China Press Review – December 20, 2018

Press review

EU takes China to WTO again over technology transfers
The European Union launched a second challenge against China at the World Trade Organization on Thursday over laws it says force the transfer of technology in areas including electric vehicles and biotechnology.

Trump can’t have his tariffs and the stock market too
The president’s continuing obsession with the stock market could force him to cut a trade deal with China.

If you thought 2018 was bad, just wait until next year
Richard Harris gets a review of the year from Santa himself, who made it clear the continuing bad news over trade tariffs, data breaches and slumping stocks, among other challenges, mean the ‘year of consolidation’ will last beyond 2018

China Is Willing to Make a Deal
Its leaders are talking tough, but privately, many Chinese officials are worried about their economy and eager to end the trade war.

Trade war truce: China’s Sinograin confirms US soybean purchase
Statement follows last week’s report that Sinograin and fellow state-run Chinese firm Cofco had bought over 1.5 million tonnes of US soybeans First major purchases since China and United States agreed a temporary ceasefire in their trade row

Top finance execs are losing confidence in China’s economy, survey shows
Growing trade risks have soured sentiment among senior finance officers at companies operating in China, according to a Deloitte survey. “There has been a sharp shift in sentiment,” says the consultancy’s William Chou. Deloitte queried chief financial officers and other top officials at a mix of multinational, Chinese and Hong Kong companies for the biannual China CFO Survey.

Will the Huawei Arrest Influence the U.S.-China Trade Talks?
In summary, it’s highly likely that Meng’s arrest and the new U.S.-China trade talks were not initially related. The degree to which the Chinese government and the Trump administration allow them to become part of the negotiations remains to be seen. I just hope that the Trump administration keeps them separate. Too many times in the past, the U.S. government has needlessly sacrificed crucial trade priorities to the goals or concerns of national security agencies. It would be a shame for that to happen again.

How far should China go to stimulate the economy? That’s a question for Xi Jinping in 2019
China taking incremental approach to stimulus, based on economic performance and trade talk progress With the economy expected to slow further next year, Xi Jinping needs to find ways to put growth on track without worsening China’s long-term economic problems

China’s builders are hurting: Beijing may feel the pain
Beijing began tightening approvals for infrastructure projects last year and ordered an overhaul of its public-private partnerships program as part of its efforts to tackle debt risks. Infrastructure spending growth slowed to 3.7 percent in November, near its lowest level in two decades, from levels of over 20 percent last year.

Can China’s leaders restore confidence to private businesses?
China is rolling out a nationwide initiative to help private business owners but some question whether it will be able to take the necessary steps While the Communist Party has been happy to reap the benefits of burgeoning private sector, fears that ideology will trump pragmatism remain

China’s central bank keeps short-term borrowing rates steady despite US Fed rise
The People’s Bank of China’s kept the interest rate on seven-day reverse bond repurchase agreements at 2.55 per cent, and the 14-day rate at 2.7 per cent US Federal Reserve had raised its benchmark rate just hours earlier

China offers low-cost loans to banks to help fund small businesses, shore up economy
Central bank introduces new lending facility to boost liquidity ahead of interest rate increase in the United States The People’s Bank of China also extends banks’ credit line by US$14.5 billion

China to strengthen oversight of banks’ required reserves
China’s central bank said on Thursday it will strengthen the oversight of the reserves that commercial banks and other lenders are required to deposit to ensure timely and full payment. The People’s Bank of China will impose penalties on delayed payments of required reserves to the central bank, it said in a statement on its website.

Beijing vows to reduce meddling in trading after bad year for China stock market
The heavy hand of intervention will be replaced by the light touch of market forces China pledges to attract more funds into stocks after the market reported one of the world’s worst performances in 2018

Shanghai mulls fivefold expansion of free-trade zone in bid to attract foreign capital
New zone to include Lingang, site of Tesla’s first international production facility Further easing of restrictions on foreign investment and greater freedom in moving commodities and money in and out of China could follow expansion

Chinese Consumers Becoming More Discerning: Nielsen and Vipshop
The report points to a reverse trend, first-tier city consumers are tending to be rational shoppers and are more sensitive to pricing — but lower-tier cities consumers are upgrading their shopping choices and moving to premium brands

The innocuous doctrine that shapes boom and bust
In the final chapter Toward a Beijing Consensus Lubin argues that China will play a much bigger role in global finance, but not in the immediate future. “There is a huge gap between China’s impact on the real economy and on the financial system,” observes Professor Rey. Lubin says of his vision: “I was very nervous writing that last chapter because I realised that I was expressing a view about not the next thing to happen, but maybe the next after the next after the next things to happen. The interim is very, very unclear.” According to Lubin, China remains a minnow in international finance, and will remain so “for a long time” because of the capital controls it has in place. Those controls prevent its wealth from diversifying out of China and out of renminbi, which itself is not strong enough to replace the dollar as an international trade currency. Even China’s Belt and Road infrastructure scheme has been largely financed in dollars. Despite these caveats, Lubin predicts China will eventually extend its influence on trade to include rewriting the global financial rules for emerging economies.

