China Press Review – February 22, 2019

Press review

New round of US-China trade talks begins in Washington with eye toward reaching framework for final deal
Beijing is expected to announce a large purchase of US agricultural and energy products, which will be incorporated into the overall agreement Key structural issues yet to be resolved include forced technology transfers, cybertheft and market access
www.scmp.com

China’s top trade negotiator Liu He to meet Donald Trump on Friday
Hopes for a deal grow as White House announces pair will sit down together at 2.30pm Liu’s status as envoy to Chinese President Xi Jinping gives him greater authority than at previous talks
www.scmp.com

Economies in China and Europe are faltering. But where is the US economy heading?
While growth in China and the euro zone is clearly slowing, worrying investors, the markets are much less certain about the state of the US economy. Indicators point in different directions, and even the Fed appears unsure
www.scmp.com

China should boost ties with Japan, South Korea to counter increasingly hostile US, analysts say
Beijing has become too dependent on US for trade, government researchers say Nation should leverage relationships with Tokyo, Seoul and Southeast Asia to drive regional economic development
www.scmp.com

Spurned by the West, China should still find friends in tycoons like Li Ka-shing
Patriotic tycoons like Li Ka-shing not only have substantial investments overseas but also vision. The US-led effort to stifle China’s technological development, now centred on resisting Huawei, cannot succeed if Beijing works with the business elite
www.scmp.com

China is going to need more foreign money as its trade surplus dries up, Morgan Stanley says
China’s economy is in “long-term decline” and growth from 2020 will be increasingly dependent on foreign capital, according to Morgan Stanley. This year, the current account shortfall could be 0.3 percent of its GDP, and slip further to 0.6 percent in 2020, the investment bank predicted. The report blamed the shrinking current account on China’s aging population, and flattening market share in goods exports, among other factors. But there are opportunities for investors too, the bank said.
www.cnbc.com

Morgan Stanley: China’s debt is set to worsen, but there’s less risk from shadow banking
China’s debt in relation to its economy is expected to climb by three to four percentage points of its economy, Morgan Stanley’s Chief China Economist Robin Xing told CNBC on Friday, referring to the debt-to-GDP ratio. Beijing has been trying to reduce its reliance on debt, but the trade war is denting its efforts as it seeks ways to boost its slowing economy.
www.cnbc.com

Why We Can Forget About a Rate Cut in China
Borrowing costs are already below neutral and lowering them won’t help funnel credit to private businesses, researchers argue.
www.bloomberg.com

This is China’s plan to eclipse Silicon Valley
China’s Pearl River delta is the site of the most dramatic urbanization in human history. The area is home to nearly 70 million people. It contributes an eighth of China’s GDP, with an economy worth $1.5 trillion – roughly the same as Australia and Spain, and nearly as big as Russia and South Korea.
Now the Chinese government has outlined its plans to unite what it calls the Greater Bay Area into a giant megalopolis, and transform it into a high-tech centre that could rival California’s Silicon Valley and Japan’s Tokyo Bay. The Greater Bay area encompasses Hong Kong and Macao, along with nine cities in Guangdong province: Guangzhou, Shenzhen, Zhuhai, Zhongshan, Jiangmen, Zhaoqing, Foshan, Dongguan and Huizhou.
www.weforum.org

Greater Bay Area plan receives mixed reaction in Guangdong province, still work to do for Beijing
Hi-tech manufacturers, property speculators and market investors who stand to gain support the plan for China’s rival to Silicon Valley and the Tokyo Bay Area Export traders and low-tech manufacturers see Beijing’s grand plan as doing little to help their struggle to survive, with fears it could actually increase costs
www.scmp.com

Asia’s exports to China plunge as economy stumbles
Companies reshape supply chains to avoid trade war’s impact
asia.nikkei.com

Australia seeks clarification on China coal import ‘block’
The Australian government says it is seeking an “urgent” clarification from Beijing over reports that a major Chinese port has halted imports of Australian coal.
www.bbc.com

Business or politics? China’s coal cut kills two birds with one stone
The frenzied debate around why China would ban Australian coal imports to a number of its large ports falls into two camps – those that say it’s commercial, and those that view it as political.
www.smh.com

