China Press Review – April 6, 2020

Press review

China showing signs of economic recovery
After defeating the domestic Covid-19 epidemic, China’s focus is now shifted to restarting its virus-battered economy.

Why China’s COVID-19 Stimulus Will Look Different Than in the Past
The stimulus that is likely to come in 2020 will differ from 2008 in both size and target.
Before the novel coronavirus hit, China was already walking a fine line between spending enough to prop up economic growth and cutting down high levels of debt that pose a structural threat to its economy’s sustainability. While China’s 2008 stimulus kept the economy growing, it came at a high price that now constrains the options of the government’s economic planners. For instance, China’s corporate debt to GDP ratio is 156.7 percent, which is the highest in the world. The threats to the economy are, however, at least as big as they were in 2008 – if not more so – and the stimulus package will likely be sizable.  According to Reuters, the Chinese government is considering spending up to RMB 2.8 trillion (US$394 billion) in local government special bonds to spur infrastructure investment. Though such a figure would be a much smaller percentage of GDP than the 2008 stimulus, it would still be significant.

Coronavirus has lit the fuse on a time bomb in China’s economy: debt
Beijing has a tough choice to make: tolerate an unprecedented hit to the economy or go for massive stimulus and risk explosive consequences   It should beware, a financial virus can be every bit as toxic as a biological one

What Shanghai’s First Digital Fashion Week  Meant For Brands And Designers
Shanghai Fashion Week wrapped up last week. Due to the Covid-19 pandemic, organizers brought the entire autumn-winter 2020 edition online, making it the world’s first fashion-week event at this scale to go fully digital.

The Verdict On Shanghai Fashion Week
This season, facing unprecedented disruption to brands, stores and supply chains, Shanghai Fashion Week’s industry elite chose a new approach   This online fashion week was executed under extreme, extenuating circumstances and was a swift response to an exceptional crisis. It has, however, democratized the industry’s most exclusive event, transforming it into a consumer-facing trial which resulted in increased views, sales and innovative branding exercises. It also challenged the necessity for the global travel and carbon footprint associated with fashion weeks.  Conversely, it raised many questions. For example, could this propel designers to move towards a direct to consumer sales model, eliminating wholesale and the need for retail buyers? Can this result in the celebritization of the fashion designer in China and further commercialize them as stars in their own right? As the fashion industry digests this imperfect but daring feat, it is clear that only China could have executed such a vast, dynamic demonstration of pushing fashion’s possibilities.

Coronavirus supercharges China digitalisation as stay-at-home economy thrives
Online sales, teleconferencing and entertainment making major strides amid social distancing to contain the coronavirus    But forced digitalisation is also increasing the technological divide between companies, industries and regions

Coronavirus: nearly half a million Chinese companies close in first quarter as pandemic batters economy
Some 460,000 Chinese firms shut in the first quarter amid fallout from the coronavirus  Registration of new firms between January and March fell 29 per cent from a year earlier

Chinese banks face double threat of more bad debt, lower margins amid worsening coronavirus pandemic
Chinese banks, now closely integrated into global supply chains, could be affected if outbreak is not contained by third quarter, China Construction Bank says  Non-performing loan pressure to worsen during second quarter and second half of this year: analyst

How did Huawei fall foul of the US government and find itself at the epicentre of a new tech war?
This is the first in an eight-part series looking at how Huawei has found itself at the epicentre of the US-China tech war    Four years after Huawei set up shop in the US, a RAND report tied Chinese telecommunications companies like Huawei and ZTE directly to Beijing

Construction of 30GW solar project in Chengdu, China begins
Construction of a 30GW solar cell and supporting project in Chengdu, China has begun. This is after technology firm Tongwei Group broke ground on the Tongwei Solar Photovoltaic Industrial Base Project. Located in Huaizhou New Town, Jintang County, the high-performance solar cell and supporting project is being built in phases and is estimated to cost about US $2.8bn. The first phase of the project involves the development of 7.5GW capacity with completion scheduled within 2021. Subsequent phases of the project are planned to be completed and be commissioned in 3-5 years, based on market demand

Coronavirus: China’s new export restrictions on medical supplies are bad for business and the world, insiders say
‘We are very sad that we can’t send [medical] gowns to our clients who are racing to save lives,’ Guangdong factory owner says   Beijing ruled on Wednesday that only firms licensed to sell medical supplies at home can export them overseas

