China Daily Mail
Finance & Economy
US-China ‘trade’ war, if not ended soon, may spill over to ‘finance’
“On the international monetary front, the key problem was the acute dollar shortage in post-war Europe … In the effort to reconstruct a viable Western Europe, the United States conceded degrees of protection and discrimination in trade that were incompatible with its original blueprint …” Ian Clark, a Fellow of the British Academy and a … Continue reading
Businesses struggle as cracks appear in China’s economy
Cracks are opening in China’s mighty economy: investors are backing away from deals, factories are moving abroad and companies are shedding jobs. The world’s second-largest economy is losing steam, hitting its slowest growth in almost three decades last year, and flagging further in recent months. While gross domestic product grew at 6.6 per cent in … Continue reading
The myth about Chinese monetary policy
Government policies always generate conflicts of interests within society, monetary policy is no exception. Foreign policies, to some extent, are the reflection and extension of domestic governance. Domestic monetary policy, no matter how elusive and insignificant to some people, provides the currency for Chinese government’s outreaching tentacles around the world. On October 7, 2018, the … Continue reading
Drink beer to understand the China Model
Cheers! ‘France 24’ reported on Nov 5 that “… Heineken seals $3 bn deal with China’s top brewer …… Under the deal the Dutch brewer said it will take a 40 percent stake in the holding company that controls China Resources Beer, merge its current operations in China into the firm and license to it … Continue reading
Looking at the US-China Trade War from a Micro-Perspective: The Aluminum Imports
On July 6, U.S. initiated $34 billion worth of tariffs on imports from China, officially marking the largest trade war since the Great Depression. Among the imported goods levied, including auto parts, jet engine parts and other machinery, aluminum and other metals have long been the targets of U.S. tariffs. But this time, aluminum has … Continue reading
Trump to win more trophies from China in the 2018 trade war
US Treasury Secretary Steven Mnuchin is said to be visiting China beginning from May 3 Thursday. It means the trade war negotiation is about to enter into the direct bargaining stage and, if done smoothly, a deal would be finalized very quickly. Trump’s victory appears to be too easy and more fruitful than anticipated. The … Continue reading
Trump will win the US-China trade war easily
Beijing will accept a new US-China trade deal which is dictated by Trump. The American oilseeds for producing cooking oil, navigational instruments for building cargo vessels (dry bulk or container ships), intermediate producer goods for manufacturing … (see the picture shown above) are at this moment irreplaceable items that China needs to import from the … Continue reading
Duterte in between China and Quad
“Australia, the United States, India and Japan are talking about establishing a joint regional infrastructure scheme as an alternative to China’s multibillion-dollar Belt and Road Initiative in an attempt to counter Beijing’s spreading influence …” reported by Reuters on Feb 19, 2018. These four countries are commonly referred to as the “Quad”, the driving force … Continue reading
The ‘Power Audit’ of EU-China
In Dec 2017, the European Council on Foreign Relations published a Power Audit report on China’s influence, named as “China at the gates”. It is a very long essay with lots of details. In the summary, it says “China practises ‘pick and choose’ in its relations with the European Union, focusing on its direct interests, … Continue reading
Why China’s stock market is so boring
In September 2008, Warren Buffett’s Berkshire Hathaway acquired 10% stake in BYD, a pioneer in electric vehicle technology and production in China, for around US$232 million (around HK$1.8 billion or HK$8 per share). This morning, it is $79, slightly down from the record high of HK$83 a few days ago. BYD’s share price followed the … Continue reading
Could Hong Kong, after a merger with Shenzhen, help China’s One Belt One Road thrive?
