China Press Review – May 6, 2019

Press review

For all the hubub about the US-China trade war, trade is a fraction of China’s economy
Trade tensions between China and the United States have rumbled along for months. There have been false dawns, and a great deal of rhetoric. But China and the US still need each other—and the world Although both the US and Chinese economies are large and domestically driven, both also have critical interdependencies. China depends on technology imports: It imported $313 billion of electronic integrated circuits in 2018, dwarfing its $239 billion of crude oil imports. Around half of its technology import contracts, including IP and technical services, comes from just three countries: the United States, Japan, and Germany.

Donald Trump’s ‘Thanos-like’ tariff threat to China adds to ‘risk of global recession’, analysts say
One analyst compared the US president to the character from the ‘Avengers’ who wiped out half of all life in the universe with a snap of his fingers
Companies in China and Hong Kong rush to seek legal advice amid threat that the United States will increase tariffs on Chinese goods from 10 per cent to 25 per cent

Hold the champagne, Mr Trump. China isn’t about to give the US a preferential trade deal
Trump’s tariff war is harder to win than he claimed. Studies have found that the US economy is paying the costs of his tariffs. Meanwhile, China’s overtures to other trade partners suggest it won’t cut a preferential deal with the US

Shares hit by Trump tariff threat to China
Stock markets in China and Europe have been hit after US President Donald Trump threatened new tariffs on China, putting a trade deal in doubt.

Trump Threatens China With More Tariffs Ahead of Final Trade Talks
The president’s threat was aimed at forcing Beijing to agree to a final trade deal on America’s terms this week in Washington.

‘Is it fake news?’: China censors Trump’s US$200 billion tariff tweets
Mainstream and social media silent on US president’s unexpected reaction to trade talks between China and US moving ‘too slowly’

Stocks Blog: Trump tweets lead to biggest daily loss in China stocks in three years
Donald Trump threatens to increase 10 per cent China tariffs to 25 per cent on Friday Traders ignore better-than-expected April Caixin services PMI after surprise Trump tweet

Warren Buffett on Trump’s tough trade negotiations: Sometimes you have to ‘act half crazy’
Warren Buffett said an escalation of the U.S.-China trade dispute would be bad for the whole world.
The stock market nosedive on President Donald Trump’s weekend threat to increase tariffs on China is “rational,” Buffett said. The billionaire investor acknowledged the “dangerous game” being played by the world’s biggest economic superpowers. Sometimes negotiators need to “talk tough” and even “act half crazy” to get results, he said, but he refused to put odds on how the talks to resolve the U.S. trade differences with China will turn out.

A US detente with China and Russia would boost the world economy
Washington has to stop the senseless arms race with new arms agreements. America’s priority is to rapidly close its huge trade deficits with China. In addition to harming the U.S. economy, those deficits are conduits for transfers of American wealth and technology that support China’s economic development and its global network of influence and zones of interests.

The trade war rumbles on – but US chip makers are cautiously optimistic despite lingering soft demand
Major US chip companies have moved on from trade war worries that had weighed heavily on business last year Soft orders seen continuing as China works through a glut of supply stretching back to last year

Update: China still ‘preparing’ delegation for US trip despite Donald Trump’s threat to increase tariffs
US President said he will increase punitive tariffs on US$200 billion of imports from 10 per cent to 25 per cent on Friday in a tweet posted on Sunday Earlier suggestion planned trip to Washington by chief negotiator and Vice-Premier Liu He this week could be delayed or even cancelled altogether

China gives modest boost to economy with RRR cut amid renewed trade tensions
China’s central bank said on Monday it will cut reserve requirement ratios (RRRs) to release about 280 billion yuan ($41 billion) for some small and medium-sized banks, in a targeted move to help companies struggling amid an economic slowdown.

