China Press Review – May 12, 2020

Press review

Donald Trump says he is ‘not interested’ in China trade deal renegotiation
The US president argues Chinese negotiators would only want any changes to benefit their side
‘Let’s see if they live up to the deal that they signed,’ Trump adds
www.scmp.com

Coronavirus: is China prepared to handle an unemployment crisis?
Changes that helped during previous waves of unemployed in the late 1990s and during the global financial crisis are viewed as not present amid the current crisis    China’s state-run benefit system covers only a small portion of the country’s unemployed, while the fund is also now paying out more than it receives
www.scmp.com

The rise of the Chinese World Order
For better or worse, China is capitalizing on the Covid-19 crisis to rewrite the rules   There is a strong indication that China will have a V-shaped recovery, largely thanks to its strong supply chain and the government’s major focus on creating demand by providing excess liquidity through interest-rate cuts.  But for the rest of the world, the good news is yet to come. The International Monetary Fund recently said the global economic outlook had worsened since its last forecast. The US may slip into recession for at least two quarters and some countries will face a solvency crisis and will need debt write-downs rather than just payment postponements. The US response to the Covid-19 crisis has been less than satisfactory, while China’s success in battling the virus and its outreach to poor nations may give it an opportunity to fill the shoes the rival superpower. But it would be immature to assume that there is not going to be any shift in the global order.
asiatimes.com

Coronavirus: China’s factory prices hit four-year low as pressure continues to mount on manufacturers
China’s producer price index fell to minus 3.1 per cent in April, the lowest point since minus 3.4 per cent in April 2016   Consumer inflation continued to fall, with the consumer price index 3.3 per cent in April
www.scmp.com

Coronavirus lessons for China: prioritise health care and quality of life over economic growth
The pandemic has shown that countries with robust health care systems could contain the spread of Covid-19 without a complete shutdown    Instead of the mindless pursuit of debt-fuelled GDP growth, China should focus on revamping its scandal-ridden health care sector
www.scmp.com

Restarting national economies during coronavirus, part two
For weeks, most governments have focused on controlling the spread of the coronavirus, many of them by implementing a full lockdown strategy. That’s starting to change; in recent days, a few have moved to strike a better balance between “flattening the curve” and reviving the economy. But uncertainty is rampant. In our previous article, we outlined a selective lockdown strategy, in which certain regions and sectors can gradually return to work. Such a strategy makes it possible to define the optimal number of people allowed on the streets, making sure that lives are protected, while also minimizing the cost on livelihoods.In this article, we explain the elements required for the selective lockdown approach to work: a fine-grained understanding of the virus’s spread in every part of a country; the economic relevance of every sector in every region; capabilities for testing, tracing, and isolation compliance (TTC); and protocols for physical distancing and safety. In some cases, expanded intensive-care unit (ICU) capacity is another key element. If governments can master these requirements and build the information systems needed to understand in real time what is working and what is not, then they will have found a way out of our collective nightmare.
www.mckinsey.com

Coronavirus: China’s factory prices hit four-year low as pressure continues to mount on manufacturers
China’s producer price index fell to minus 3.1 per cent in April, the lowest point since minus 3.4 per cent in April 2016   Consumer inflation continued to fall, with the consumer price index 3.3 per cent in April
www.scmp.com

China announces new raft of US imports eligible for trade war tariff waivers amid rising superpower tensions
Second batch of trade war tariff exemptions covers 79 products, including ores, chemicals and certain medical products     Importers must apply for waivers within six months of the announcement, with the exclusion process active for one year from May 19
www.scmp.com

White House investment ban threatens US interests more than China’s
Washington would be better off by coming up with a coherent strategy rather than taking a scattershot approach to Beijing
www.scmp.com

COVID-19 exposes the West’s hegemonic angst toward China, again
The West is in decline, but what the West thinks matters to China, so China has to find a way of relating to public opinion in the West, which is going to bring as many people in the West along with it as possible. It matters what the West thinks to China. It’s not the only question for China, but it is an important question. I think China has still got quite a lot to learn about that because still, it’s where the ways of China – China underestimates the importance of that. But more importantly than that, it doesn’t quite understand how to do it. It’s not surprising. I mean China is different. What works in China doesn’t work easily in the West. What works in the West doesn’t work in China. Therefore, it’s a learning process. I mean China is becoming a very, very powerful country. It’s going to become, in my view, the global leader. Therefore, it’s got to be culturally very aware and much more knowing of how opinion in these countries work and value that as important to form cooperation.
news.cgtn.com

China is exempting some foreign executives from travel ban as authorities get coronavirus outbreak under control
The Ministry of Commerce told some key foreign companies they can apply for exemptions to the entry ban if they want to get executives back into China, according to people familiar with the matter  One person who got in was Volkswagen AG’s executive vice-president for research and development, Thomas Muller, who entered China from Germany recently, according to Volkswagen
www.scmp.com

