China Press Review – May 6, 2020

Press review

How soon will economies recover from the coronavirus pandemic? Look to China for answers
Going by China’s experience, it could take countries over three months after lockdown restrictions are eased to get their economies back on track. Economic activity could return to normal levels by the last quarter of 2020

China must act fast to avert the disaster of mass unemployment amid the coronavirus onslaught
Anecdotal evidence suggests more jobs are being lost than is being captured in official data. Without forceful, timely policy support to protect the livelihood of its teeming workers, including 170 million rural migrants, China’s fragile economic recovery won’t go far

Coronavirus: can China and the US uphold the phase one trade deal amid Covid-19?
China agreed to buy US$200 billion worth of US products and services over the next two years before the scale of the coronavirus outbreak became clear  US President Donald Trump said on Sunday that he would terminate the deal if China does not buy the amount of American products it has promised

COVID-19 Risks Reigniting US-China Trade War
Given China’s role as a top producer and consumer in the global economy, any further trade escalation between the U.S. and China will slow the post-COVID-19 economic recovery.

China’s 2020 economic growth target in focus as Beijing set to convene National People’s Congress
Annual parliamentary meeting will be held this month, fanning debate about China’s economic growth target for 2020    Beijing may have to lower economic, development goals due to damaged caused by the pandemic, analysts say

Managing supply chain risk in a post-COVID-19 world
The coronavirus pandemic has called into question several assumptions which have underpinned global trade for decades. By the time the dust settles, the world’s approach to trade could look quite different.In light of the COVID-19 disruptions, Japan is making a concerted effort to reduce its supply chain dependencies on China. The recent stimulus bill passed by the Japanese legislature allocated US$2.2 billion to help Japanese manufacturers shift production out of China. This desire for greater diversification has dovetailed with Japan’s strong commitment to the CPTPP and is leading to an even more proactive push for new members.   The COVID-19 pandemic will recede at some point. But its impact on trade will endure. The world can expect to see less China-reliant supply chains and a beefed-up CPTPP, providing a potential boost for ASEAN’s strong regional orientation.

Global Trade Talk: Reconfiguring US-China Supply Chains for a Post-Coronavirus World
global tradeWhile we need to address the dangers of being over-reliant on China in our supply chain, we also must remain aware of China’s growing global market share, so we can benefit and participate in a fair, constructive and competitive manner.    “A major obstacle in moving jobs and production back to the US is the need to rebuild and upgrade infrastructure.”     “Every company needs to use this time to reexamine its supply chains to determine where they are vulnerable.”     “The US remains the world’s largest economy, at about $22 trillion.”      “Bottom line – to benefit from growth in China you need to be there.”

Coronavirus triggers China’s weakest corporate earnings in a decade. The worst may be over
Profits for more than 3,000 companies on the mainland’s exchanges dropped 42 per cent from a year earlier in the first quarter, according to Soochow Securities     Interim results may still face challenges as Covid-19 dampens listed companies’ overseas sales, Ping An Securities says

Coronavirus: China’s central bank, finance ministry at odds over funding for economic recovery
Finance Ministry official calls for central bank to purchase bonds directly from the government, breaking a long-standing taboo   But the People’s Bank of China warns relaxing rules could erode fiscal discipline and spending efficiency

China Considers Dropping Numerical GDP Growth Target for 2020 Bloomberg News Bookmark
China’s leaders are considering the option of not setting a numerical target for economic growth this year given the uncertainty caused by the global coronavirus pandemic   Full-year economic growth will likely slow to 1.8%, according to the median estimate of economists surveyed by Bloomberg. It’d be the first time for Chinese leaders not to issue a numerical growth target in at least two decades. The State Council Information Office referred questions on the growth target to the National Development and Reform Commission, which did not immediately respond to a request for comment. The State Council typically leads the drafting of the work report. Some economists, including central bank adviser Ma Jun, have publicly advocated scrapping the numerical goal because of the pressure it puts on policy makers. The nation’s top leaders also softened their tone on the importance of meeting specific growth targets at a Politburo meeting last month.

