CHANGSHA, July 31 (Xinhua) — Sustained drought over the past four weeks has caused a water crisis for 1.2 million people in central China’s Hunan Province, local authorities said on Tuesday.

    Drought is plaguing 120,000 square km of land in the province, more than half of its total area, said sources with the provincial flood control and drought relief office.

    This has caused a water shortage for more than 1.2 million people and 700,000 heads of cattle in 14,000 villages, they said.

    In Guangrong village of Xinning County, the 600 residents have to trek six kilometers to fetch water from the neighboring village, which they carry on horseback.

    Hunan Province has received about 544 mm of precipitation since the rainy season started in June, 25 percent less than normal, the provincial flood control and drought relief office said.

    Since July 1, the average rainfall has measured only 20 to 50 percent of the normal volume.

    Lack of rain has left most of the province’s 2.04 million water storage facilities half-empty, and 859 reservoirs have dried up.

    The water crisis has cut the province’s daily power generating capacity by 20 million kilowatt-hours. The provincial capital Changsha has suspended power generation at all local hydropower stations to save water for drought relief.

    At least four cities including Changsha have started creating artificial rainfall in cloudy weather.

    Yet the provincial meteorological bureau has forecast a new heatwave before any substantial rain: the high temperature will hover around 37 to 40 degrees Celsius in many parts of the province in August.

    A month-long drought is also crippling the eastern Jiangxi Province, where 820,000 people and 460,000 heads of livestock have been suffering drinking water shortages.

    The drought has also affected 394,700 hectares of farmland, 31,300 hectares of which were ruined.

    The province has invested 100 million yuan (13.16 million U.S. dollars) in the disaster relief effort.

    BEIJING, July 31 (Xinhua) — Chinese stocks managed to conclude Tuesday’s trading at a new high after experiencing a correction in the morning session upon government’s decision to hike reserve requirement ratio by 0.5 percentage points to rein in credit extension by banks.

    The market sentiment was driven up by nonferrous metal, liquor, rare resources and cement sectors in the later session.

    The benchmark Shanghai Composite Index rose 30.26 points, or 0.68 percent, to close at 4,471.03 points on a daily transaction volume of 152.269 billion yuan (20.1 billion U.S. dollars).

    The key index moved between 4,379.20 points and 4,476.63 points.

    The Component Index on the Shenzhen Stock Exchange went up 138.70 points, or 0.92 percent, to end the day at 15,199.56 points with a turnover of 83.896 billion yuan.

    The People’s Bank of China, the central bank, announced on Monday afternoon that it will raise the reserve requirement ratio by 0.5 percentage points to 12 percent for commercial banks from Aug. 15.

    The central bank said the move was aimed at “strengthening management of liquidity in the banking system and rationalizing lending growth”.

    This is the sixth time China has raised the reserve requirement ratio to curb excess liquidity, following an interest rate hike announced last Friday in which China raised the one-year benchmark deposit and lending rates by 27 basis points to 3.33 percent and 6.84 percent respectively.

    Meanwhile, the State Council, or cabinet, has decided to reduce tax on the interest on personal bank savings from 20 to five percent from Aug. 15.

    However, Song Guoqing, an economist with Beijing University believed “half a percentage points is not enough”, and all of the measures “just can’t catch up with the overshooting economy.” “So there will be more policies coming out,” he predicted.

    Observers said a great number of metal and resources stocks, which are expecting disclosure of good interim earnings, would likely help shore up the mood on capital markets.

    They believed the bullishness of A-share market was based on appreciation of Renminbi, better-than-expected interim earnings for listed companies, rapid but stable growth of Chinese economy and excess liquidity. The new hike in reserve requirement ratio can only affect commercial banks’ incentive for expanding credit extension, but can do little to bite off the excessive liquidity.

    On Tuesday, there were 509 gains and 331 losses on the Shanghai bourse and 349 gains and 237 losses on the Shenzhen stock exchange.

    The Hushen 300 Index, which tracks 300 companies on the Shanghai and Shenzhen stock exchanges, closed at 4,460.56 points, up 50.26 points, or 1.14 percent, from the previous close.

    BEIJING, July 31 (Xinhua) — A total of 158 countries, regions and international organizations have confirmed their participation in the 2010 World Expo to be held in Shanghai.

    Yang Xiong, Vice mayor of Shanghai and member of the organizing committee for the World Expo 2010 Shanghai China, made the announcement at a news conference in Beijing on Tuesday.

    The organizing committee forecast that more than 200 countries, regions and international organizations are expected to attend the 184-day event.

    ”The international community is reacting positively to the event and we receive a confirmation letter every three days,” Yang said.

    Research shows that a total of 70 million people will visit Shanghai during the event and the daily number may reach 800,000, Yang said, adding that transportation will be the biggest challenge.

    ”The subway will be the solution,” Yang said, “Shanghai will have 230 kilometers of subway in operation by 2007 and it will have 400 kilometers by 2010.”

    Shanghai will also take other measures to fight traffic congestion, such as forbidding private cars from entering the expo park, Yang said.

    Shanghai is also expanding its airports, railway stations and highways to accommodate such an enormous passenger flow, Yang said.

    By 2010, 60 highways, connecting Shanghai and its neighboring Jiangsu and Zhejiang provinces, will be finished, Yang said.

