China Press Review – March 18, 2019

Press review

China’s central bank chief takes blame for economy to protect Xi
Yi Gang, the powerful governor of the People’s Bank of China, began a high-profile press conference last Sunday in an unusual way: with a somber analysis of the country’s economy that implied serious self-criticism

Global recession prophets have misread the US and Chinese economies
Relax everyone, that looming financial apocalypse just isn’t going to happen. Well, not in 2019 at least

EU trade surplus with U.S. expands, deficit with China grows
The European Union’s trade surplus with the United States and its deficit with China both increased in January, serving as potential fuel for trade conflicts between the world’s largest economies. The EU surplus in goods trade with the United States expanded to 11.5 billion euros (10 billion pounds) in January, from 10.1 billion in January 2018, EU statistics office Eurostat said.

Trump-Xi meeting to end trade war may be pushed back to June, sources say
An April meeting has been described as less likely, but the two sides could be able to reach agreement by the middle of the year One stumbling block appears to be the demand from some in the White House for an enforcement mechanism to ensure China lives up to its promises

It’s about time someone yells ‘It’s trade, stupid’ to Trump’s trade negotiators and enlighten them on the folly of their errors
The world’s economy is slowing, with growth slowing in the US, the euro zone and China It’s not the decline that is worrying, but what’s driving it: Shrinking trade

A US-China trade deal will come. It just won’t solve any of the problems that matter
An agreement is needed to mitigate current tensions, but the terms will neither tackle the imbalances in bilateral trade, nor address the geopolitical and strategic concerns that underlie the conflict

Chinese Premier Li Keqiang seeks to assure EU it won’t undermine it as price for ending US trade war
Olive branch from Beijing follows increasing concern in Europe that China is a ‘strategic rival’ that may undermine its interests

Forget the Mexico border, the new US military budget is focused on ‘China, China, China’
Acting Pentagon chief named hypersonic missiles, space operations, technology theft and militarising land in the South China Sea as threats posed by China China ‘seeks Indo-Pacific regional hegemony in the near-term and displacement of the United States’, warned Patrick Shanahan

China should quickly get out of its huge US trade problem
Beijing cannot indefinitely continue to accumulate wealth and technology by exploiting America’s open markets. A prompt solution of the U.S.-China trade dispute requires a rebalancing on bilateral trade accounts — drastically lower Chinese sales to the U.S. and sharply increasing Chinese purchases of American goods and services. China’s regulatory changes are a different matter. Financial markets should stop fretting about the U.S.-China trade problem — that’s a peripheral issue and a purely trading event. Only the Fed can crash Wall Street.

China wants to open financial sector wider but it’s a ‘negotiation game’ in trade war, Zhou Xiaochuan says
Beijing has determination for ‘much braver financial liberalisation and opening-up policies’, former central bank governor says at event in London He also rejects calls from within China for greater protectionism

China’s central bank to set up new regulatory rules for fintech
The People’s Bank of China (PBOC) said on Saturday that it will gradually develop a system of rules to regulate financial technology. It also pledged to fully utilize the technology to improve the flow of credit and reduce financing costs for businesses, and plans to enhance new technology applications to improve risk prevention capabilities.

Briefing: China’s central bank to set up new regulatory rules for fintech

China’s new investment law replete with question marks
The new foreign investment law is likely to be the foundation of China’s response to a series of US complaints that sparked their trade war

China’s Economic Black Box
Beijing’s recent GDP downgrade shows that it is serious about fixing its data problem. The accuracy of China’s official growth statistics is once again in question. Last week, at the annual “two sessions” conference, Premier Li Keqiang announced that China would reduce its 2019 target for GDP growth to between 6 and 6.5 percent—previously, it was “around 6.5 percent.” That same week, a group of Chinese economists published a paper with the Brookings Institution concluding that China’s official nominal growth rates from 2008 to 2016 were being overstated by as much as 1.7 percent.
China’s Economic Black Box

Chinese companies are reporting delays in getting paid by business partners
Chinese companies are reporting longer delays in getting paid for their goods and services, according to a survey by French trade insurer Coface. Slowing economic growth, tighter credit conditions and rising bond defaults are pressuring cash flows, it said in its China Payment Survey 2019, which queried 1,500 private and state-owned companies. The survey also also found that 59 percent of respondents saw it as unlikely that economic growth will improve this year, the first time since the survey began in 2003 that a majority expressed such a view.

Small firm shows scars of China’s economic woes
Manufacturers across Japan depend heavily on customers in China, the world’s second-biggest economy, to buy their products, especially the parts and equipment that reach China’s factory floor and fuel its domestic and export growth.

