China Press Review – March 2, 2020

Press review

Coronavirus escalation could cut global economic growth in half – OECD
An escalation in the coronavirus outbreak could cut global economic growth in half and plunge several countries into recession this year, the Organisation for Economic Cooperation and Development has warned.  Sounding the alarm as the disease spreads around the world and rattles investors, the OECD said that global GDP growth could plunge this year to as little as 1.5%, almost half the 2.9% rate it forecast before the outbreak took hold.
www.theguardian.com

Coronavirus May Cause 6% Contraction in China’s GDP: Pimco
The economic fallout from the deadly coronavirus may cause a 6% contraction in China’s first-quarter gross domestic product, according to Pacific Investment Management Co. The GDP contraction, which would be at a quarterly annualized rate, would push down year-on-year growth to 3%, compared with 6% expansion last year, Nicola Mai, a portfolio manager and head of sovereign credit research in Europe, and Tiffany Wilding, a U.S. economist, wrote in a blog post published on Friday. The impact of this will be felt around the globe as China accounts for a quarter of worldwide manufacturing activity, they said.
www.bloomberg.com
 
How Coronavirus May Bring China’s Debt Pile To The Global Economy
Expect more of the same in 2020 as China’s outbreak hobbles any number of growth engines. When it comes to the fallout for the most populous nation, economists don’t know what they don’t know.
“The direct costs of China’s economy-wide shutdown to contain the spread of Covid-19 are visible in empty streets and shuttered stores,” says analyst Thomas Gatley of Gavekal Research. “But the extent of the second-order impacts is much harder to see: how much of the economic damage wrought by those closures will last even after businesses reopen?”Gatley estimates that Chinese companies collectively will lose around $710 billion in cashflows in the first quarter. “In the face of this huge pressure,” he says, “many firms will have no choice but to default or delay payment on their cash obligations to staff, banks and suppliers, and to curtail their capex plans this year.”Even this, of course, could prove optimistic. If so, the $1.7 trillion rout U.S. stocks suffered the first two days of this week could be a harbinger of things to come. It’s the risk Trump didn’t consider when tossing sand into China’s export engine: how the economic trauma would boomerang back America’s way.Bad enough China is facing a potential health crisis. Even worse it’s doing so in a weakened position. Global investors have plenty of reasons to worry. Thirty-four trillion, in fact.
www.forbes.com

A coronavirus pandemic may well be the trigger for the long-feared global debt crash
A pandemic would hit confidence, possibly prompting lenders to raise rates, recall loans or simply stop lending, just when governments and companies are neck-deep in debt and desperate to borrow more to stay on their feet
www.scmp.com

Coronavirus Is Hitting China’s Economy Harder Than Expected
China’s economy is getting hit much harder by the coronavirus outbreak than markets currently recognize. And Wall Street appears to be the last one to know it.The difficulty in predicting the actual extent of the coronavirus contagion has generated immense uncertainty and catalyzed a sell-off this week. Markets should be more worried, however, that the true economic pain caused by the virus has thus far been even harder to determine.Moreover, while the permanent dislocation of some companies within China is now a very real risk, the global implications of this sharp downturn are also sobering. Commodities-producing countries such as Australia are already hurting. In addition, countries in Europe and North America are at a high risk of suffering knock-on effects as businesses ranging from autos and smartphone manufacturers to e-commerce firms are hit with supply shocks. Any serious economic fallout, especially in the U.S., will inevitably create pressures for further policy easing.For markets the coronavirus emergency has underscored a lesson familiar to China-watchers: spin is plentiful but reliable data are hard to come by. In this case, economic activity has deteriorated far more than early projections indicated. Investors are only belatedly waking up to the epidemic’s true damage. Now they can hardly afford to keep flying blind.
www.barrons.com

