China Press Review – January 23, 2019

Press review

Donald Trump needs a trade deal, China not so much – but Beijing may just be ready to settle, too
Neal Kimberley says the timing seems right for a deal between Washington, where worries about Trump’s 2020 prospects are beginning to bite, and Beijing, which can do without the distraction of a trade war as it focuses on economic reform at home

Worst Is Yet To Come For China’s Economy
China analysts have a hard time fully trusting Beijing’s GDP numbers. So they look elsewhere for evidence of economic health, like energy consumption, trending just under 2% per year. The government has basically ordered its state-run banks to open its coffers and lend, lend, lend. They are focused on the usual: a build-out of Chinese infrastructure as demonstrated by over 1 trillion yuan ($146 billion) worth of rail and metro projects approved since late last year and another 1.39 trillion yuan quota approved for local government bond issuance to help finance it. Year-over-year comparisons will look worse also as China’s monetary and fiscal stimulus hasn’t yet worked into the system. Upcoming PMI data for January will provide further insights. The latest GDP data show that annual growth in 2018 was 6.6%, though many China-watchers believe that true GDP is more like 5% at best.

China’s GDP: Statistics and reality in the Chinese economy, Part 2
China’s economic growth last year dropped to its lowest rate in a generation and though there were a number of international and domestic reasons for that performance the Chinese economy has been slowing steadily for the last five years.

Chinese finance ministry and central bank on same page on growth after Xi warns of risks to economy
Ministries announce plans for tax cuts, infrastructure spending, more market liquidity and greater lending

Xi Jinping has issued a rallying cry, but what is China on alert for?
Current account deficit, mounting debt, growing hostility from abroad and slowing economy could be among the risks top cadres have been told to keep watch for

Opinion: Chinese economy: The good, the bad, and the uncertainties
With this background, the Chinese government has announced to implement several easing policies to counter the downturn, most of which are from the fiscal policy perspective. While such policy is reassuring and their effectiveness is also foreseen, we can also expect the government to further lower down its growth target in 2019.

China insists trade war talks with US are continuing after reports Washington turned down meeting
Foreign ministry spokeswoman says she is not aware of any changes after reports that US rebuffed Beijing’s offer due to lack of progress over intellectual property protection and structural reform China’s chief negotiator Liu He is due to visit Washington next week for talks with senior US government figures

China Singyes plunges, highlighting cash flow woes of China’s private companies and solar industry
Trading resumed after a three-month suspension that prevented investors from selling on its earlier debt-default news Many Chinese solar farms developers suffer from weak operating cash flow

From natural gas to electric cars, China’s push towards renewable energy should spark investor interest
David Smith says investment opportunities lie in companies that stand to benefit from China’s switch from coal to natural gas, its focus on renewable energy and support for electric vehicles

The future of China’s AI industry is in the hands of just three companies
More than half of the country’s major AI players have funding ties that lead back to Baidu, Alibaba, and Tencent.

China could completely cut off investment into Silicon Valley amid Huawei bust-up
Chinese tech giant Huawei is facing restrictions from several Western governments, amid concerns that its products could be used for spying. It comes at a time when the U.S. and China are locked in a long-running trade dispute, with investors increasingly worried the conflict could spill over into a so-called “tech war.”

‘I strongly declare I am innocent’: Huawei executive ‘Weijing W’, arrested in Poland, says he is not a Chinese spy
The Chinese executive, fired by Huawei after his arrest, broke his silence to say espionage charges by Poland are ‘completely groundless and terribly hurtful’ He said he ‘did not cooperate with any kind of intelligence, especially Chinese intelligence’

Huawei to seek swift resolution for detained executive Meng Wanzhou
Huawei chairman Liang Hua was appointed acting chief financial officer after Meng Wanzhou’s arrest in Canada

Tesla’s US$5 billion Gigafactory helps Shanghai record increase in foreign direct investment for 2018
Capital committed by investors rose by 16.8 per cent to US$46.9 billion, while foreign funds actually received hit US$17.3 billion, up 1.7 per cent

China’s Belt and Road Initiative will add US$117 billion to global trade this year, a new study shows
Euler Hermes says nations targeted by the initiative will see higher trade volumes, even if they are yet to receive any direct investment from China The trade insurer estimates that the Belt and Road Initiative resulted in US$460 billion worth of investments in the five years since its inception in 2013

Taiwan compiles new blacklist banning slew of Chinese tech firms
Taiwan preps China blacklist banning Huawei and ZTE – Nikkei Asian Review Taiwan is preparing to bar government agencies and state-controlled companies from using equipment from Chinese tech companies on a new blacklist, which it plans to publish by the end of March. Companies including telecom equipment manufacturers Huawei and ZTE, surveillance camera makers Hikvision Digital Technology and Dahua Technology, and computer manufacturer Lenovo are likely to be put on the list.