How China’s Two Sessions offer glimpse into tech policy priorities
Vaguely akin to the Oscars, with the rich and famous showing off their loyalty to the Communist Party of China on the red carpet, China’s Two Sessions, or lianghui, can be bewildering for the uninitiated: lots of bold pronouncements, wacky ideas from celebrities, and a virtual (pun intended) isolation from the rest of the world as the government gets serious about unlicensed VPNs.

How China’s Two Sessions offer glimpse into tech policy priorities

China’s top diplomat rejects West’s ‘immoral’ Huawei concerns
China opposes politically motivated attempts to discredit its telecoms equipment makers on security grounds, the Chinese government’s top diplomat, State Councillor Wang Yi, said on Monday.

Is Huawei a security threat? Seven experts weigh in

Huawei’s $200 million contract for Perth trains confirmed
The Australian government has confirmed it will move forward with a Huawei contract to build digital radio systems for data and voice services for trains in Perth. The Chinese telecommunication firm won the $200 million contract from the Australian Public Transport Authority in July. It was shelved by Canberra one month later, following a ban on Huawei equipment for constructing the 5G network in Australia. The work is now proceeding and will be completed by 2021.

Briefing: Huawei’s $200 million contract for Perth trains confirmed

Czech network operator CETIN sees Huawei risks as manageable: newspaper
The Czech Republic’s largest telecommunications network operator CETIN said risks related to technology of China’s Huawei Technologies were manageable and it had options to lower that risk, the daily Hospodarske Noviny reported on Thursday.

Chinese children take to coding amid country’s lofty goals in AI, other hi-tech initiatives
The wave of enthusiasm in China for coding education comes as the country moves to become an AI powerhouse

Hong Kong ranked among top 3 global financial hubs
Hong Kong has been ranked among the top 3 global financial hubs, following New York and London, according to the 25th edition of the Global Financial Centers Index report launched on Monday in Dubai.

China’s Debt Is Still Piling Up—And the Pileup Is Getting Faster
If you think China’s monetary policy became more lax in 2018, wait for 2019. Pushed by gloomier activity data, China’s policymakers have moved from an orthodox monetary policy to a much more heterodox one. The core of this more aggressive move is to exhort banks to lend more to the private sector, with specific targets on the amount of credit granted to private companies and, in particular, small and medium enterprises (SMEs). Such a move is clearly costly for banks, as private companies tend to be more leveraged and/or less able to repay debt.

China’s Banks Have a Hidden Wave of Bad Debt
Factor in the amount of soured loans they stripped from their balance sheets last year, and the situation looks a lot more troubling.

China online lender Dianrong blames govt for its woes – memo
Dianrong, one of China’s biggest peer-to-peer (P2P) lenders which is laying off staff and shutting stores, blamed the government for its troubles saying the absence of clear-cut policies was proving to be a heavy burden.

A Big Shift In China: Consumers Are Trading Down, Author Says
Slowing economic growth in China is taking some of the glow off of one of the country’s greatest attractions for foreign businesses: consumers’ willingness to splurge on higher-priced goods as incomes rise.

For countries around the world, China’s ‘Belt and Road Initiative’ has more pros than cons
Despite American opposition to the ambitious global trade plan, China should be viewed as a partner, not a rival

China seeking global partners to fund its BRI projects
China will be holding the second Belt and Road Forum (BRF) in April, which Chinese Foreign Minister Wang Yi stated would be bigger than the one held in 2017.

China, Europe on path of expanding Belt and Road cooperation
Since it was proposed in 2013, the BRI has been bringing tangible benefits to both Europe and China. Gradually growing into an iconic brand in Europe, China Railway Express, which connects 59 Chinese cities with 49 European cities in 15 countries, made 6,363 trips in 2018, surging 73 percent from 2017, according to the China Railway Corporation. Those freight trains have rumbled along the routes, taking garments, auto parts, chemicals and other Chinese goods to European consumers, while taking back European food, machinery, equipment and timber.

Japan to propose G20 aid rules to check China’s Belt and Road
Openness, transparency, sustainability to be keys for infrastructure investment

Chinese President Xi Jinping heads for Europe amid unease over Italian belt and road deal
Italy’s willingness to join initiative leads to disquiet among neighbours, as France urges ‘coordinated approach’ to Beijing’s US$1 trillion project

Mr Xi’s European tour is response to US-China rift
Yet Xi’s upcoming trip to Europe is perhaps the most intriguing of all. The two countries chosen by Beijing, Italy and France, are both founding members of the European Union; they’re also G7 and NATO members, fairly large economies, and strong allies of the United States. This sets them apart from nations in Eastern or Southern Europe, considered as easy targets for “predatory” China.

