China Press Review – October 7, 2019

Press review

Why the 13th round of US-China trade war talks may well be unlucky for some
Far from making America great, Trump’s tariffs have brought US manufacturing to its knees and failed to address the challenges of doing business in China. Going down that road will only produce a deal of little substance

China is reportedly reluctant to agree to a broad US trade deal with talks set to restart
Chinese officials are growing hesitant to pursue a broad trade deal with the U.S. in negotiations set to begin this Thursday, people familiar with the matter told Bloomberg News.

With the party over, Beijing needs to see progress on Hong Kong, US trade talks
The contrast between Beijing’s lavish National Day celebrations and the chaos on Hong Kong’s streets is a fitting metaphor of the challenges China’s leaders face On both the trade war and Hong Kong, it might be time for Beijing to take a more flexible approach

Why Trump’s threat to cut China from US capital markets makes no sense
The administration is reportedly considering delisting Chinese stocks from US markets, but this would only push more belt and road business onto the Hong Kong and London exchanges, leaving New York out in the cold. Who exactly is Trump trying to punish?

Trump impeachment may rescue economy by forcing China trade deal, Wall Street
“As this [impeachment] inquiry proceeds, President Trump will be eager, if not desperate, to redirect the news flow,” said Yung-Yu Ma, chief investment strategist at BMO Wealth Management. “He will probably be more willing to agree to a “mini-deal” or de-escalation with China, so there’s a potential economic upside to the impeachment process – at least in probability terms,”

Kudlow says there could be some ‘positive surprises’ out of next week’s China trade talks
“There could be positive surprises coming out of these talks,” Kudlow said. “I’m not predicting. I’m just saying don’t rule that out. There could be some positive surprises.” Trade negotiators from the U.S. and China are set to resume trade negotiations on Oct.10 in Washington. However, Kudlow said the U.S. strong support of Hong Kong’s protests for democracy could have a negative impact on the talks.

China’s currency pain is Germany’s gain
A devaluation of China’s currency during the ongoing trade war with the US may lead to more prosperity for Germany and the rest of the world, except the United States. But not much, an ifo report suggests.

Europe has to choose a side in the U.S.-China rivalry
Europe has been at the center of nearly every great-power competition of the last 500 years, either as home to one or both of the protagonists or as the decisive theater of struggle. No longer: The world wars of the last century saw to that. Yet Europe’s nations are still capable of playing a critical role in the defining contest of this century: that between China and America. Or, they can allow the continent to be reduced to a weak, divided region that struggles to make its influence felt. China desires the latter, and has a strategy for achieving it. The U.S. should prefer an active and capable set of European allies, but its policies have too often played into Beijing’s hands.

EU-Japan take on China’s BRI with own Silk Road
The EU and Japan have signed an infrastructure deal to boost connectivity between Europe and Asia. The pact is being described as the EU and Japan’s riposte to China’s Belt and Road Initiative (BRI).

How the EU can tidy up Eurasia’s tangled web of infrastructure projects
From China’s belt and road to India’s Asia-Africa growth corridor, there is wasteful duplication and rising geopolitical tension The EU should aim to unite nations under a connectivity code of conduct, expand a common umbrella of finance and set up a forum for the private sector and civil society to talk about connectivity

Can Kazakhstan’s China-backed financial hub boost belt and road funding?
New stock exchange in Kazakh capital backed by Shanghai and Nasdaq exchanges and Goldman Sachs, among others But analysts unconvinced new financial hub can tap international investor money without greater transparency of project details

China’s September forex reserves fall to $3.092 trillion
China’s foreign exchange reserves fell more than expected in September despite the yuan rebounding from its biggest monthly drop in 25 years in August amid a cooling domestic economy and rising Sino-U.S. trade tensions.

Budweiser wants to take on China, the world’s largest beer market where local brews rule
After listing its Budweiser APAC in Hong Kong last week, AB InBev said it will be looking to expand in Asia — especially in China, South Korea, India and Vietnam. However, local beers are still dominant in Asia. China is the world’s largest beer market by sales but firms have found it challenging amid fierce competition between local brewers and global beer giants.

