China Press Review – November 14, 2019

Press review

China’s Commerce Ministry says trade war should be ended by removing tariffs
China is still calling for the U.S. to roll back tariffs as part of any “phase one” agreement, as trade negotiations between the world’s two largest economies drag on. “If both sides reach a phase one agreement, the level of tariff rollback will fully reflect the importance of the phase one agreement,” China’s Ministry of Commerce spokesperson Gao Feng said in Mandarin.  Gao did not specifically address a comment from President Donald Trump last Friday that he had not agreed to remove tariffs on Chinese products.

China think tank becomes first government-linked body to predict 2020 growth will drop below 6.0 per cent
National Institution for Finance and Development says China’s economic growth rate will slow to 5.8 per cent in 2020 from an estimated 6.1 per cent this year   This is at the bottom end of China’s target range of 6 to 6.5 per cent growth for 2019 and is in line with the International Monetary Fund

Economic Relationship?
Beneath the tariffs, counter-tariffs and on-again off-again negotiations between the U.S. and China over trade policy, a deeper confrontation is brewing—one with potentially bigger consequences.

China’s economic slump continues as manufacturing growth slows sharply, investment growth hits 20-year low
Industrial production grew by 4.7 per cent in October, down from 5.8 per cent in September, and below analysts’ forecasts    Retail sales and fixed asset investment growth also declined in October, as pressure builds on Beijing to arrest the downturn in the economy

China’s Investment Growth Slows to a Record Low
The engines of China’s economy are sputtering, with exports falling, factory output slowing, investment growth at a record low and consumption coming off the boil. Industrial output rose 4.7% from a year earlier, versus a median estimate of 5.4%, data showed Thursday. Retail sales expanded 7.2%, compared to a projected 7.8% increase. Fixed-asset investment slowed to 5.2% in the first ten months. That was the lowest reading in comparable data back to 1998.

China’s outbound investment up 5.9% in first 10 months
China’s non-financial outbound direct investment posted steady growth in the first 10 months of the year, data showed Thursday.    Non-financial ODI in 164 countries and regions amounted to 621.78 billion yuan (US$90.46 billion) in the period, up 5.9 percent year on year, according to the Ministry of Commerce.

China ramps up regional effort to curb financial risks in Yangtze River Delta
China’s financial regulators have set up a regional mechanism to improve coordination on identifying, monitoring, reporting and resolving financial risks in the sprawling Yangtze River Delta, a provincial banking regulator said on Thursday.

Your Introduction to the Gen-Z Consumer
Gen Z understands the importance of staying informed, and this knowledge formed their beliefs that brands should adopt socially and environmentally responsible practices. Photo: Shutterstock
In spite of their general resistance to marriage and procreation, millions of millennials have nonetheless embarked upon the adventures of family life. Yet once they embrace parenthood, their priorities and spending habits change from a focus on frivolities and leisure activities to parenting products and services. Therefore, the luxury industry came up with a contingency plan by turning its focus toward Generation Z. Both generations remain relevant, but Gen Zers are credited with bringing new blood into streetwear culture while helping to modernize classic brands like Gucci and Saint Laurent.

Burberry aims to woo more customers in China with Tencent tie-up
British luxury brand Burberry <BRBY.L> on Thursday said it has joined forces with China’s Tencent <0700.HK> for a new digital marketing and sales push to tap the nation’s increasingly social media savvy shoppers in a critical luxury market.      Burberry said it will open a so-called “social retail” store in Shenzhen in China’s technology hub powered by Tencent technology in the first half of next year that will blend retail and social media to create digital and physical spaces aimed at attracting customers.

Sorry Trump, Multinationals Are Still Pouring Cash Into China
Foreign companies continue to invest more in China even after President Donald Trump called on U.S. firms to look elsewhere, as the rising spending power of 1.4 billion people proves too hard to resist.    Companies from Tesla Inc. to Walmart Inc. are expanding operations in the world’s second-biggest economy, joined by counterparts from Korea, Japan and Europe. That’s helping offset the departure of goods manufacturers that have had to rethink supply chains after U.S. tariffs made their products more expensive.

Where is the new China?
As the trade war carries on and labor costs rise, supply chains seek a new home for manufacturing and sourcing. But each alternative location comes with pros and cons.

China’s economic success given ample plugging in new exhibition, while glancing over problems
A new exhibition at the Beijing Exhibition Centre carefully narrates China’s economic transformation from backwater to global power   But the show glosses over historical moments like Mao Zedong’s disastrous Great Leap Forward or China’s public debt problems

China’s economy: Powerful, yes, but vulnerable
China’s rapid growth has produced prosperity and reduced poverty. It has also generated less wholesome economic, social, and ecological consequences which are now catching up with it.

