to jointly explore resources in the South China Sea, and agreed to come up with something more concrete by November.

Duterte is apparently getting impatient. The Philippines is desperate for a new source of natural gas, as the Camago-Malampaya natural gas field is expected to dry up by 2024. The field off the coast of Palawan province fuels three power plants that provide electricity to half of the main island of Luzon.

Reed Bank, a shallow seamount that spans nearly 9,000 sq km, is a promising prospect. It is believed to hold up to 5.4 billion barrels of oil and 1.56 trillion cubic metres of natural gas. But these resources are in waters that China and the Philippines are contesting.

China has agreed to a 60:40 resource-sharing arrangement, in favour of the Philippines. Mr Duterte is pressing to have this set in stone.

His tougher posturing may also be intended to appease the military, analysts say.

In recent months, security officials have taken shots at Beijing over the sinking of a Philippine fishing boat by a Chinese trawler, “swarming” of a Philippine-held island by China’s fishing militia, incursions by Chinese warships into Philippine waters, and friction caused by the burgeoning population of Chinese workers in Manila’s offshore gaming industry.

Duterte jokes he wants US to enforce defence treaty in China dispute

Political analyst Richard Heydarian said: “Against the backdrop of rising criticism of China at home, Duterte is toughening his rhetoric to stave off a full-scale backlash.”

But few expect Mr Duterte to push too hard and risk losing China as an ally. “If anything, the visit to Beijing is likely to be an effort to ease tensions and explore new compromises,” said Mr Heydarian.

Gregory Poling, director of the Washington-based Asia Maritime Transparency Initiative, told online news site Rappler that unless Mr Duterte’s effort is part of a larger diplomatic effort to push back against China, “it won’t make a difference”.

The file, which leaked out of the closed-door dialogue yesterday onto WhatsApp, also shows that KXP’s development will be financed by the sale of a 18sq km piece of land around the proposed airport site.

The dialogue session was between senior government officers, and attended by Mentri Besar Datuk Seri Mukhriz Mahathir.

Labelling KXP as the “game changer” and the “new gateway to the northern region”, the project is expected to have the potential to generate RM3.8bil in private investments to the vicinity and create up to 18,000 jobs.

In comparison to KXP’s 17sq km, Penang International Airport (PIA) is a mere 3.3sq km while the Kuala Lumpur International Airport’s land is a whopping 100sq km.

On the importance of having two runways, an airport expert told The Star that it would allow KXP to see 60 flight movements – landings and takeoffs – per hour.

“That is one flight movement per minute, barring unforeseen delays. It is ideal for clockwork efficiency in managing both cargo and passenger flights, ” said the expert, who added that KLIA has three runways and PIA has only one.

Based on the presentation, “sale of land bank through a master development together with KXP”is expected to be the financing model.

The presentation states that the project promoter will sell 18sq km of land around KXP to developers and investors over 10 years, which is specified as being from this year until 2029.

A look at Google Earth shows that the land is presently a vast expanse of oil palm plantations and padi fields.

Although it is within Kulim district, it is actually about 10km from the heart of the Sungai Petani town, right beside Bandar Puteri Jaya, a suburb south-west of Sungai Petani.

The site is about 20km from Kulim town, and about 30km from the mainland point of Penang Bridge.

Likewise, should the Penang undersea tunnel be built as the third link between Penang island and the mainland (at Bagan Ajam, Butterworth), the journey is also about 30km via the North-South Expressway.

The land acquisition cost of this site is calculated at RM3psf, and when the status is converted to development land, it is targeted to have a market value of RM21psf

(or a seven-fold increase), which leads to a development budget of RM3.25bil, spread over 10 years.

In one of the slides, it is shown that a new interchange is earmarked along the North-South Expressway, north of Muda River, to connect KXP to the expressway.

In terms of domestic tourism, the KXP’s catchment is estimated to cover 1.2 million people living in Kuala Muda, Kulim, Baling and Penang’s north Seberang Prai district.

The Star has sent an email to KXP AirportCity Holdings Sdn Bhd chief executive officer Datuk Dr Annuar Mohd Saffar for comment on the presentation slides, and is awaiting his reply.

