China is ready to ease the military standoff with the United States in the South China Sea, according to Chinese military officials. The defense sources assured that there were no plans for an increase in Chinese military presence in the disputed region. China and the U.S. both played down the incident of a month earlier, when a U.S. surveillance ship was penetrated by five Chinese vessels in the South China Sea. Both sides emphasized the mutual interest in diplomatic exchanges and a functioning cooperation.
Australian regulators called for an extended review of a planned Fortescue stake sale to China’s Hunan Valin Iron and Steel Group. Fortescue, Australia’s third-largest iron ore exporter, plans to sell a 17.6 percent stake to Valin in order to raise capital for its expansion. Concerns over national strategic assets have recently slowed down China’s pursuit of overseas assets. Australian authorities are currently reviewing a number of Chinese investment plans, among them the Chinalco-Rio Tinto and the Valin-Fortescue deals.
Angel Gurria, Secretary General of the Organization for Economic Cooperation and Development, said the OECD may cut its forecast for China’s economic growth in 2009 to as little as 6 percent. The revised forecast will lower the expected growth from 8 percent in November last year to “between 6 and 7 percent”. With the U.S., Europe and Japan in recession, China’s growth is widely expected to slow down in 2009, but will still significantly outgrow other economies hit by the global financial crisis. Earlier this week, the World Bank cut its forecast for China’s GDP growth to 6.5 percent.