According to the International Monetary Fund (IMF) June 2016 research report “Neoliberalism: Oversold?” which was described as “a political bombshell … that caused a near-panic among advocates of free market policies” by the Foreign Policy analyst Rick Rowden [Note 1] , what ‘capital account liberalisation’ brings to developing countries is “the pervasiveness of booms and … Continue reading
Manila-Beijing relations to determine ASEAN growth
As the two possible ‘Joint Development Areas’ — “off Triton Island in the Paracels” and “Reed Bank off Philippine Palawan” [Note 1] — have almost been out of the minds of both the analysts and general public of the Philippines, a failure to revive the Manila–Beijing relation after the May 9 presidential election would jeopardize … Continue reading
China to ban foreign companies from online media business
The ruling Chinese Communist Party has announced new regulations that will ban foreign companies from publishing online media, games and other “creative” content within China’s borders from next month. The “Regulations for the management of online publishing services” also ban foreign-invested joint ventures from engaging in online content provision, according to a copy of the … Continue reading
The truth behind China’s exchange rate delusion
The current bout of anxiety is a symptom of the fact that China’s transition from an export-led growth strategy is proceeding far less smoothly than hoped China’s management of its exchange rate peg continues to rattle global financial markets. Uncertainty about renminbi devaluation is fuelling fears that deflationary forces will sweep through emerging markets and … Continue reading
The currency dictatorship and China’s action plan
The last time a country decided to dump the dollar in the oil business, the US destroyed it. Now India, the world’s third largest economy, and Iran have agreed to settle their outstanding oil dues in rupees. What’s more, the two countries may conduct all future trade in their national currencies. This follows an agreement … Continue reading
Ghost cities show China crisis, but is the Chinese furniture market still interesting?
Yujiapu is one of the most impressive ghost cities in China. An almost empty agglomerate of half-finished buildings and skyscrapers modelled on Manhattan’s skyline. Many say it’s one of the most scary landmark of China’s failed ambitions: a ghost city that was once supposed to become a world financial centre. Many others say it’s an … Continue reading
China threatens sanctions against U.S. companies
China’s recent threat to impose sanctions on U.S. defence companies that sell arms to Taiwan should come as no surprise to American officials or corporate executives: Washington has been issuing sanctions of these sorts for years. It was only a matter of time before U.S. competitors started copying its tactics. Regardless of whether China follows … Continue reading
China halts stock trading after 7% rout triggers circuit breaker
The worst-ever start to a year for Chinese shares triggered a trading halt in more than $7 trillion of equities, futures and options, putting the nation’s new market circuit breakers to the test on their first day. Trading was halted at about 1:34 p.m. local time on Monday after the CSI 300 Index dropped 7 … Continue reading
Cool War: United States and China in the future of the global competition
Are we on the edge of a new Cold War era? Or, alternatively, every power struggle mindset has to be considered a lost legacy of the XX century and we’re headed to a new era of global cooperation? These are the big questions opening Cool War by Noah Feldman, a must read essay on the … Continue reading
Understanding the two Chinas
Our view that China may be heading for a mild cyclical upswing next year needs to be set against the background of the broader economy, which is changing rapidly. We think that it makes sense to view the economy as consisting of two parts: old and new. In its latest Five-Year Plan—full details of which … Continue reading
China has a $1.2 trillion Ponzi finance problem
Chinese borrowers are taking on record amounts of debt to repay interest on their existing obligations, raising the risk of defaults and adding pressure on policy makers to keep financing costs low. The amount of loans, bonds and shadow finance arranged to cover interest payments will probably rise 5 percent this year to a record … Continue reading
Can China’s consumers save the world economy?
Long the place that makes stuff and doesn’t consume much, China is set to redress the balance. And thus, some say, rescue the troubled global economy. But it’s a stretch to think that Beijing’s plan — shifting the export-driven country from emphasizing manufacturing and infrastructure to relying on public consumption – will spread sweet prosperity … Continue reading
The one thing holding back China’s yuan
While China may be the world’s second largest economy, the future of the yuan playing a bigger role in international markets is clouded by politics. Earlier this fall, the IMF postponed a scheduled update of the designated basket of reserve currencies, a basket that is used by member countries for Special Drawing Rights (SDR). Though … Continue reading
China’s economy is worse than you think
The unreliability of Chinese official economic data has become almost a cliche. A few years before he became China’s premier, Li Keqiang said that the country’s numbers were “man-made” and “for reference only.” If the top economic policy maker of a country says that the numbers aren’t reliable … well, you believe him But how unreliable? … Continue reading
What could really disrupt China’s economy?
