China Press Review – July 13, 2020

Press review

China economy rebounds in Q2 after virus hit: AFP poll
China returned to growth in the second quarter after the coronavirus pandemic handed the world’s second largest economy its first contraction in decades, according to an AFP poll of analysts.  The survey of analysts from 11 institutions pegged China’s growth at 1.3 percent — a far cry from the 6.1 percent expansion posted last year but in better shape than other countries still grappling with the contagion.

If it’s goodbye to Chinese goods, then it’s hello to runaway inflation
Consumers in developed economies like the US, Britain and Australia say they’re willing to pay more to lessen reliance on China   The true cost of that stance may come as a surprise   In sum, if we want to buy from local manufacturers, and pay a higher price accordingly, we will presumably consume less and expect the things we buy to last longer. Meanwhile, in the short term, the cost of logistics is unlikely to fall back to pre-Covid-19 levels. Combined, these factors will push up the underlying price of finished goods over the long term and drive inflation sharply higher in developed economies.

Busy with coronavirus bailouts, the world has taken its eyes off the looming debt crash
The global debt crisis racked up in the decade before the pandemic has not gone away and, together with the added burden from bailouts, could crush banks and leave many companies without a financial lifeline

Is China the ‘greatest threat’ to the United States?
Americans, Washington is a far greater threat to your own health and life, your wallet and your children’s future than anything we Chinese can do to you

US national security adviser O’Brien heading to Europe for talks on China
Robert O’Brien and Matthew Pottinger will meet with counterparts from the United Kingdom, France, Germany and Italy     Talks will focus on the West’s competition with China across a variety of areas, including 5G

China will punish Britain for defying its will. We need allies to hold the line
Threats of reprisals over help for Hongkongers and refusing 5G technology should be taken very seriously

Huawei is being swept up in the tide of history as China turns away
The path towards divergent technological poles in geopolitics is set, but warnings of a major 5G setback ring false

Will Huawei’s woes open the door for new 5G challengers?
Strict US sanctions are blocking the world-leading tech company from key components   A number of APAC markets have heavily restricted Huawei’s technology in their infrastructure or have banned it entirely    The disadvantage could leave a gap for other competitors to race ahead

5G Risk? Huawei Is Small Potatoes Compared To TSMC (Who?)
If Huawei were to disappear tomorrow, it would disrupt but not derail 5G. If TSMC were to disappear, or be neutralized, it would cripple 5G and many other facets of the digital economy. Could this happen? Well, it’s not earthquakes that could neutralize TSMC. In Taiwan, they’re watching the news, like all of us. They know it’s pretty much only the 7th fleet that stands between them and the CCP goons now taking over Hong Kong.

UK government to make Huawei statement on Tuesday
British minister Oliver Dowden will make a statement to parliament on Huawei some time after 1130 GMT on Tuesday, the opposition Labour Party said on Twitter.Britain is set to ban Huawei from Britain’s 5G network in a landmark decision that will anger Beijing but win plaudits from President Donald Trump as the United States grapples with China’s rising economic and technological clout.

More US action on TikTok, WeChat to be expected, White House adviser says
The Trump administration is ‘just getting started’ with the two apps, said White House adviser Peter Navarro on Sunday    He indicated that even if TikTok is sold to an American buyer, it would not solve the problem

Hong Kong: German minister defends China ties
China’s so-called Hong Kong security law sparked outcry with many fearing it will infringe on human rights. Germany won’t sever its trade relationship with China over it, says Economy Minister Peter Altmaier.

Donald Trump hints lack of interest in a phase two US-China trade deal
President says relationship between Washington and Beijing is ‘severely damaged’    The comments come one day after his top trade negotiator could not say with certainty what the purpose of the two-year-old trade war was supposed to be

Why the US should emulate China’s production at home rather than trying to undercut its economic progress
We should not allow economics to become hostage to geopolitics or, worse, to reinforce and magnify the strategic US-China rivalry    The West’s objective should be to build more productive, more inclusive economies at home – not simply to outcompete China

In battle for WTO leadership, the real fight is against paralysis of the global trade system
In the face of US-China tensions, Trump’s ‘America First’ unilateralism and the economic maelstrom whipped up by Covid-19, the WTO’s new leader will be challenged to lead the charge in championing the benefits of multilateralism and free trade

How the coronavirus is turbocharging Hong Kong’s fintech revolution
Forced to adapt quickly, Hong Kong’s banking and financial services industry has hastened its adoption of digital transformation and AI in the name of survival, supported by a rapidly evolving regulatory environment

