China Press Review – April 1, 2019

Press review

China March factory activity grows for first time in four months, but exports weak
Factory activity in China unexpectedly grew for the first time in four months in March, an official survey showed on Sunday, suggesting government stimulus measures may be starting to take hold in the world’s second largest economy.

China’s factories are now defying the economic slowdown
Beijing in response has resorted to trillions of dollars worth of new measures intended to stimulate the economy, including tax cuts for businesses, infrastructure spending and looser monetary policy. March’s upbeat data shows these policies “are apparently bearing fruit”

China will continue to suspend extra tariffs on US vehicles, auto parts
The goodwill gesture comes after US decision to delay tariff hikes on Chinese imports

Overreaction to China threat could turn into McCarthyite Red Scare, says former US official
Susan Shirk, who handled China relations in the Clinton administration, also warns that decoupling of US and Chinese economies could be ‘apocalyptic’ She says ‘herding instinct is taking us off the cliff’ over perceived threats

China Purchases Could Undercut Trump’s Larger Trade Goal
A trade deal could result in China promising to buy hundreds of billions of dollars of American products. It could further cement Beijing’s role in the economy.

Could China-US deal be dotted before G20?
Trump seeks to reduce US global trade deficit, crack down on unfair trade practices
Chinese Vice-Premier Liu He will engage this week in a new round of trade talks with the Trump team in Washington. While a deal is still by no means ‘in the bag’, there are growing incentives for both sides to cut an agreement at or before June’s G20.

US-China trade war inactivity could lead to the ‘worst recession in recent Chinese history’, says scholar
Political economy professor Minxin Pei says Beijing lacks the will to make radical political changes to deal with the trade war with the United States Also says China’s strong control of the economy will eventually backfire, with economy slowing to its lowest growth point for almost 30 years

China’s Xi says West has long-term economic, military superiority
Developed Western nations have long-term economic, technological and military advantages over China and the Communist Party has to realise that some people will use the West’s strong points to criticise socialism’s failings, President Xi Jinping said.

Economic interdependence vs war with China
On Saturday at Peking University’s Yenching Global Symposium in Beijing, former US deputy assistant secretary of state Susan Shirk warned that Washington’s current policy of decoupling the US and Chinese economies could be “apocalyptic,” and exaggeration of the China threat “could turn into a McCarthyite Red Scare” that damages American interests.

China’s $13 trillion bond market marks a milestone today. Here’s what it means
Starting Monday, 364 onshore Chinese bonds will be added to the Bloomberg Barclays Global Aggregate Index over the next 20 months. Analysts estimate that the full inclusion will attract around $150 billion of foreign inflows into China’s roughly $13 trillion bond market — the third-largest in the world after the U.S. and Japan. The inflows will help support the Chinese yuan at a time when China’s current account surplus is shrinking, said Khoon Goh, the head of Asia research at ANZ Bank.

Don’t Fight the People’s Bank of China
With both the Fed and PBC providing cheap capital, the market has a wind at its back.

China’s thrifty consumers are key to its economic growth – can Beijing convince them to spend more?
As China’s economy slows, in addition to loosening monetary policy and investing in technology to counter the impact of its falling birth rate, the country must strengthen welfare provisions, such as health care, to bolster consumer confidence

Chinese tech faces an innovation reality check as the economy cools and start-ups stumble
Even after a banner year for venture capital funding, some investors predict that as many as 90 per cent of Chinese tech start-ups are doomed to fail The sheer size of the Chinese marketplace is no longer enough to keep a struggling tech company afloat

Don’t blame China for unraveling US-Europe relations
China has nothing to do with seemingly unbridgeable divisions between the U.S. and Europe. The EU-China economic relations will continue to strengthen on the basis of mutually beneficial business transactions. For many EU countries, trade with China will be an important growth vector.