China’s central regions lure manufacturing from the affluent coast, with low labour and land costs
Foreign investment is rising rapidly in central China, as many manufacturing firms move production away from the coastal regions in search of lower costs inland China’s six central provinces – Anhui, Henan, Hubei, Jiangxi, Hunan and Shanxi – are all are tapping into the growing demand for low-cost production

China’s Canton Fair sees drop in orders and visitors as US trade war bites
Export orders totalled US$29.6 billion, down 1.1 per cent from the same period last year and a 0.9 per cent decline from the previous fair in November Competition from belt and road country exhibitors grows for Chinese exporters

Time for Hong Kong to gear up to make the most of belt and road opportunities
There are plenty of roles Hong Kong can play in the belt and road plan if the city can get its act together

Belt and road bonds are poised to make a splash as investors eye infrastructure gains
With returns on equity uncertain in a challenging global economy, China’s massive project will propel infrastructure to become the next red-hot asset class for investors

Belt and road bonds are poised to make a splash as investors eye infrastructure gains
With returns on equity uncertain in a challenging global economy, China’s massive project will propel infrastructure to become the next red-hot asset class for investors

China’s digital economy reaches 31.3 trillion yuan in 2018
China’s digital economy reached 31.3 trillion yuan (US$4.6 trillion) in 2018, accounting for 34.8 percent of the country’s total GDP, according to a report released by the Cyberspace Administration of China on Monday.

Poorly educated workers may threaten China’s future growth
China has a growing economic problem: A massive education gap between rural and urban areas. Privileged city kids attend well-funded schools and their after-school hours are crammed with music lessons and extra study sessions. Ninety percent of them go on to finish high school.But those kids lucky enough to be born in cities account for only about one-quarter of China’s children.

China agrees to restructure Republic of Congo’s debt, African nation says
Deal was reached in Beijing last week, Congolese government spokesman Thierry Moungalla says

Are the Gloves Coming Off in China-Germany Economic Relations?
As Germany shifts its China approach, Huawei is in the crosshairs.

Huawei will fight US efforts to disqualify lead lawyer James Cole in bank fraud and sanctions case
The US government did not make public why it is seeking to remove Cole, a former deputy attorney general in the Obama administration ‘We have seen no facts from the government that would justify disqualifying him and denying Huawei its constitutional rights,’ the company says

Foxconn boss ‘not afraid’ of shutting down factories in China
Presidential hopeful won’t meet Chinese leader until Beijing acknowledges Taiwan’s existence

US rejects Tesla’s bid to avoid tariffs on Chinese-made Model 3 ‘brain’ in one of 1,000 product denials linked to ‘Made in China 2025’ plan
Move illustrates attempt to thwart Beijing’s efforts to develop hi-tech industries that Washington alleges benefited from theft of US intellectual property Programme aimed at growing China’s prowess in 10 strategic sectors dominated by US is central to trade negotiations and American demands

China’s plan to reduce smog in cities basically just moved it to other areas
A new study in Science Advances looks at the unintended harm smog-reducing plan did to bordering regions.

China targets steel industry as latest front in its war on pollution
Steel plants are now biggest source of harmful emissions after strict curbs on coal plants came into force New measures will force producers to meet ultra-low emissions standards

China’s top coal province defies Beijing, allows new coke projects: ministry
China’s top coal and coke producing region Shanxi has relaxed environmental policies regarding its coking industry despite repeated orders from Beijing to curb production from coke plants, the Ministry of Ecology and Environment said on Monday.

Shenzhen AI start-up Intellifusion helps city police identify jaywalkers and banned drivers
In the first 10 months after installation of the equipment, as many as 13,930 jaywalking offenders were named and shamed

Shenzhen to adopt Singapore housing policy and drop Hong Kong model
Shenzhen plans to offer 1 million homes at as low as half of the prevailing market rate, according to a policy paper released last month High cost of living seen as a factor driving away skilled workers

Chinese banks quietly lower daily limit on foreign-currency cash withdrawals
Lenders have reduced the ‘scrutiny benchmark’ for US dollar withdrawals to US$3,000 from US$5,000 on the instructions of the central bank

Why Do Luxury Businesses Fail in China? Study the Data
The real reasons for poor performance in the China market are usually a lack of precise and timely consumer insights and the willingness to translate those insights into approaches that express the global brand positioning in an authentic and relevant way to Chinese consumers.

Why Do Luxury Businesses Fail in China? Study the Data

China’s consumer spending surges over extended Labour Day holiday
Tourism revenue up 16.1 per cent at US$17.5 billion as traveller numbers rise 13.7 per cent Box office revenue grows to 1.5 billion yuan from 990 million yuan in 2018 recruiting to staff new business initiatives announced on May 5 that the first batch of new graduate recruits are joining the company as the company kicks off the plan to increase its workforce by 15,000 this year. As part of the recruiting plan, more than 2,000 position categories were created. Some of the newly created positions include e-sports players, drone service manager, global fresh produce buyer, and AI assistant trainer.