China’s Hainan free-trade port plan draws approval, and scepticism, as questions linger over implementation
Chinese businesses are heading to Hainan after Beijing last month unveiled plans to turn the island into a ‘free-trade port’    But some investors and locals are taking a wait-and-see approach, wary that government promises may not translate into real rewards

China bets on Hainan duty-free shopping mecca to boost spending at home
China has increased duty-free shopping limits for mainland tourists visiting Hainan as part of its free-trade port plan    Beijing hopes it can transform the island into a shopping hub that will compete with centres in Japan and Europe

Hong Kong will stay China’s financial gateway to the world, former top banking official says
Liu Mingkang, one-time chairman of the CBRC, says the rule of law and personal freedom are foundations of the city’s status      Greater Bay Area needs to improve financial infrastructure and joint oversight, he says

Trade, deglobalisation and the new mercantilism
The COVID-19 pandemic is accelerating changes underway since the global financial crisis (GFC) in 2008. It is ushering in a new era of deglobalisation and protectionism — a new mercantilist world order. Three global shifts will likely shape international trade beyond the immediate crisis and into the ‘post-vaccine’ future.

In Trump, China has an adversary who’s not afraid to push back – even if it means economic pain
Communist Party leaders have overplayed their hand by tightening control over Hong Kong with a national security lawvTrump and his senior advisers not only believe in the law of the jungle, but are also unafraid to wield raw power against their foes
Minxin Pei

Who wins, who loses in China’s plans for a Greater Bay Area wealth management hub?
Banks with large retail market share on the mainland and offshore likely to be beneficiaries
Boutiques, brokers and insurance companies seen missing out

China zeroes in on coronavirus goal but pandemic divides world, experts say
Chinese epidemiologists give their views on why the mainland approach was successful but would not work in democracies     Communication between leadership and scientists key part of response, in country with limited public health system

Scientists hope WHO China visit will throw light on early Covid-19 probes
Questions remain for many international experts about initial Chinese investigations into origins of the new coronavirus    World Health Organisation investigators to lay the groundwork for mission to trace animal roots of deadly pandemic

Who, when, where? No word on WHO experts’ coronavirus trip to China
Two specialists were in the Chinese capital on the weekend to talk terms of a bigger mission into the origins of the pandemic    Much will depend on how much access the investigators are given to data and a laboratory in Wuhan, observers say

The battery billionaire who holds the key to Tesla’s future in China and Elon Musk’s global electric-car dominance
Zeng turns Amperex into a US$17 billion fortune from a US$30-a-month job with state-run company    His company will supply battery to Tesla’s Made-in-Shanghai electric vehicles from this month

Chinese EV startup Li Auto files for US IPO
Li Auto on Friday announced it had filed an application with the US regulator to offer shares on Nasdaq, making it the second Chinese electric vehicle maker to list on the US stock market after Nio.

China sharpens economic espionage penalties in ‘tit-for-tat provision’ against US accusations of trade secret theft
Proposed section of criminal code targets theft of trade secrets by foreign entities, as US cases against Chinese nationals soar    Draft of the law, which is out for review until August 16, has flown under the radar until now

Chinese super regulator calls for crackdown on ‘cancer’ of fraud in capital markets
Financial Stability and Development Committee sets out seven measures to eliminate fraudulent activity     Committee acknowledges ‘shortcomings in China’s financial system design and the subsequent low cost of committing a crime’

Can Brands Tap Into The Rebellious Gen-Z “Tea Art” Trend?
A new makeup style in China called Tea Art is turning a derogatory internet catchphrase upside down, but can brands take advantage of this trend?  Tea Art is the next highlight in Jing Daily’s new series, What Gen- Z Wants, which reports on the booming Gen-Z luxury consumer in China. The series analyzes microtrends and styles that are contributing to the empowerment of young Chinese fashion communities.

Today’s Luxury Brands
Luxury brands must focus on digital mastery today to create extreme value for customers because the world will move on with or without them   Consumers don’t just follow brands anymore. They want to immerse themselves in a brand’s content, stories, and inspirations. When Christian Dior and Nike announced the drop of their Dior x Air Jordans, more than 5 million people wanted to buy the sneakers at a price point of over $1000. Only a few thousand pairs were made, and many were offered to Dior’s best customers around the world first. Yet all the shoe’s hype was digital, almost entirely lacking the benefit of offline foot traffic, which was mostly impossible due to lockdowns.

