China Press Review – October 19, 2018

Press review

Wallonia increasingly popular among Chinese businesses, tourists
With its huge advantages in logistics and transportation, tourism and information technology, Belgium’s Wallonia region aspires to attract more Chinese investors and travelers, according to a key expert from the area. Pascale Delcomminette, CEO of the Wallonia Export-Investment Agency, recently told China Daily that Wallonia, a gateway to the European market, is well-positioned to develop its already booming logistics and transportation industry. Wallonia leaders are confident that their region can be a center for Chinese tech companies seeking alliances in order to localize their business and secure steady growth, she said. Chinese businesses, such as Cainiao, e-commerce giant Alibaba’s logistics arm, and new energy vehicle maker Thunder Power, have already made headway in their efforts to expand to the European market through Wallonia.

China moves to lift confidence as economic growth hits weakest pace since 2009
China’s economic growth cooled to its weakest quarterly pace since the global financial crisis, with regulators moving quickly to calm nervous investors as a years-long campaign to tackle debt risks and the trade war with the United States began to bite.

China and Europe join WTO challenge to Trump metals tariffs, opening new front in trade war
There are fears a showdown over steel and aluminium tariffs could lead the US to exit the World Trade Organisation Opponents want a WTO dispute panel to investigate the US ‘national security’ justification for the tariffs

At Brussels summit, EU embraces China and other Asian powers, in the face of Trump’s protectionism
EU states are being joined at the summit by more than 20 Asian leaders, including Chinese Premier Li Keqiang, as they hammer out a joint defence of free trade The meeting comes amid bitter disputes with Washington over Donald Trump’s protectionist policies

EU spearheads multilateralism at ASEM summit
European leaders sought to build support from Asia on Thursday (18 October) in defence of free trade and the fight against climate change, to counter the growing protectionism of President Donald Trump’s America.

China to further expand two-way opening-up with France, premier says
Chinese Premier Li Keqiang said here Thursday that China stands ready to work with France to further expand two-way opening-up so as to promote the continuously balanced growth of investment and trade, and maintain a positive outlook for enterprises from both countries.

China to scale down subsidies for Europe-bound cargo trains
China will start gradually reducing subsidies it offers to Europe-bound freight trains, in a bid to improve the efficiency and commercial viability of such services that have boomed in recent years. China’s Ministry of Finance requires that government subsidies for the China-Europe cargo trains should not exceed 50 percent of domestic railway costs, and that subsidies should be reduced by 10 percent a year compared to the 50 percent level in 2018.

China’s economy to brace for slower growth pace as trade war with United States takes its toll
China’s economy, which grew in the third quarter at the slowest pace in a decade, is likely to slow further in the coming months as the ongoing trade war with the United States takes its toll. That would put pressure on the Chinese government to refresh its policies to bolster confidence, stabilise growth and stimulate investments, analysts and economists said.

Trump’s trade war is forcing Beijing to retreat from its own anti-debt battle
Faced with pressure from the U.S. trade war, China is stepping away from a battle to pare massive debt levels as it seeks ways to bolster its faltering economy. A Citi report says the pause in the so-called deleveraging campaign will see China’s debt-to-GDP ratio increase to 274.5 percent by the end of the year. China has been cutting reserve requirement ratios for banks, freeing them up to lend out more money.

China stocks rally after economic chief, financial and regulatory institutions step in to underline economy’s resilience
Shares listed in China on Friday rallied the most in more than two months after the country’s vice-premier, central bank governor and financial regulatory institutions stepped in to calm investors amid its worst stock rout in about four years.

China markets rebound strongly after turbulent morning; GDP numbers miss forecasts
After a turbulent morning, Greater China markets rebounded strongly, following a series of measures by China’s securities regulator to support the struggling stock market.China’s GDP numbers showed its economic growth slowed to 6.5 percent year-over-year in the third quarter of 2018.

