China’s tech megacity Shenzhen at risk of being high-income trap as GDP soars
Avoiding the high-income trap would require restructuring Shenzhen’s economy, but that could take a hefty toll on traditional manufacturing. Soaring labour expenses and a real estate bubble have already made the city less attractive to manufacturers planning to build new plants. Guo added that despite Hong Kong no longer being rated the world’s freest economy, its financing function “is still in place”, and some Shenzhen-based companies are eyeing a secondary listing in Hong Kong. As the new administration of US President Joe Biden is expected to continue taking a confrontational approach to Chinese firms such as Huawei, Shenzhen’s access to foreign capital, technology and markets looks to be waning. Analysts have said the US’ restrictions on core technologies will be a blow not only to Shenzhen, but also to the broader Chinese economy. “Huawei’s mobile phones are now very popular in China, meaning it can only offset part of the impact of US sanctions through internal circulation,” Guo said. “The impact of US sanctions is, of course, big. Shenzhen can only steer itself out of trouble with the help of entrepreneurs, who may succeed in a few years, but may also be beaten down.”
China debt: State Council says local governments must ‘tighten their belts’ and cut debt to reduce financial risks
Announcement doubles down on Beijing’s commitment to move away from decades-old reliance on debt-driven growth Analysts expect China’s leadership to focus on tackling growing implicit debt piles, particularly at local government levels
UBS raises China’s GDP growth forecast to 9% in 2021 on stronger recovery
UBS upgraded China’s 2021 GDP growth forecast to 9.0 percent on Tuesday, higher than the previous forecast of 8.2 percent, citing stronger-than-expected domestic economic activities and stronger global recovery from the COVID-19 pandemic. The investment bank said in a report that the $1.9 trillion stimulus package signed by the Biden administration should lead to a stronger U.S. and global recovery, which would in turn drive demand for Chinese exports. China’s exports in January and February soared by 60.6 percent to $468.9 billion and imports rose by 22.2 percent to $365.6 billion, data from country’s customs authority showed “We see domestic consumption rebounding 10 percent in real terms, which, together with stronger exports, should help support corporate capex (capital expenditures), even as infrastructure and property investment slow,” the report said.
M&A Report 2021: China | International Financial Law Review
U.S. and China Prepare for Post-Pandemic Economic Policies
U.S. Congress has passed a 1.9 trillion-dollar stimulus plan, while China has convened its biggest annual political event called the Two Sessions. The Two Sessions refer to the back-to-back meetings of China’s two major political organizations—the National People’s Congress and the Chinese People’s Political Consultative Conference. Every year, international eyes are on this key political event in China, as it determines the country’s overall policy direction. This year’s event drew special attention all the more because China was the only major economy in the world to post positive growth in 2020 amid the COVID-19 pandemic. Here is Cho Yong-chan, director of the America China Economic Research Institute, to discuss economic strategies of the U.S. and China in the post-COVID-19 era and how South Korea should cope with them.
American Rescue Plan: China moves to counter ‘turmoil in financial markets’ as policy divergence widens with US
Beijing and Washington are moving in opposite directions in their attempts to support their respective economies Chinese officials and policy advisers have been highly critical of US President Joe Biden’s new US$1.9 trillion American Rescue Plan
China’s young people struggle to find jobs as unemployment rate holds at 13.1%
The unemployment rate for those aged 16 to 24 was 13.1% as of February, far above the national urban jobless rate of 5.5%, the National Bureau of Statistics said Monday.
Moody’s – Chinese banks’ performance steady as economy recovers
Moody’s Investors Service says in a new report that Chinese banks’ profitability and capitalization will stabilize, and asset growth will slow down amid elevated asset risks over the next 12-18 months as China’s economic recovery continues. China’s regulators are continuing to derisk the financial system with a special focus on financial technology platforms. “Chinese banks’ asset growth is likely to decelerate in the next 12-18 months as the economy becomes less reliant on extraordinary liquidity creation through the banking system. Banks’ loan balance grew 13.3% from a year ago at the end of 2020, 41 basis points lower than three months ago. Non-loan asset growth also slowed to 8.3% from 9.3%,” says Nicholas Zhu, a Moody’s Vice President and Senior Credit Officer.
China plans new food trading giant with Cofco merger and IPO
China’s largest food company plans to merge its international trading division with several domestic businesses to create a new agricultural commodity behemoth before embarking on an initial public offering. Cofco Corp has hired bankers to advise on a plan to combine Cofco International with some of its domestic trading and processing assets, according to people familiar with the talks. After the merger, Cofco plans to sell shares in the new company, most likely in Shanghai, the people said, asking not to be named as the matter is private. The IPO could value the new company at more than US$5 billion (S$6.7 billion), the people said.