Coronavirus Could Be The End Of China As Global Manufacturing Hub
The new coronavirus Covid-19 will end up being the final curtain on China’s nearly 30 year role as the world’s leading manufacturer.  “Using China as a hub…that model died this week, I think,” says Vladimir Signorelli, head of Bretton Woods Research, a macro investment research firm…..The coronavirus is China’s swan song. There is no way it can be the low-cost, world manufacturer anymore. Those days are coming to an end. If Trump wins re-election, it will only speed up this process as companies will fear what happens if the phase two trade deal fails  Picking a new country, or countries, is not easy. No country has the logistic set up like China has. Few big countries have the tax rates that China has. Brazil surely doesn’t. India does. But it has terrible logistics.  Then came the newly signed U.S. Mexico Canada Agreement, signed by Trump into law last year. Mexico is the biggest beneficiary.
www.forbes.com

Global Recession Is Now Certain, Sparked By Deep China Recession
China’s economy is experiencing a severe economic recession which, in a best case scenario, will last at least two quarters.   A global recession is certain to be sparked by China’s deep recession and it will last at least two quarters in a best case scenario. The rapid and widespread international contagion of COVID-19 will deepen the global recession further, to an extent that is highly uncertain, making the timing of recovery highly difficult to forecast.  The degree of incompetence, on the part of Wall Street economists and strategists that is currently being demonstrated by their failure to gauge the severity and extent of the global economic damage caused by the COVID-19 fallout, is astounding.
seekingalpha.com

China’s Megacity Drivers Leading New Push to Cheap EV Batteries
Electric-vehicle manufacturers in China are seen turning to cheaper batteries to slash costs and meet the needs of drivers in its megacities who don’t need to travel huge distances.    There’s been resurgent interest in lithium-iron-phosphate (LFP) batteries since the middle of 2019 when China started to rein in subsidies that had spurred adoption of more expensive, longer-range units using materials such as nickel and cobalt. The cost-competitiveness, safety and low sensitivity to commodity price dynamics of LFP batteries are boosting their popularity in the country, according to a report by BloombergNEF.
finance.yahoo.com

The rush to deploy robots in China amid the coronavirus outbreak
Chinese companies are rushing to deploy robots and automation technology as the coronavirus spreads throughout the nation
www.cnbc.com

Coronavirus leads to exhibition cancellations
List of postponed or cancelled trade fairs and exhibitions worldwide
www.expodatabase.de/en/articles/125890-coronavirus-leads-to-exhibition-cancellations?fbclid=IwAR1Xx34qd8YYejSBnAulpGN_eeS6h7glyqWCxjSHVAo5F30Is5aWzqVnXx0

Will the shows go on: coronavirus affects tech shows, so what’s next?
First it was Mobile World Congress, and now at least two more technology associated shows have been cancelled. What else will likely be cancelled in 2020?
www.pickr.com

Trade shows postponed over coronavirus fears
As the contagion continues to spread, its impact is beginning to be felt on the solar industry outside China with the cancellation or postponement of major trade shows and conferences that were set to take place over the next few weeks.
www.pv-magazine.com

EHFF 2020 postponed to the second half of the year
Due to recent developments concerning the coronavirus, FIBO has decided to postpone its exhibition trade show until the second half of the year. We fully support FIBO in delaying its trade show as health safety is a key priority to all of us. Because of this we had to take the difficult decision to postpone the European Health & Fitness Forum (EHFF) to the second half of the year 2020 as well. We will promptly inform you when new dates are confirmed for both FIBO and EHFF.
www.europeactive.eu/blog/ehff-2020-postponed-second-half-year

