Belgian-Chinese Chamber of Commerce (BCECC)

China Press Review – November 24, 2021

5 things to know about marketing to China’s post-95s
If there is one group that seems to hold the keys to the promised land of Chinese consumerism, it is the “post-95s”. This moniker refers to those born after 1995, also known as Gen Z in the West, who have come to redefine the Chinese economy with their individualism, their search for what being Chinese means, and their preference for authentic brands and meaningful experiences. It can often be a confusing proposition for brands to market to this group of twenty-somethings, as their tastes seem so different from the generations that came before them.  But it doesn’t have to be complicated: a series of interviews by Chinese mag Digitaling revealed exactly how they think and what they prioritise in brands. As it turns out, they are not so different from Gen Z in the West.

EU-China deals fall after screening increase
Deals between China and Europe have fallen dramatically over the last two years, according to a report from the European Commission that indicates there are still governments that haven’t implemented increased screening of foreign deals and investments, reports Bloomberg. While 24 nations either have rules in place or are working on them, three EU member states—Bulgaria, Croatia and Cyprus—haven’t revealed any legislation to scrutinize outside investments.   China’s merger and acquisition transactions in Europe fell 63% in 2020 from the previous year and made up just 2.5% of all deals compared to 4% the previous year, the report said. The decline seems to be independent of the pandemic, since it started in November 2019, two months before the first COVID-19 restrictions, and hasn’t picked up significantly as economies opened up again. China is the fourth biggest source of M&A for the region, far behind the US, UK and Switzerland.   EU governments have been showing concern over Chinese investment for several years, prompting rules that require foreign investors to notify deals or projects that might touch on sensitive areas such as defense or crucial technology. Germany blocked a Chinese bid for a machine-tool firm in 2019.

China’s investments in Europe plunge amid coronavirus, squeeze on foreign buyers
Chinese and Russian purchases in particular can expect to face review and scrutiny under the EU’s investment screening mechanisms   The screening tools were established after concerns were raised about Chinese investments in European infrastructure sites and technology firms

China on high alert for mounting economic headwinds as Li Keqiang meets with local government heads
Li Keqiang urged local governments to take more action to support small businesses and make them a major economic priority     The move comes hot on the heels of warnings by several government advisers that the country’s economic recovery is not stable yet

US-China tech war: Beijing calls on Washington to stop further dialogue with Taipei on supply chain resilience, semiconductors
The second annual economic dialogue between Washington and Taipei focused on issues that include supply chain security and semiconductors     Taiwan economic affairs minister Wang Mei-hua also asked Washington for government subsidies to support Taiwanese firms doing business in the US   In addition to “countering economic coercion”, the talks also focused on supply chain resiliency, “promoting the digital economy, strengthening 5G network security, and advancing collaboration in a variety of science and technology fields”, said the US State Department in a statement.  Meanwhile, cooperation between Beijing and Taipei is expected to depend on mutual trust between the two sides, according to semiconductor research fellow Liu. She indicated that the mainland Chinese market has huge potential, which no Taiwanese hi-tech company – especially in the semiconductor sector – would ignore.   Taiwanese engineers, for example, have played a major role in helping develop the mainland’s semiconductor manufacturing industry. China’s top foundry, Semiconductor Manufacturing International Corp, was founded by Taiwanese entrepreneur Richard Chang Rugin.    Still, mainland China has largely focused on mature chip technologies that are not subject to US trade sanctions.  “There is no realistic prospect of China being able to match the capabilities of the global leading-edge semiconductor manufacturers in the next few years,” said Tilly Zhang, a researcher at Gavekal, in an industry note this week.

China remains Germany’s biggest import country market for consumer electronics: Destatis
China remained Germany’s biggest import partner for consumer electronics between January and September this year, accounting for 39.2 percent of total imports, the Federal Statistical Office (Destatis) said on Tuesday.    Around half of all consumer electronics devices imported into Germany came from Asia. With a share of 7.8 percent, Japan was Germany’s third most important source of imports after Poland, according to Destatis.    Germany imported consumer electronic products worth 7.7 billion euros (8.7 billion U.S. dollars) in the first three quarters of 2021, an increase of 12.9 percent year-on-year. Compared with pre-crisis year 2019, imports were up 9.4 percent.