China’s chip industry brings high hopes to Shanghai trade show
With supply shortages and a crackdown from Washington, China’s up-and-coming chipmaking sector has rarely seemed under such pressure — and yet William Wang could scarcely be happier as he heads to Shanghai for China’s biggest semiconductor event of the year. SEMICON China will also mark the first physical international semiconductor fair since U.S. President Joe Biden took office in January, and comes just ahead of the first high-level meeting between Chinese and U.S. diplomats in Anchorage, Alaska, on March 18.The two major semiconductor industry associations in the U.S. and China — neither of which is related to their respective governments — have furthermore agreed to set up working groups to discuss trade and export control issues, a move seen as an overture to ease tensions between the world’s two biggest economic powers. Chips — which serve as the brains and heart of electronic devices ranging from computers and servers to smartphones and connected cars — have become a key battleground in U.S.-China tech tensions.
Beijing’s latest five-year plan contains lots of clues on China’s commodities
China’s economic policy for the next five years includes a 20 per cent target for non-fossil fuels consumption, increased nuclear generation ‘Markets are priced for perfection at the moment, and 2021 is likely to be a volatile road’ – MineLife analyst, Gavin Wendt Higher growth rate and decarbonisation is good news for China’s demand of key Australian commodities
podcast : THE BULLETIN WITH UBS Investing in China
In the past 20 years, China’s economy has grown fivefold and its equity market capitalisation has increased by 25 times. Despite this, many global investors are significantly underallocated in China relative to its weight in global benchmarks, whether due to insufficient understanding of the opportunity and market complexity, or other factors. Two of the authors of a new UBS report join the programme to help us better understand the landscape and to explain how global investors can position themselves to take advantage.
China tycoon Wang Jianlin who lost $43 billion tries to salvage an empire
Wang Jianlin used to be Asia’s richest person, busy expanding his Dalian Wanda Group by acquiring trophy assets overseas, all aided by easy credit. Now the 66-year-old doesn’t even figure among China’s top 30 richest people, having lost about US$32 billion (S$43 billion) of his personal fortune in less than six years – the most for any tycoon in that period. As Mr Wang seeks to cut the group’s total debt from 362 billion yuan (S$74.9 billion) and turn his entertainment-to-property empire around, he’s facing skeptical bond investors.
What China’s Livestreaming Boom Means for International Luxury Retailers
E-commerce livestreaming has been on a global march over the past year, with a steadily growing number of brands and influencers using the format to promote and sell products on Instagram, Facebook, Amazon, and TikTok. But in China, arguably the world’s most sophisticated e-commerce livestreaming market, the global impact is being felt in a different way, with overseas Chinese students, expats and immigrants using livestreaming to sell everything from cosmetics and food products to luxury goods to compatriots back home. A quick glance at the data makes it clear that “live selling” is a hot sector. As of December 2020, China’s livestreaming audience had reached 617 million, a rise of 57 million since March of last year. Of those viewers, 388 million made purchases via livestreams, up from around 300 million last summer. These figures are likely to continue their upward trajectory this year as more platforms expand their e-commerce livestreaming capabilities and consumers stick to the “new normals” of shopping domestically for luxury brands and living more of their lives digitally.
ByteDance team to develop AI chips as China aims for self-reliance
Chinese TikTok-owner ByteDance is making plans to develop semiconductors, according to the company’s job postings and a source familiar with the situation. The plan is still at an early stage and the company’s focus is on Arm-based server-side chips, the person told Reuters.
Chinese scientists challenge Google’s ‘quantum supremacy’ claim with new algorithm
US tech firm in 2019 said its Sycamore processor did a task in three minutes and 20 seconds that would take a classical supercomputer 10,000 years Researchers in Beijing say they took a different approach that saw 60 graphics processors complete the job ‘in about five days’
Jack Ma’s SCMP joins Hong Kong media groups facing China control
As news broke that China is pressuring Jack Ma’s Alibaba Group Holding to sell the South China Morning Post, surprised employees pondered the future of Hong Kong’s main English-language daily.
Beijing presses Alibaba to sell media assets, including South China Morning Post
Jack Ma, Alibaba’s co-founder, has been at the center of a government crackdown that began last year, targeting the e-commerce giant and its finance affiliate Ant Group Co. The Chinese government wants Alibaba Group Holding Ltd. to sell some of its media assets, including the South China Morning Post, because of growing concerns about the technology giant’s influence over public opinion in the country, according to a person familiar with the matter.
Jack Ma’s Saga: Chinese dominance negatively affecting its economic potential
China has dramatically turned itself into a leading business country across the globe. In a time span of just 40 years China had opened up its economy and contributed wholesome amounts to the global economy. Now in the new era of digitisation, the president of China Xi Jinping is drafting out plans to turn his country into a digital land. But this is not as easy as it looks. Xi’s ambitions have been turned down with his own idiosyncrasy of tech dominance. Yes, you are right, hey we’re talking about the forceful crackdown of Chinese authorities on the business empire of China’s business tycoon Jack ma.