Yuan halts slide against US dollar after PBOC comments
The Chinese yuan edged higher on Friday after People’s Bank of China governor Yi Gang said measures to help alleviate corporate financing problems and encourage commercial banks to boost lending are on the way

China’s Dangerous Dollar Addiction
China pays for raw materials in greenbacks, but Trump’s trade war could soon dwindle its dollar reserves.
China’s Dangerous Dollar Addiction

China’s September FDI figure rises as foreign investor shrug aside concerns of trade war
FDI in China accelerated in September despite the trade war, though analysts warn investment could slow in the medium-term if the trade conflict persists

China-US trade war: More pain to come for China
The world’s second largest economy is losing steam and with some big risks on the horizon, that slowdown is likely to continue.

Americans not convinced by Trump’s trade war with China, poll suggests
The Trump administration’s willingness to spark a trade war with China might well be its most ambitious foreign policy move. But what does it mean for U.S. policy if a majority of Americans don’t agree that China is such a worrying threat? And what happens if they don’t think a trade war is worth the cost?

Trade war with China could lead to recession sooner rather than later
Take a trade war with China, mix in frosty economic relations with Canada and Europe, add in Federal Reserve rate hikes and here’s what you get: A recession by 2020.

Weighing The Nation’s Fear Of China
China presents many concerns, to be sure, but today’s fears exaggerate Beijing’s strength while minimizing its task of gaining the dominance many believe is eminent. None of this is to say that China will go the way of Japan. But it does show that similar fears to those that grip the country today have gripped it falsely in the past. Perhaps China will prove more flexible and succeed where Japan failed. Even then, the nature of innovation suggests that this country can benefit from gains elsewhere, including China, and even improve on them. Meanwhile, China’s efforts to use its growing economic and diplomatic strength to upset existing relationships have met with as much failure as success. Its huge investments in Africa, for instance, have begun evoke African fears of a “new colonialism.” Many in Asia complain about Chinese bullying and have refused Chinese development money. China presents many concerns, to be sure, but today’s fears exaggerate Beijing’s strength while minimizing its task of gaining the dominance many believe is eminent

China in the Balkans: Motivations behind growing influence
Beijing’s influence in the Balkans continues to grow, but we should not compare it with Russia. Chinese influence differs in both motives and tools used for its spreading, writes Matej Šimalčík.

G20 join US against China’s subsidies for state-owned enterprises
Chinese government aid leads to overproduction and sales at lower than market prices, i.e. dumping, which undermines competition. The B20 (G20 business leaders) calls for same level playing field for both state-owned and private enterprises. If China followed the rules of a market economy, it would destroy itself in a few months.

China Is Set to Keep Minting New Millionaires Faster Than U.S.
Household wealth in U.S. grew 5.5% in 2018, Credit Suisse says China to mint millionaires at faster rate than U.S., bank says

China’s One-Time Richest Woman Becomes Biggest Loser in Wealth Rout
Lens Technology’s Zhou Qunfei loses 66% of fortune this year Zhou’s company supplies touchscreens for IPhones, Tesla cars

Alibaba, SenseTime Launches Hong Kong AI Lab To Finance Seven Start-Ups
The Hong Kong artificial intelligence lab (HKAI Lab), backed by Chinese artificial intelligence company SenseTime and Alibaba, has unveiled its first batch of seven start-ups that it will financing under its accelerator program. Each of the seven start-ups will receive US$100,000 seed funding from the Alibaba Hong Kong Entrepreneurs Fund as part of the accelerator program, along with working spaces from Hong Kong Science and Technology Parks Corporation (HKSTP).

Alibaba, SenseTime Launches Hong Kong AI Lab To Finance Seven Start-Ups

Alibaba Invests $290M In Chinese Liquor E-Commerce Firm 1919 Wines
Alibaba Group Holding Limited has injected a RMB2 billion (US$290 million) series C round of investment to Chinese liquor e-commerce retailer 1919 Wines & Spirits Platform Technology Co., Ltd., according to a company announcement. After this round, the company is valued at RMB7 billion(nearly US$1 billion), making it a unicorn in the Chinese alcoholic drinks retail industry.

