Belgian-Chinese Chamber of Commerce (BCECC)

China Press Review – June 28, 2021

China’s economy seems to have peaked for the year. Is a rapid slowdown on the cards?
Major industrial activity indicators in May were disappointing and consumption recovery seems to be fizzling out. Bad news on the growth front is good news for the policy outlook, however, with monetary tightening likely to be gradual.

The “reverse migration” is taking hold up in China as the workers leave big city
For the majority of workers who they are less educated, moving to smaller towns or back to the countryside can he reduce cost of living. But wages are lower, contributing to growing income inequality in China.   Analysts with Chinese investment bank CICC said in a report this month that in low-end work market, both unemployment rate is in looking for work rate they have increased since the pandemic, reflecting a disconnect between employers and workers.Official data showed that while unemployment rate – based on a survey of urban residents only – ticked below 5% in By May, cities had created 230,000 jobs in less for the year so far compared to the same period in 2020.    The statistics bureau did not provide a updated figure on migrant workers at his latest press conference this month.

China’s economy grew by 189 times in 70 years: CPC official
China’s economy has grown by 189 times over the past 70 years since the founding of the People’s Republic of China (PRC), a Chinese official said Monday at a press conference in honor of the 100th anniversary of the founding of the Communist Party of China (CPC).

Fitch Affirms China at ‘A+’; Outlook Stable
China’s ratings are supported by the country’s robust external finances, a record of strong and resilient macro performance, and size as the world’s second-largest economy. The ratings are constrained by fiscal and macro-financial stability risks associated with China’s highly indebted non-government sector, and per capita income and governance scores that fall below ‘A’ peers.  The Chinese economy has entered a mature stage in its pandemic recovery, following the country’s early success in virus containment. Real GDP surged by 18.3% yoy in 1Q21 (0.6% qoq seasonally adjusted), from 6.5% yoy in 4Q20, in part due to the base effect from last year’s shutdown. Activity indicators have been mixed since then, but broadly point to somewhat slower domestic demand, counterbalanced by still-strong export growth and manufacturing production amid the global economic rebound. Fitch forecasts GDP growth of 8.4% in 2021 (2020: 2.3%) and 5.5% in 2022, which will continue to position China among the world’s top performing economies.

How China became the big winner of the COVID era
US is buying even more goods from China than it did before the pandemic   Overall, U.S. goods exports to China averaged $11.6 billion per month in January-April, up 38% from the same period in 2019.   The U.S.-China goods trade balance (exports minus imports) averaged minus $26.1 billion in the first four months of this year — slightly better than in January-April 2019, pre-COVID, due to the higher U.S. exports.   As for the effectiveness of the Trump administration’s tariffs, which have not been reversed by President Joe Biden, the average goods trade balance was minus $25.5 billion in January-April 2016, before Donald Trump’s election.  In the same period this year, the balance was 2% higher, in favor of Chinese exports to America.

Digital vaccine passports: how blockchain and QR codes can revive international travel if regulation can catch up
To jump-start travel after the pandemic, a number of digital health passes – sometimes called vaccine passports – are now emerging around the world  Cryptographic technologies, such as digital signatures and blockchain, are being used to ensure that health records are authentic, secure and private

Back in Barcelona, telecoms bosses stake claim to digital future
– Telecoms bosses toasted the return of Barcelona’s Mobile World Congress on Monday with an agenda to put the industry at the centre of digital development and inclusion in a global reboot following the coronavirus pandemic

China’s cyber power at least a decade behind the US, new study finds
China’s strengths as a cyber power are being undermined by poor security and weak intelligence analysis, according to new research that predicts Beijing will be unable to match US cyber capabilities for at least a decade.The study, published on Monday by the International Institute for Strategic Studies, comes as a series of hacking campaigns have highlighted the growing threat of online espionage by hostile states.

US remains the world’s dominant power in cyberspace but China is catching up, report says
The IISS report assessed 15 countries’ core intelligence powers, leadership in global cyberspace affairs, security and resilience as well as offensive capabilities      US has been building dominance in cyberspace since the 1990s, and its power has been amplified by intelligence-sharing networks such as the Five Eyes alliance

Accounting for 40% of Entire Chinese Economy    Digital Economy of China Growing Very Fast
China’s digital economic environment is growing faster than those of most advanced economies, based on the Chinese government’s intensive strategic investment. At present, digital economy accounts for approximately 40 percent of the entire Chinese economy, which is the highest in the group of emerging economies. As of 2019, China came in seventh in the world, with Germany at the top and South Korea coming in fourth.

