At the regular press conference on April 20, Shanghai Municipal Government representative Jiao Yang answered reporters' questions.

1. China Radio International: At a conference last week, a dozen overseas-invested companies told the local government that they have to decline investment in Shanghai and turn to other regions because of the power shortage here. What kind of guarantees can the city government give to boost overseas investors' confidence in Shanghai?

Jiao Yang: What I have indicated just now on local power grid construction and government measures can relieve your worries. I should re-stress the principals that I have spoken of at the last press conference: under no circumstances will power cutoffs be enforced, but the rationing of power will be used. We will neither cut off nor ration power in residential quarters. But in certain emergencies, temporary power rations will be imposed on enterprises although no power cutoffs will be enforced. Certainly, sudden accidents will be an exception where both domestic and foreign companies are likely to have their electricity supplies cut off temporarily. However, local power departments will adopt emergency measures to resume power supplies as soon as possible, minimizing the impact on companies. At present, the Shanghai Economic Commission is drawing up preparatory plans for the peak power-consumption period this summer, including how to guarantee power supplies in hot days and emergency-response measures. In normal circumstances without sudden accidents, local power supplies can make up for the power shortages. The local government will inform companies on their plans for this summer by the end of May.

2. Shanghai Television Station News Channel: It is reported by many media today that according to the National Statistics Bureau, local housing prices grew the fastest across the nation in the first quarter of this year. Do you have any comments on this situation? You have mentioned just now that from now to the end of next month, 11 groups of foreign presidents will visit Shanghai. The last time, US Vice President Cheney visited Fudan University, and it took one-and-a-half days for local traffic resume to normal. Can you tell me if there are any better measures to deal with this traffic problem?

Jiao Yang: Your first question is an issue of statistics. Local housing prices in the first quarter of this year increased by 28.3 percent from the same period last year. The city's property prices grew rapidly in the second half of last year, and all the price increases after the first quarter of last year have been calculated into the year-on-year increase, so the growth rate is really high. But the local housing price growth has actually slowed, with property prices up 3.8 percent in the first quarter of this year over the fourth quarter of last year. The month-on-month increase in January, February and March this year hit 1.9 percent, 0.9 percent and 1 percent respectively. Generally speaking, Shanghai's real estate market is growing in a healthy and orderly way. The local government has paid much attention to the excessive housing price increases as of the second half of last year by adopting a series of measures, including stopping the transfers of uncompleted apartments as of Monday to encourage the local real estate market to continue developing in a healthy and orderly way, to avoid ups-and-downs in housing prices and to benefit local residents, especially common wage-earners.
As to your second question, I remember a similar question was raised at the press conference of the United Nations' Economic and Social Commission for Asia and the Pacific (ESCAP). Holding key international conferences in Shanghai will help raise the city's global status and improve local comprehensive competitiveness. Our authorities, especially the public transportation department, always give priority to minimizing the impact on local citizens. They will try their best to minimize road blockages by adopting highly efficient organization and high-tech controls. If some necessary measures affect the normal lives of residents and companies' production, the government will issue notices on the media, asking the public to make earlier preparations. All local residents and companies are expected to give us understanding and support, and overcome possible inconveniences and difficulties in order that we can display the proper character in meeting our hosting responsibilities.

3. Jiefang Daily: Shanghai's fixed assets investment has been overheated over the past two months. What do you think about that situation?

Jiao Yang: Different people have different views on whether or not the local fixed assets investment is overheated. I will not make more comments on the issue, but I should stress that the local government will stick to carrying out the spirit of the Party Central Committee and State Council, and adhere to economic and social development in a coordinated way and at an overall, scientific and sustained development. Have you noticed that there are some key indices added to the local economic and social development guideline system of this year's government report? For example, expenses of research and development accounted for 2.2 percent of the local GDP, and environmental expenditures accounted for three percent of the GDP. However, investment is not regarded as one of the key indices of local economic and social development. Therefore, the Shanghai government is paying close attention to the overall, balanced and sustained growth of the city, while not just seeking high GDP and investment volumes.