Tech conferences cancelled, postponed, or going virtual
MWC Americas (Oct 28-30 in Los Angeles) – Being held as scheduled
Gartner CIO Symposium/ITxPo (Oct 18-22 in Orlando) – Being held as scheduled
VMworld (Aug. 31-Sep. 3 in San Francisco) – Being held as scheduled
HPE Discover (Jun. 23-25 in Las Vegas) – Being held as scheduled
Cisco Live (May 31- Jun. 4 in Las Vegas) – Being held as scheduled
Recode Code Conference 2020 (May 26-28 in Beverly Hills, Calif.) – Being held as scheduled
F5 Agility 2020 (Mar. 16-19 in Orlando, Florida) – Cancelled; virtual event
Google I/O (May 12-14 in Mountain View, Calif.) – Being held as scheduled
SAP SAPPHIRE NOW (May 12-14 in Orlando) – Being held as scheduled
Facebook F8 (May 6-8 in San Jose, Calif.) – Cancelled
Dell World (May 4-7 in Las Vegas) – Being held as scheduled
Google Cloud Next (Apr. 6-8 in San Francisco) – Being held as scheduled
Adobe Summit (Mar 29-April 2 in Las Vegas) – Being held as scheduled
Google News Initiative Summit (Late Apr. in Sunnyvale, Calif.) – Cancelled
Black Hat Asia 2020 (Mar. 31-Apr. 3 in Singapore) – Postponed until Sep. 29-Oct. 2
EmTech Asia (Mar. 24-36 in Singapore) – Postponed to Aug. 4-5
Gartner Data and Analytics Summit (Mar. 23-26 in Grapevine, TX) – Being held as scheduled
Nvidia GTC (Mar. 22-26 in San Jose) – Being held as scheduled
Game Developers Conference (GDC) (Mar. 16-20 in San Francisco) – Cancelled
SXSW (Mar. 12-22 in Austin, Texas) – Being held as scheduled
Facebook Global Marketing Summit (Mar. 9-12 in San Francisco) – Cancelled
OFC 2020 (Mar. 8-12 in San Diego, Calif.) – Being held as scheduled 
Salesforce World Tour Sydney (Mar. 4 in Sydney) – Online-only event
Cisco Live Melbourne (Mar. 3-6 in Melbourne) – Cancelled
RSA (Feb. 24-28 in San Francisco) – Held as planned (IBM, AT&T, Verizon and other vendors withdrew)
www.zdnet.com

COVID-19: Malaysia Autoshow 2020 postponed to July
Malaysia’s largest annual automotive event, Malaysia Autoshow 2020, which is scheduled for this April 9 to 12 at the Malaysia Agro Exposition Park Serdang (MAEPS), has been postponed due to concerns over the COVID-19 outbreak.
themalaysianreserve.com

Huawei’s European factory will improve supply chain efficiency, ease security concerns, analysts say
Once up and running, the facility will produce 1 billion euros’ worth of products annually and directly create 500 jobs   Huawei said it has secured 91 commercial 5G contracts worldwide, of which 47 are from European telecoms operators
www.scmp.com

Trump must stand firm on Huawei to convince US allies to ban the Chinese company from their 5G networks
US allies who hesitate to keep Huawei out of their 5G networks are not only afraid of reprisals from Beijing but also find a Trump-sponsored policy a hard sell. Worse, they are unsure the US will be there for them when the dust settles
www.scmp.com

Huawei makes end-run around US trade ban by turning to its own chips
The world’s biggest telecoms equipment supplier shipped about 600,000 5G mobile base stations as of early February   More than 50,000 of those gear were manufactured without US hi-tech components
www.scmp.com

US approves plan to pay satellite companies US$9.7 billion to give up airwaves for 5G expansion
The Federal Communications Commission will auction off the airwaves to US mobile network operators including Verizon, AT&T and T-Mobile    The initiative is expected to help the US beat China in the race to build a vast 5G mobile infrastructure
www.scmp.com
 
UN intellectual property agency the latest battleground as China and US vie for influence
Beijing’s nominee Wang Binying is widely seen as the front runner in next week’s election   Chinese officials have accused US of pressuring other member states not to vote for her, while Washington has reportedly sought to promote Singaporean
www.scmp.com
 