US-China tech war: how one dumped Apple supplier’s fate shows the pain of global supply chain politics
Ofilm was kicked off Apple’s supplier list over allegations that it was involved in a programme that transferred ethnic minorities from Xinjiang to work       Most of the workers the Post spoke to were from Jiangxi, not Xinjiang

US-China tech war: Huawei founder Ren Zhengfei tells his employees to learn from the United States
A recently published speech that Ren gave in May emphasised the need to keep expanding outside China    Ren warned against isolation and said the company has much to learn from the US in science and technology…Massimiliana

US-China tech war: mainland universities rush to expand semiconductor programmes in drive for self-sufficiency
China’s Ministry of Education has made semiconductor science and engineering a priority academic programme    That has encouraged more universities across the country to establish new schools dedicated to the field related to integrated circuits

US-China tech war: AI, semiconductors get quasi-military commanders as ‘supply chain chiefs’ to boost self-sufficiency
Local governments in China have taken to appointing ‘supply chain chiefs’ to oversee hi-tech industries such as artificial intelligence and semiconductors     The effort has not been officially endorsed by Beijing, but President Xi Jinping’s adviser Liu He was recently put in charge of national chip development

US-China relations: American efforts to reshore supply chains blasted as ‘empty talk’ by former minister
Wei Jianguo, a former vice commerce minister, says the US will become increasingly dependent on China in economic and trade terms in the next five years    Despite worsening relations in many spheres, China’s trade surplus with the US rose to US$31.78 billion in May from US$28.11 billion the previous month  “There is no longer a belief in the US that China’s end goal is the same as that of the US – that’s integrating into the world order,” he told the event hosted by AmCham China last Thursday.   “Over the last few years, particularly during the second half of the Trump administration, it was clear that the Chinese leadership began to question whether or not the US government saw the Chinese leadership as legitimate or wanted the Chinese leadership to succeed.”But he said the latest moves by Beijing and Washington to resume talks showed the two countries were entering a phase where things are more or less steady. “People are seeing a real attempt by the two countries to define a new normal … so that there can be more predictability,” he said.

China’s Envision Group to build US$2.4 billion battery plant for Renault in France
French President Emmanuel Macron is expected to unveil the agreements on Monday at Renault’s assembly plant in Douai    Envision’s plans for the Douai site could also go beyond Renault, said the greentech company’s CEO Lei Zhang

China turns on world’s first giant hydropower turbines
Two of the giant Baihetan station’s 16 one-gigawatt generators have started full operation after a three-day trial     President Xi Jinping says the achievement is a breakthrough for the country’s high-end equipment manufacturing

How hydrogen combustion engines can contribute to zero emissions
Hydrogen combustion engines can leverage existing technologies and provide a zero-emissions option for specific use cases while supporting the growth of hydrogen infrastructure.

Shandong’s first intercity hydrogen trunk line starts
The first intercity hydrogen trunk line in Shandong Province, which was successfully developed by Qingdao International academician port, started simultaneously in Qingdao International academician port Intelligent Manufacturing Industrial Park and Linyi road transportation port intelligent logistics equipment industrial park. This activity will start 170 hydrogen energy cold chain logistics vehicles and slag trucks at one time, which can reduce carbon dioxide emissions by nearly 20000 tons every year.

SK Group Aiming to Become World’s No. 1 Hydrogen Player
SK is preparing to build the world’s largest hydrogen production base to prepare an ecosystem for a hydrogen economy. It plans to supply a total of 280,000 tons of eco-friendly hydrogen by building the world’s largest liquefied hydrogen plant by 2023 and a clean hydrogen production base that removes carbon dioxide by 2025. It also set a goal of targeting Asian hydrogen markets such as China and Vietnam as well as Korea.

China’s Automaker Great Wall Aims To Sell 4 Million Cars In 2025 0  20 1
Great Wall, which sold 1.1 million cars last year, aims for 80 per cent of its annual sales in 2025 to be new energy vehicles, including battery-electric, plug-in hybrid and hydrogen fuel cell vehicles.