Europe-China political unity still far off despite Xi Jinping’s nimble diplomacy on tour
Mathieu Duchatel writes that Chinese diplomacy worked in Rome with a divided Italy and in Paris with a Franco-German-EU coalition, but the problem of a lack of a political engine for Europe-China cooperation remained unsolved

Is Italy reshaping China-EU relations?
A stronger partnership with China could attract the additional capital inflows that Italy sorely needs, given constrained lending by its banks.

Is Italy reshaping China-EU relations?

Chinese flags over Europe?
As President Xi Jinping wraps up his week-long tour of Europe, his first overseas visit of the year, he seems to have left a growing sense of unease amidst both EU and US policymakers with regards to their pre-existing stance on China. While the US is still locked in an increasingly complex trade row with China, the EU just prior to President Xi Jinping’s meeting with itstop leaders had designated China as a strategic rival

Chinese flags over Europe?

China’s Belt and Road may be the closest the world has to a stimulus plan that can kick some vigour back into the global economy
There is nothing for global stock markets to be bullish now, from corporate earnings to the US-China trade war, to Brexit and the next US trade war on Japan China’s Belt and Road Initiative may be the only hope for a global economic stimulus

China’s top diplomat says 40 state leaders will attend belt and road forum in April
Meeting will welcome representatives of more than 100 countries, Yang Jiechi says Politburo member dismisses claims infrastructure plan creates debt traps for Beijing’s partners

US fight dethrones Huawei as top mobile equipment provider
Huawei Technologies was unseated as the world’s top telecommunications infrastructure provider in 2018 as U.S. calls to bar its products began to influence the market and put pressure on 5G operations. Sweden’s Ericsson took the crown for the first time in two years as its global market share rose 2.4 percentage points to 29%, while Huawei’s fell 1.9 points to 26%, according to British research company IHS Markit. Its report said some countries hesitated to make new purchases from Huawei because of the trade war.

As Facebook looks to WeChat, China’s digital world is wowing the West, and globalisation is no longer a one-way street
With even Silicon Valley giants like Facebook learning from the hyperconnected WeChat universe, the investment in data and AI by the Chinese state and companies is paying off

Western governments have been made to fear China’s Huawei, but Ireland’s can’t afford to
The Chinese tech giant has been under intense scrutiny around the world in recent months amid concerns its technologies could by hijacked by Beijing Intelligence agencies from Washington to Canberra have warned about potential national security risks – but Dublin doesn’t seem to be concerned

China defends ban on Canadian canola, saying it reported pest problem on four occasions
Block on two Canadian exporters ‘legitimate, reasonable’, Chinese embassy says in response to complaints from Ottawa Customs agency notified Canadian government it had ‘intercepted quarantine pests’ on January 4, March 1, March 15 and March 26, it says

China’s big 4 banks boost lending in state stimulus push
China’s big four state-owned banks stepped up lending to small and midsize businesses in 2018, acting on orders from authorities as Beijing seeks to invigorate a sluggish domestic economy. The collective loan balance at Industrial and Commercial Bank of China, China Construction Bank, Agricultural Bank of China and Bank of China was up 9% to 52.5 trillion yuan ($7.8 trillion) at the end of 2018 from a year earlier, with added interest and fee income feeding a 4% to 5% rise in net profit, earnings reports released this week showed.

Greater Bay Area: 10 facts to put it in perspective
Tapping the near-unlimited potential of one of the country’s most productive geographical areas is the aim of the Chinese government’s master plan.

China’s HNA speeds up asset sales in ‘return to roots’
Hong Kong Express exit marks latest move by debt-laden group to consolidate

Want Luxury Business Success in China? Avoid These 3 Pitfalls
Cracking the China code is challenging, and launching a brand there without the proper tools and strategies in place is a recipe for disaster. Luxury brands need to avoid pitfalls to achieve success in China accounts for the majority of global luxury purchases today (if you combine domestic and international consumer spending), owns one of the top three national luxury markets, and boasts one of the world’s highest growth rates, even after a recent economic slowdown. That’s why global luxury brands simply can’t survive today without a strong presence in China.