Europe’s Struggle for a China Strategy
Chinese President Xi Jinping will visit Italy and France next week amid a European Union firestorm over the dangers of rapidly growing Chinese trade and investments – particularly regarding next-generation telecom technology – and intensifying divisions among its members about how to deal with them.

Sieren’s China: A divided EU
While Italy wants a part in China’s new Belt and Road project, the European Union as a whole would like to halt China’s increasing influence. DW’s Frank Sieren argues that a common strategy is needed.

Xinhua Headlines: China, Europe on path of expanding Belt and Road cooperation
Following the principle of consultation and collaboration for shared benefits, the BRI is increasingly embraced by European countries and people, who have already benefited from the development opportunities the initiative offers.

The Sinophile driving Italy’s hopes of a New Silk Road deal with China
Italian trade and investment tsar Michele Geraci aims to reach agreement with Beijing during Xi Jinping’s visit next week Italy could become the first G7 country to join the flagship Chinese strategy

EU dilemma: how to deal with China
Beijing is, little by little, extending its influence not only inside the EU but inside the NATO space.

How China hit a roadblock on its way to central and eastern Europe
The 16+1 initiative was supposed to boost trade and investment between the participants but so far it seems largely one-way, observers

US says China’s Belt and Road project has problems with corruption, debt, opacity and environmental damage
The United States on Friday clashed with China at the UN Security Council over Beijing’s Belt and Road initiative, saying the infrastructure investment scheme had “known problems” with corruption and debt distress.

US says China’s Belt and Road project has problems with corruption, debt, opacity and environmental damage

An Introduction to Beijing: China City Profile Series
Beijing, formerly known as Peking, is the capital of the People’s Republic of China, and the country’s political and cultural center.

Almost one-third of Chinese cities are shrinking, but urban planners told to keep building
Satellite imagery monitored the intensity of night lights in more than 3,300 cities and towns between 2013 and 2016 In 28 per cent of cases, the intensity of lights had dimmed, but urban planners are still assuming China’s urbanisation will continue, research shows

US mulls partial ban on Chinese trains and buses, citing cybersecurity and ‘Made in China 2025’
Senators have taken the first steps to ban rolling stock manufactured by Chinese companies with state ties as part of the ongoing US-China trade war The rail industry is one in which China had been making big inroads into the United States with recent sales to Boston, Los Angeles and Chicago

China plans multibillion-dollar investment to knock US from top spot in fastest supercomputer ranking
China and the US dominate when it comes to the world’s fastest supercomputers, owning 45.4 per cent and 21.8 per cent of the top systems globally respectively Multibillion-dollar investment aimed at upgrading three existing supercomputer labs to the latest exascale computing technology over three-year period

China’s 2019 ‘Two Sessions’ and the Statement of Artificial Intelligence Ambitions
China’s “Two Sessions” this year cast a special light on artificial intelligence.

US–China commercial espionage will crush prospects for technology cooperation
Technology has become a new battlefield in US–China relations. But it could also be an arena for immense cooperative possibility if the framework underpinning two-way technology flows is fair, equitable and reciprocal. There should be no space to secure under-handed advantages via cyber-enabled intellectual property (IP) theft. Fair competition and technology cooperation are two sides of the same coin.

US–China commercial espionage will crush prospects for technology cooperation

Boeing’s woes fuel Washington’s fears of the age of the made-in-China plane
The worldwide grounding of the 737 MAX 8 jet is giving the US a chance to fixate on another Chinese sector: aviation. To trade hawks, China’s C919 project is a sore reminder of the way Beijing is using state subsidies, and US tech, to compete

China’s Race to Become A Global Leader in the Electric Vehicle Market
Why are tiny electric cars so big in China?

New carmaker on the block: Byton’s CEO on China’s car of the future
Carsten Breitfeld, an industry veteran turned disruptor, explains how his Chinese-conceived, globally oriented start-up is tuned for the emerging mobility transformation.

BMW, Mercedes among luxury carmakers to cut prices in mainland China amid weaker demand, lower VAT
Price cuts of around 2.5 per cent come as Beijing prepares to lower VAT rate on manufacturers from 16 to 13 per cent Mercedes-Benz, BMW, Lincoln, Land Rover, Jaguar and Volvo announced that they would lower retail prices on their models

How to Best Reach Millennials? AI
For a recent project, I was asked to optimize store traffic for the flagship store of a leading luxury fashion brand in Asia. Given the exorbitant rent at this prime location and the high cost of running the place (personnel, maintenance, decoration, inventory, etc.), foot traffic and in-store sales weren’t high enough to make the flagship profitable. There were indications from the store that the majority of visitors and consumers who visited were over 40. In short, the store was lacking in millennials and younger Generation-Z consumers. This is typical for many luxury (and non-luxury) brands, so you’re probably familiar with the issue.

