Belgian-Chinese Chamber of Commerce (BCECC)

China Press Review – November 26, 2021

China’s world-class business environment plans ‘address’ some concerns, but ‘implementation key’
China’s State Council has selected six economically developed cities to take part in a pilot programme to improve its business environment. European Union Chamber of Commerce in China president Joerg Wuttke welcomed the plans, but said China has fallen short of implementation in the past. The State Council has selected six of China’s economically developed cities – Beijing, Shanghai, Guangzhou, Shenzhen, Hangzhou and Chongqing – to take part in a pilot programme, according to a circular released on Thursday.

Reform comes first in delicate balancing act for China’s economy
Despite the economic slowdown, Beijing believes the window of opportunity remains open for further opening up to ensure growth is sustainable and not just about numbers. Local government needs more support. Li pledged that Beijing would transfer more money to the provinces and called for more transfer payments at the grass-roots level and for stronger financial support below the county level.  Beijing believes the window of opportunity remains open for economic reform to ensure sustainable growth and get the balance between growth factors right, rather than just focus on numbers.    This involves deleveraging and restructuring, including selectively supporting small and micro businesses. Private business is the core of China’s consumer economy and a pillar of rising incomes and domestic consumption under a strategy to rely less on exports. Forgoing major changes of policy to stimulate growth may be a hard decision, but remains necessary to keep the focus on reform.    The remarks by Xi and Li help set the scene for the Central Economic Work Conference, a meeting of China’s top leadership expected next month to set priorities for 2022.

Russia-China Bilateral Trade Up 30.9% Over 2020
Russo-Chinese trade turnover from January to October 2021 grew by 30.9% year on year, reaching US$115.66 billion, China’s General Customs Administration reported on Sunday. That indicates a predicted 2021 total trade turnover of about US$140 billion for the year.

Hong Kong must capitalise on global financial trends to maintain hub status, pro-Beijing think tank says
Hong Kong should use its edge to position itself as an offshore yuan centre, an ESG investment hub and a digital-asset trading centre, says One Country Two Systems Research Institute report     Mainland China has high hopes for the development of Hong Kong’s financial industry, says the think tank’s chairman Peter Lee

Beijing looks into setting up digital asset exchange to push the e-yuan
The proposal shows the country’s determination to promote its digital currency, says broker      The suggestion is among a wide range of developmental plans for the Beijing municipal administrative centre

China’s real estate uncertainties persist, fueling market anxiety
While the plunge in Evergrande’s shares has abated, the volatility in other Chinese real estate companies has continued this month.    The consensus among economists is that the real estate slump is contained, since it’s driven by a top-down government decision to limit reliance on debt in the property industry.    Foreign investors say they are largely in the dark, rather than receiving timely corporate disclosures or clarity on policy.

US-China tech war: state media questions Washington’s intent on demanding chip supply data from TSMC, Samsung amid ‘targeted sanction’ concerns
The US government’s recent request for chip supply data ‘exposes its plot’ to hold back China’s semiconductor development, according to Xinhua    While no mainland Chinese firms were targeted by the US survey, it set off alarm bells in the country’s semiconductor industry   TSMC, which plans to expand its chip fabrication facility in the eastern city of Nanjing, assured in October that it would “respond to the request without providing customers’ confidential information”. In a commentary published on Chinese media on November 9, a day after the US survey’s deadline for submissions, Beijing-based tech analyst Xiang Ligang indicated that the information gathered could help the US “accurately strike” Chinese companies that may order advanced chips from manufacturers overseas. Despite his earlier warning of potential targeted sanctions, Xiang on Friday said the US will not know the details about the progress of China’s domestic semiconductor companies. Xinhua’s latest broadside against the US government came a day after Washington added a dozen more Chinese firms to its trade blacklist, which restricts American enterprises from selling products to these companies on national security grounds. The additions to the US Commerce Department’s entity list include semiconductor firms, quantum computing companies and Chinese businesses that have contributed to nuclear activities in Pakistan.

China requires new apps to get state approval
China’s ruling Communist Party has relied upon success stories like Tencent to push forward a digital transformation in the country, and the biggest domestic apps have hundreds of millions of users.
But Beijing abruptly turned on the sector late last year as concerns mounted over its aggressive expansion and allegations of monopolistic practices and data abuses –- paralleling similar unease with tech firms in the United States and elsewhere.

