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Shares skyrocketed on the first day of trading for Citic Bank’s IPO, raising $5.4 billion for the company and marking the world’s biggest initial public offering this year.  The issue jumped to 11.37 yuan in the overnight in Shanghai as Hong Kong traded shares advanced 14 percent. <Full Story See Below>

Citic Bank IPO Soars In Shanghai

Shares skyrocketed on the first day of trading for Citic Bank’s IPO, raising $5.4 billion for the company and marking the world’s biggest initial public offering this year.  The issue jumped to 11.37 yuan in the overnight in Shanghai as Hong Kong traded shares advanced 14 percent.  Reflective of a healthy equity market environment , the issue shows how much interest still remains in the region as both domestic and foreign investors mopped up the company’s interest.  Additionally, it sets the tone for more successful offerings including China Molybdenum Co. and Country Garden Holdings Co.  Both shares soared on their first day of trading with China Molybdenum stock jumping 60 percent in Hong Kong yesterday.

Wu Pledges To Fight WTO Sanctions

In a move that showed recent contention with US WTO complaints, Wu Yi, China’s most senior trade official spoke out against American policy makers in the beginning of the week.  Vowing to “fight until the end”, Yi commented that “it’s unprecedented for a WTO member to file two complains against another in  such a short time”.  As a result, “these moves betray the consensus reached by China and the US to resolve trade issues.”  Speaking at a commerce ministry conference on intellectual property rights in Beijing, the trade official also noted the US’s negligence in recognizing recent efforts on stricter policy against trademark infringement.  Recently, the country has revised legislation that would place increased penalties on piracy felons.  Incidentally, the comments come a month before Wu and other trade officials are scheduled to travel to Washington.  During the weekend of May 22-24, Chinese officials are set to continue talks with US Secretary Henry Paulson, the second of two annual meeting established to improve relations between the two countries.  However, the tone has changed considerably for both sides with recent statements from Paulson noting that tangible results will be needed from Chinese officials on a more flexible currency regime.

Canada Joins Full Slate Of Complaints By The US

It’s not only US policy makers that have been under the gun by domestic industry groups, it seems that the world’s ninth largest economy is also under increased scrutiny from local industries.  The pressure has prompted Canadian officials in joining the recent slate of WTO complaints, with Japan likely to  “join the fray”.  Announced by Canadian Trade Minister David Emerson, the decision was made in the effect of “seeking clarification from China on its intellectual property rights enforcement regime, given concerns expressed by Canadian industry”.  The addition of Canada, coupled with announcements surrounding Japan’s third party participation in US-China trade talks, have increased the subtle pressure that global trade partners are putting on Chinese officials.  Although bolstering speculation of a near term widening of the currency’s band, the recent pressure is likely to chisel little away from the hard stance that Chinese officials have taken.  Revaluation hopefuls, don’t hold your breath.

Paulson Criticizes China

Further evidence of a change in tone by US Treasury Secretary Henry Paulson could be seen in a recent interview with Charlie Rose.  A week after the G7 meeting highlighted frustrations of the highly public Paulson, the treasury secretary reiterated comments saying that Chinese officials “are not moving, in my judgment, quickly enough” , in regards to further revaluation.  The single statement could set up for an interesting confrontation in the tail end of May, when Paulson and Chinese officials are set to meet and discuss recent trade relations, likely including the WTO complaint applications.  This time around, however, it seems that Paulson may not be as supportive of the recent regime, forcing Chinese officials to bring something to the table.

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