China’s consumption upgrade props up shrinking car market with locally made premium models flying off the assembly line
Sales of 10 premium brands, which includes BMW, Mercedes-Benz, Audi, Volvo and Lexus, have risen in a steeply declining market Overall car sales in China have fallen 11 per cent in the year’s first eight months to 16.1 million units

Analysis: How China is fuelling Volkswagen’s electric dream
Volkswagen’s ambitious EV plans rely heavily on China, which poses major challenges The rapid expansion of Volkswagen’s new electric ID range will ramp up in 2020 with the launch of two SUV-based models – both of which will be offered exclusively in China.

French carmakers fight to find their footing in China
When French automakers jumped into China, they thought Chinese consumers’ appetite for French design and luxury goods would translate into booming car sales. That hasn’t been the case. After several years of growth in China, sales at PSA Group and Renault have dropped sharply. True, the slumping Chinese economy has affected sales at almost every automaker, but Renault and PSA were down 62 percent overall in the first half compared with the same period last year and hold just a 0.7 percent market share.

How Chinese money is driving Southeast Asia’s tech start-up scene
Chinese investment in the region’s start-ups ballooned to US$1.78 billion in the first seven months of this year, an eightfold increase A saturated tech scene in China and Southeast Asia’s maturing mobile economy are driving the influx of cash

New soybean could make China more self-reliant during trade war
Scientists create Henong-71, whose seeds produce nearly four times the average yield for the plant in China A drop in imports from the US left a shortfall for the world’s biggest soybean consumer

Are Chinese consumers spending less? Rising instant noodle sales revive debate
Sharp recovery in sales renews talk of whether people are tightening their belts because of economic worries Government argues that strong sales are a sign of upgraded consumption

New projects offered to China as part of CPEC: Pak Minister
Pakistan would engage China at the highest level for talks on several big projects in the fields of hydropower, oil refinery and steel mills as part of the China-Pakistan Economic Corridor (CPEC), a Minister said here.

China is too big to be isolated
A TPP for digital trade is the answer to the Huawei dilemma

How China is aiming for a state of technological independence
Rather than hampering semiconductor innovation in China, is America’s technology policy actually boosting it?

Why factories leaving China aren’t going to India
Vietnam seems to be the consensus pick for winner of the U.S.-China trade war, as Chinese and other manufacturers shift production to the cheaper Southeast Asian nation. If there’s a loser, at least in terms of missed opportunities, it may be the countries of South Asia.

The Secret Behind the Most Profitable Fashion Media in China — GQ Lab
According to Newrank, the WeChat ranking agency, GQ Lab now has over 800,000 fans with an equal balance of male and female readers in their early 20s and 30s, who are, perhaps, struggling to find their place in the world and seek content that reflects their version of reality

The Secret Behind the Most Profitable Fashion Media in China — GQ Lab

China breeds giant pigs the size of polar bears as African swine fever causes pork shortage
Breeders adopt ‘bigger is better’ philosophy in response to a shortage expected to continue into 2020 The country’s hog herd has been decimated by the epidemic

University emails reveal breadth of FBI campaign against researchers’ ‘wholesale theft’ of trade secrets for China
Agents have lectured at seminars, briefed administrators in campus meetings and distributed pamphlets with cautionary tales of trade secret theft Senior FBI officials said they were not encouraging schools to monitor researchers by nationality but instead to take steps to protect research

Generation Z in China the new focus of luxury fashion brands, which woo them with sneakers, streetwear and celebrities such as Fan Chengcheng
Shoppers in China born since the mid-1990s spend more than counterparts in other markets, are nationalistic and prefer to buy products made in China Getting their custom is a challenge for Western luxury brands, which are turning to athleisure and collaborations with Chinese celebrities to reach them

Tycoon Zhang Zhenxin, owner of troubled Chinese financial conglomerate UCF Group, dies aged 48 as company struggles with mountain of debt
Zhang, 48, died in London last month due to multiple organ failure, alcohol dependence, his company said in WeChat post

More than half of world’s wealthiest families expect a recession next year, survey by UBS and Camden Wealth shows
Asia-Pacific family offices enjoyed portfolio returns of 6.2 per cent until end of second quarter this year, highest of any region ‘Business as usual’ for UBS’s Hong Kong family office despite protests

China’s Coal Power Giants Seen Charging Ahead Into Climate Risks
China’s top six listed coal-power generators are failing to respond to climate change, lagging international peers and leaving them misaligned with Beijing’s broader environmental policies, according to a sustainability and governance risk consultant.