China’s tech giants want to go global. Just one thing might stand in their way.
Multibillion-dollar companies like Alibaba and Tencent have thrived thanks to a government that provided incentives but otherwise let them grow. Can they count on that in the future?

Alibaba’s Tmall led China’s US$186 billion online retail B2C market in Q3 2018 with almost 60% market share
China’s online retail B2C market reached US$186.13B in Q3 2018. Tmall led this market with a share of 59.5%, followed by (25.8%) and Suning (6.4%). The online retail B2C was a 1,284.37 billion yuan (US$186.13B) market in China in Q3 2018, which increased by 30.3% compared with the prior year period.

Partnerships with third-party platforms in China are having a positive impact on business, international brands have been saying as they reported financial results in the recent quarters.

Huawei counts on playing role in German 5G networks
ZTE suffers contract setback but still in running to build new system

There we were, all ready for Donald Trump to cede global leadership – but China’s heavy-handedness has left its neighbours happy to see the local thug beaten up by the bigger, global bully

China’s Growing Footprint in Latin America
Many Latin American countries experienced political change in 2018, with presidential elections in three of the largest countries—Brazil, Mexico, and Colombia—and transitions in Chile, Costa Rica, Cuba, El Salvador, and Paraguay. Meanwhile, several long-term China partners, such as Peru, Argentina, and especially Venezuela, have been entangled in political scandals. How are relations evolving between China and Latin America, and between China and individual countries in the region? And how do China’s interests and relations in the region differ from those of the United States?

The new US Africa strategy is not about Africa. It’s about China
President Donald Trump’s national security advisor John Bolton outlined the US administration’s new Africa strategy in a speech last week at the Heritage Foundation, a conservative think tank in Washington, DC. The main tenets of the strategy, including the prioritisation of trade and investment, combatting of terrorism, and better-targeting of US foreign aid in Africa, are on the whole sensible. The US has already increased the promotion of private sector engagements in Africa as a key lever for development and should continue to support US investment in Africa.

A duet, not a duel: China’s world view has evolved
In 2018, China achieved all-round improvement and growth of our relations with neighbouring countries, especially with India.

China’s ‘Belt and Road’ plan in Pakistan takes a military turn
When President Donald Trump started the new year by suspending billions of dollars of security aid to Pakistan, one theory was that it would scare the Pakistani military into cooperating better with its U.S. allies.

Why Is China Losing Interest In Nuclear Power?
The future of the nuclear power industry lies in China. The Chinese are presently building more nuclear electric power generating stations than any other country. This year, the Chinese will add three more nuclear power stations to their fleet bringing their total up to 40, while eighteen nuclear plants are also under construction. According to MIT estimates, the Chinese can erect a nuclear plant for half the cost of a plant here in the U.S. If so, what’s the problem?

China continues to drag its feet on road towards gender equality, but claims success in white-collar work
Report finds that progress towards parity is slow and that China is not one of the countries closing the gap on work, health, education and politics

New Laws in China: Prepare Your Business for Big Changes on January 1, 2019
New laws in China affecting business and trade will come into effect on January 1, 2019. They range from tax reform to international tariff agreements.

China Lawyers: The Fakes and the Quasi-Fakes
But with the recent decline in China’s economy we have in the last few months been seeing a precipitous increase in a new sort of “China lawyer” problem: Chinese law firms that seem to know nothing about international law representing foreign companies shockingly badly at shockingly law prices.

What China needs to do to stem the flow of fentanyl to the US
China is believed to be the primary source of the powerful painkiller, responsible for almost 30,000 fatal overdoses in the US last year Outlawing all forms of the drug – threatening more producers with the death penalty – is mooted, but enforcement is more complex

EU cables hack reveals no bombshells but many insights
Leak offers picture of EU bureaucracy worried by China, Russia and Trump

World’s tallest buildings of 2018: China dwarfs the competition as skyscraper construction soars
One country continues to tower over the rest of the world when it comes to the construction of tall buildings, with China dwarfing the competition thanks to a staggering 88 completions of buildings 200 metres or higher in 2018.

China launched more rockets into orbit in 2018 than any other country
And in the next few years it plans to launch the world’s biggest space telescope, the world’s heaviest rocket, and a space station to rival the ISS.

China Focus: A global view of China’s reform and opening-up
Lawrence Lau, former vice president of the Chinese University of Hong Kong, still vividly remembers his trip to the Chinese mainland in 1979. “I saw fried dough sticks and baked sesame seed cakes along the streets. They looked fairly tasty and were only five cents each,” Lau recalled. “But the vendors wouldn’t allow me to buy them because I didn’t have any food coupons.”

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