China’s imports are growing despite virus outbreak, trade frictions
Government support plays key role in trade stability. China’s imports are growing, helped by the swift acceleration of the nation’s economic recovery, despite the global pandemic outbreak and trade frictions. This is giving hope to global businesses still struggling from the pandemic’s impact.
China’s Bad Loan Season Descends Again and This Time It May Be Really Bad
The amount of bad debt is staggering at a time when the economic recovery hasn’t benefitted all provinces and companies in the same way. Indeed, as banks dispose of bad loans, more keep coming. The numbers are staggering: After disposing of over 3 trillion yuan ($465 billion) of soured loans last year, non-performing assets continued to rise, up 281.6 billion, even as regulators allowed more loan forbearance to prop up companies climbing out of the virus slump. That’s compared to the almost 4 trillion yuan of loans banks cleared away in 2018 and 2019 combined.
Coronavirus recovery: protect lenders and borrowers to ease bad loan damage
More than ever, banks must strike a delicate balance between extending needed lines of credit to borrowers while also safeguarding themselves against bad debt Banks must continue to lend while anticipating loan losses, and shielding lenders and borrowers while managing bad loans is essential to an economic recovery Spurred by the pandemic, S&P Global Ratings expects aggregate global credit losses for 2020 and 2021 to hit about US$1.8 trillion. According to its 2021 forecast published last July, North American and Chinese banks will continue to lose US$240 billion and US$398 billion respectively. Across the Asia-Pacific, loans have plunged as the pandemic has made banks more reluctant to lend. This is in line with their counterparts across the globe. Amid heightened concerns around risk and borrower creditworthiness, European banks tightened lending guidelines and approval criteria for new loans in the final quarter of last year, taking these measures to levels unseen since the 2008 global financial crisis. Closer to home, HSBC has warned that it could take loan loss provisions of up to US$13 billion.
Get the latest insights and analysis from our Global Impact newsletter on the big stories originating in China. With spiking unemployment affecting Hong Kong and many other economies, there will be an increasing number of risky borrowers. More than ever, banks must be able to strike a delicate balance between extending much-needed lines of credit to borrowers while also safeguarding themselves against bad debt.
China will pay a price for rights abuses, says Biden
China will pay a price for its human rights abuses, US President Joe Biden has warned, responding to queries at a televised event on Beijing’s handling of Muslim minorities in its far western region of Xinjiang.
Beijing hits back at Biden plans to put ‘China challenge’ on G7 agenda
Foreign ministry statement warns against ‘exclusive cliques’ and ideological confrontation ahead of Friday’s meeting Group of Seven virtual talks will be the new US president’s first since taking office in January
China Blocked Jack Ma’s Ant IPO After Investigation Revealed Likely Beneficiaries
Well-connected Chinese power players, including some with links to political families that represent a potential challenge to President Xi, were behind layers of opaque investment vehicles. The information added to concerns about financial risk and anger at Ma’s outspoken criticism.
China’s Gen Z consumers drive growth of domestic brands as spending power rises
This group of young consumers — born between 1996 and 2010 — accounts for 17% of China’s population but 25% of total expenditure on new brands, according to L Catterton’s latest consumer insights report on China. Unlike previous generations, China’s Gen Z cohort is notably more globally minded and enthusiastic about “Made in China” products, said Charlotte Chang, vice president of consumer insights at L Catterton. Chang highlighted that China’s capital market has also doubled down on consumer brands, making it one of the few sectors to see an increase in activity in 2020.
ByteDance looks to list Douyin in New York, seizing on new mood in Biden administration and strong demand for China tech stocks
Listing in New York has gained traction with ByteDance’s investors after Joe Biden’s inauguration as the 46th US president, according to a source A US listing is not mutually exclusive with raising funds in Hong Kong, as ByteDance can follow with a secondary listing in Asia’s second-largest capital market
Will China’s Ox charge ahead of the rest?