How the coronavirus pandemic could lead to a ‘less Chinese’ belt and road initiative
As the physical connectivity aspect of the belt and road plan takes a hit amid the Covid-19 outbreak, health and e-commerce projects may get greater attention    To spread risks, China may have to work with partners such as the World Bank or Asian Development Bank – a move that could boost trust in the initiative

Boost your e-commerce revenue in times of crisis – expert tips
Regardless of whether you’re a new business organization or you’re a seasoned business owner who is in the market for several years, increasing your e-commerce sales can always benefit your organization. However, it is sad to note that businesses often go through ups and downs. You don’t have to get discouraged if such things happen.      While there are firms like Ignite Digital that give you the best tips to boost your e-commerce revenue, you should still know how you could generate more sales for your e-commerce website.

Chinese EV makers Nio and Lixiang deliveries double in April
Lixiang, a Chinese electric vehicle maker little known outside the country, is quickly catching up to other domestic EV startups by delivering more than 2,600 cars in April, a finish just several hundred units fewer than another Tesla’s challenger, Nio.

China tech faces double compliance challenge in Europe
Chinese tech firms such as Huawei and Bytedance have developed their global presence through aggressive R&D and physical presence in the European Union (EU). Huawei, for instance, filed the highest number of patents in 2017 out of any company in the EU and booked billions in contributions to the EU economy the same year.

Global firms push US to research 5G tech that would minimise Chinese influence and allow multiple vendors
Companies including Google, Samsung, Cisco, AT&T and Vodafone urge US lawmakers to fund next-generation tech development     Firms urge research into radio access networks that would move 5G infrastructure away from expensive proprietary hardware dominated by China

Is Huawei’s 5G national security threat or economic opportunity for the UK?
In January, just a few weeks before the COVID-19 pandemic delivered its deadly strike against the United Kingdom, its National Security Council awarded Chinese telecoms giant Huawei the central contract to develop the UK’s 5G network. British Prime Minister Boris Johnson trumpeted that this was ‘a very important strategic win’, would boost the economy, and promised it would ‘not compromise critical national infrastructure’.

Chinese chip maker SMIC’s US$3 billion Shanghai listing is a hedge to reduce company’s reliance on US technology
SMIC plans to float as many as 1.69 million new shares on Shanghai’s Star market     The plan could help SMIC raise more than US$3 billion

Online push helps Shanghai shopping festival pull in US$2.2 billion of sales in first 24 hours
The Double Five shopping festival is part of measures to boost consumer spending, which has slowed during the Covid-19 outbreakombined sales from online and offline channels crossed the 10 billion yuan mark 20 hours after the event launched

Tmall’s head of fashion in Europe on new luxury Soho channel
Alibaba Group has piloted Luxury Soho, a new platform aimed at young, value-conscious luxury shoppers. We spoke to Christina Fontana, head of Tmall Fashion and Luxury in Europe, on the launch of the new platform and why she sees it as the company’s next major destination for premium brands after Tmall Luxury Pavilion.

The Secrets of Top-Selling Chinese Beauty Brands
As Chinese consumers grow less enthusiastic about global beauty brands, emerging domestic players are gaining market share? But how? According to Statista, revenue in the Beauty & Personal Care market amounts to over $55 million thus far in 2020. Moreover, the market is expected to grow annually by 7.1 percent through 2023.   Until recently, L’OréalEstée Lauder, and Shiseido were the prestige companies benefiting the most from recent beauty market growth. But gone are the days in China when local consumers were easily swayed by global beauty brands. Because of changes in consumer behavior/sales patterns and the greater proliferation of e-commerce, domestic players now have a shot at outperforming their big international competition.

Beauty Trends in the Time of Social Distancing
COVID-19 has brought on a host of unforeseeable challenges to the beauty industry. Yet, some of the latest trends have emerged as the lockdown continues.  COVID-19 is changing everything. For the beauty industry, which pre-pandemic, was busy cultivating innovation, investing in experiential marketing, designing sustainable packaging, and rewriting the rules of consumer engagement, the advent of the pandemic has brought on a host of unforeseeable challenges, as well as new possibilities. With consumers around the world in various stages of lockdown, revenues have drastically fallen, and with it marketing budgets, brands have been forced to rethink their entire business models. Some brands have leveraged the power of the Internet to increase their perceived value, while others have revived their brand identity through contemporary sales techniques. It goes without saying, that regardless of the strategy, every brand felt the profound impact of COVID-19 on its operations.