4.  Real Estate Times:  You mentioned the five measures for the housing market.  One phenomenon is noteworthy, that is most home owners don't register with the housing department when renting out their property, resulting in the housing authority's having little information about homes for rent.  That's because the owners must pay tax for this registration.  Can the government introduce a similar policy for home renters as the previous policy for homebuyers in order to reduce or exempt the taxes? Is there such a policy?

Jiao Yang:  You have put forward a suggestion which can be referred to housing officials present now at the conference.  Since taxation is a crucial tissue, the policies must undergo cautious research.  But I still appreciate the reporter's concern for the healthy development of Shanghai's housing market.  You may communicate with the authority in this sector.

5. China Business: After China unveils the national auto industry policy and auto purchase policy, Shanghai may probably be the only place in the country that issues auto plates via auction.  Is there a timetable for the city government to solve the issue?  What measures will the government adopt in response to the national policies?
　　
Jiao Yang:  I can't comment on the issue because we haven't seen the document as yet.
　　
In keeping with the principles established by the "Shanghai Urban Transportation White Book", especially considering the fact of Shanghai's small downtown area with a dense population, Shanghai government has drafted a policy granting priority to the public transportation system, various policies in other areas and a policy ensuring the balanced development of local roads and vehicles. Meanwhile, according to the "Shanghai Road Transportation Administrative Regulations", the city aims at an orderly development of the car transportation.  These policies, based on practical experiments, are designed with reference to traffic administration methods by other world metropolises as well as Shanghai抯 own situation.  They reflect the government's commitment to the citizens for smoother transportation and ensure security, smoothness and convenience for local transport.  Basically, they're aimed at protecting the public抯 benefits.
　　
On the orderly development of private cars, Shanghai is freer in issuing auto plates to individual cars than to state-owned vehicles, in keeping with the demand for the social and economic development and the overall balanced development of roads and vehicles.  The number of plates issued to individuals has increased during the last 4 years: 2000 (14,000), 2001 (16,000), 2002 (32,000) and 2003 (48,000).  From January to April 2004, 20,000 plates were issued, a jump of 63 percent over the same period a year ago.  Shanghai's private cars have skyrocketed from 7,000 in 1998 to 240,000 today as a result of the method of increasing issuance of private car plates, issuing C plates in suburban areas, swapping motorcycle plates with car plates and allowing individuals to buy second-hand cars together with their plates.  The cars account for 45 percent of Shanghai's total 530,000 cars.  Therefore, the Shanghai traffic department has always been considering ways to meet consumers?demands of as well as ensure the order of Shanghai's traffic.  It's an inter-related problem.
　　

6.  Shanghai Law:  A spokesperson has described the floating auto insurance premium mechanism.  Information in your material indicated there are 1.78 million autos in Shanghai and that 17-odd million of them violated traffic rules or polices in 2003.  In other words, each car committed 10 violations on average.  Under the new traffic policy, the insurance rates for cars with 10 violations will be increased by 15 percent.  Does that mean the auto insurance premium for cars in Shanghai will be 15 percent higher than those in other cities?  Since prices of Shanghai private auto plates have seen a steady increase to more than 40,000 yuan, many people choose to buy their plates in other cities.  Will the situation be aggravated if the auto insurance premium here is higher than in other places?
　　
Jiao Yang:  In an international metropolis, if our auto drivers have no sense of law-abiding and safe driving, it will cause major problems with traffic congestion and will be harmful to people.  In this case, we have unveiled a series of measures to ease the problem.  I think the measures are aimed at cracking down on violations of traffic rules, reducing the dangers of driving and easing the problem of traffic congestion and unsafe driving by means of an economic lever.  Rather than increasing the costs, the measures will serve to protect drivers' benefits while maintaining safe traffic in the city and protecting citizens?security and benefits.  On the other hand, in addition to the rate increases, rates for some drivers will decline.  Drivers with good safety records will pay lower rates.  That will benefit them.
　　

