China Press Review – May 29, 2019

Press review

China or the US? Europe’s ‘impossible choice’ in the trade war
The EU is a top trading partner of both China and the US Bloc now in a difficult spot as Trump moves to ratchet up pressure on Beijing Merkel and French President Emmanuel Macron have said they will not block Huawei or any other company because Europeans are “pragmatic and realistic”

German firms find US less reliable than China as trading partner after getting caught between Trump and a hard place to do business
China ranked higher than US and Britain as trading partners in a survey of 2,000 German companies by Commerzbank Washington’s protectionist stance and the UK’s Brexit plans were major factors in the choices of respondents

Huawei asks US courts for summary judgment on its move to get federal ban on its gear overturned
Huawei calls on US to halt ‘state-sanctioned campaign against company’ as it will not deliver cybersecurity The US government recently took its campaign against Huawei a step further, placing it on a trade blacklist that prevents it from buying American technology

Huawei files new motion against US ban, aiming for swift dismissal
The exterior of a Huawei store in Shanghai on March 23, 2019. (Image credit: TechNode/Shi Jiayi)
Chinese telecoms equipment maker Huawei said on Wednesday it has filed a motion requesting the court to rule in its favor in reference to a lawsuit filed in March. The company said that the 2019 National Defense Authorization Act (NDAA), which was signed by President Donald Trump on Aug. 13, 2018, singled out Huawei without an opportunity for rebuttal or defense. The legislation banned US government agencies from buying telecommunications equipment from Huawei or its rival ZTE.

Huawei files new motion against US ban, aiming for swift dismissal

US ban on Huawei goes against the fair-use understanding of intellectual property protection
If an IP holder denies access to the technology by abusing its monopoly, it undermines confidence in the rights protection regime America’s move will hurt consumers and is a blow to the global value chain

China consumer market ‘too big to ignore’, to attract domestic and foreign M&A activity amid trade war
Economic uncertainty will push Chinese companies to focus on M&A to boost business at home
Consumer spending stimulus could attract foreign players despite trade war

China’s Economy Weakened in May, Early Data Show
Copper, stocks, trade and small businesses lead the decline Tariffs to ‘materially affect’ small firms’ sales: StanChart

Trade ban affects 1,200 US suppliers, Huawei says
Legal officer insists affect will be limited as telecom major considers lawsuit

Huawei: US blacklist will harm billions of consumers
A US move to put Huawei on a trade blacklist “sets a dangerous precedent” that will harm billions of consumers, the firm’s top legal officer said.

Rising Chinese AI star Megvii gets caught in the US-China tech war
Megvii among Chinese facial recognition companies reportedly being considered for US technology blacklist for role in Xinjiang surveillance China wants to adopt AI in all walks of life, from health care to financial services to driverless cars and robots

Short of war, US can’t help but lose to China’s rise in Asia, says think tank Lowy Institute
Lowy Institute’s 2019 Asia Power Index puts Washington behind both Beijing and Tokyo for diplomatic influence Trump’s assault on trade has done little to stop Washington’s decline in regional influence, compared to Beijing, say experts

China will not rule out using rare earth exports as leverage in trade war with US
A governmental spokesman says Beijing will give priority to domestic demand for the minerals, though China is the leading exporter to the US The remarks come after Chinese President Xi Jinping visits a major rare earth mining and processing facility in Ganzhou

Beijing reportedly considering limiting rare earth exports to US
Three incidents have raised suspicions that China could soon curb its exports of 17 rare earth elements, which are immensely valuable to technology manufacturers, as a retaliation in the US-China trade war. After President Xi Jinping visited rare earth mines and processing facilities last week, an official from China’s National Development and Reform Commission told CCTV that using rare earth minerals mined in China against them would displease the Chinese people. Another official told Xinhua News on Tuesday that the government would prioritize domestic demand of the precious materials. Hu Xijin, Editor-in-Chief of the Global Times, a newspaper that is close to the Communist Party, said on Twitter that given his knowledge, Chinese authorities are seriously considering this measure.

Briefing: Beijing reportedly considering limiting rare earth exports to US

Dethroning the dollar — will China lead the charge?
The US dollar has dominated financial markets in the post-war period, but countries across the globe are increasingly taking steps to reduce dollar use in trade and finance. The consensus among most market participants is that any shift in the monetary order away from the dollar will happen gradually and take decades. After six of the past seven years in which the dollar has risen against other currencies, that may be understandable. But in our view, several factors point to de-dollarisation gathering pace over the next few years.

Dethroning the dollar — will China lead the charge?

Rattled China Investors Worry What’s Next After Bank Seizure
Regulators on Friday took over Baoshang Bank for one year Stock and debt markets took a hit this week amid questions Is it the start of a new era for China’s $42 trillion financial industry, or a one-time shock that will be quickly forgotten? Five days after the first government seizure of a Chinese bank in 20 years, investors are still grasping for answers.