Did Donald Trump just give Huawei a pass?
US President Donald Trump said he wants the US to ‘win through competition, not by blocking out currently more advanced technologies’ Trump made the comment about 5G in a tweet on Thursday, without mentioning Huawei
www.scmp.com

Huawei or US: Mike Pompeo issues warning to allies that partner with Chinese firm
America ‘won’t be able to work alongside’ countries that use Chinese telecoms giant’s equipment, politician says Statement comes as Britain, New Zealand and Italy say there may still be room for Huawei in their 5G development plans
www.scmp.com

Huawei would refuse if China requested ‘back doors’ into foreign wireless networks, says chairman Liang Hua
Liang Hua says Huawei has obtained a legal opinion that it is not obliged to help the Chinese government secure ‘back doors’ into foreign telecom networks He said Huawei plans to expand its Canadian workforce by 20 per cent and increase research and development investment, despite arrest of Meng Wanzhou
www.scmp.com

Huawei to grow Canadian investment, adding 200 R&D jobs
Huawei chairman Liang Hua said on Thursday that the company plans to boost research and development spending in Canada this year, including 200 new jobs and a 15% increase in investment. The company’s statement comes after a cascade of global diplomatic events following the December arrest of Meng Wanzhou, the firm’s CFO and daughter of its founder, by Canadian police at the request of the United States for fraud involving US sanctions against Iran.

Briefing: Huawei to grow Canadian investment, adding 200 R&D jobs

Chocolatier Godiva to sell Asian-Pacific operations to MBK Partners
Godiva Chocolatier, has agreed to sell parts of its Asia-Pacific business to private equity firm MBK Partners, Godiva CEO Annie Young-Scrivner told Reuters. The deal includes Godiva’s operations in Japan, South Korea and Australia, and the production facility in Belgium supplying these regions.
The transaction could be worth between $1 billion and $1.5 billion.
www.cnbc.com

Alibaba CEO rules out layoffs this year despite China’s slowing economy
Alibaba CEO Daniel Zhang said in a Weibo post on Friday that the company plans to avoid layoffs this year despite China’s slowing economy. He also added that Alibaba will continue to boost consumption and bring in more orders using the platform’s resources. The comments contradict Chinese media reports and market speculation about job cuts and a pull-back for China’s internet sector amid weakening domestic demand and an prolonged trade dispute with the United States.
www.cnbc.com

China wants its rural villages to go cashless by 2020
Residents of even the tiniest far-flung villages in China may soon be able to pay on their phones to run daily errands as Beijing announced this month that it aims to make mobile payments ubiquitous in rural areas by the end of 2020.

China wants its rural villages to go cashless by 2020

China’s January home price growth at nine-month low as confidence dips
Growth in China’s home prices eased to a nine-month low in January in a further sign that the slowing economy is weighing on consumer confidence.
www.reuters.com

Commentary: Buying a car has lost its lustre in China
Many automakers have seen sales plunge in China last year but bright sparks remain in the electric vehicle industry where the numbers are on an uptick, says China-based commentator Tom McGregor.
www.channelnewsasia.com

Chinese companies look to invest in Britain
Investment targets pursued by Chinese firms in the UK despite Brexit uncertainties
www.telegraph.co.uk/news/world/china-watch/business/chinese-investment-in-uk/

Apple teams with Ant Financial, banks for interest-free iPhone financing in China
Amid waning sales in China, Apple teams with Ant Financial and local banks to offer interest-free finance
www.scmp.com

ADIDAS’ ULTRABOOST 19 MAKES GLOBAL DEBUT ON TMALL
Sportswear giant Adidas this week became the latest international brand to leverage Alibaba Group-owned Tmall, China’s leading B2C marketplace, for the global launch of its newest product.
www.alizila.com

China’s Massive Belt and Road Initiative
China’s Belt and Road Initiative is the most ambitious infrastructure investment effort in history. But is it also a plan to remake the global balance of power?
www.cfr.org

Will the Chinese Belt and Road change the geopolitical game?
The Belt and Road is more a concept than a legal or economic blueprint signed and sealed by its conceptualisers, according to the author.
www.asianage.com