    ”By using new energies, such as solar power, there will be no emissions from the expo park,” Yang added.

    The 2010 World Expo in Shanghai will be held from May 1 to Oct. 31.

    BEIJING, July 31 (Xinhua) — The Beijing Organizing Commitee of the Olympic Games (BOCOG) Tuesday announced that one licensee was found to use child labor and the another three violated labor law.

    BOCOG announced the investigation results on its official website that Le Kit Stationery Co. Ltd (Dongguan), was believed to have used child labor by employing eight students in the first months this year for packaging work, which was not related to Olympic products.

    The company also failed to sign labor contracts with some of its workers, BOCOG said. So BOCOG has decided to terminate Le Kit Stationery Co.’s right to manufacture and sell Olympic licensed products and revoked its licensing contract with the company.

    BOCOG said another three companies, Eagle Leather Products (Dongguan), Yue Wing Cheong Light Products (Shenzhen) and Mainland Headwear Holdings Ltd., (Shenzhen) had overtime issues, but no child labor issues were discovered. It has decided to suspend approval of all Olympic products designing of the three licensees, and requested they rectify their production and business operations in accordance with local labor bureau’s requirements immediately.

    An NGO FairPlay 2008 released a report in June this year, alleging labor abuses in the four licensees, which drew BOCOG’s immediate attention. BOCOG requested that the four companies provide detailed information and explanations on the situation.

    Relevant labor administrative departments at national and provincial levels responded quickly. Local municipal authorities in Dongguan and Shenzhen formed a special team to conduct comprehensive investigations from June 12th to 18th and delivered an extensive report on the issue. From the end of June till the beginning of July, investigation teams from Guangdong Labor and Social Security Bureau, the Ministry of Labor and Social Security and BOCOG further reviewed the results of the investigation reports and have now concluded the investigation.

    BOCOG reiterated on its website that it attaches great importance to working conditions and corporate social responsibility issues in licensees’ companies. BOCOG will, in line with its licensing agreement, seriously deal with any licensees who have violated national labor laws and regulations.

    BEIJING, July 31 (Xinhua) — In an effort to cash in on the 80th anniversary of the People’s Liberation Army (PLA), China Unicom, the country’s second largest mobile phone operator, has launched its own military service.

    Subscribers will be able to receive military news from the People’s Liberation Army newspaper and download military songs and movies at a cost of between eight and ten yuan a month, or two yuan for each clip or track.

    Yu Peng, a senior official with China Unicom, was coy when asked if the service, which has been running for a week, had been in high demand.

    ”It is too early to say - we are promoting the channel and carrying out market research as well as uploading songs, pictures and movies,” he said.

    ”I believe it will be popular since we have so many military fans in China. We have more than 300,000 pictures of weapons and military figures in our database along with clips of hundreds of movies, such as Battle for Berlin, Normandy Invasion and Shang Ganling, a movie about the Korean War,” he said.

    ”I guess I will subscribe to the service when more cool stuff, like the newest jet fighters and nuclear submarines, are added in the channel,” said 28-year-old military nut Yang Yong.

    ”It’s not just about making money. By doing it, we are celebrating the PLA’s 80th anniversary,” Yu said, “and, in the process, providing more healthy content through mobile phones.” (One U.S. dollar is equal to 7.57 yuan)

    MOSCOW, July 31 (Xinhua) — The first batch of Chinese troops arrived at a Russian military base on Tuesday for a joint anti-terrorism drill sponsored by the Shanghai Cooperation Organization (SCO).

    ”Six Chinese military transport planes landed at the Shagol airbase in the Chelyabinsk region on Tuesday, delivering 287 servicemen, military equipment and supplies,” Interfax and Itar-Tass quoted Assistant to the Russian Exercise Coordinator Igor Konashenkov as saying.

    The Chinese People’s Liberation Army (PLA) troops will be divided into two groups: 147 of them will be stationed at the Shagol airbase while the others would go to the Urals Chebarkul military camp.

    The transporters took off from an airport in west China’s Xinjiang Uygur Autonomous Region early Tuesday and traveled for about four hours and covered a distance of 2,900 km before arriving at the drill venue.

    The Russian-made Ilyushin IL-76 transporter, a major air transporter and in charge of airborne troops of the PLA, will be used as navigating planes for PLA fighters and bombers to arrive at the venue.

    More soldiers and armaments will be transported from Xinjiang to the Russian base by two other air force units within days, while the main force of China’s 1,600 troops already set off by train on July 19 from Xinjiang.

    Four trains with Chinese personnel, armaments and military hardware were traveling across Russia on schedule, Konashenkov was quoted as saying.

    Those trains will arrive at the Misyash station in the exercise area on Aug. 2 and Aug. 3, he said.

    Two Chinese army aviation units, consisting of 16 Mi-17 transportation helicopters and 16 Z-9 armed helicopters, are expected to arrive at the Shagol airbase Tuesday evening and on Wednesday respectively.

    The “Peace Mission 2007″ drill will be carried out in Chelyabinsk in Russia and in Urumqi, capital of Xinjiang, from Aug. 9 to 17.

    The SCO members — China, Kazakhstan, Kyrgyzstan, Russia, Tajikistan and Uzbekistan — will stage the joint anti-terrorism drill, which will involve 6,500 military personnel.