HNA seeks help from Hainan government as coronavirus outbreak imperils highly leveraged group’s debt workout
A working committee led by the Hainan government, comprising representatives of the civil aviation administrator and China Development Bank, will take over the management of risks at HNA, the company said    The committee will be led by Gu Gang, who also heads the provincial authority’s development unit, HNA said.
www.scmp.com
 
Coronavirus: China says 90 per cent of state firms back in business after manufacturing index hits all-time low
Report by central government supervisory body comes after economic data for February shows plunge in manufacturing and service sectors in February   In contrast, small and medium-sized businesses continue to struggle to get back to work
www.scmp.com
 
As New Coronavirus Cases Slow In China, Factories Start Reopening
As new cases of coronavirus infection slow in China, the country is gradually getting back to work. Authorities and businesses are taking a range of measures: Local governments are chartering buses for workers. Some companies are buying out entire hotels to house quarantined staff. A temporarily shuttered movie studio is even loaning employees to factories that are short on labor.
www.npr.org

Coronavirus: China manufacturing collapse confirmed as private sector factory survey hits record low
Caixin/Markit manufacturing purchasing managers index (PMI) plunged to 40.3 in February from 51.1 in January    Caixin survey, which focuses on smaller firms, mirrors huge drop in official PMI data, both of which show the impact of the coronavirus on manufacturers
www.scmp.com

China’s factory activity falls to record low amid new virus spread
China’s factory activity in February plunged to a record low since comparable data became available in January 2005, government data showed Saturday, underscoring the impact of the new coronavirus on the world’s second-largest economy.
english.kyodonews.net
 
Markets expected to fall further as coronavirus hits China’s economy
Manufacturing production levels in world’s second largest economy dropped to record lows in February
www.theguardian.com

Coronavirus: will China opt for massive infrastructure spending spree to save its economy as it did in 2008?
China implemented a 4 trillion yuan (US$572 billion) stimulus package in 2008 in an attempt to manage the global financial crisis      The coronavirus outbreak is increasingly likely to deal a heavy blow to China’s economy, threatening President Xi Jinping’s plan for 2020
www.scmp.com

Bitter harvest for China’s farmers as coronavirus keeps country in lockdown
Crops are rotting in fields as workers are forced to stay at home and transport links are cut   Poultry breeders and vegetable growers are among the hardest hit, authorities say
www.scmp.com

China has been battered by coronavirus, African swine fever and armyworm – is it ready for locusts?
Forestry and grassland agency puts out alert on threat from most voracious of insects     Government goes for strategy of monitoring, prevention if possible, and control
www.scmp.com

China restarts rare earth capacity after closures
The impact of the coronavirus has been felt on a range of markets as well as the macroeconomic performance of the Chinese economy during early 2020.  The rare earths industry has not been exempted from these factors, as many Chinese processing facilities have reported prolonged closures after the Chinese New Year holiday and there have been disruptions to both local and national transport networks, labour availability and enforced shutdowns at facilities, a new market report by Roskill found.
www.mining.com
 
Coronavirus: first Chinese province that declared top-level emergency downgrades alert status
Zhejiang province, which is China’s key export and manufacturing base, declared a Grade I emergency on January 23, a day before the epicentre of Hubei     According to the Zhejiang Health Commission, there have been no new confirmed cases of the coronavirus in the province for nine days
www.scmp.com

Beware of coronavirus outbreaks coming back to life, WHO warns
Scientists still to determine the intermediate host of the disease, raising risk of recurrence   Study by Hong Kong and mainland China researchers finds that more than half of the patients did not have a fever when admitted to hospital
www.scmp.com

Coronavirus: critically ill Chinese patient saved by stem cell therapy, study says
65-year-old woman in Kunming hospital intensive care unit showed no adverse effects to her first shot and after two was up and walking again, researchers say    Results ‘could be very important and inspire similar clinical practices in treating critically ill Covid-19 patients’
www.scmp.com