This week, China celebrates the start of the year of the Ox. Sturdy, hard-working, reliable, investors will hope that China’s stock market can adopt those characteristics to build upon last year’s remarkable outperformance. A lot of attention was paid to the US’ ‘V-shaped’ market recovery last year. Not enough was given to China’s. Over the past 12 months, China’s CSI index has delivered a 45% return, while America’s S&P 500 managed just 18% (by comparison, the FTSE 100 has made an 8% loss).
China wants to be carbon neutral by 2060, but can its provinces manage it?
Ensuring carbon emissions peak before 2030, as is promised, may prove difficult for some provinces, not least where the economy relies on coal Some provincial-level authorities have taken steps towards the government’s goals, while others’ actions have been slow or vague
Growing number of countries echo U.S. warnings about Chinese espionage and influence
In the past week, intelligence agencies in the Netherlands, Finland and Canada expressed deep concern about China’s espionage and political influence in democracies.
New WTO chief’s pile of problems
The coronavirus pandemic, log-jammed trade talks and a long-delayed meeting of member states are just a few of the crises awaiting Ngozi Okonjo-Iweala as she takes the helm of the World Trade Organisation next month.
Decoupling denied: Japan Inc. lays its bets on China
US-China trade rift creates havoc and opportunity for Asia’s economic giants But while Tokyo has tried to wean its companies off China, even offering subsidies to Japanese companies to exit the China market, it is clear that leaving China is easier said than done. Japanese companies operating in China remain bullish: Just 7.2% of them said they were moving or considering moving production out of China in a September survey by JETRO, down from 9.2% in 2019.
China Decoupling Would Cost U.S. Economy Billions, Chamber Says
U.S. firms halving FDI in China could cut GDP by $500 billion Lobby urges Biden to take balanced, rational approach to China American companies would lose hundreds of billions of dollars if they slashed investment in China or the nations increased tariffs, the U.S. Chamber of Commerce said in a report highlighting the cost of a full decoupling of the world’s largest economies.
Coronavirus: facing criticism and attacks, WHO team readies report on Wuhan probe
Questions have been raised about the findings of the Covid-19 origins mission and the scientists’ access to information in China All eyes are now on the official reports, with the first expected to be released this week WHO does not possess the mandate to enter uninvited to any nation state and must show due diplomatic respect to the process of engaging with governments,” he said. “As such this was and remains a collaborative process of discovery between scientists. Clearly there is a political layer on this that has been difficult for all parties to manage.” As things stand, Griffith University’s Davies says the “carrot approach” may yield better results for the WHO as far as access to data and future field studies in China. The upcoming report, likely to be framed as the beginning of a continued investigation, can be part of that approach, she said. “If you really want to get the data, you need to demonstrate exactly what is missing and why, in its absence, things can’t be ruled out.”
CGTN：What is China’s role in global fight against COVID-19?
The COVID-19 pandemic, affecting all countries, has underscored both the way China addresses a global challenge and its vision for a better world. As the first major country to have effectively contained the virus and the only major economy to register positive growth last year, China has been at the forefront of the global fight – believing that COVID-19 knows no borders and cannot be defeated without working together.
China-US relations: Xi knows there will be ‘repercussions’ for human rights violations, Biden says
Biden says he told China’s president the US would speak up against abuses and crackdowns that contravened American values Secretary of state deems US in a stronger position against China when it works with allies and leads from the front rather than using Trump tactics
Joe Biden’s still evolving China policy is a tough balancing act
That the US conducted a two-carrier naval exercise in the South China Sea shortly after Biden pledged to be open to ‘result-oriented engagement’ with China signals continuity rather than radical change
However, to build on its edge against China, the US would have to engage with Beijing in the economic and trade domain While the US-Russia relationship would be of special relevance to US allies in Europe where a degree of dissonance is discernible, Biden’s current focus is the Indo-Pacific. India has a favourable geographic location in the Indian Ocean and strategic relevance to US long-term objectives.