China’s cash-strapped developers hold off defaults through deals with investors, but not out of the woods just yet
Kaisa reaches an agreement with investors that its wealth management product will pay a 10 per cent instalment on maturity followed by 10 per cent payments every three months     Aoyuan Group says it has reached a resolution with investors to extend the payment of its 816 million yuan asset support special plan

and what that could tell us about Evergrande’s future
Anbang, Baoshang, and HNA are three of China’s most high-profile corporate meltdowns in recent years. Authorities stepped in to manage all of them.  Chinese property giant Evergrande is teetering on the brink of collapse, with $300 billion in debt.   The Chinese government is likely to step in to manage the company’s unraveling, experts say.  Authorities previously stepped in to manage meltdowns at Anbang Insurance, Baoshang Bank, and HNA Group.

Beijing lectures Alibaba, Baidu cloud units over fraudulent websites amid internet clean-up campaigns
China’s industry ministry told Alibaba and Baidu that their cloud units were not adequately fighting telecoms fraud and ordered corrective action     Both cloud computing and storage services are facing mounting scrutiny in China as the government increases regulatory oversight of the internet

China suspends Tencent from updating existing apps or launching new apps -report
China’s Ministry of Industry and Information Technology has told app stores and platforms to implement the order against Tencent apps     It is not known how long the suspension will last and the Chinese ministry has not published any information about the ban

China’s tech crackdown: live-streaming e-commerce stars get a reality check from the taxman
The implications of this tax-focused campaign on the live-streaming sector could be huge for the world’s biggest e-commerce market     Chinese live-streaming stars Zhu Chenhui and Lin Shanshan have become the unofficial poster girls of this new crackdown

Samsung’s US$17 billion Texas chip plant to create 2,000 jobs as US looks to ease global chip shortage, counter China
Samsung Electronics’ new US-based semiconductor plant will be about 30 miles outside Austin, Texas, with a 90 per cent break on property taxes     The US has been courting chip makers like Samsung and TSMC as it seeks to safeguard the production of cutting-edge technology amid competition with China

Huawei, banned from the US, teases consumers with Black Friday 100 per cent discount offer
After the Twitter post drew thousands of likes, Huawei USA said it was ‘just a joke’ because ‘we can’t sell anything in the USA’     Huawei reported a 32 per cent slump in sales for the first nine months of 2021, deepening a 29.4 per cent decline in the first half

China Green Cards: Guangzhou Mulls New Scheme for High-Level Talent
A new China green card scheme proposed in the southern city of Guangzhou aims to attract high-level talent from both within and outside of China to the city. The scheme offers two levels of green cards to high-level talent that provide a range of benefits to aid relocation, living, working, and conducting business in Guangzhou.

Deciding how to spend the world’s carbon budget is complicated, with consequences for business and nations as well as the planet
Decarbonisation investment is necessary in sectors where low-carbon solutions do not yet exist   The path to net-zero emissions will vary between industry sectors and the resources of individual nations   For instance, 20 per cent of India’s annual greenhouse gas emissions come from agriculture, more than double the equivalent share in the European Union and about four times as much as in the US or China. While it is much harder and more expensive to reduce emissions from agriculture than it is for many other activities, countries can identify achievable targets. A significant share of electricity in India comes from burning coal and could be replaced by cleaner forms of electricity generation – relatively inexpensive in the long term    One scenario suggests that by 2050, weekly meat consumption for the average household will decline by 33 per cent, and all new cars sold will be battery-powered. The committee also suggests that electricity will be virtually carbon-free, that wooded areas will increase by around 40 per cent and that restored peatlands will nearly triple in size.   Discover more analysis on how the world should be allocating a carbon budget in our latest report.

China’s disappearing ships: The latest headache for the global supply chain
Ships in Chinese waters are disappearing from industry tracking systems, creating yet another headache for the global supply chain. China’s growing isolation from the rest of the world — along with a deepening mistrust of foreign influence — may be to blame.
Analysts say they started noticing the drop-off in shipping traffic toward the end of October, as China prepared to enact legislation governing data privacy.