Stocks Blog: Shanghai ekes out small gain, while Hong Kong slips amid US-China trade, tech tensions
China rare earth stocks shoot up after Global Times warning to US Kweichow Moutai jumps as investors gather for annual general meeting

The Global Slowdown Has Divided Corporate America’s Fortunes
While the U.S. economy is resilient, the picture overseas is gloomy. Profits at companies focused on the rest of the world are suffering.

The Trade War’s Next Battle Could Be China’s Access to Wall Street
As some inside and outside the White House call for weakening China’s links to U.S. financial markets

China’s growing demand for clean energy and natural gas sparks contest in the Middle East
First Qatar, and now Saudi Arabia, are competing to dominate China’s fast-growing natural gas market, already the third largest in the world, as Beijing encourages the switch from coal to cleaner, greener energy

Digital Watch: How Chinese Millennials & Gen Zers are Re-connecting with Their Elders
China’s post-90’s Millennials and Gen-Zers came of age in a quickly-developing and economically-open country with access to the latest global trends and information via the Internet and global travel. But their grandparents were raised quite differently (under the conformity of Mao’s communism) while their parents experienced China’s massive changes during their middle-age years. These young generations are also different in that many were raised as single children and received a lot of attention — but also pressure — from their elders. Because of these and other factors, China now owns one of the greatest societal and generational gaps in the world.

Digital Watch: How Chinese Millennials & Gen Zers are Re-connecting with Their Elders

How a cosmetics giant reaches Chinese consumers: An interview with Shiseido CEO Masahiko Uotani
China has become a critical growth engine for this global cosmetics powerhouse

Can China’s Beauty Brands Wrestle the Market Back from Western Ones?
It has been a while since the Chinese beauty market saw an influx of domestic beauty brands. For a long time, premium labels that offer higher quality and prices from countries like France, the U.S., Japan, and South Korea didn’t see them as a real threat. That, however, is changing quickly. It seems as if the C-beauty era has arrived.

Can China’s Beauty Brands Wrestle the Market Back from Western Ones?

China’s SOE Reforms: What the Latest Round of Reforms Mean for the Market
The latest round of China’s SOE reforms covers topics like “SOE classification”, “capital assets management”, “mixed ownership reform”, and “Party leadership”. China Briefing looks at these developments to help you understand how they might impact the market. The reform of Chinese state-owned and state-holding enterprises (SOEs) has taken place for over four decades. It remains the core element of China’s economic reform process, but the official thinking regarding how they should be implemented has changed over time. Since China’s SOEs are some of the biggest players in both the domestic and international markets, it is essential for foreign investors to gauge the strategic shifts brought about through the latest round of reforms. This article discusses China’s SOE reform process, current policies, and what they mean for the market.

To make AI ethics work, we need Chinese companies to lead
China’s ambitions to lead the development of AI technology have received considerable attention from Western media, policymakers, and tech leaders alike. Tech leaders continue to debate whether China’s aspirations for global leadership in technical AI research are feasible, but much less attention has been paid to China’s bid to lead the ethical conversations that surround AI technologies. Chinese researchers have proven that they can produce world-class breakthroughs in theoretical AI, and Chinese companies have proven that they can produce world-class innovations in the commercial sector. Can China prove that it can lead the world in ethical AI?

To make AI ethics work, we need Chinese companies to lead

China introduces new draft rules for data privacy protection
Government efforts to crack down on misuse of private data is intensifying in China. The national cyberspace administration on Tuesday introduced a new data protection law, further tightening regulations amid increasing global concern about data privacy.

China introduces new draft rules for data privacy protection

Pinduoduo Plans $1.4 Million Lawsuit Over ‘Inaccurate’ Article
The publisher of the story claims gambling websites used the e-commerce platform for illicit transactions.

EV maker Nio sees 50% revenue decline in Q1, expects continued slowdown

Electric vehicle manufacturer Nio has reported a 50% sequential drop in quarterly revenue as its deliveries during the first three months of 2019 fell sharply. Revenues reached RMB 1.6 billion (around $231 million) in the first quarter, down from RMB 3.4 billion at the end of last year. Deliveries of the company’s flagship ES8 SUV dropped by half to around 4,000 vehicles compared with the fourth quarter of 2018.

EV maker Nio sees 50% revenue decline in Q1, expects continued slowdown

Chinese travel to US dips for first time in 15 years
Trade war dents one of the most lucrative inflows of money

China’s capital outflow controls have gone to the ‘extreme’, former central bank adviser says
Yu Yongding, a senior research fellow at the Chinese Academy of Social Sciences, a state-owned think tank, told a financial forum in Beijing on Wednesday that he recently tried to exchange yuan to the value of US$20,000 at a bank and transfer the money out of China to pay for a trip to visit relatives living abroad. But the bank refused to provide the service even though Yu, like all citizens under Chinese law, is allowed to make foreign transfers of up to US$50,000 each year. According to Yu, the bank refused to provide the service because he is over 65.

