Via Horse’s Mouth:

According to the Xinhua News Agency Zhang Guangqin, vice-minister of the Commission of Science Technology and Industry for National Defense denied media reports that an aircraft carrier was already in the process of being constructed in Shanghai….

… that picture is of the Varyag, a full deck carrier the PRC purchased from the Russians, it is now sitting in a Chinese shipyard with a lot of activity going on on and around it. The Chinese originally indicated they purchased it to be a floating casino…but the buildup of the Chinese navy and their self-stated intentions to either acquire or build a carrier tells us otherwise.

Some strange history on the Varyag can be found here, here and here.