Jobs are being destroyed around the world as coronavirus pandemic pushes one economy after another into recession
JPMorgan Chase’s economists predict their measure of unemployment in developed markets will jump by 2.7 percentage points by the middle of this year  While there will be some healing as economies recover, they still predict elevated unemployment of 4.6 per cent in the US and 8.3 per cent in the euro area by the end of 2021

Global Cargo Is Leaving On A Jet Plane
The trend is taking off. The International Air Transport Association (IATA) has been cited as estimating the split between cargo carried by passenger airlines and freighter aircraft at 60/40 and forecasts that will grow to 70/30 in the coming years.

NYT: Nearly 40k flew to U.S. from China after Trump’s coronavirus travel ban
Nearly 40,000 Americans and authorized travelers have come into the U.S. from China since President Trump imposed travel restrictions more than two months ago, the New York Times reports.  Why it matters: Trump has suggested that his action to ban foreigners from entering the U.S. if they were in China before early February has contributed to lower COVID-19 cases and fatalities in the U.S.

Coronavirus: Hong Kong university to mass-produce reusable face shields for public to help in fight against epidemic
Protective masks designed by Polytechnic University using 3D-printing lab  First batch of 30,000 to be rolled out in three weeks and expected to cost between HK$40 and HK$50 each

How the pandemic is hitting the reset button on the world economy and international cooperation
The Western media, still suspicious of China, have bent over backwards to laud anti-Covid-19 efforts in South Korea, Taiwan and Singapore. But the world’s experts must work together to dig us out of this mess, then prepare for the next pandemic

Philanthropists step up citizens’ diplomacy with gifts even as US, Chinese diplomats play the blame game amid coronavirus pandemic
The philanthropic foundations of Jack Ma and Joe Tsai, two of China’s wealthiest technology entrepreneurs, have donated 23 million face masks, 2,000 ventilators and 170,000 pieces of protective gear to New York   The donation, the biggest by private citizens to the epicentre of the global coronavirus pandemic, was described by New York Governor Andrew Cuomo as ‘really good news’

China donates 1,000 ventilators to New York
A donation of 1,000 ventilators from China will arrive in New York state on Saturday, Gov. Andrew Cuomo said at a press conference.Health care workers and the federal government are scrambling to stretch limited inventories of medical equipment to fight the coronavirus crisis, as the U.S. won’t be able to manufacture enough medical masks and ventilators in time for a surge in demand expected to hit in mid-April.

Taiwan offers masks and medical aid to foreign countries, angering Beijing
Self-ruled island has been frozen out of the World Health Organisation but its strong response to Covid-19 has helped raise its profile   Taipei has offered to donate 10 million face masks to countries that are battling the outbreak

How the United States ‘wasted two months’ to prepare for the coronavirus
American stockpiles of essential health equipment such as ventilators and masks are quickly being drained as the number of patients needing critical care surges  Experts say the federal government should spearhead efforts to make sure that supplies are available and go to the places that need them most.

9 Reasons Why You Can’t Buy Face Masks with Low Risk in China
The Western world is scrambling to buy face masks and other PPE materials. And all the conditions are met for highly expensive mistakes. If I could ring the proverbial alarm bell, this article is my way to do that. Most suppliers are very new to this game. According to the business data firm Tianyancha, more than 28,000 companies have added masks, disinfectants and PPE to their product ranges since early February. The number of firms selling forehead thermometers jumped 3,700% in the same period, it said. This was a quick response to a gigantic need. In a way, that’s great. According to the Financial Times, China was making 12 times more masks at the end of February than at the start of that month (!!). And it got multiplied again in March. On the other hand, many of those products are of substandard quality. Two weeks ago, I wrote Advice for Buying Face Masks in China without Losing your Shirt, in which I warned buyers of the very unpleasant market they were entering and the high risks they were running. Since then, several European countries complained about products they bought that were found non-compliant to EU standards. This comes as no surprise. And, despite those well-reported incidents, I found that few buyers are even aware of the risks they are running. As a consequence, virtually none of them are applying a quality assurance program that addresses the main risks.