7.  Eastday.com:  There's an opinion spreading on the website that Shanghai's ban on the transfer of unfinished apartments will leave half of the city's families in debt.  What's your comment?
　　
Jiao Yang:  This opinion is totally groundless.  Shanghai's housing market is bolstered by a substantial demand.  Presently, about 80,000 families are relocated every year and some 90,000 families buy new homes to improve their living standards. These constitute 75-80 percent of the city's total homebuyers.  The rest, one quarter of the buyers, are from out of Shanghai and abroad.  Shanghai's housing market is generally healthy.  But we will not ignore the new problems arising in development.  The city's government is paying careful attention to the periodical overly-fast growth of housing prices.  It has unveiled measures to control this rapid growth and ensure an orderly development of the market.  The purpose is to benefit the public and prevent the sharp rise and fall of housing prices.  In this sense, it's impossible that half of the local families will be left in debt.  This concern is unnecessary and the opinion is groundless.

8.NIKKEI NEWS: The North Korean leader Kim Jong Il is presently visiting in Beijing. Will he visit Shanghai during this Chinese tour?

Jiao Yang: I regret that I couldn't reply to your question since I'm not informed on this issue to date.

9.Wen Wei Po (Hong Kong): It's reported that Shanghai is planning a power plant of three million kilowatts capacity with natural gas-dependent generators. Where will the power plant be built and when will the construction complete? How much is the investment?

Jiao Yang: Officials from the power authority is present at today's briefing, please relate to them for you question.

10. News Times: The materials you just now provided say the government will take a series of measures to ensure the power supply this summer, including increasing power price gap between peak and non-peak hours. What are the detailed measurements and how big will the gap be? Secondly, you mentioned that the government will development generators dependent on natural gas in order to optimize power consumption structures. Yet there are few air-conditioners dependent on natural gas available in local market. What kind of air-conditioner may meet this requirement?

Jiao Yang: General, Shanghai's power supply capacity is in line with the economic development of the city. Electricity shortfalls only occur in certain seasons and certain hours. For instance the biggest power supply shortfall last year was 40 percent of Shanghai's total supplying capacity in peak hours. So this year the price gap between day and night will be increase to 4.5:1 from the current 3.6:1. (Meaning power price in peak hours will be 4.5 times of that in non-peak periods.)
As for the natural-gas dependent air-conditioner, probably you've assumed this kind of facility is for household use, therefore asked about it supply in local domestic facility market. The air-conditioner I just mentioned, which use natural gas, is for cooperate use in large-scale buildings. Actually it's a middle and small-scale heat-electricity transferring system that generates electricity from natural gas. It will be used for power supply in certain cooperates and units without consuming electricity from the public power network. It's true that the use of gas dependent air-conditioners is quite limited in Shanghai now, so we'll actively promote it use. By the way, Shanghai Municipality office building is using exactly this gas-dependent air-conditioner now.

11. Shanghai Morning Post: What measure will the banks take to avoid the possible occurrence of non-performing loans following the policy that restrict transferring of uncompleted houses that takes effect on April 26? Will the policy cause a price hiking in second-hand house market as the amount saleable estate decreases?

Jiao Yang: Under the market economic, the banks have they rights and duty to take measures to prevent financial ventures.
The policy that takes effect recently is to protect and maintain a health real estate market overall. And the price of second-hand houses is driven by the market supply and demand. So I could not give any predictions on the house price.

12. Shanghai Daily: You mentioned just now the Shanghai government will development natural-gas dependent generators in future. However, the current power plants are coal-burning, how will the government sustain the supply of natural gas?
I heard the a deputy of the city congress put forward a suggestion that Shanghai won't build coal-burning power plant in future. Yet the Waigaoqiao power plant now in construction is still a coal-burning one. Why?

Jiao Yang: The power plant projects I introduced just now include both coal burning and natural gas consuming ones. Sure that we will take measures to guarantee the natural gas supplement as far as we decided to promote this kind of generators. The municipal government will be responsible and serious for these large-scale projects. As for the suggestion you mention, I've no knowledge about that up to now. I will seek further information after the briefing.

13. Security Times: It's reported that Shanghai government will ease the criterion for presale of unfinished apartments. What's you comment on that?

Jiao Yang: The municipality is hightly concern about the house price and takes series of measures to control the soaring price. While the issue of ease the criterion for presale of unfinished apartments is still in discussion. The general goal of related polices is to pace up the supply of apartment on the market and keep the balance between house supply and demand, both in terms of amount and price level.