China’s Coronavirus Back-to-Work Lessons: Masks and Vigilance
The country’s efforts to get back to business have been inconsistent and sometimes stricter than workers elsewhere might tolerate. Still, it could set a path for the rest of the world.
www.nytimes.com

How COVID-19 will change China and Africa’s economic relationship
The COVID-19 pandemic and related measures have brought the world economy to a shuddering halt. In April the price of a barrel of oil on the New York Mercantile Exchange reached minus $37.63; airlines are not alone in shedding tens of thousands of staff. The GDP of China, the engine of world growth, shrunk by 8.6% in the first quarter of 2020. Low-income countries, ordinarily at the mercy of commodity prices, tourism and the volatility of remittance flows – through no fault of their own – find millions of their citizens, and by extrapolation all of us, are at risk of both the pandemic and also economic havoc.
www.weforum.org

Can Emerging Economies Afford a “green” Recovery from COVID-19?
However, rising public debt, combined with significant capital outflows and reduced exports, will make financing green investments a challenge for many emerging markets as their governments seek viable strategies for kick-starting their economies once the disruption from the pandemic subsides.
A report by the International Renewable Energy Agency (IRENA) projected that accelerating investment in renewable energy could underpin the global economy’s COVID-19 recovery by adding almost $100trn to GDP by 2050.   In addition to helping curb the rise in global temperatures, the IRENA report claims that ramping up investment in renewable energy would effectively pay for itself over the long term, by returning between $3 and $8 for every $1 invested, and quadrupling the number of jobs in the sector to 42m over the next three decades.
www.globaltrademag.com

COVID-19 pandemic may be good news for India’s economy or may be bad for China
In 2019, Chinese companies signed 6,944 newly foreign contracted projects in 62 countries including “Belt and Road Routes” at a value of $154.89 Billion.  In Asia, India is one among top countries withholding maximum number of Free Trade Agreement (FTAs) and Preferential Trade Agreement(PTAs) either in operation or under negotiation or proposed and most of them existing with Asian countries which are quite different from each other in terms of the level of their economic development.
www.financialexpress.com

Bain & Company: Chinese Consumers Will Make Up Half of Global Luxury Purchases by 2025
The latest Bain report sheds light on how China will only increase in importance for luxury players, as Chinese consumers will account for nearly 50 percent of the global luxury market — valued at €320-330 billion    Faced with the prospect of a global collapse driven by worldwide lockdowns and shutdowns, the ongoing COVID-19 pandemic has been a wakeup call for the luxury industry, forcing many companies to rethink their overall strategies, especially when it comes to the China market.
jingdaily.com

Can Increasing Prices Help Luxury Brands?
Chinese consumers contend that the pricing of Chanel will approach Hermès after this round of price increase.  It is being reported that luxury houses like Chanel, Dior, Gucci, and others will increase their prices soon in response to Louis Vuitton’s price increase on May 5. Louis Vuitton and Dior haven’t responded to Jing Daily’s requests for comment, while Chanel has confirmed to local media outlet Jiemian Fashion that “they will adhere to the global pricing alignment to get rid of distinct price variations between different markets.”
jingdaily.com

Smartphone shipments in China up 17 per cent in April, signalling likely rebound
Smartphone makers shipped 40.8 million handsets in April, up from 34.8 million in the same month last year   The numbers suggest a potential return to normalcy in China for the broader consumer hardware market in the aftermath of the coronavirus outbreak
www.scmp.com

A bumpy week for China’s logistics market
China’s logistics industry has been in tumult as the country begins a return to normalcy: Hive Box pisses off customers; courier services raise prices; and SF Express launches a food delivery service.
technode.com

Tesla sales practices are once again under scrutiny in China
Sales of Tesla cars tumbled in April by nearly two-thirds from March, according to the country’s industry group. The electric vehicle maker is facing outcry from hundreds of owners who were pressured into paying full price for the standard range Model 3 before the release of a long range version.
  Tesla’s revenue and margin are likely to come under pressure in the near term, given the weak April sales in a market expected to be a growth engine for the company.
technode.com

How coronavirus crisis is shaping the future of office space in Hong Kong
The net absorption of office space has fallen to an 18-year low, with a dramatic drop in demand from mainland firms. In the long run, the Covid-19-induced trend towards flexible working arrangements will drive office decentralization
www.scmp.com

Coronavirus ‘close relative’ found in bats in China
New virus has key feature in common with pandemic pathogen, suggesting that Sars-CoV-2 did not escape from lab, researcher says   But genome differences make the newly discovered virus less of a threat to humans
www.scmp.com

Coronavirus: Wuhan draws up plans to test all 11 million residents
The Chinese city of Wuhan is drawing up plans to test its entire population of 11 million people for Covid-19, state media report.
www.bbc.com