Briefing: recruiting to staff new business initiatives

Why China’s 996 Work Culture Makes Sense Right Now
Yes, China’s 9-9-6 work culture does make Silicon Valley look sleepy. Startup teams in China routinely work 9-9-6 or 12 hours per day, seven days per week while the Bay Area is more accustomed to 9-5-5. The gap in economic development between China and the United States accounts for this acceptance of long hours in China as it catches up to the West, and begins to surpass it in some sectors. Chinese founders and their teams can’t afford to be lazy or act entitled. There’s too much work to be done. From what I have seen and experienced in China’s leading innovation hubs of Beijing, Shanghai and Shenzhen, it wouldn’t be a stretch to see Chinese entrepreneurs working 10-10-7 or 12-hours every day of the week.

China and the US may be competing over AI, but they don’t need to engage in a race to the death
China’s governance model, the massive number of internet users and a generation of entrepreneurs are driving progress in AI. While China’s boom has provoked concern in the US, there are many areas where the two countries can collaborate

The US-China Trade War: Winter is Coming
I’ve had a front row seat to China for well over a decade. My law firm started this blog in January, 2006, and we were representing foreign companies in China and the rest of Asia long before that. When we started this blog we were unabashedly optimistic about China, but in the last ten or so years China has gotten more difficult for foreign companies and it has rarely missed an opportunity to prove that its promises to open its economy ring hollow. For nearly every small opening China makes there is usually a corresponding closure. Fool me once, shame on me….

The US-China Trade War: Winter is Coming

China’s small gambit to boost the economy is falling on deaf ears so far today
Although the move is only aimed at small to medium-sized banks, it is part and parcel of China’s continued efforts to stimulate the economy this year. The PBOC noted that this will release about ¥280 billion of funds for private and small business lending in order to lower funding costs for said companies.

Encouraging Signs in China’s Sluggish Auto Industry
China’s vehicle sales declined for the 10th month in a row in March and fell by double digits during the first three months of the year. Despite this gloomy performance, however, encouraging signs are providing hope that the worst may be over for China autos.

Encouraging Signs in China’s Sluggish Auto Industry

China’s Northeastern rust belt was once ‘eldest son’, now struggling as runt of the litter
Liaoning, Jilin and Heilongjiang were birthplace of China’s industrialisation in 1950s, but now contribute just 6.3 per cent to gross domestic product combined People’s Republic of China founding father Mao Zedong called the region the country’s ‘eldest son’ on whose shoulders the family’s future rests

Is that dish real Chinese food? Ask an AI taste-testing robot
Manufacturers are profiting from machines that mimic the senses of human experts but not everybody is ready to let a device have the last word on Chinese cuisine

May Fourth, the Day That Changed China
Protests in 1919 propelled the country toward modernity. One hundred years later, the warlord spirit is back in Beijing.

Ask China Anything: What do you think of idol culture in China?
Chinese pop star Cai Xukun became a meme this spring when the internet began poking fun at his basketball skills. Now, his lawyers are demanding that users of video site Bilibili take down their viral, satirical videos.

Ask China Anything: What do you think of idol culture in China?

China’s Xi Jinping causes alarm with mass student trips to the country
Under the guideline, university and vocational school students will be expected to spend their summer vacations participating in technological, medical and cultural development in impoverished villages nationwide to deepen a “rural rejuvenation” championed by President Xi Jinping. While the scheme is supposed to be voluntary, given Xi’s personal endorsement of the plan it is likely to be seen as compulsory for many university students keen to advance in the party and the government.

Pompeo aims to counter China’s ambitions in the Arctic
The Trump administration sees the polar north as the next frontier of geopolitical competition — and it has China and Russia in its sights.

China’s military may have ‘technologies stolen from US’
US Department of Defense reports say Beijing is aiming to be both prosperous and powerful

China Rejects US Military Passage in South China Sea
China objected Monday to the passage of two U.S. warships near disputed islands in the South China Sea.

The challenges that drive up military spending – in Asia-Pacific and beyond
Collin Koh writes that military operations in the Asia-Pacific region and elsewhere plausibly will have to do more with less in the coming years.

China fires up drills near Taiwan Strait in test of combat strength
Military exercises this week meant to foster image that Beijing can win a war over the island, analyst says

Alain Gillard
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