Alibaba Invests $290M In Chinese Liquor E-Commerce Firm 1919 Wines

For coffee lovers in China, grabbing a fresh cup of venti cappuccino from Starbucks will soon be as easy as a few quick taps on their smartphone.

China ‘regrets’ America’s departure from Universal Postal Union
Beijing will continue working ‘to make our contribution to the development of the global postal service’, says foreign ministry; White House says the system allows developing countries like China to ship goods around the world more cheaply and put American firms at a disadvantage

China minister projects US$14 billion domestic market for intelligent, connected cars by 2020
Intelligent connected cars herald a “new era” for cars, China’s industry minister says Major technology companies are developing driverless cars and vehicle connectivity

US-China trade war tariffs on seeds and crop protection products may raise food prices: BASF
The German chemicals giant says all global players will be affected to some degree

Chinese Agricultural Banks See Rising Bad Loans While More Are Expected
Chinese agricultural banks are seeing their non-performing loan ratio increase rapidly, as one of the hardest hit segments in the financial system under tighter regulatory oversight. Many small agricultural banks have seen their NPL ratio go up to over 20%. The local agricultural bank in Wuxiu, Henan province, a county with 187 villages and a population of 270,500, reported NPL ratio of 20.74% as of end of 2017. Guiyang Agricultural Bank saw NPL ratio rise to 19.54% in year-end 2017.

China’s online gaming market shrank by 10.8% in Q2 2018
China’s online gaming market decreased by 10.8% YoY to US$8.29 billion in Q2 2018. Mobile games accounted for 65.1%. Tencent is the biggest player with a share of 53.17%.

Tencent and Huawei back development of coinless “blockchain ecosystem”
Tencent and Huawei lead Chinese companies in building coinless ‘Ethereum-killer’ Huawei and Tencent are backing a consortium that is developing the open source “blockchain ecosystem” FISCO BCOS. The platform, which will be released next month, is geared towards enterprises and is completely coinless. It is being developed by China’s Financial Blockchain Shenzhen Consortium (FISCO), whose members include WeBank, Tencent Cloud, and Shenzhen Securities Communication.

Briefing: Tencent and Huawei back development of coinless “blockchain ecosystem”

Five Things We Learned from the Business of Fashion China Summit
It’s all about the youth—but don’t forget their parents

Five Things We Learned from the Business of Fashion China Summit

China Founds Trademark Office to Protect Domestic Brands
The new office shows China is serious about protecting intellectual property — at least where its own companies are concerned.

Chinese President Xi Jinping set to visit Guangdong to boost confidence in economic model
Leader will head to southern manufacturing base in the coming days, sources say
He may also attend the official opening ceremony of the new Hong Kong-Zhuhai-Macau bridge

China’s former internet tsar Lu Wei pleads guilty to corruption
The once flamboyant gatekeeper of the world’s largest online population was grave and pale in his court appearance Sentencing date has not yet been announced

Two die in violent clash over Chinese home demolition order
A demolition order that sparked violent clashes in eastern China in which two people were killed has reopened a debate about the practice of local authorities hiring private firms to tear down people’s homes.

An interactive map of China’s wildcat strikes
China’s move into a “mixed economy” has created a wealth inequality crisis to rival any nation’s; wildcat workers’ strikes (aided by Young Communist movements) have become increasingly common, though they are not often reported in the news (it helps that Chinese state media and the country’s official censors suppress these reports).

An interactive map of China’s wildcat strikes

US and Chinese air forces urged to sign up to South China Sea guidelines after Asean states agree on code of conduct
Rules designed to reduce risk of accidents over disputed waters agreed at defence ministers’ meeting in Singapore Washington and Beijing urged to adopt similar guidelines

Alain Gillard
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