Luxury’s Post-Pandemic Playbook
When brands want growth, they are tempted to expand distribution and promote items. But a better idea is to follow the post-pandemic luxury playbook. Since Prada and Bottega Veneta have been stellar examples of brands that initiated a strong turnaround, excited their customers all over the world, and gained enormous traction with younger target groups, there is clearly a strong correlation between improving desirability and the ability to reduce or entirely discontinue promotions.  Hermès, Louis Vuitton, Dior, and Gucci were among the most successful luxury brands during Q1 2021. These brands do not ever discount and keep incredibly tight control over their distribution, fostering the ability to exercise full control over the brand’s storytelling, which generates trust.   The ability to create desire over time depends on becoming an agent of innovation, change, and influence so you can connect with the most influential target group: Generation Z.

Is Nike Losing The Race In China?
Nike delivered record results thanks to high revenues in the North American market, but it should be concerned about its China strategy

TikTok insiders say social media company is tightly controlled by Chinese parent ByteDance
Former TikTok employees say there is cause for concern when it comes to the popular social media app’s Chinese parent company. They say ByteDance has access to TikTok’s American user data and is closely involved in the Los Angeles company’s decision-making and product development.   Some cybersecurity experts worry that the Chinese government could use TikTok to spread propaganda or censorship to American audience, or to exercise influence over users who may come to regret what they posted on the service.

China is now second largest export partner of India
China replaced the UAE as the second largest export destination for India in fiscal 2021, with outbound shipments to the neighbouring country rising 27.53% to $21.18 billion in the pandemic year

China’s chip champion SMIC offers executives US$3.7 million in shares in effort to retain semiconductor talent
As part of a discounted shares scheme covering a quarter of SMIC employees, two top executives from TSMC and company chairman were each offered 400,000 shares     SMIC is considered China’s best hope at achieving self-sufficiency in semiconductors, but US sanctions and a talent shortage have made it a difficult goal

Mainland China and Taiwan propel semiconductor investment frenzy as Singapore and Japan join the game
The massive investment in chip manufacturing in Asia comes amid a global supply shortage due to rising demand for chips to power 5G devices and smart vehicles     Ramp up also comes as governments move to secure chip supply chains amid an escalating tech war between China and the US

Safety ‘recall’ of 285,000 Teslas in China
Over 285,000 Chinese cars manufactured by Tesla–which includes more than 90% of Chinese-made sales–require an update to address safety issues, reported the Wall Street Journal.    According to the WSJ, the State Administration for Market Regulation called for a recall which means affected Tesla vehicles require a cruise-control software update. This update can be carried out remotely and does not require a visit to a dealership.     The recall is necessary to fix a fault that means that the cruise-control system could be activated accidentally and potentially result in an unexpected speed increase, the regulator said.    The recall includes 249,855 Model 3 sedans and Model Y compact crossover vehicles manufactured by Tesla’s Shanghai plant, as well as 35,665 imported Model 3 cars, it said.

China Adds A Vaccine Billionaire
China, home to one of the world’s largest pharmaceutical industries, added a new billionaire from the field on Friday.  Shares in vaccine maker Changchun BCHT Biotechnology rose by 226% from their IPO price on debut on the STAR board at the Shanghai Stock Exchange to close at 118.5 yuan. That left President Kong Wei’s 25% stake worth 12 billion, or nearly $1.9 billion

Why Hong Kong is the ideal global hub for family offices
For decades, Hong Kong has been a popular investment platform for ultra-high net worth individuals    The city is now making a concerted effort to attract even more family offices, with Asia – and mainland China in particular – experiencing rapid growth in the number of very wealthy residents

Coronavirus: China hits goal of vaccinating 40 per cent of population before end of June
More than 1.12 billion doses have been administered and 630 million people inoculated  For now, with variants circulating, social distancing, mask mandates and closed borders are still considered crucial to preventing major outbreaks

China’s investment in new Silk Road countries exceeds $130 BILLION
The volume of direct investments by Chinese companies in the economies of the countries participating in the Belt and Road Initiative have continued to grow rapidly, according to Chinese Foreign Minister Wang Yi.  “Over the past eight years, the Belt and Road Initiative has turned from a sketch into a reality, providing tremendous opportunities and bonuses to countries around the world,” the Chinese Foreign Ministry’s website quoted him as saying on Thursday at a video conference on cooperation within the framework of the initiative in the Asia-Pacific region.    “The aggregate trade between China and the countries participating in the One Belt, One Road initiative has exceeded $9.2 trillion. Direct investments of Chinese companies in the countries of the project have exceeded $130 billion,” Wang said.