WHO WINS IN THE FIGHT BETWEEN AMERICA, EUROPE AND RUSSIA? CHINA | OPINION
But there is a shared long-term strategic and systemic threat just over the horizon that Washington, Moscow, Brussels and Berlin all prefer to ignore: the rise of China. At the University of Singapore Middle East Institute conference earlier this month, where I delivered a report on Central Asian Infrastructure Investment, experts analyzed massive Chinese plans to establish strategic presence from Myanmar and Sri Lanka to Djibouti and Dubai. Not just Pakistan’s Gwadar, but Egypt, Israel, Greece and Czechia are targets of massive Chinese port and rail projects. The Belt and Road Initiative is going to reformat the world as we know it. China is already Africa’s main trade partner.
www.newsweek.com

The 21st century belongs to China—but the 22nd will be Africa’s
The 21st century will most likely belong to China as the Chinese Century. But with a rapid increase in Chinese investment and African innovation, the 22nd century may see the dawn of the African Century. China’s investment in Africa will create an infrastructure for African culture and innovation to accelerate. Chinese investments and contracts in sub-Saharan Africa total $299 billion from 2005 to 2018, according to the China Investment Global Tracker, and in 2018, Chinese president Xi Jinping vowed to invest a further $60 billion into African nations. If the continent can successfully navigate the issues raised by Chinese neo-colonial ambitions—such as the fear of “debt trap” diplomacy, with $130 billion in loans from China to African nations since 2000—they will be able to ascend from this trajectory into global power.
qz.com

Saudi, China sign $28 billion worth of economic accords – SPA
Saudi Arabia and China signed economic cooperation agreements worth a total of $28 billion at a joint investment forum during a visit by Saudi Crown Prince Mohammed bin Salman to Beijing, Saudi state news agency SPA said on Friday.
in.reuters.com

As China Cuts Air Pollution, An Unseen Killer Emerges
Efforts to cut smog-causing PM 2.5 are leading to rises in ground-level ozone, a chemical harmful to health.
www.sixthtone.com

Xi Study App Highlights Party Influence Over and Through Tech
Chinese tech companies’ ties with Party and state authorities are coming under increasingly close scrutiny as, in the recent words of the Center for a New American Security’s Ashley Feng, the lines between them are “dangerously blurred [by] Chinese domestic laws and administrative guidelines, as well as unspoken regulations and internal party committees.” Faced with criminal charges against his company in the U.S. and a multi-front battle to defend its participation in 5G network development elsewhere, Huawei founder Ren Zhengfei has recently sought to defuse this kind of suspicion, reiterating denials that the telecom equipment provider has or would ever provide Chinese authorities with users’ private information or the means to access it. Ren has even claimed that “even if we were required by Chinese law, we would firmly reject that.”

Xi Study App Highlights Party Influence Over and Through Tech

China’s taste for worms is killing the soil
Shocking video shows men using electric currents to lure earthworms out of the ground for the cooking pot The method is destroying the environment
www.scmp.com

The ‘unsustainable’ price of lab-grown diamonds has collapsed 60 per cent, says De Beers, after stunning industry with synthetic stones for jewellery
De Beers says the massive price falls will continue as improved technology increases the quality and volume of lab-grown diamonds for jewellery
www.scmp.com

China’s Military Seeks New Islands to Conquer
Allies in the Pacific are worried that the U.S. and Europe are no longer reliable.
www.bloomberg.com

CPC – the magic behind China’s rise
China’s 40 years of reform and opening up have largely contributed to the country’s transformation into a modern, dynamic and robust economic power. Throughout these past 40 years of reform and opening up, Communist Party of China (CPC) and its visionary leadership has proved to be the backbone of China’s rise, providing leadership and vision to the country’s march on the world horizon.
www.pakistantoday.com

The Handshake that Changed the World
Forty-seven years ago today, Nixon grasped the hand of Chinese Premier Zhou Enlai, an image that represented a sea change in foreign relations for the two countries. Lesser known, however, is the story of how those images were captured and broadcast around the world. Robert Siegenthaler, the head of the TV network pool covering the visit, shares his story with CBR.

The Handshake that Changed the World

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