In an earlier post, I explained why I’m still bullish on China’s economy. But as the events of the past few months have shown, the risks of economic disruption are real. Here are several potential risks that could throw China’s economy off track. While the likelihood of all of them occurring is low, they are … Continue reading
10 things the Communist Party wants you to believe about China’s next five-year plan
The Chinese newspaper that serves as the ruling Communist Party’s mouthpiece has outlined 10 objectives that are expected to lead to breakthroughs on the mainland in the next five years. The targets were revealed on thePeople’s Daily’s Weibo account as the party’s fifth plenum, which will review the nation’s next five-year plan for 2016-20, gets … Continue reading
Doing a business event in the Gobi Desert
It is something in China, about which very little is known in Europe – the business meeting, which builds relationships impossible to break. Often, though, it is also impossible to form, and must be made in a different way, which I will try to explain here. I had the pleasure to get to know Kuba Zwoliński, … Continue reading
Nerves on edge as Chinese authorities probe market mayhem
The head of hedge fund manager Man Group Plc’s (EMG.L) China business has been taken into custody to help authorities in a probe into recent market volatility, Bloomberg reported on Monday, while separately a local financial reporter confessed on national TV to having spread false information that caused “panic and disorder”. Both are likely to … Continue reading
China’s meltdown shows the country is out of control
The world’s second-largest economy may be able to stem a financial crisis, but don’t count on it to stimulate the world’s economy. Global stock markets have rebounded after the shock of Black Monday, but worries over the Chinese economy are not over, in fact they are just beginning. The People’s Bank of China’s move on … Continue reading
China wants great power without great responsibility
Forty-three years after Richard Nixon made his famous visit to China, that country has seemingly decided to take a page from the former U.S. president’s Treasury Department. As China lowers the value of the yuan, the country’s economic policy makers are mimicking the blasé attitude of Nixon-era Treasury chief John Connally, who dismissed international complaints … Continue reading
China’s massive economic advantage over the world is about to disappear
We have finally arrived at a point in history that economists have been dreading for years: The moment when the total number of Chinese workers goes into decline for the first time in decades. Since way before the 1990s, China has had one huge economic advantage over the rest of the world: Year after year, … Continue reading
Chinese SOE chairman says China has won the stock market war against western financial giants
The following is based on a translation of an article in Chinese media: China’s official mouthpiece the Global Times published an article by Lin Zuoming, Chairman of the Board of Directors of China’s State-owned giant Aviation Industry Corporation of China (AVIC), on the recent disturbance in China’s stock market. The head of any large state-owned … Continue reading
International investors are pulling out of China in favour of India because of China’s interference in stock market
The tumult in China’s stock markets has turned into a blessing for Indian shareholders. International investors are pulling out of China, fuelling record outflows through the Shanghai-Hong Kong exchange link, amid a $2.8 trillion plunge in mainland equity values since June 12. They’ve ploughed $705 million into India over the same period, sparking a world-beating … Continue reading
The danger from China’s coming recession
China is going to have a recession. Not necessarily this year or next year, but it will. That’s just how economies work. How the Chinese government deals with its first capitalist recession is the great, dangerous unknown in world politics and economics. The frantic efforts China made to stop the recent stock market fall do … Continue reading
India to beat China again as fastest-growing economy in 2016 says IMF
India will be the world’s fastest growing economy for the second consecutive year in 2016 at 7.5 per cent, IMF today said, even as it lowered its current year global economy growth forecast to 3.3 per cent. In its World Economic Outlook Update released here, IMF retained India’s growth projection for current year at 7.5 … Continue reading
China not fit for global leadership
Australia’s top public servant has dismissed any prospect of China leading the world, saying the economic giant is neither willing nor able to solve global problems. Michael Thawley, secretary of the Department of Prime Minister and Cabinet, said China had shown itself to be more interested in challenging the existing order than building a better one. … Continue reading
Western companies are being forced to figure China out all over again as sales plummet
Foreign companies have long known that China’s economic slowdown—now upon us—could hit their earnings hard. They just didn’t expect they’d be hit by changing consumer buying habits and a rise in Chinese competitors at the same time. Suddenly, foreign brands are finding it a lot harder to convince consumers in the world’s most populous country … Continue reading