China’s $1 Trillion Of U.S. Treasuries Are A Bet On Trump’s Casino That May Go Bust
The house always wins. This casino-industry maxim goes a long way to explaining the leadership style of a U.S. president who made his bones running such establishments.   More accurately, running them into the ground. How Donald Trump the businessman managed to bankrupt his Atlantic City, New Jersey, casinos and still make money is part of the folk-hero schtick that propelled him to the White House.

How COVID-19 is changing the world of beauty
The beauty industry has been resilient in the past. Could this crisis have a different outcome?  Even before the pandemic, the definition of “beauty” was becoming more global, expansive, and intertwined with individuals’ sense of well-being. The COVID-19 crisis is not likely to change these trends—and in that, there is reason for hope.

Coronavirus lockdown: India jobless numbers cross 120 million in April
A lockdown to curb the spread of coronavirus has seen 122 million Indians lose their jobs in April alone, new data from a private research agency has shown.

India offers land twice Luxembourg’s size to firms leaving China
Land has been one of the biggest hurdles for companies looking to invest in India.

Coronavirus: Can live-streaming save China’s economy?
China’s live-streaming industry has become an important platform for economic recovery
“I’m a bit nervous,” confessed Li Qiang, the deputy mayor of Wuhan, the Chinese city where the coronavirus was first reported late last year, as he awaited the start of his first-ever live-streaming event.

Bank of China oversteps regulations in passing derivatives off as wealth management. And it’s not alone
Several bank officials say the crude oil derivative products effectively overstepped regulations that bar the country’s lenders from operating as commodities futures brokerages     Bank of China says it will compensate 20 per cent of investors’ original investments in the oil-linked product, according to investors

European Union backs international inquiry into origins of coronavirus outbreak
The bloc says it and its member states will co-sponsor a draft resolution on a ‘independent review’ into the Covid-19 pandemic at the World Health Assembly   China has so far resisted calls for an investigation, saying it would become the target of a ‘blame game’

Coronavirus: China could cut US debt holdings in response to White House Covid-19 compensation threats, analysts say
US news reports suggest White House officials have already considered the idea of cancelling all or part of the US$1.1 trillion debt owed to China   In response to the debate over the highly unlikely ‘nuclear option’, China could cut its holdings as the US ramps up borrowing to pay coronavirus-related costs

A US move to seek coronavirus pandemic damages from China might well trigger war
Mounting calls in the US to demand compensation for perceived Chinese missteps over Covid-19 have the support of both political parties and public opinion. If Washington gave in, it would spell the end of 40 years of normalised diplomatic relations   If Trump acts to seek damages from China over the pandemic, it will put an end to such normalised diplomatic relations, as any such move might be tantamount to the declaration of war. Under such circumstances, history will be pushed back in time, probably to before Deng’s US visit or Nixon’s China trip.

Joint coronavirus response could ‘restore trust’ in US-China relations
Chinese ambassador to Washington Cui Tiankai says relationship should be based on more than economics and trade, in CCTV interview Wuhan was ‘first victim’ of the pandemic and China should not be held responsible, he adds

Deciphering Trump’s political attacks on China
Trump clearly hopes that China-bashing will get him re-elected in November; so does his rival Joe Biden

‘This is the start of a new Cold War,’ former Trump trade official says of rising US-China tensions
Rising tensions between the U.S. and China — made worse by the coronavirus pandemic — is the start of a new Cold War, former top White House trade negotiator Clete Willems told CNBC.  Among the latest disputes between Washington and Beijing is the origin of the coronavirus, which has infected more than 3 million people and killed over 250,000 globally, according to Johns Hopkins University data.   In the U.S., critics allege Beijing wasn’t upfront about the dangers of the virus, was too slow to respond and under-reported the extent of the outbreak within its borders.  China has rejected many of those claims and at times appeared to attempt to turn the tables around by alleging that the U.S. military might have brought the virus to Wuhan.

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