China to unify regional economic data calculation from early 2020 to further boost acceptance of figures
Economic data quality has constantly been questioned, particularly at a local level where governments have strong incentives to inflate figures for political promotion   News comes with analysts questioning if a census will be modified to allow China to reach its goal of doubling the size of its economy in 2020 from a decade earlier

Chinese President Xi Jinping tells BRICS summit ‘protectionism and bullying’ hurting world economy
No mention of partial trade deal with United States after previous suggestions that Xi and Donald Trump could meet this week to sign one    Xi invites Indian Prime Minister Narendra Modi to visit China next year

China bolsters Europe foothold with Belt and Road expansion
Cosco-run Greek port to receive fresh investment to expand  Greece, in Egypt and in France, top Chinese officials promoted the Belt and Road Initiative this week, defying U.S. skepticism toward the infrastructure-building program, and making clear their intent to expand its footprint in Europe.

China Smart City Expo was unveiled in Shenzhen
On November 13, 2019, China’s top science and technology exhibition – China Hi-Tech Fair (CHTF), which has been held for 20 sessions, officially kicked off. The China Smart City Expo jointly organized by the State Information Center and IDG Asia was officially opened in Hall 6 of Shenzhen Convention & Exhibition Center.

China trails US, Europe in quantum computing development: researcher
Zhang Shengyu, a prominent researcher at Chinese tech giant Tencent, said that China will not be able to match the US and Europe in quantum computing “within two or three years,” the South China Morning Post reported.

American Poultry Farmers Regain Access to China
United States Trade Representative Robert Lighthizer and U.S. Secretary of Agriculture Sonny Perdue released the following statement on China’s decision to lift its ban on poultry imports from the United States:

Anatomy of a China Joint Venture
Despite the increasing difficulies with doing business in China (or perhaps because of those difficulties), our China corporate lawyers are seeing an increase in foreign companies looking to do joint ventures in China. This is the first part in a new series of posts in which we will explore the issues involved in forming a China joint venture, from beginning to end.    Our firm usually gets a China joint venture matter when a company calls or emails us, saying they are “looking to do a China joint venture” and asking us if we can help. Our immediate answer is to say yes we can, because we can.

Alibaba sets price for Hong Kong-listed shares after overwhelming response for global tranche of US$13.9 billion secondary listing
Alibaba Group Holding will offer its shares at no more than HK$188 (US$24) each, according to bankers and sources familiar with the deal     Alibaba plans to raise up to US$13.86 billion, in the first secondary listing on Hong Kong’s stock exchange, in a deal that would catapult the city back to the top of global ranks as the IPO capital

Deloitte: China could be a gold mine for asset managers
The Chinese government is set to eliminate restrictions on foreign ownership of fund management firms in 2020, opening up major opportunities for U.S. and other global firms to capture potentially trillions of dollars in new assets, according to new research from Deloitte.

Is Australia too dumb and too China-dependent?
Having been labelled ‘dumb’, ‘getting dumber’ and ‘too dependent on China’, it’s been a rough few weeks for Australia’s exports. Luckily, these criticisms are largely misguided. They misunderstand how and why markets produce certain outcomes in an open economy. The remedies proposed are solutions in search of a problem.

Chinese tourists say ‘I do’ to low-cost European holidays in Serbia
Landlocked Balkan state is one of the fastest-growing destinations in Europe for Chinese travellers, with 92,000 visiting in the first eight months of 2019    Ties between the two countries have flourished since Serbia in 2017 became the first European nation to scrap visas for Chinese visitors

Trade war puts cork in U.S. wine sales to China
Since June, Beijing has been imposing 93 percent tariffs and taxes on American wine

Is Beijing ready to step in to stop Hong Kong protests?
Despite the escalating chaos this week, observers do not think the central government is ready for such a drastic step   One analyst believes that the cost to China’s international reputation is still too high while another questions whether it has an effective plan

If China puts troops in Hong Kong, US should end the city’s trade status, US commission recommends
Washington should end the special economic status granted to Hong Kong if China deploys its military forces in the city, a congressional body warned on Thursday.  The US-China Economic and Security Review Commission also called for US export control measures on mainland Chinese companies to be extended to their Hong Kong subsidiaries.

Mars here we come: China completes lander test for 2020 mission
Module successfully hovers, avoids obstacles at test site in northern China    Programme on track to begin seven-month journey to red planet next year, head of space administration says

Alain Gillard
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