Chinese military steps up training along disputed Indian border
A military spokesman said the People’s Liberation Army recently conducted a ‘record-breaking’ high-altitude drill      Indian media has reported that Beijing is recruiting local Tibetans to form militia units

British, US China hawks call for ‘Nato for trade’ against Beijing
Group would retaliate as one to economic coercion from China aimed at any member, proponents say   But analysts say idea could be undermined by competing commercial interests and problems mounting joint action

China-Australia trade is still growing despite covid
China made a grave threat to Australia but new figures show that Beijing isn’t sticking to it – and we’re reaping huge rewards.

Why is China so misunderstood? Here are 2 reasons
The focus on China’s megacities can blind observers to the policy experimentation done at lower levels and in the country’s interior    Meanwhile, far too many China ‘experts’ have been focused on trying to change China than understand how it works and why it succeeds

Beijing seems unlikely to rein in its aggressive Wolf Warrior diplomats
The defiant style of diplomacy mirrors Chinese leader Xi Jinping’s personality and policy priorities, analysts and former emissaries say   ‘In the end, you’re selling your country’s foreign and domestic policies. When the product stinks, there’s only so much you can do’

Washington’s Dangerous New Consensus on China Bernie Sanders
Don’t Start Another Cold War    Americans must not be naive about China’s repression, disregard for human rights, and global ambitions. I strongly believe that the American people have an interest in strengthening global norms that respect the rights and dignity of all people—in the United States, in China, and around the world. I fear, however, that the growing bipartisan push for a confrontation with China will set back those goals and risks empowering authoritarian, ultranationalistic forces in both countries. It will also deflect attention from the shared common interests the two countries have in combating truly existential threats such as climate change, pandemics, and the destruction that a nuclear war would bring.     Developing a mutually beneficial relationship with China will not be easy. But we can do better than a new Cold War.

podcast : What is the weak spot of China’s economy?
The number of working-age people in China is shrinking, which could threaten the country’s rise as an economic superpower

Developing Your China Trade with Japan and South Korea Under RCEP
China’s tariff commitments to Japan and South Korea under RCEP is expected to boost their bilateral trade flows and create multilateral trade opportunities.   In November 2020, China, the 10 ASEAN members, Japan, South Korea, New Zealand, and Australia signed the long-awaited Regional Comprehensive Economic Partnership (RCEP) Agreement.  While most signatory countries have existing free trade agreements (FTAs) with each other – even prior – the RCEP’s multilateral agreement is the first ever FTA between China and Japan as well as between Japan and South Korea. Thus, the conclusion of the RCEP agreement also raises hopes for a trilateral free trade deal between these three East Asian economies, which has been under negotiation for as long as the RCEP.   China, Japan, and South Korea, as the world’s second, third, and 12th largest economies, respectively. Together, they account for more than 80 percent of the total GDP of the RCEP region and nearly 70 percent of the total population of the RCEP signatory countries.

China’s rebounding coal price set to fall after Communist Party centenary celebration, says top economic planner
Coal output is expected to recover as idle capacity is resumed, while current orders suggest imports will peak in July and August   The National Development and Reform Commission (NDRC) said a ‘relatively large’ drop in China’s coal prices may follow in July

A critical juncture in the China-US contest in Southeast Asia
Celebrations for the Fourth of July in the US and the Chinese Communist Party’s centenary will intensify the clash of narratives among the competing powers seeking greater regional engagement    In high-level diplomacy, Covid-19 vaccine supply, infrastructure and trade, China has made much headway

China-US tension: Beijing will not engage in intense ideological war with Washington, says expert
Tsinghua University academic Yan Xuetong says it’s impossible for China to return to the ‘low-profile’ foreign policy of the Deng Xiaoping era   ‘China has clearly indicated that it does not attempt to export its ideology and values,’ Yan tells Beijing seminar