COVID-19 heightens US–China tensions
As we try to imagine what the world will look like after COVID-19, a central question is whether the pandemic will exacerbate or alleviate tensions between the United States and China.The simple reality is that the United States and China will recover from this crisis together, or not at all. It’s a reality that is understood across the Asia Pacific region, where countries have long been uninterested in the idea of a ‘new Cold War’ in Asia, and are now looking for US–China cooperation rather than rivalry in handling the crisis. In recent days we’ve seen glimpses of a thawing in US–China tensions, with Trump and US State Secretary Mike Pompeo abstaining from the use of the term ‘Wuhan virus’, and the two countries’ top health officials discussing pandemic prevention efforts by phone. The US shortage of face masks, gloves and other personal protective equipment was also briefly alleviated this week when planeloads of badly-needed medical supplies arrived from China.  These are welcome signs, but much more serious cooperation will be needed if the two countries are going to work together to effectively manage the crisis.   Otherwise ‘buckle up’, say Hass and Dong, ‘because things are likely to get worse before they get better’.

Coronavirus: Japan to declare emergency as Tokyo cases soar
There are fears Tokyo, the world’s most populous city, is on the verge of a major outbreak
Japan is to declare a state of emergency in the capital Tokyo and six other regions in an attempt to tackle the rapid spread of coronavirus.

Coronavirus: China promises not to restrict exports of medical supplies
Commerce Ministry says it remembers the ‘helping hand’ other countries gave China and will not restrict the sale of masks, gowns and other vital equipment   Customs figures shows country has exported US$1.4bn of medical supplies since the beginning of March
podcast audio : Sunday Long Read — In Depth: How a Rugged Covid-19 Recovery Puts More Than 100 Million Jobs at Risk

Ahead of Lockdown’s End, a Soft Reopening for Wuhan Businesses
As the virus-stricken city prepares to lift its lockdown, shopkeepers are anxious to make up for lost time.

Wuhan coronavirus survivors may have their health but normal life will take a little longer
Part of a series exploring the experiences of Covid-19 survivors from around the world
‘It was like waiting for death,’ man says of suffering at home

Coronavirus: desperate overseas firms turn to China as lockdowns hit home
As infections spread in the US and across Europe, lockdowns are halting business operations   Senior managers are also unable to return to China, leaving firms also looking for stand-in CEOs and chief operating officers

Coronavirus: China’s deserted shops and restaurants show that even as lockdown ends, scars remain
Lockdown may have been lifted, but shops, bars and restaurants remain empty in Beijing, showing struggle facing economic recovery   Controls have been returning in other parts of China, where cinemas and tourist attractions shut amid fears of new wave of infections

China sees rise in asymptomatic coronavirus cases
Mainland China reported 39 new coronavirus cases as of Sunday, up from 30 a day earlier, and the number of asymptomatic cases also surged, as the government struggled to stamp out the outbreak despite drastic containment efforts.

Coronavirus can stay on face masks for up to a week, study finds
Pathogen that causes Covid-19 is gone within three hours from surfaces like printing and tissue paper, but can last for days on banknotes, stainless steel and plastic, researchers from University of Hong Kong say  But virus is no match for household disinfectants, bleach or frequent hand washing with soap and water

Coronavirus: What are the lockdown measures and travel bans in Asia?
The restrictions introduced in Wuhan, where the new virus was first reported, are being replicated in varying degrees around the region    Travel bans, compulsory quarantine and reduced freedom of movement for residents are a common feature

Coronavirus: Beijing doctor points to signs of hope in Wuhan following pandemic fear and chaos
This article is part of a series exploring the experiences of Covid-19 survivors from around the world   As Wuhan cases decline, a visiting doctor remains behind to help the city recover

Coronavirus brings opportunity to curb capitalism’s excesses. First, make the wealthy pay for the pandemic
The people best able to cope with the devastation of Covid-19 should be the ones to shoulder most of the financial burden of ill health, lost production and massive job cuts  Tax rates must rise for the super-rich, and tax avoidance and offshore tax havens reined in. It’s time to level the playing field

The coronavirus crisis reveals what’s gone wrong with health care investment
Amid the Covid-19 panic, the cry has gone up for better health care and other services. But the question of how all these priorities are to be financed by public or private enterprise remains largely unaddressed