Jamie Dimon says he regrets joking about the Chinese Communist Party
Dimon is trying to take back a joke about China and its powerful political machine.
Speaking at an event in Boston on Tuesday, the JPMorgan (JPM) CEO said he “made a joke” during a recent trip to Hong Kong, referencing the ruling Chinese Communist Party’s 100th anniversary.
“The Communist Party is celebrating its 100th year. So is JPMorgan,” he said, referring to the bank’s recent celebration of a century of operation in China. “And I’ll make a bet we last longer.”

The status quo in the Taiwan Strait is edging toward conflict. Here’s how to stop it.
In December 2003 during his meeting with Chinese Premier Wen Jiabao at the White House, then U.S. President George Bush said that the United States opposed “any unilateral decision by either China or Taiwan to change the status quo.” Nearly two decades later, that message hasn’t changed. At the end of last month, U.S. Secretary of State Antony Blinken is reported to have made it “crystal clear” in his talks with Chinese Minister of Foreign Affairs Wang Yi that the United States opposes any unilateral change to the status quo.    Is this evidence of a consistent, clear American position on the cross-Strait question? Or is it the expression of a weak policy formula, in which status quo simply means no war

Hong Kong: Pro-democracy activist Tony Chung jailed under security law
A student activist in Hong Kong has been sentenced to three years and seven months in prison for arguing that the territory should pursue independence.

podcast Biden, Xi, and the Importance of Guardrails in the US-China Relationship
The United States and China aren’t satisfied with their relationship, but both sides appear to be interested in managing their differences.

Australia’s reliance on China buying lots of our iron ore puts us right where Beijing wants us
Efforts to push back against China’s bullying behaviour will prove ultimately pointless, with Australia dangerously beholden to Beijing.

What do Xi Jinping’s policies mean for Africa?
China’s New Era is the era of Xi Jinping, and Xi’s policies towards Africa are increasingly driven by politics rather than economics, says David Large in his new book “China and Africa: The New Era”.  Here too there are likely to be future tensions. China’s expanding role as a holder of African debt will increasingly shape relations in the months ahead as African economies brought low by the Covid-19 pandemic seek loan deferrals and cancellations from Beijing and its network of policy banks. Given the vital importance of debt renegotiation and forgiveness, Chinese financial support at this year’s FOCAC is not expected to rival previous years, where announcements totalled up to $60bn in total. The era of easy Chinese money in Africa looks to be coming to a close, especially given domestic worries about the health of the Chinese economy following recent financial scandals. Even so, while the future of China-Africa ties may increasingly be geared towards politics, it can be argued that China’s economic engagement with Africa, in the form of investments, loans and patronage, has already borne substantial dividends. Such is the realpolitik of the current world order.    Until the West can compete with China’s economic pledges on the continent, their political influence is likely to remain secondary to the expansive vision of Xi Jinping.

Biden administration invites Taiwan to its ‘Summit for Democracy,’ infuriating Beijing
Washington, DC The Biden administration has invited Taiwan to its “Summit for Democracy” next month, according to a list of participants published on Tuesday, a move China has called a “mistake.”The first-of-its-kind gathering is a test of President Joe Biden’s assertion, announced in his first foreign policy address in office in February, that he would return the United States to global leadership to face down authoritarian forces led by China and Russia.  There are 110 participants on the State Department’s invitation list for the virtual event on December 9 and 10, which aims to help stop democratic backsliding and the erosion of rights and freedoms worldwide. The list does not include China or Russia.

Communist Party infighting, a sign that Xi Jinping doesn’t control everything
Cracks have appeared in the CCP before and after its sixth plenary session. Internal opposition prevents President Xi from imposing his version of the third “historic resolution”. The case of tennis player Peng Shuai was artfully built to hit Zhang Gaoli. The Chinese do not accept Xi’s dictatorial model. The “father of democracy” in China, now exiled in the United States, offers his thoughts.

Alain Gillard
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