It is found that the holding company has called a tender for consultants to develop the master plan for KXP AirportCity, or Aerotropolis. The tender closed on July 31.

On the website, kxp-airport.com, an announcement on the tender for environmental impact, social and traffic assessments is also displayed.

KXP is expected to have far reaching economic impact for both Penang, Kedah and southern Thailand, which relies heavily on northern Malaysia’s public infrastructure, including Penang Port, because Bangkok is too far from the region.

In July 2014, Wong Hon Wai, as then political secretary to former chief minister Lim Guan Eng, revealed that KXP was being planned when he called on the Federal Government to specify whether KXP is in the National Airport Master Plan.

Since then, many people have commented on the proposal and on social media, Kedahans and those living in Seberang Perai seem eager for KXP to become reality.

Penang’s islanders, however, prefer PIA.

Penang Chief Minister, Chow Kon Yeow, has been critical of KXP and called for further studies.

Earlier, Chow said Penang had hired consultants to study KXP’s impact, and the analysis showed that it would be injurious to Penang’s economy.

In an interview with Astro Awani on May 3, Mukhriz said KXP would only handle cargo, and not passengers.

Chow, in the Penang state assembly meeting in mid-May, expressed doubt that an airport of KXP’s size was only for cargo.

Read more at https://www.thestar.com.my/news/nation/2019/08/28/kulim-airport-to-have-two-runways#pvMdiMKDPGTqrRxL.99

All sea voyages were halted in eastern waters and 10 flights were canceled at Manila’s international airport due to bad weather caused by Jenny, which gained strength and speed as it bore down on eastern Luzon.

The Philippine Atmospheric, Geophysical and Astronomical Services Administration (Pagasa) said the storm was likely to make landfall in Aurora province between 9 p.m. Tuesday and 1 a.m. Wednesday.

As of 4 p.m. Tuesday, Jenny was 290 kilometers east of Infanta, Quezon province, moving west-northwest at 35 km per hour with sustained winds of up to 65 kph and gustiness of up to 80 kph, according to Pagasa weather forecaster Jaime Bordales Jr.

Signal No. 2

The weather service raised storm signal No. 2 in the provinces of Isabela, Aurora, Quirino, Nueva Vizcaya, Ifugao and Mountain Province.

It earlier raised signal No. 1 in Cagayan, Apayao, Abra, Kalinga, Benguet, Ilocos Norte, Ilocos Sur, La Union, Pangasinan, Nueva Ecija, Tarlac, Zambales, Bataan, Pampanga, Metro Manila, Rizal, the northern part of Quezon (including Polillo Island) and Alabat Island, Cavite, Laguna, Camarines Norte, Catanduanes and the northeastern part of Camarines Sur.

School was called off in Metro Manila on Tuesday in anticipation of heavy rain and flooding, but the capital only had light rain and overcast skies.

Asked why signal No. 1 was raised in Metro Manila and surrounding provinces despite relatively better weather, Bordales said there was still “a level of uncertainty” in forecasting. But the forecast for the capital, made late Monday, was for 36 hours, he said.

“It is also part of the protocol of [local governments] to give lead time when there is a weather disturbance,” Bordales said. “They also need to mobilize services, and perhaps that’s why most of them decided to call off school.”

Moderate to heavy rain was expected in Metro Manila on Tuesday evening.

Out by Thursday

Jenny is expected to blow out of the Philippines by Thursday afternoon, but some parts of western Luzon—including Bataan, Zambales and Pangasinan—would continue to be drenched by the storm’s outer rain bands and the enhanced southwest monsoon.

As Jenny approached on Tuesday, Isabela deployed disaster response teams in anticipation of floods and landslides.

The local government of Cauayan stopped fishermen from going out to sea and banned the sale of liquor.

Gov. Rodolfo Albano III suspended classes at all levels due to incessant rain.

In Ilocos Norte, which was battered by Tropical Storm “Ineng” (international name: Bailu) last week, assistance from both the government and the private sectors continued to arrive on Tuesday.