Want Luxury Business Success in China? Avoid These 3 Pitfalls

Chinese Whispers: Louis Vuitton, Piaget, Montblanc Lower Prices in China After VAT Drop, And More
Louis Vuitton, Piaget, Montblanc lower prices in China after VAT drop Shanghai Tang names a new creative director Lululemon’s Q4 China e-commerce sales grow more than 140 percent

Chinese Whispers: Louis Vuitton, Piaget, Montblanc Lower Prices in China After VAT Drop, And More

The Rising Potential of China’s New Seniors
There is certainly no shortage of research or advice when it comes to marketing to millennials, touted as the most significant demographic in marketing. China is no exception when it comes to millennial obsession. However, a closer look reveals that elderly people (defined as over-60s) represent the fastest growing generational group in China. This group accounts for over 170 million people, representing more than a quarter of all Chinese households. Not only are they getting more comfortable with technology, they are also open to new experiences and products, making them a hard-to-ignore group.

The Rising Potential of China’s New Seniors

Alibaba CTO spearheads tech philanthropy push
Jeff Zhang, Alibaba Group’s chief technology officer and president of Alibaba Cloud Intelligence, will serve as chairman of a new internal committee dedicated to technology-driven philanthropy, he said in an internal letter to employees.

That curious Chinese regulation about IPO sponsors also owning stakes? It’s ‘temporary,’ says nation’s biggest investment bank
A rule that requires sponsors of initial public offerings (IPOs) on China’s new technology board to also own stakes is “temporary,” said the chief executive of the country’s largest investment bank The bank, which counts two of China’s largest tech companies Tencent and Alibaba as among its major shareholders, said it can strike a balance between their interests

Shanghai Fashion Week: UK brands battle for China’s growing market
Over the next week Shanghai Fashion Week will fill the city with models, designers and buyers. The show is becoming a key route into China but the lucrative market remains difficult to navigate.

Chinese industrial park where chemical factory blast happened ‘opened in a rush’

Engineer who has worked with the facility and the pesticide plant alleges the park was set up without a proper planning process He also accuses local authorities of turning a blind eye to the safety risks after receiving bribes, official newspaper reports

China starts investigation into abuses of new tax rules
Inspections of tax-related service companies and agencies will be carried out across the country for the next two months It will focus on those who may have sold companies unnecessary services or products or unfairly raised charges as firms adjust to new rules

Shanghai’s Minimum Wage to Increase April 1
The city will raise the monthly statutory minimum wage for full-time workers from RMB 2,420 (US$360) to RMB 2,480 (US$369) and the hourly minimum wage for part-time workers from RMB 21 (US$3.12) to RMB 22 (US$3.27). With the increase, Shanghai continues to have the highest minimum wage in China, followed by Shenzhen RMB 2,200 (US$328) and Beijing RMB 2,120 (US$316).

Asia’s smog exodus: companies forced to offer ‘pollution premiums’ to recruit top talent
Executives with families are often unwilling to put their children’s health at risk however attractive the job offer

Growing pains: China’s shrinking cities are addicted to building
Dozens of Chinese cities are spending big on construction projects, despite having shrinking populations 90 officially-designated cities have shrinking populations and 71 of those have expanded their urban areas

China’s Pension Shortfall to Reach $540 Billion in 2020
Rapidly aging population, one-child policy has burdened China’s retirement system.