Didi shares sink on a report that Chinese regulators have asked it to delist from U.S.
Chinese regulators have asked Didi to come up with a plan to delist from the New York Stock Exchange in the U.S., according to a Bloomberg report.  Shares of the ride-hailing giant sank nearly 7% in U.S. premarket trading.    SoftBank shares in Japan closed down by 5%. SoftBank’s Vision Fund owned more than 20% of Didi following its U.S. listing.

China tech: round two of government crackdown will generate more losers
Beijing has not yet cracked down on the tech giant.Regulators have ordered social media group Tencent to stop deploying New app .They also went to Didi of the ride-hailing company Remove from list From the US exchange. If delisting is forced, the impact will be widespread.    Diddy was told to create a delisting plan because of concerns about possible leaks of sensitive data. Beijing is reported to have set a deadline for resolving the issue. The report was sufficient to hold down more than 5% of Diddy’s largest minority stake in Japanese tech investor Softbank on Friday.     Unprecedented forced privatization should worry US investors. It could spur sales to more than 240 Chinese companies with a market capitalization of over $ 2 trillion listed in the United States. This includes China’s largest companies such as e-commerce group Alibaba and, as well as financial groups such as ChinaLife Insurance and Lufax, the online lending division of China’s largest insurance company PingAn. The latter contains much more sensitive data than data through Didi’s app.

Walmart store in Shenzhen is closing, sparking broad discussion among Chinese
The US supermarket chain Walmart is closing its first store in the Chinese mainland at the end of November, on the occasion of the 25th anniversary of the company’s entering the market.

Debt-stricken Fantasia becomes first Chinese developer to face a wind-up petition, possible liquidation
Fantasia said a major subsidiary was facing a wind-up petition filed by creditors, which could force the debt-ridden developer into insolvency    It is the first time that a wind-up petition related to offshore debts has been filed against a mainland developer or its subsidiaries

China’s housing market slump, power crisis lead to first drop in carbon emissions since Covid-19 economic recovery
Carbon dioxide emissions fell by around 0.5 per cent year on year in the third quarter, according to a report by Centre for Research on Energy and Clean Air     Carbon emissions could rebound once again before peaking later this decade if Beijing injects stimulus to boost its economy in case of a slowdown, report warns

Learning from China’s Double 11 Shopping Festival: Marketing, Retail, Consumption Trends
China’s rising consumer power plays an important part in the country’s dual circulation strategy and is an engine of global growth in many categories. The Double 11 shopping festival, as the largest and most popular annual global shopping festival in the world – now overshadowing Black Friday and Cyber Monday combined – serves as a window to observe China’s latest consumer trends.  This year, the Chinese annual shopping festival began on October 20, 2021 at 8 pm. It was first launched by the Alibaba Group Holding Ltd. in 2009 around the unofficial November 11 holiday that celebrated single people. Since then, the commercial activity around the celebration has expanded from one day to three weeks and extended from Alibaba’s Taobao and Tmall marketplaces to the whole retail sector.   Retailers and brands now tap into social features on social media platforms and embrace livestreaming sessions besides omnichannel marketing campaigns to increase their sales in the Chinese market, particularly as new entrants bolster competition during periods like the Double 11 shopping festival. In this article, we’ll walk you through the emerging new trends.

Ant Group applies to China’s central bank to set up personal-credit scoring joint venture with state-backed partners
The personal-credit scoring joint venture, Qiantang Credit, will be 35 per cent owned by a unit of Ant Group    Tech firms are hiving off their consumer-credit data units in joint ventures with state-backed entities, which could help allay regulators’ concerns about their control over personal data

China’s yuan firms, market expects Beijing to rein in strength
China’s yuan strengthened against the dollar on Thursday, underpinned by continued year-end corporate demand for the local currency, but some economists expect Beijing to start reining in the currency’s rise amid concerns about its impact on exports.

The Idiosyncrasies of China’s Bond Market
China’s bond market appears hampered by unpredictable default mechanisms, non-standardized bond covenants, and unreliable bond ratings.   Financial stability continues to be a top policy priority in China. More transparent defaults, more standardized covenants in bond indentures and better ratings are needed for stability in China’s bond markets and the broader financial system. We are watching China’s capital markets evolve before our eyes; what happens with a few large looming defaults and restructurings will be critical to this effort.