Coronavirus disinformation creates challenges for China’s government
The word “rumor” has taken on a different meaning in China since the death of Li Wenliang, the doctor who was punished for trying to warn others about the spread of coronavirus.
Instead of doubtful hearsay, for many the word has come to suggest the inconvenient truths that authorities are trying to hide — just like Li’s attempt to expose a dangerous outbreak that has to date claimed more than 2,900 lives, including his own
edition.cnn.com

China’s coronavirus blame game
The censoring of doctors will be painted as a failing of local policing, the two weeks of inaction and lack of notification due to decay in Wuhan’s politics. China’s leaders will throw every resource they have at stopping the epidemic, knowing that inaction would look worse than incompetence. The danger now is that the pendulum has swung too far toward overreaction and away from trust in appropriate public health measures.  With faster information sharing among doctors, the spread of the virus could have been slowed. A stronger public health system and initial government response would therefore have meant that the virus was less damaging.
www.eastasiaforum.org

China targets travellers at its borders in strategy change to stop coronavirus spread
People leaving or entering China will be checked for symptoms, contact with infected persons or travel from areas with a high number of infections     China prepared to evacuate its citizens from overseas areas with serious outbreaks, foreign ministry says
www.scmp.com
 
Coronavirus fears send US stocks tumbling in worst week since financial crisis
Almost US$3 trillion wiped from American equities as Dow drops to lowest level since June    Fed chairman Jerome Powell says central bank is monitoring virus, hinting at possible rate cut
www.scmp.com
 
Falling bond yields may be less a sign of a bubble than a reflection of the long-term trend of a mature market
The low interest rates and bond-buying schemes of central banks are pushing up prices, creating what some fear to be the mother of all bubbles in bond markets
But with no sign of investor speculation, gradually falling bond yields may actually be the result of a structural market change
www.scmp.com
 
Beware of coronavirus outbreaks coming back to life, WHO warns
Scientists still to determine the intermediate host of the disease, raising risk of recurrence     Study by Hong Kong and mainland China researchers finds that more than half of the patients did not have a fever when admitted to hospital
www.scmp.com

Beijing rolls out colour-coded QR system for coronavirus tracking despite concerns over privacy, inaccurate ratings
Beijing residents will be assigned coloured QR codes, with only those with green codes being able to move around the city freely    The system, which has been rolled out in more than 100 cities across the country, has been criticised for a lack of transparency and potential mislabelling
www.scmp.com

Coronavirus: US-China military tensions remain high despite epidemic
Beijing responds to US freedom of navigation operations in East and South China seas by staging its largest live-fire naval exercise in two years    But defence ministry says it will scale back military drills as PLA troops are deployed to help fight the deadly disease
www.scmp.com
 
Online prices of liquid soap, disinfectants, toilet paper soar in Hong Kong as coronavirus fuels panic buying, even robbery
The median price of liquid soaps including disinfectants soared by more than 113 per cent, while all-purpose cleaning wipes now cost 214 per cent more    Panicky online buying triggered dramatic price swings for toilet paper by 82 per cent
www.scmp.com

Operating Your China Business during Contagious Disease Outbreaks – New Issue of China Briefing Magazine
Managing Your China Business Operations through Contagious Disease Outbreaks   Using Tech Solutions to Remotely Coordinate Your China Business Operations  HR Management during Public Health Crises: Learning from the COVID-19 Outbreak   Preparing Your Business Against Exposure to Legal Risks
www.china-briefing.com

Cybercrime lurks as biggest work-from-home experiment puts state, corporate secrets in peril
Staff working at home or connected to public Wi-fi networks are more likely to be hacked, security analysts      Hong Kong weathered first month of working-from-home regime without any noticeable rise in cybercrime, according to privacy commissioner
www.scmp.com

China introduced a sweeping new law that bans people from posting all negative content online, and it could be used to suppress news of the coronavirus
China has enforced a new law which effectively only lets people post “positive” content to the internet, amid dissent over the coronavirus outbreak.
www.businessinsider.fr/us/china-internet-ban-criticism-could-suppress-coronavirus-news-2020-3

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