The Iran scam worsens: the North Korea – China connection
It is likely that the P5+1 nuke “deal” with Iran will be approved soon. Military and other nuke sites which Iran has not “disclosed” will not be inspected. Nor will Iran’s nuke ties with North Korea — which P5+1 member China seems to be helping, Iran’s massive support for terrorism and abysmal human rights record be considered because they are also deemed … Continue reading
3 helpful tips for dealing with vexing Chinese negotiating tactics
As a film producer and consultant who works extensively in China, I am often confronted with the vexing challenge of making deals with savvy Chinese negotiators. I have found the advice offered by Steven Dickinson, an attorney with the Seattle-based law firm Harris Moure, to be extremely helpful in confronting the business negotiating tactics that … Continue reading
China’s new silk road could change global economics forever
Beginning with the marvellous tales of Marco Polo’s travels across Eurasia to China, the Silk Road has never ceased to entrance the world. Now, the ancient cities of Samarkand, Baku, Tashkent, and Bukhara are once again firing the world’s imagination. China is building the world’s greatest economic development and construction project ever undertaken: The New … Continue reading
Outdated mindset is blocking China’s new ideas, say analysts
A leading mainland Chinese inventor-entrepreneur says he may not have surrendered his professorship at an elite university if government policy at the time had allowed him to set up his company while still staying in his post. “If there had been an option, I would have definitely considered it,” Zhong Faping – one of the best-known … Continue reading
This is how China is trying to save its economy
China has had 35 years of hypergrowth, but now it’s over. It’s going to have to settle for really, really good growth instead. But that’s still going to be hard now that fewer Chinese are working-age, fewer people are moving to the cities and, most of all, now that China has a debt bubble it’s … Continue reading
Putting China’s debt into perspective
China’s total debt quadrupled between 2007 and 2014, which was about one-third of the $57 trillion in debt added globally during that period. Can this possibly be safe? To answer this question, the McKinsey Global Institute devotes an entire chapter to China’s debt in the new report Debt and (not much) deleveraging. The key issue … Continue reading
Chinese media says India’s economy will surpass China’s
The following is based on a translation from Chinese media: Mil.huanqiu.com says in its report today that according to Indian publication The Hindu’s report on April 29, India is expected to achieve a growth rate of 8%, faster than China. If it conducts further reform and achieves steady faster growth rate, it will certainly surpass … Continue reading
Chinese state-owned company, in a first, defaults on its domestic bonds
For decades, regardless of weaknesses or inefficiencies, an overriding certainty of state-backed capitalism in China has been that the government looks after its own. That may be changing. On Tuesday, a little-known power equipment manufacturer became the first state-owned company to default in China’s huge domestic bond market, throwing doubt on the long-held notion that … Continue reading
The Domino Theory: Asia’s growing China problem
Asia has a China problem. Beijing has just initiated its biggest cut in bank reserve requirements since 2008, a move that underscores just how worried it is about its economy. But the cut is also a stark wake-up call for neighbours that have gotten used to riding China’s boom. For years, China’s steady growth served as a welcome antidote … Continue reading
The China Syndrome: Is China headed for a financial meltdown?
In the 1979 movie The China Syndrome, Jack Lemmon plays Jack Godell, a supervisor at a nuclear power plant. The facility experienced “unusual vibrations” and Jack was concerned about a potential meltdown. Today, many believe that China – a country with the world’s second largest economy – may be on the verge of a “financial” … Continue reading
Future growth of India and China to be tuned by Japan
The gear shift of Asia’s growth in the decades to come is in the hand of Tokyo as Japan is in control of the formation of the emerging India-China-Japan (I+C+J) power structure in Asia. In its “World 2050” research report, PricewaterhouseCoopers (PwC) suggested that “… in purchasing power parity (PPP) terms … India should become … Continue reading
Productivity, not reproductivity, must be the new driver of Chinese growth
Around a quarter of China’s remarkable economic growth over the past three decades or so was delivered by the dividend from its demographic structure, with a young population augmenting the workforce and lifting output in new jobs. A large proportion of the population were of working age; the proportion of the young and the old … Continue reading
What’s behind the surprise drop in Chinese exports?
China’s exports for the month of March fell by 15% from a year ago (in dollar terms), the General Administration of Customs said today. It was a big surprise to markets and investors, who were expecting a rise of as much as 12%. Imports also dropped, by 12.3%, although that was in line with expectations. As a result … Continue reading
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