Highlights from the last week of China business news: A minister calls a mining accident a “natural disaster”; the Shanghai Composite Index crosses the 5,000 mark while new securities regulations are introduced
Blaming a mining accident on nature
A horrific mining accident in Shandong province has sparked a round of finger-pointing. The worst offender was the civil affairs minister, who tried to lay the blame on Mother Nature. “The disaster was caused by heavy rain, not problems within the mine, so it was decided that this was a natural disaster,” he said. The mine’s bosses also allegedly could have averted the disaster if they had paid attention to warning signals . Instead, 181 miners were trapped in a flooded coal mine and now presumed dead. Rescue officials said it could take 100 days just to drain the mine of the floodwaters. The government has posted riot police at the mine company’s offices, fearing trouble from the trapped miners’ families. The heavy hand of government was also seen elsewhere this week in a series of new regulations aimed at dampening train protestors, and when it was revealed that several big blog providers, including Microsoft, have agreed to a government plan to register bloggers’ real names.
The Shanghai Composite Index broke 5,000 yesterday for the first time, crossing yet another psychological threshold. Investors are happily bidding prices up on the mainland but in the last week the Shanghai Stock Exchange announced plans to curb speculation and insider trading. The SSE said it would now suspend trading on new stocks that double in value or drop below half their opening price. This only applies to new issues, of which there will be plenty. The suspension can last up to half an hour and trading can resume if the exchange accepts the company’s explanation for the volatility. The program will start September 1. Chinese individual investors were also given the option of investing in Hong Kong for the first time, in a pilot program in Tianijn that underlines the city’s growing significance to the central government.
Related: The Red Dragon Fund’s take on the new individual investor program
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