Huawei pivots to fish farms, mining after US blocks its phones
Six months after the Trump administration dealt a crushing blow to Huawei’s smartphone business, the Chinese telecommunications giant is turning to less glamorous alternatives that may eventually offset the decline of its biggest revenue contributor, reported Bloomberg. Among its newest customers is a fish farm in eastern China that’s twice the size of New York’s Central Park. The farm is covered with tens of thousands of solar panels outfitted with Huawei’s inverters to shield its fish from excessive sunlight while generating power. About 370 miles to the west in coal-rich Shanxi province, wireless sensors and cameras deep beneath the earth monitor oxygen levels and potential machine malfunctions in mine pit — all supplied by the tech titan. And next month, a shiny new electric car featuring its lidar sensor will debut at China’s largest auto show. “It’s very unlikely that the US will remove us from the Entity List,” Ren said last month at the opening of a mining innovation laboratory partly sponsored by Huawei. “Right now, we just want to work harder and keep looking for new opportunities to survive.”
China is traveling with a digital vaccine passport
China on March 9 rolled out its own “vaccine passport” amid global controversy around potential equality and privacy issues of the health document. China’s vaccine passport, the International Travel Health Certificate (ITHC), serves as an international version of China’s year-old health code system that helped the country resume domestic travel after the initial outbreak early last year. It contains information such as the holder’s coronavirus test results, vaccination records, and antibody test results, according to China’s foreign ministry (in Chinese). To sign up, users enter their passport number in a foreign ministry-owned mini program on Tencent’s WeChat instant-messaging platform. Verify your identity using face recognition, and the certificate is instantly available. It is currently only available for Chinese nationals. China hasn’t revealed plans to issue the certificate to foreign nationals living inside or outside of the country.
China eases visa rules for recipients of its vaccines
China said on Monday it will simplify visa applications for foreign nationals who have been inoculated with Chinese-made Covid-19 vaccines, its latest small step towards normalising international travel. Vaccinated passengers travelling to China by air will still need to show negative tests as under current rules, foreign ministry spokesman Zhao Lijian said, according to an official transcript of a daily briefing.
China likely to be hot topic when top US officials visit Japan, South Korea, observers say
US Secretary of State Antony Blinken and US Secretary of Defence Lloyd Austin will meet their counterparts in Tokyo and Seoul ahead of talks with China’s top diplomat in Alaska next week US will be seeking support from Asian allies on issues relating to China and the Korean peninsula, academic says
Nato chief urges US, EU to mend alliance to stop China ‘bullying countries all over the world’
Nato chief describes China’s behaviour as ‘undermining the rule of law’ European Parliament members ask Stoltenberg questions about China, suggesting anxiety about its threat
US and Japan vow to continue joint drills around Senkaku Islands
China singled out as threat to Indo-Pacific region in ‘two-plus-two’ talks Japan and the U.S. on Tuesday vowed to keep conducting joint military drills around the Senkaku Islands amid an upsurge in Chinese incursions into Japanese waters near the disputed islets.
US-Taiwan relations: Biden administration gives green light to exports of key submarine technology
The island’s plans to build its own submarine fleet receive a boost after sales of the sensitive equipment are approved by Washington The US had previously been reluctant to sell advanced defence technology to Taipei, but the new administration appears to be continuing Donald Trump’s approach
US tells China to improve ties with Australia
The Biden administration has told China that normalising relations with Australia is a precondition to Washington taking any substantial step towards improving relations with Beijing, a senior US official said on Tuesday.
Why are Myanmar’s anti-coup protesters angry at China?
Chinese-run factories were attacked on Sunday, amid an ongoing crackdown on anti-coup protesters Many protesters believe China supports the military and that security forces and other agitators carried out the destruction to incite more trouble
Facial Recognition Cameras In Commercial Properties
The illegal but widely installed face-capturing cameras in commercial properties including shopping malls, auto dealer shops, and property sales offices is one of the main stories featured at this year’s March 15 Consumer Day TV progress by China’s state TV station CCTV. With a camera with facial recognition function, once a customer enters a Kohler bathroom store, the facial information will be captured and recorded, and Kohler will know which store the customer has gone to before and how many times he/she has been there.
How China built the world’s largest arch dam in just four years
The speed of Baihetan’s construction has raised eyebrows, in a country where rapid infrastructure building is the norm Project team says it would not have been possible without the extensive use of artificial intelligence
Encrypted messaging app Signal appears to be blocked in China
Encrypted messaging app Signal has stopped working in China. The app can still be accessed through a virtual private network (VPN). China blocks many foreign apps and services including those from Facebook and Google.
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