China food delivery giant Meituan reports 10bn yuan loss after paying antitrust fine
China’s biggest on demand food delivery provider Meituan reported a 10 billion yuan loss in Q3 after getting hit with an antitrust fine   Chinese regulators are taking a much tougher stance on the country’s increasingly powerful tech giants

China’s nominee wins Interpol seat despite concerns of human rights groups
The candidacy of Hu Binchen, an official in the Chinese public security ministry, was also opposed by alliance of lawmakers from 20 countries    Election helps China use global policing body for repressive policies, endangering Hongkonger, Uygur, Tibetan, Taiwanese and Chinese dissidents, alliance says   “Hu’s election gives the [Chinese] government a green light to continue using Interpol as a vehicle for its repressive policies globally, and places thousands of HongkongerUygur, Tibetan, Taiwanese and Chinese dissidents living abroad at even graver risk,” IPAC said.

podcast : China’s subnational diplomacy in Germany and Europe, with Roderick Kefferpütz
China and European countries entertain relations with each other not only at the state level. During past decades, a close network of partnerships between Chinese provinces, European regions or federal states and also cities and municipalities has emerged. On subnational channels, there are a lot of oftentimes mutually beneficial exchanges – in business and politics, but also at the level of civil society. It is very challenging for a federally organized country like Germany, but also other European regions, to deal with actors from China who are following strategies prescribed by a centralized party state.

Australia says disconnect between China’s peace push and ‘alarming’ actions as spy ship sails off its coast
Defence Minister Peter Dutton said Beijing’s militarisation of the South China Sea and aggression towards Taiwan show China’s actions being at odds with its rhetoric    The remarks came as Canberra confirmed it had monitored a Chinese intelligence ship sailing in August inside the country’s EEZ

China Is Closing Another Major Bridge to Taiwan
The last cohort of people who can span the divide between Beijing and Taipei are being scared away. Tsai has walked a fine line. To the irritation of many party supporters, she strategically hasn’t advanced an independence agenda, a fact not publicly acknowledged by China. But her refusal to embrace Beijing’s one-China stance, an issue that her predecessor and the KMT were willing to discuss, has led Chinese leaders to ban select officials from visiting the mainland and to belittle countries that show support for Taiwan. Exchanges on the political, cultural and economic level have suffered.

US and China jostle for influence as Honduras weighs ties with Taiwan
Central American nation, which goes to the polls on Sunday, is one of a shrinking club that maintains relations with Taipei     Switching recognition to Beijing could mean more Chinese investment for the country, the third poorest in the Americas

China still committed to Africa despite Covid-19 disruption, minister says
Pandemic’s economic impact is ‘temporary difficulty’, head of foreign ministry’s African department says before Forum on China-Africa Cooperation meeting     Strengthening cooperation with the continent ’will not waver’, he says, after slowdown in Chinese spending

Beijing condemns Solomon Islands violence and attacks on Chinese businesses
Chinese foreign ministry also voices support for South Pacific nation’s decision to switch diplomatic ties from Taipei      Public concerns have grown over Beijing’s influence in the Solomons economy, analyst says

China brings e-cigarettes under tobacco monopoly law
China amended its tobacco monopoly law on Friday to include e-cigarettes, stepping up regulation of the fast-growing vaping industry in the world’s largest tobacco market.      The cabinet order, published on the Chinese government’s website and signed off by Premier Li Keqiang, comes into effect immediately

China announces completion of hypersonic wind tunnel
China has completed work on a wind tunnel that can simulate the air resistance encountered by a plane or missile travelling at speeds of up to 2.7 kilometres per second, or eight times the speed of sound.

China’s ageing population a ‘long-term reality’, and its silver economy needs to catch up, State Council says
New guidelines set out to rectify an ‘unbalanced and inadequate development’ of industries and policies that cater to the elderly      Improving internet connectivity and related services for the elderly is also deemed a priority

China’s ageing crisis: new plan to encourage children to live with their parents met with resistance
China’s central government is struggling to deal with a rapidly ageing population   It is estimated that there are more than 100 million people aged 60 and above who are living alone or with their spouses only

Hong Kong and China move closer to partial border reopening
Hong Kong and Chinese authorities said a meeting on Thursday moved them closer to partially reopening the border between them, as the two governments dig their heels in as among the last in the world pursuing a zero-COVID-19 strategy.      The global financial hub has followed Beijing’s lead to implement some of the strictest travel restrictions in the world, hoping that would convince China, its main source of economic growth, to allow some cross-border movement.

Shanghai cancels hundreds of flights, shuts schools over three Covid cases
Over 500 flights from Shanghai’s two major airports were cancelled and six hospitals suspended outpatient services

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