US ‘neglect’ drives Asean towards China in superpower economic rivalry, analysts say
The 10-member Asean bloc is moving deeper into Beijing’s sphere of influence, some analysts say US foreign policy indifference towards Southeast Asia is creating ambivalence among some nations
The centrality of geo-economics
Sustained economic growth merged with economic integration is the surest path that will uplift Pakistan In fact, the centrality of Pakistan’s relations with China, apart from the strategic dimension and strengthening defence, aims at lifting its economy by placing it on more durable lines. The China–Pakistan Economic Corridor (CPEC) is largely based on this concept and if faithfully implemented along with other major national pursuits should place the country on an upward trajectory. And give strength, sustenance and durability to the China-Pakistan relationship. The rising Chinese economic power is being thwarted by the US by trying to place several hurdles in its way. But despite that China’s economy is moving ahead and was the only major power whose GDP was growing at an appreciable pace. According to experts, government-led investment and demand for Chinese goods globally were the major factors that helped China to boost its exports and revive its economy at a faster rate. This augurs well for Pakistan as it is a major beneficiary of Chinese loans and its aided projects.
Soaring EU-Xinjiang trade in textile machinery, tomatoes piles pressure on Brussels to act on alleged forced labour
Shipments of German-made parts and accessories for textiles machinery in Xinjiang hit a record high of US$41.2 million last year, a staggering 2,763 per cent increase since 2017, when detailed records began.
China under US pressure to condemn Myanmar military coup
China under US pressure to condemn Myanmar military coup
State Department calls on Beijing to play constructive role as Chinese envoy denies his country is giving help to junta Ambassador to Myanmar Chen Hai describes claims as ‘laughable’ in interview with local media
National security law: attacks on Hong Kong courts ignore strong rule of law
Attacks over the new security law are starting to target Hong Kong’s legal industry, challenging Hong Kong’s place as a seat of international arbitration Singapore’s example shows a strict legal code to uphold national security and robust courts that respect the rule of law are not mutually exclusive
Beijing suspected of blocking Taiwan’s plan to buy the Pfizer-BioNTech vaccine
The agreement involved the purchase of five million doses. For Taiwan’s Health Minister, political interference sunk the deal. Shanghai Fosun has the rights to distribute the vaccine in China, Hong Kong, Macao and Taiwan. Taiwan has already bought millions of doses from AstraZeneca and Moderna.
Learning how to drive in an AI simulator is becoming more common in China
AI simulators that replicate the driving experience can save operators rental, labour and equipment costs To a certain extent, they may replace traditional driving instructors, although students still need to go on real roads at some point
BOOKS: What Beijing gets right
Two Western economists believe that China’s economic success is here to stay Two recent books by Thomas Orlik and Grzegorz W. Kolodko provide well-informed insights into China’s political economy. As a consensus develops that China is the main strategic competitor to the United States and poses a paramount security threat to the West, a realistic understanding of China’s political economy is more important than ever. Over the past four decades, Western policymakers and analysts have been more often wrong than right in their forecasts about China. Perhaps the most interesting part of Orlik’s book describes how, in its Made in China 2025 program, the country aims to conduct the “Fourth Industrial Revolution” — the application of cloud computing, robotics, artificial intelligence and big data to overhaul its industries. He asserts that the Chinese government has focused more intensely on building a cutting-edge industrial sector than any other government. Orlik believes that China’s post-2025 economy may use capital, labor and energy less intensively, be more environmentally sustainable, and remain a formidable competitor to Western manufacturing. The focus of the two authors is limited to the present and recent past. Neither Orlik nor Kolodko provide historical or cultural contexts explaining how China’s market capitalist system came into being. Was the system created over the past half-century, or does it have roots in Chinese cultural values over the millennia? Answers to this question would suggest whether the present system is sustainable and deeply grounded in Chinese soil, or is a fragile and adventitious construct without staying power. Aside from that caveat, these two books provide excellent material for developing a more nuanced approach to dealing with the reality of China in the future.
China’s Firework Bans Spark Craze for Dangerous Alternatives
China has seen red-hot demand for “cold fireworks” over the Lunar New Year holiday, but Chinese authorities say the products pose an unacceptable safety risk.
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