Trucks aren’t using Hong Kong-Zhuhai-Macau Bridge because rules are unclear, says Kerry Logistics chief George Yeo
Sea crossing was touted as major part of China’s Greater Bay Area plan but commercial use remains low Logistics company boss says complexity of using bridge means firms are unsure whether it is cost effective to do so

Unfazed by trade war, Google collaborates with Huawei on health care AI initiative
Huawei’s new Track AI product uses Google’s TensorFlow AI software to diagnose eye conditions A creative team that works with Google’s advertising clients also provided marketing help to Huawei

How a Chinese firm is using artificial intelligence to zero in on liver cancer
Genetron Health has developed a technique that detects the disease earlier than other methods

Self-driving cars traveled 150,000 kilometers in Beijing in 2018
Autonomous vehicles (AVs) traveled more than 150,000 kilometers on Beijing’s roads in 2018, with search giant Baidu’s fleet accounting for more than 90% of the total, according to an industry report.

Self-driving cars traveled 150,000 kilometers in Beijing in 2018

Building a Higgs boson factory: China’s race to the frontier of physics
One team in Beijing is leading the charge to create the next generation of giant particle colliders to unlock the mysteries of the fundamental forces of the universe But the quest is costly and complicated, and other teams are competing with the same ambition

China sent home more than half of its North Korean workers in 2018, United Nations report says
Statement, which does not include an absolute figure, made to UN sanctions committee in compliance with 2017 resolution Russia issues similar report saying it repatriated about 20,000 North Koreans last year

Chinese jets’ incursion across Taiwan Strait is Beijing’s way of pushing back against the US, say analysts
Think tank chief believes China’s attitude to Washington’s ‘freedom of navigation’ exercises is hardening He says Taipei’s objections now matter little to Beijing

Amid US-China tensions, Washington gallery exhibit highlighting Chinese empresses’ lives serves as cultural bridge
‘Empresses of China’s Forbidden City, 1644-1912’, organised by American and Chinese curators, is on view at the Smithsonian’s Sackler Gallery through June 23 The exhibition offers a rare look at Qing dynasty objects including clothing, jewellery, paintings, furnishings and imperial portraits.

Chinese Football Association wants naturalised players to have ‘patriotic feelings’ and learn about the party
Directive issued by national soccer body says footballers who become citizens must study Chinese, the country’s culture and history Clubs are to assign staff to track players’ thoughts and performance and file a written report to the CFA every month Tyias Browning, has joined Chinese Super League side Guangzhou Evergrande Taobao and is in the process of applying for Chinese citizenship, according to the club. Browning’s maternal grandfather was Chinese. Chinese President Xi Jinping’s passion for soccer is well known, and the government has sought to promote the sport – including recruiting foreign players and opening soccer academies around the country – in a bid to achieve his dream: for China to qualify for, host and win the World Cup by 2050.

Taobao doubles down on livestreaming with ambitious Taobao Live plan
Taobao Live, the live-streaming unit of its consumer-to-consumer (C2C) platform, is aiming to expand its business in 2019 to 10 product categories with annual sales volume of more than RMB 100 million (around $15 million) each and 200 Taobao live-stream virtual shopping rooms with an annual transaction value of RMB 100 million each, Wen Zhong, director of Taobao’s content e-commerce department, announced at the Taobao Live Gala held on Saturday in Hangzhou.

Taobao doubles down on livestreaming with ambitious Taobao Live plan

Google blocks ads for VPN review sites in China
Google has stopped promoting ads in China for two websites that review virtual private networks (VPNs), software that allows users to jump the Great Firewall and view censored sites. VPNMentor and Top10VPN, two such sites, reported that they had received emails from the American tech giant notifying them of the decision despite having advertised with Google previously.

Briefing: Google blocks ads for VPN review sites in China

China’s media companies are failing at home, failing abroad and failing Xi Jinping

China is spending billions in an effort to tell its stories to the world But the official media’s poor coverage of an explosion at a chemical plant in Jiangsu exposes just how clueless its propaganda officials really are

China’s Tech Companies Really Want to April Fool You
From AI assistants helping you keep the romance alive to WeChat programs that’ll taste your food for you, here’s a quick rundown of the day’s pranks from Baidu, Alibaba, and Tencent

Alain Gillard
Information Officer
Service Asie Pacifique
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