In Bulacan, heavy rain shuttered schools in the towns of Calumpit, Paombong, Pulilan, Hagonoy and San Miguel.

The river in Santa Maria breached its banks, damaging the Macaiban bridge.

In Eastern Visayas, Biliran, Leyte and Samar provinces kept schools closed as Jenny headed for land.

The Coast Guard in Cebu City and in Western Visayas watched out for strong winds, ready to shut down the port if the weather turned worse

Speaking at a press conference held at the Ministry of Foreign Affairs on Tuesday, the Office’s Deputy Director General, Mr Anousine Khattiyalath, said the situation at Selamphao upstream on the Laos-Cambodia border was normal.

“I would like to confirm that the Laos-Cambodia border situation remains normal, which is different from what some domestic and foreign news outlets have reported on their social media channels,” he said.

Some local and foreign media outlets have been spreading fake news on the Laos-Cambodia border situation. They also reported that Laos and Cambodia had deployed troops at the border area known as Selamphao upstream, which is situated between Champassak province and Preah Vihear on the Cambodian side.

Mr Anousine said this disinformation misled and damaged the image of the relationship between Laos and Cambodia, adding that Laos and Cambodia are friendly neighbouring countries and respect each other’s independence, sovereignty and territorial integrity.

He said Laos and Cambodia had committed to address border issues through peaceful and diplomatic means. The two nations aimed to develop the Laos-Cambodia border area as a border of peace, friendship and cooperation.

The guideline, issued on Aug 18 by the Central Committee of the Communist Party of China and the State Council, said Shenzhen needs to set up a comprehensive and long-term mechanism for a stable and healthy development of its real-estate market.

The document, in particular, urged the city to speed up improving its affordable housing policies for low-income citizens and talents.

Skyrocketing property prices are inevitable with the city’s prosperity, but if not handled properly, it could result in problems like companies being forced to move out due to high office, factory and living costs.

Some of the solutions have been very effective, including the introduction of a scientific category system of talents and a rents model before home purchases. More new measures with affirmative results are also expected, such as creating affordable industrial spaces.

Yan Yuejin, director of the E-house China Research and Development Institution, said industrialization and urbanization have led to sky-high property prices in Shenzhen, as in the case of other major international cities.

Industrialization has pushed up home prices in metropolises like London and New York, while urbanization has boosted Tokyo’s.

As for solutions to the problem, Shenzhen has tried and plans to roll out further measures besides introducing home-purchase curbs like many other cities on the Chinese mainland.

Yan said some of the solutions have been very effective, including the introduction of a scientific category system of talents and a rents model before home purchases. More new measures with affirmative results are also expected, such as creating affordable industrial spaces, he said.

The latest measure is a system of “commercial apartments with stable rents” planned to be launched in October this year — the first of its kind in the country.

Apartments under the system are required to be rented out for a fixed period at average market rates, but limited to a fluctuation range of 5 percent annually.

Shenzhen is also the first mainland city to set up an independent system of affordable housing for talents, as early as in 2016, with different levels of talents and detailed incentive policies accordingly.

Shenzhen Talents Housing Group Co was founded three years ago to focus on investment, construction and management of homes for talents. So far, it has set up about 88,700 homes, started construction of 28 projects, and has been operating a leasing area of more than 720,000 square meters.

In a document released by Shenzhen’s housing authorities in April, the city plans to build 170 new residential homes with 60 percent being affordable units for rent and purchase by 2035.

Shenzhen will be more like Singapore, where the majority of the population live in public housing projects and their asset value will weaken, said Sun Bushu, deputy director of the South China City Research Association. In Singapore, only about 40 percent of all residential homes are public properties.

As a “demonstration city”, Sun said Shenzhen will learn from others’ experiences and, more importantly, usher its own path of unprecedented management models with high demonstrative value.

With these measures, he believes Shenzhen’s housing prices would be stable along the way to becoming a “demonstration city”.

In the first half of this year, the total trading volume of new homes in Shenzhen surged 38 percent, but average prices had dropped slightly by some 2 percent, compared with the same period last year, according to the China Real Estate Index System.