China is more focused on trade talks than Donald Trump’s attack on Joe Biden, observers say
Despite US president’s call for Beijing to investigate a political rival, China is more concerned about making progress in the next round of negotiations, analysts say China also keen to maintain its position of not interfering in other nations’ domestic affairs, academic says

China Loves News About Trump’s Controversies. Not This Time.
Since President Trump called for China to investigate the Bidens, Chinese media and officials have been notably muted. They have reason for caution, said experts.

HSBC to axe jobs in Europe, high-paying roles amid more cost cutting
Bank to still hire for ‘revenue-generating’ roles as it grows in Asia Cuts on top of plan to eliminate less than 2 per cent of workforce, reduce wage costs by 4 per cent over the course of 2019

Club Med, Fosun betting on Xi’s ambition of 300 million skiers before 2022 Winter Olympics to catapult resorts
Club Med to open equal number of ski and beach resorts over next few years Skiing holidays are more profitable for company than beach resorts, executive says

Houston Rockets’ Daryl Morey backtracks after ‘stand with Hong Kong’ backlash, saying he did not intend to offend China
Daryl Morey says he has now had the opportunity to ‘hear and consider other perspectives’ since his first tweet results in an exodus of Rockets’ sponsors Morey tweets an image depicting ‘fight for freedom, stand with Hong Kong’ before the Chinese Basketball Association ceases cooperation with the Rockets

Huaren or huaqiao? Beijing respects the difference and is not coercing foreigners to toe its line
Beijing has taken great care to tailor distinct policies for both its citizens overseas and Chinese descendants of foreign nationality The former are subject to China’s domestic policies while the latter come under foreign affairs, and Beijing is careful not to blur the distinction

Beijing confident Carrie Lam can restore order to Hong Kong, Chinese ambassador to Britain says
Unrest in city has ‘escalated to a dangerous level’, but leader has central government’s ‘full trust’, envoy Liu Xiaoming says Chief executive’s decision to introduce ban on wearing masks shows she is still ‘in control’, he says

Hong Kong and Beijing: A Tale of Two Cities
However, both the Hong Kong government and Beijing are wary of foreign response. This is due to the need to maintain Hong Kong’s separate economic status as well as its role as a link to overseas Chinese. In addition, the PRC leadership is greatly concerned that, for all of its charm offensives in the region, the views on China on the part of its Asian neighbors have been becoming steadily more negative. Whatever happens next, as a result of the current wave of protests, two illusions are gone: First, the foreign one that Hong Kong people are only interested in money. Second, the mainland one that Hong Kong would remain a separate territory where they could safely store their money. It is perhaps the even more intriguing one.

Hong Kong and Beijing: A Tale of Two Cities

How the flames of Hong Kong’s out-of-control protests are being fanned by a rigid mindset, leaving no place for those with an open mind
Like a political rally, the Red Guards or a heated football match, the protests have been taken over by a frenzied mindset. It’s no longer clear what the protesters’ goal is, but it is obvious that they are doing lasting damage to Hong Kong

Is China’s DF-17 hypersonic missile a serious threat to the United States?
An American general warned last year that the US does not have an effective defence against such weapons But with the PLA Rocket Force set to deploy the missile for the first time next year, Ankit Panda looks to dispel the hype

‘South Park’ Scrubbed From Chinese Internet After Critical Episode
After the “Band in China” episode mocked Hollywood for shaping its content to please the Chinese government, Beijing has responded by deleting all clips, episodes and discussions of the Comedy Central show.

China will use economic pain to hinder US’s Pacific missile deployment
Beijing’s leverage looms over American allies like Philippines and South Korea “The military balance in the Pacific is going in the wrong direction,” said former U.S. defense department strategist Elbridge Colby recently. Following the dissolution of a landmark arms control treaty in early August, the U.S. is now eyeing where it might field missiles as a counterweight to China’s sizable arsenal.

China and Taiwan clash over Wikipedia edits
Ask Google or Siri: “What is Taiwan?” “A state”, they will answer, “in East Asia”. But earlier in September, it would have been a “province in the People’s Republic of China”.

Alain Gillard
Information Officer
Service Asie Pacifique
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