How to Best Reach Millennials? AI

E-commerce for poverty alleviation in rural China: from grassroots development to public-private partnerships
China’s rapid development of e-commerce has begun to reshape production and consumption patterns as well as change people’s daily lives. In 2016, the World Bank and the Alibaba Group launched a joint research initiative to examine how China has harnessed digital technologies to aid growth and expand employment opportunities through e-commerce development in rural areas. The research seeks to distill lessons and identify policy options to enhance the positive effect of e-commerce on the reduction of poverty and inequality. Emerging findings from that research show that rural e-commerce evolves from grassroots development to become a potential tool for poverty alleviation with public-private partnerships

Cash-strapped Chinese regions seek support from Beijing to meet costs of environmental clean-up
Delegates to recent National People’s Congress asked for more help from central government and warn of cost of fighting pollution

China can’t quite match appeal of European firms as Asia’s windpower infrastructure boom begins
Mainland’s wind-farm sector is dominated by state-backed firms with little foreign involvement European firms seen as favoured option for green energy build out among China’s neighbours

Chinese delegation set to revive stalled Argentina nuclear power plant talks
Technical team expected to go to Latin American country to discuss project reportedly worth up to US$8 billion

How Chinese Investment In Latin America Is Changing
After becoming a major source of capital flows to Latin America and the Caribbean over the past 15 years, a more diverse range of Chinese investors. The profile of Chinese investment in the region tracks the evolution of China’s economy as it moves toward a higher reliance on services and domestic consumption. One may expect the continuation of a sizable Chinese footprint in the region.

Investing in China: All Bets Are Off
As it gets harder to raise money from venture investors, many Chinese tech startups are hoping to raise capital by listing shares on public exchanges. But the long queue of firms seeking public exit, and the dismal performance of last year’s China tech IPOs, has dampened the appetite of retail investors.

Can the world’s investors trust China’s wild stock markets?
Foreign money is piling into China’s evolving markets – and could hit US$100 billion this year But a visiting US investor might be prompted to say, ‘Toto, I’ve a feeling we’re not in Kansas any more

Hong Kong property agents still up to old tricks despite new rules on adverts for flats
Bait-and-switch tactics and flats advertised even though they are off the market still common, Post analysis finds This is three months after industry watchdog warned against the ploys

China and the US are locked in a crucial battle for space domination
China’s military ambitions hinge on controlling outer space. The US is worried

China’s Ant Financial, thwarted in the US, is expanding rapidly in Europe
Ant Financial is expanding rapidly outside of its home market, mainly to serve legions of big-spending Chinese tourists already familiar with its platform. A key question is whether the company, which is valued at more than Goldman Sachs and Morgan Stanley combined, will pursue Western consumers as well.

The United States must go beyond ‘baby steps’ in infrastructure as China builds strong bonds in Asia, says former US ambassador
Former US ambassador to Vietnam David Shear says Washington needs to devote more resources and attention to its Indo-Pacific strategy if it’s to match Beijing’s growing influence

As China builds its military muscle, it will pivot to head games
Ankit Panda writes that as the great-power competition with the US heats up, China’s defence spending is delivering a modern military The next step will be to develop the experience and knowledge base of its military personnel

China’s former energy chief accused of corruption
China has expelled one of its most senior ethnic Uighur officials from the Communist Party, the country’s anti-corruption watchdog said Saturday, accusing the former energy chief of abusing his position to live a “lavish life”.

Investing in women in Asia
East Asia’s economic rise was initially built largely on the back of a female labour force. Both the more prosperous countries in Northeast Asia and the developing countries in Southeast Asia need to once again unleash and engage the female labour force to sustain prosperity and development.

Investing in women in Asia

Fosun to open Club Med ski resort near Beijing to capture China’s new-found love for snow sports leading to 2022 Winter Olympics
The new resort will be located near Beijing, where several retreats are already operating in the Chongli district, about three hours’ drive from the capital Club Med already operates two ski resorts in northeastern China in Heilongjiang’s Yabuli and Jilin’s Beidahu

‘Lewis Hamilton of pigeons’ sold for world record €1.25m
Racing pigeon Armando goes for huge sum after bidding war between Chinese enthusiasts

Alain Gillard
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