In China’s manufacturing hub of Dongguan, a sock maker struggles to keep his factory from folding
STo be fair, the decline in China’s low-end manufacturing sector and its exports started long before the coronavirus outbreak, as the nation has been gradually losing its traditional low-cost advantages. The Chinese government has also been pushing businesses to move up the global supply chain for many years. About a decade ago, Guangdong province rolled out a policy of “emptying the cage for new birds” – meaning kicking out low-end factories to make room for hi-tech businesses.

Hong Kong’s Hang Seng Index went from bear to bull in just over three months. What stock investors need to know now
Excitement is building about the city’s stock market: money is pouring in; 24 companies plan to list this monthRed hot new economy stocks could be heading for a correction, analysts warn

Chinese investors borrow most money in five years to buy stocks as bull market charges on
The outstanding balance of margin trading on the mainland’s stock exchanges rose to 1.3 trillion yuan (US$185.9 billion), the most since August 2015     Bocom International’s Hong Hao says stocks are still cheap relatively to bonds, meaning rally won’t end any time soon

The Next Frontier for Mind-Blowing AI: Esports
For now, the world’s top gamers can still beat the most sophisticated bots — but the tide may turn in as little as three years, according to a former StarCraft II champion.

Battered by Historic Floods, Jiangxi Goes Into ‘Wartime Mode’
The water level of China’s largest freshwater lake is at an all-time high, and a nearby island is asking locals working elsewhere to return and help with flood control efforts.

Covid-19 Unmakes China’s Belt and Road Initiative
China’s flagship global projects under the banner of Belt & Road Initiative (BRI) are coming under increasing scrutiny worldwide, including even in countries such as Pakistan where worth billions of dollars of ventures under the China-Pakistan Economic Corridor (CPEC), have already become fully functional.

China Has Never Liked Playing by Other People’s Rules
From the time of the earliest emperors, its leaders would incur great costs and surrender tangible benefits to return to supremacy. Arguably, no country in the world has benefited more from the U.S.-led global order than China. Yet, to many eyes, Beijing seems determined to upset that order, its principles and its institutions.Some would argue that such ambition is only natural in a rising power, one that played little role in writing the rules by which it’s now expected to adhere. In fact, at least some of the roots of China’s discontent with the current order run much deeper — back to the earliest emperors more than 2,000 years ago. Throughout history, Chinese leaders have rarely liked playing by other people’s rules. For centuries, there was little need to do so. Ancient Chinese statesmen perceived the world as a hierarchy, with the Chinese atop a pyramid of peoples. In order for foreign kingdoms to share in the wonders of Chinese civilization, they had to send tribute to acknowledge the superiority of China and its emperor.   Still, many Chinese leaders appear to see the U.S. system as a foreign imposition that has relegated them to, in effect, a subordinate position in the world, besieged by alien ideals and norms. If they are not looking to overthrow that system entirely, they would like to clear out space to rule as they see fit — whether that means cracking down on the pro-democracy movement in Hong Kong or demanding obeisance from smaller neighbors.  “Long gone are the days when we [in] China had to takes cues from others,” a senior Beijing official recently said. This is deeply risky. The Chinese economy still badly needs the West for technology and job-creating investment. China’s actions are prodding countries from Australia to India to resist its climb. China’s rulers aren’t likely to be dissuaded, though, if history is any guide.

Global Impact newsletter: Australia’s political risks from provoking the dragon that is China
Global Impact is a fortnightly curated newsletter featuring a news topic originating in China with a significant macro impact for our newsreaders around the world    In this third edition we will explore how national sensitivity over the origin of the coronavirus pandemic has led to an escalating war of words and sanctions between China and Australia.

Decode China: US backs Chinese-language news site in Australia as battle of the narratives heats up
Decode China will operate under an arrangement with the US Department of State and the London-based Institute for War & Peace Reporting    The venture has been linked to critics of Beijing and comes amid tensions over Hong Kong, trade and claims of spying

As China grows more aggressive, Australia needs to turn its attention to our vulnerable neighbours
But Penny Wong’s point is correct: while there is already so much to do, we need to be escalating our attention on, and aid to, our vulnerable near neighbours.    If we don’t, someone else will. And that could leave us even more alone

Is China really behind a malicious plot to buy up Australia’s water?
Fraying diplomatic ties between Canberra and Beijing have led to talk of conspiracy, but China owns just 1.9 per cent of Australia’s water market     While experts call for more transparency over water ownership, they say it is more important to know how much there is and what it is being used for

South China Sea: Beijing extends its military and economic reach
China has dramatically increased its defence budget over the past 10 years. Plus, Nigeria prepares to export gas.