Briefing: Taiwan compiles new blacklist banning slew of Chinese tech firms

Mobile payments overtake cash for China’s overseas travelers
What happened: Mobile payments have overtaken cash for the first time among Chinese outbound travelers, according to a joint report released by global data analytics company Nielsen and mobile payments platform Alipay. Chinese outbound travelers paid for 32% of their transactions with mobile phones, overtaking cash—which was used only 30% of the time. The researchers surveyed around 2,800 Chinese travelers and over 1,200 overseas merchants.

Briefing: Mobile payments overtake cash for China’s overseas travelers

China’s space-startup boom fueled by government boost
Country looks to tap into growing commercial rocket and satellite sectors

Is China capable of providing international stability?
China has become something of a punching bag for Western criticism. At the East Asia Summit in Singapore last year, US Vice President Mike Pence insinuated that China is pushing ‘empire and aggression’ in the Indo-Pacific. Disgruntlement with China dominated November’s Stockholm China Forum meeting, a gathering of American, Chinese and European ambassadors, diplomats, scholars, politicians and business leaders. Whether it’s the ‘debt trap’ of its Belt and Road Initiative, island building in the South China Sea or alleged influence operations, China is causing profound anxiety in Western democracies. Has China become a great disrupter?

Is China capable of providing international stability?

Israel has enough sense and self interest to avoid efforts to drag it into US-China trade war, analysts say
China and Israel mark 27th anniversary of diplomatic ties at a difficult time Relationship could be tested by US efforts to influence Israeli government policy

Bond default by China’s best-performing stock this year sends shares slumping in Shanghai
Shares of Wintime Energy, which had surged 60 per cent this year until Friday, fell almost 10 per cent in trading on Wednesday after it said that it had defaulted on a bond payment

China rips into Tencent’s news service, killing 9,300 mobile apps
The Cyberspace Administration of China has scrubbed the web of more than seven million items since January 3

Rise of the Red Retirees? China’s ‘Dama’ Are No Red Guards
Commentators like to blame collectivism and poor values for seniors’ supposed bad behavior, but the real culprit is a reform movement that left them in the cold.

Baidu sues Bytedance and Maimai over defamation and copyright infringement
Chinese tech giant Baidu has filed a RMB 5 million (around $735,000) lawsuit against Bytedance and the operator of professional networking platform Maimai for defamation and copyright infringement.

Baidu sues Bytedance and Maimai over defamation and copyright infringement

Chinese film industry coughs up US$1.7 billion in back taxes after Fan Bingbing scandal triggers crackdown
Figure represents almost a third of China’s box office revenue in 2018 Investigation yielded good results, tax authorities say

China’s online healthcare market to exceed 20 billion yuan in 2019
China’s online healthcare market is estimated to reach 17.7 billion yuan with a YoY growth of 19.8% and will grow to 20.4 billion yuan in 2019 according to data from iResearch. B2C medicine e-commerce contributes the largest share of the total market size (89.2% in 2017), followed by advertising revenues.

E-Commerce App Loses ‘Tens of Millions’ From Coupon Glitches
Pinduoduo says technical flaws allowing users to access an unlimited number of coupons have been repaired.

China’s military overhaul likely to raise neighbours’ concerns over improved offensive capabilities
Move away from defensive focus – as seen in downgrading of land army – likely to trigger concerns about growing assertiveness in areas like the South China Sea Regional powers expected to react to PLA’s greater offensive capabilities by boosting their own forces

Chinese university fires scientist who modified baby genes
The Southern University of Science and Technology in the Chinese city of Shenzhen has fired He Jiankui, the scientist who stunned the world last year after announcing he had created gene-edited babies. The university said in a statement on its website that it will “rescind the work contract” with the researcher and terminate his teaching and research activities at the institution.

Briefing: Chinese university fires scientist who modified baby genes

When Chinese Millionaires Give Gifts, What Brands Win?
In China, it’s nice to have a friend who is a millionaire. A study by Hurun Research Institute released last week showed that the favorite gift-giving brands of 465 Chinese millionaires in 2018 included Cartier, Chanel, and Dior.

When Chinese Millionaires Give Gifts, What Brands Win?

Luxury Brands Push the Pig In Chinese New Year Campaigns
In many cases this year, brands seem to be learning from past mistakes. Compared to 2018 (The Year of the Dog), when several fashion and jewelry houses’ Chinese New Year collections were mocked as gaudy, kitschy or featuring poor design, it seems easier to depict the vibe of the Pig Year

Luxury Brands Push the Pig In Chinese New Year Campaigns

Europe’s Future Is as China’s Enemy
The continent can save NATO—but only if it takes Washington’s side in its growing struggle with Beijing.
Europe’s Future Is as China’s Enemy

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