Coronavirus: US and China reignite their war of words, this time in Europe
US ambassador to the Netherlands Pete Hoekstra says Beijing’s misreporting of fatality rates had caused Washington to misjudge the global health crisis   Chinese envoy responds by saying ‘there are a lot of good things in the United States we can learn from’ but Hoekstra isn’t one of them

China’s Coming Upheaval
Competition, the Coronavirus, and the Weakness of Xi Jinping   The events of the past few months have shown that CCP rule is far more brittle than many believed. This bolsters the case for a U.S. strategy of sustained pressure to induce political change. Washington should stay the course; its chances of success are only getting better and better

To avert a pandemic catastrophe, wealthy nations need to help the world’s poorest
Without urgent economic assistance, the world’s poorest countries face the prospect of Covid-19 ravaging their inadequate health care systems, overcrowded jails and refugee camps – bringing a global catastrophe

One virus caused Covid-19, scientists say thousands more are in waiting
As the coronavirus has swept the world it has forced changes in behaviour on all levels of society. It has also highlighted how globalisation that allows goods and people to travel the globe in 24 hours can help viruses to spread    In the second part of our series on lessons learned from the pandemic, we look at the importance of identifying new viruses and the risks of them jumping to humans

China needs more, not fewer, immigrants if it wants long-term growth and prosperity
China’s current ‘green card’ system is more of an obstacle than an opportunity for foreigners looking to settle in the world’s second largest economy Proposed new threshold for permanent residency should be lowered if China wants to foster innovation and tackle its ageing population

Relevant lessons from climate change and a global pandemic in the 19th century
A powerful volcanic eruption in 1815 set off a chain of events, from extreme weather and crop failures to a global cholera pandemic   In 2020, the world should know better than to waste time squabbling about the origins of Covid-19

Building an e-commerce business: Lessons on moving fast
With consumers moving online in reaction to coronavirus restrictions, companies will need to learn how to launch new e-commerce businesses quickly.

Which Luxury Brands Will Collapse In A Crisis?
When a brand without a digital infrastructure hits a crisis like COVID-19, it’s already too late. Here’s what brands must do to survive hard times.  Brands that chose a wait-and-see approach to digital transformation in the past have now been left in the dark. If they are still in business, they don’t know nearly enough about changing customer sentiments, since they lack digital, real-time, consumer-insight tools. Before this crisis, many companies thought of those tools as “nice to have,” not realizing they would soon be essential lifelines. As a result, they’re unable to move quickly enough to engage with online consumers and compensate for their lost physical sales. Succeeding in the digital realm takes a lot more than just deploying a web store. I refer to it as “cyber-luxury” — the ability to create highly-engaging and relevant end-to-end digital experiences that closely connect to physical buying experiences. For most brands today, the purchase journey starts online. Recently, I reconfirmed with brand owners in all categories including luxury beauty, luxury fashion, high-end jewelry, and luxury cars that even before the COVID-19 crisis most consumers decided they were going to purchase from a brand before they even entered the store. Today, going into a store is just about confirming a purchase. What does this mean? It means that if consumers decide upon purchases before a store visit, a brand has to win them over digitally. And they have to address all aspects of the customer journey, including consumer sentiment changes, competitive dynamics, trending topics, concerns, and content. Brands that haven’t prepared for the digital age — and that’s most of them — will need to right now, or they risk not attracting consumers.

When Will Hong Kong’s Luxury Retail Market Recover?
Approximately one-third of local participants of a recent study thought recovery would occur in 2021, with 18 percent of those expecting a recovery Q2 2021.

Survey: Indian consumer sentiment during the coronavirus crisis
India is in the early stages of the COVID-19 contagion, with a nationwide three-week lockdown that started March 24. A 1.7 trillion rupee (US$22 billion) stimulus package was announced two days later. About half of Indian consumers surveyed say they are highly optimistic of an economic rebound within two or three months, although they also expect a short-term reduction in income and savings, and a need to spend cautiously or cut back. Most consumers say they are very concerned with the safety of their family, followed by overall public health, and the economy.

Coronavirus pandemic likely to permanently change dining habits of Asian consumers, Nielsen study says
Asian consumers are expected to eat less out and more at home as Covid-19 changes attitudes and behaviours of consumers, finds Nielsen study Study finds 86 per cent of those polled in China plan to eat at home more often than before the outbreak, followed by 77 per cent in Hong Kong

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