US military South China Sea moves are ‘futile and its allies risk harm’: Chinese colonel
Chinese navy researcher says ‘US double standards cannot disguise its real motives’ on disputed territory in one of Beijing’s public posts about the issue    China’s Southern Theatre Command used social media to try to sow doubt about US loyalty to allies such as India

China-India border row: why Narendra Modi won’t let fire and fury ignite a war
Modi has taken an aggressive stand in the bloody territorial dispute but he will not risk an all-out conflict, observers say    The anti-China protests and the tough talk do not reflect broader public sentiment or the realities of a military campaign, they say

New Delhi still hesitates to take side in China-US rivalry despite deadly border clash
Fears of becoming a subordinate ally to the United States have so far kept India from fully embracing the US’ Indo-Pacific strategy  ‘China’s strategic goal is to stabilise relations with India in order to prevent the US wooing it away and avoid a two-front war,’ analyst says

Why India and China’s latest dispute could cost both sides greatly
Tensions are running high following last month’s deadly clash in the Himalayas and calls are mounting for a boycott of Chinese goods.    But China has invested billions of dollars in India, which also relies heavily on imports from the world’s second biggest economy

China ‘bigger threat to India’ than Pakistan: Sharad Pawar
Amid the border tension with China, NCP President Sharad Pawar has said China is a “bigger threat to India” than Pakistan. China’s military might is “ten times greater” than India, the former defence minister said, adding that Beijing has “weaned away” India’s neighbours to its side.

EU foreign ministers discuss measures over Hong Kong national security law
Sanctions against city’s officials are unlikely, but study and asylum schemes could be expanded for Hongkongers who want to leave  Extradition treaties could also be suspended, according to EU diplomat

Does British backlash await Hong Kong national security law migrants?
Several think tanks in Britain have warned sudden influx of Hongkongers could put pressure on public services       Nearly 3 million people could qualify for pathway to citizenship

Will Chinese students study abroad post-COVID-19?
Western universities are confronting the looming challenge that students from mainland China may no longer desire to study abroad after COVID-19. To continue attracting Chinese and other international students, host universities will need to show that they care about the wellbeing of the students. But if student numbers stay low post-COVID-19, they will have to adapt and implement different strategies.

Rubio and Cruz hit with tit-for-tat China sanctions
China has announced sanctions on top Republicans after the US imposed sanctions on Chinese officials for alleged human rights abuses

Chinese Communist Party critic Xu Zhangrun released after week in detention, sources say
Tsinghua University professor returned to his Beijing home on Sunday morning and is now resting, friend says     Xu, who criticised China’s leaders for their handling of the coronavirus outbreak, was taken into custody on Monday

Role of Liege Airport in Covid-19 relief effort recognised by King Philip of Belgium
His Majesty King Philippe of the Belgians paid a visit to Liege Airport to thank the staff and key partners for their efforts in enabling the efficient distribution of medical supplies to Belgium and across Europe during the Covid-19 pandemic, and the vital role of logistics to support Belgium and Europe’s economic recovery. During his visit, King Philippe participated in a roundtable discussion with representatives of key partners of Liege Airport, including Alibaba Group. The King expressed warm appreciation for the efficient distribution and logistics capabilities of Alibaba’s eWTP Hub and Liege Airport. “During this unprecedented crisis, Belgium, and especially Wallonia, played a crucial role as the hub for distributing vital personal protective equipment, including more than 1 billion protective face masks, to the most affected European countries through Liege Airport. This rapid mobilization was made possible thanks to existing direct transport lines with China in Belgium which were established as part of Alibaba’s eWTP hub at Liege Airport.The Alibaba Foundation and the Jack Ma Foundation were able to activate this logistics network quickly and efficiently at the beginning of the crisis to deliver urgently needed donations of PPE, and it was a determining factor in the WHO’s choice to place Liege on the map of the world’s emergency relief hubs, as underlined today by HM King Philippe during his visit”, said Michel Kempeneers, COO Overseas of Wallonia Export- Investment Agency

Alain Gillard
Information Officer
Service Asie Pacifique
Place Sainctelette 2
1080 Bruxelles
Tél 02 421 85 09 – Fax 02 421 87 75
Copyright © 2020 awex, All rights reserved