German intelligence says China’s Xi pressured WHO to delay global warnings about COVID-19 in January
German media revealed that China’s president Xi Jinping in January pressured the director of the World Health Organization, Tedros Adhanom Ghebreyesus, to hold off on issuing a global warning about the coronavirus outbreak.
www.neweurope.eu/article/german-intelligence-says-chinas-xi-pressured-who-to-delay-global-warnings-about-covid-19-in-january/

Vitriol in Indian media can only poison relations with China, at a time when cooperation is needed in coronavirus fight
Though public opinion in India has never been friendly towards Beijing, the voices raised now in concert blaming China for the spread of Covid-19 and questioning its motives in extending help to other countries are disconcerting
www.scmp.com

China halts beef imports from four Australian firms as COVID-19 spat sours trade
China has suspended beef imports from four of Australia’s largest meat processors, as the trade of several key agricultural commodities suffers in the wake of souring ties stemming from a dispute over the COVID-19 pandemic.
www.reuters.com

New Zealand will ‘stand up for itself’ despite China’s warnings over support for Taiwan joining WHO
Taiwan is excluded from the WHO due to the objections of China, which views the island as one of its provinces   Senior ministers in New Zealand last week said Taiwan should be allowed to join the WHO as an observer given its success in containing coronavirus
www.scmp.com

Taiwan’s push to rejoin WHO as observer gets a boost from US Senate
Bill backing the self-ruled island’s push to reclaim its status is unanimously approved
It calls for US Secretary of State Mike Pompeo to develop strategy for Taipei to take part in decision-making body, which meets next week
www.scmp.com

Calls for ‘China exit’ mount as Japan reviews economic security
Shortage of medical supplies forces rethink of supply chains
asia.nikkei.com

Securing China’s food supply post-COVID-19: ‘Self-reliance’ returns to the northeast provinces
Foreign food exporters have long benefitted from a perception among Chinese consumers that some domestic foodstuffs do not meet sufficient safety and quality standards. But in the wake of COVID-19, better securing the domestic supply chains of China’s critical resources – including food – has now become a top priority for Beijing. One region in China, not known for its agricultural output, has already begun a transformation into becoming the new ‘breadbasket of Asia’: the northeast. Success in this region could present a serious challenge to exporter countries like Australia if China is able to replace its food exports with increased local production.
www.thechinastory.org

The way back: What the world can learn from China’s travel restart after COVID-19
China’s COVID-19 lockdown has ended, and travel is tentatively restarting. In this article, we look at how it has recovered so far, what Chinese travelers think about their future travel, and how industry players are responding to these trends. Countries and regions around the globe are gradually moving past the peak of the pandemic. We hope that China’s experience can shed light on what other countries can—and cannot—expect for their own travel recoveries.
www.mckinsey.com

TikTok: China’s First Western Social Media Stronghold
Lockdown antidote for millions   One winner from the coronavirus pandemic is ByteDance, the Chinese AI-driven entertainment giant that owns TikTok, the phenomenally popular short-form video-sharing app. It is currently the world’s highest-value unlisted unicorn and is raising the hackles of western intelligence agencies, with the US Department of Defense warning its employees not to download it over suspicions about its Chinese antecedents.
www.asiasentinel.com

Western public opinions not unified on China regarding pandemic
European public opinion about China has gone through three stages since the outbreak of the COVID-19. First, during the early outbreak in China, some European politicians and media outlets were satirizing and smearing China. The German weekly news magazine Der Spiegel reported that the novel coronavirus was “made in China” in its cover story. Second, when the virus hit Europe, it began seeking help from China while remaining vigilant against China. In the third stage, after the outbreak was declared a pandemic, Europe started to reflect on its relations with China, as well as on globalization.
www.globaltimes.cn/content/1188140.shtml

China ‘won’t win more respect’ if it expands nuclear arsenal following calls from national media, analyst says
Editor of nationalistic tabloid wants Beijing to increase warheads to 1,000, including at least 100 ballistic missiles that can reach US mainland    But analyst says argument made by Hu Xijin and others isn’t convincing, and such a move could harm China’s credibility and national interests
www.scmp.com

Emerging from COVID-19: Australians embrace their values
Throughout all this, Australians have had to compromise—working from home, forced to accept poor digital experiences from some retailers, connecting with friends and family only through virtual means, and losing hours of their days binge-watching TV. With time to reflect on their lives, we are seeing some consumers revaluating their values and belief systems and looking to reaffirm their identity by making more deliberate choices about where they shop, what they eat, and how they spend their time. Australians are looking forward to getting back to normal. That will take time. Which changes will stick is impossible to predict. Business leaders can learn from consumers during this time—and make choices about what future they are going to create for them. Australian consumers are as much the shapers of the next normal as they are participants within it.
www.mckinsey.com

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