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China Bails Out Its Biggest Bank


China has injected $15 billion in fresh capital into the country's biggest bank, the Industrial and Commercial Bank of China, or ICBC, to help cover its huge portfolio of unpaid loans.

ICBC is the third Chinese lender to be propped up by government funds this year. Chinese banks, saddled with billions of dollars in bad loans to troubled state-owned companies, are increasingly under pressure to shape up their finances to compete with foreign banks. ICBC is also one of four Chinese banks preparing to float their shares on the international market, and Beijing is eager to get their books in order.

China's economy, meanwhile, expanded 9.5 percent in the first three months of the year, despite government efforts to cool it down.

Zheng Jingping, spokesman for China's national statistics bureau, says investment in fixed assets such as land and real estate is still on the rise, pumping extra energy into an already overheated economy.

The statistics bureau says during the first quarter, investments in factories, real estate and other sectors jumped 23 percent.

Mr. Zheng says the government needs to tighten control over land use and loans for new construction to stem the flow of money into the economy. He says the task is "arduous."

In Singapore, the government has decided to award the first licenses for casinos. Many Singaporeans were opposed to the plan, worried about the social effects of legalized gambling. But Prime Minister Lee Hsien Loong told Parliament last week that without projects like casinos, Singapore will not be able to compete with its neighbors for tourist dollars. "We have not been investing in tourism infrastructure projects that are crowd-pullers. We would become a backwater, just like many ordinary cities of Asia instead of a cosmopolitan hub of the region. And many good jobs would be lost and all Singaporeans will suffer," he said.

In Malaysia, the U.S. bookstore chain Borders opened its largest store anywhere in the world. The 60,000 square foot store in Kuala Lumpur carries more than 200,000 books, movies and music titles. More Borders outlets are expected to open in Malaysia this year.

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