China’s third-quarter economic growth slowed to its weakest pace in two years, suggesting that the government’s policy measures to cool growth have taken effect. The Chinese economy grew by 9.1 percent year over year in the third quarter, compared to 9.5 percent in the second quarter and 9.7 percent in the first quarter, according to data from the National Bureau of Statistics. Analysts noted that the latest data indicate that China’s economic growth was increasingly driven by rising domestic consumption. China’s retail sales grew by 17.7 percent in September. These figures don’t account for strong retail sales growth during October’s “Golden Week” holiday, when retail sales surged by 17.5 percent to RMB696.2 billion (USD109 billion).

 

China’s banking regulator, the China Banking Regulatory Commission (CBRC), issued a notice aimed at easing concerns about runaway lending in the informal lending market. In a transcript of a speech by CBRC chairman Liu Mingkang posted on the regulator’s website, Liu said ratings companies and analysts had “underestimated” China’s ability to carry out reforms of the sector. Liu promised to control risks and noted that government measures to shore up the banking system and tamp down on informal lending have already begun to bear fruit. China has raised interest rate five times in the last year and instituted a cocktail of measures to restrict runaway lending–moves that Liu acknowledged has “spawned various shadow banking activities.” Last week China’s Premier Wen Jiabao said the government would support small- and medium-sized enterprises, many of which have been forced to take loans in the informal lending market due to tighter lending standards at China’s state-run banks. State media said that the central bank estimates the size of China’s private lending market to be RMB3.38 trillion (USD530 billion) though analysts said it could be as high as RMB4 trillion (USDT626.3 billion) or 10 percent of China’s gross domestic product.  

 

Reports in state media suggest that China’s rail and road building projects are running short of cash. Some 10,000 kilometers worth of projects have been halted and many of the 6 million migrant workers engaged in building China’s railway system have not been paid for month, according to the reports. A member of the Chinese Academy of Engineering also said that contractors owe vast sums of money to cement and steel suppliers.

 

Japan’s government has provided the basic outline of a policy aimed at boosting the country’s agricultural sector by expanding farming operations and attracting young people to the industry. The country’s agricultural sector is expected to suffer the most from pro-free trade policies favored by Prime Minister Yoshihiko Noda. The policy calls for raising the country’s level of food self-sufficiency above 50 percent, from the current 39 percent, which is near a historic low for Japan. The policy was released as the Noda administration engages in discussions on the country’s possible participation in the Trans-Pacific Partnership (TPP)—a regional trade partnership being negotiated by the US, Australia, Brunei, Chile, Malaysia, New Zealand, Peru, Singapore and Vietnam. Japan’s business community is in favor of the country joining the TPP, fearing that a recent free trade agreement between the US and South Korea could affect Japan’s exports to the world’s largest economy. Japan’s agricultural sector, especially rice farmers, vehemently opposes participating in the agreement.

 

Russian media said that Russia hopes to invest up to USD225 billion for offshore oil and gas exploration through 2030. A plan developed by the country’s Natural Resources Ministry would attract foreign investors into the effort with tax breaks and other incentives. The plan cited by the reports is just one of several under discussion. However, sources told Russian media that the government “was on the whole in agreement” with the plan.