Hong Kong property back in bubble territory, Harvard economist says
Noted economist Carmen Reinhart told an investment forum on Tuesday that Hong Kong resembles Ireland, Spain and Iceland before their financial crises unfolded

China to lift investment thresholds
China will further open banking and insurance sectors to foreign investors and may even allow foreign institutions to set up wholly owned companies in China, according to the country’s top financial regulator on Monday. Foreign investors’ proportion of equity will continue to increase, exceeding 51% in banks and insurance companies, and may even reach 100%, said Guo Shuqing, People’s Bank of China’s Party Secretary and head of the China Banking and Insurance Regulatory Commission, said in an interview with China Central Television.

Why Donald Trump can’t make America great again by replicating Ronald Reagan’s script
Unlike Reagan who targeted Japan in the 1980s, Trump – who seeks to make China a scapegoat – has inherited a US economy with a chronically low savings rate and that is much more globally integrated Without the US raising national saving, trade will simply shift from China to other countries

New Delhi eyes summit between Prime Minister Modi and President Xi Jinping as invites go out for Indian leader’s swearing in
The date and location of the summit were not confirmed by India’s foreign ministry India took a ‘neighbourhood first’ approach to sending invites for Modi’s swearing in, but with one obvious omission: Pakistan

Is China’s BRI Posing Challenges to India’s Leadership Aspirations in South Asia?
China’s Belt and Road Initiative (BRI) is an ambitious program to connect Asia with Africa and Europe through land and maritime networks along six corridors to improve regional integration, boost trade and stimulate economic growth. It was first proposed during a speech delivered in 2013 in Kazakhstan by President Xi Jinping titled “Promote People-to-People Friendship and Create a Better Future.” The project drew inspiration from the concept of the Silk Road established during the Han Dynasty 2,000 years ago – an ancient network of trade routes that connected China to the Mediterranean via Eurasia for centuries.

China not seeking ‘sphere of influence’ in Pacific, Xi says
China is not seeking a sphere of influence in Pacific Ocean island states, President Xi Jinping told the visiting prime minister of Vanuatu amid fears in Western capitals of China’s growing role in the region.

The belt and road isn’t just re-routing investment, but also foreign language instruction in China
As China eyes partnerships across Asia, Oceania, Europe and Africa, new majors have sprung up at the country’s venerable institutions of foreign-language instruction

America biggest winner from China’s Belt and Road, study finds
China’s Belt and Road Initiative (BRI) is set to boost global gross domestic product (GDP) by more than $7 trillion a year by 2040, and benefit the US most even though it is not directly participating in it, a report has found.

China’s Richest Start Leaving As The Trade War Escalates
The number of Chinese millionaires coming to the U.K. has gone up by nearly 50%, latest figures from the U.K. Home Office show. With £2 million ($2.5 million) needed to secure a Tier 1 Investment visa, only millionaires need apply to the scheme that enables residency in the U.K.

Here is How AI is Bringing Equality to Education in China
The combination of technology and education is all about equality. Last year, webcast online courses enabled 248 schools in poverty-stricken areas to gain access to top-level education provided by Chengdu No. 7 High School. Thanks to streaming services, rural students can now watch lectures live together with students from Chengdu.

Here is How AI is Bringing Equality to Education in China

Japan’s path to war and Trump’s Huawei ban
The strategic rivalry between China and the United States has incited an outbreak of historical analogies — Athens versus Sparta, the United Kingdom versus Wilhelmine Germany, or the U.S. versus the Soviet Union. But the fracas over the U.S. actions against the telecommunications giant Huawei recalls another antecedent: the pre-World War II U.S. pressure campaign against Japan, culminating in President Franklin Roosevelt’s momentous decision in July 1941 to freeze Japan’s assets in the U.S.

China’s ‘New Art of War’ includes stealing cutting-edge technologies
Conclusion of the Introduction to a new book detailing how Xi Jinping targets the US with his ‘China dream’

Does US regret its past China engagement?
Countries often mark landmark anniversaries of their normalized relations. But instead of commemorating the 40th anniversary of their normalization of ties with fanfare, the United States and the People’s Republic of China are engaging in a multi-front conflict.

Australian helicopters targeted by lasers in South China Sea
Australian military helicopters were targeted with lasers during operations in the South China Sea this month. “Some helicopter pilots had lasers pointed at them from passing fishing vessels,

China Has Forgiven Nearly $10 Billion In Debt. Cuba Accounts For Over Half.
Over the last 18 years, China has written off around $9.8 billion in debt to other countries. Cuba accounts for over half of it.

Chaos, hope, change: stories from 70 years of the People’s Republic of China
Seven decades after Mao declared the beginning of a new era, Chinese people reflect on the dizzying and jolting changes that have forged the modern nation This year marks 70 years since Mao Zedong stood in Tiananmen Square in Beijing and declared the beginning of the People’s Republic of China. To the outside world, China’s transformation from a poor agrarian society into one of the world’s most powerful economies is nothing short of miraculous.

What exactly is Chinese food?
James Langton eats his way around the country, trying hotpots, stewed fruits and doughnuts

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