Communist Inc: The Pandemic and China’s World
The Communist Party of China will celebrate the 100th anniversary of its founding this July. This marks the first significant milestone in Chairman Xi’s “China Dream”, a project that will ostensibly culminate in 2049, the 100th anniversary of the founding of the People’s Republic, with associated aspirations of China cementing its position as a global power. In our book, Pax Sinica, we had detailed three instruments that are crucial to these ambitions: Leadership over global institutions and processes, a conducive environment for achieving “discourse power”, and the construction of new international coalitions. China seeks to control global institutions and rule-making processes, grease and dominate the media and public sphere into a favourable disposition, and enter into perverse partnerships with other nations, described as a “loan for sovereignty” arrangement in one of its avatars.     The onset of the pandemic has made many of these strategies more visible, even as it highlighted the opportunities and challenges that lie ahead for China.

The Communist party at 100: is Xi Jinping’s China on the right track?
Last month a senior official from China’s education ministry addressed more than 100 government colleagues and scholars at a closed-door event to discuss the centenary of the establishment of the Chinese Communist party, which will be officially marked with great fanfare in Beijing on Thursday.

Confucius called it xiaokang, and it is worth celebrating in a well-off China
With the goal of xiaokang likely achieved, the party will turn its sights to building up China as a ‘powerful socialist country’ by 2049     Chinese people are living a life that could have only been dreamed about one or two generations ago  While there is no denying China’s development in the past, there are various arguments about why China has been able to achieve it. Beijing attributes the achievement to the leadership of the Communist Party. As the argument goes, it is the leading party that offers the vision which holds the country together. The implications derived from these arguments can be very different.   One thing is for certain: China’s future policy will hinge on pragmatism, not ideology, even though China will probably keep hitting back at criticism of its model. With the goal of xiaokang achieved, the party will turn its sights to the next centenary goal, or building up China as a “powerful socialist country” by 2049, when the People’s Republic will celebrate its 100th anniversary. One big task is achieving “common prosperity”. China, with a socialist hat, has created one of the widest wealth gaps. This is a source of social tension, and Beijing is expected to distribute wealth more evenly. For the super-rich, they have got the message that they must contribute more to society. For the general public, especially the have-nots, the coming years can be better as the state turns its attention to them. As such, a xiaokang China is also worth celebrating.

As the Communist Party turns 100, Xi Jinping has a problem: who will take over?
With no clear successor in sight, Chinese leader is expected to stay in power beyond two terms  Next year’s leadership reshuffle will shed light on how he plans to tackle succession

What is China’s Communist Party planning for the centenary day?
In the countdown to July 1, some signs have emerged in the capital and online of what the anniversary might bring   With the country facing internal and external challenges, a major policy announcement may not be in the offing, analyst says

Chinese system is the ‘cat that catches most rats’, says Communist Party ahead of centenary celebrations
A white paper extolling the merits of the political system, which enshrines the CCP’s primacy, says it is a major contributor to humanity      Senior official praises the country’s ‘magnificent achievements’ and says it has avoided the problems caused by a multiparty system

China’s super heavy rocket to construct space-based solar power station
China plans to use a new super heavy-lift rocket currently under development to construct a massive space-based solar power station in geostationary orbit.   Numerous launches of the upcoming Long March 9 rocket would be used to construct space-based solar power facilities 35,786 kilometers above the Earth, according to Long Lehao, chief designer of China’s Long March rocket series, speaking during a presentation Thursday in Hong Kong.

China’s latest mega-airport is officially open
China’s long-awaited Chengdu Tianfu International Airport has officially begun operations, offering travelers a new gateway to the home of giant pandas.    Its inaugural flight, operated by Sichuan Airlines, took off at 11:10 a.m. on Sunday, bound for Beijing.   Chengdu, the capital of Sichuan province, is now the third city in the country to have two international airports, joining Shanghai and Beijing.   Constructed at a cost of about 70 billion Chinese yuan ($10.8 billion), phase one of the massive aviation hub has the capacity to handle up to 60 million passengers per year, further opening up the country’s southwest region.

Alain Gillard
Information Officer
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