S&P Downgrades China, Says Rising Debt Is Stoking Economic, Financial Risks

Elias Glenn
Reuters
S&P’s one-notch downgrade to A+ from AA- comes as Beijing grapples with the challenges of containing financial risks stemming from years of credit-fueled stimulus to meet ambitious government economic growth targets.

Before Wisconsin, Foxconn Vowed Big Spending in Brazil. Few Jobs Have Come.

David Barboza
New York Times
Before the Taiwanese manufacturing giant Foxconn pledged to spend $10 billion and create 13,000 jobs in Wisconsin, the company made a similar promise of 100,000 jobs in Brazil. Six years later, Brazil is still waiting for most of those jobs to...

BYD Predicts Ambitious China Shift to Electric Cars by 2030

David Stanway
Reuters
All vehicles in the country will be “electrified” by 2030, which could range from full electric cars to mild hybrids, Chinese automaker BYD Chairman Wang Chuanfu said on Thursday. BYD, backed by Warren Buffett, has already invested heavily in the...

Fame Academy, the Chinese College Offering Classes in How to Become an Internet Celebrity

Liu Zhen
South China Morning Post
Chongqing Institute of Engineering has already enrolled 19 students, mainly female, to be taught about how to present themselves online to attract viewers and translate fame into profit.

Trump's Threats Loom as China Weighs Opening to Wall Street, Tesla

Bloomberg News
Bloomberg
Coincidence or not, China appears set to ease restrictions on foreign automakers and banks amid sustained pressure from U.S. President Donald Trump to open up its economy.

China's Pollution Crackdown Shakes up Iron Ore Traders

Neil Hume
Financial Times
Over the summer, price differentials between high and low grade iron ore have intensified amid a government-led crackdown on pollution and outdated steelmaking capacity. That has caught many traders on the hop and left some nursing nasty losses from...

The Timing May Be Right for Facebook to Enter China next Year, Analyst Predicts

Evelyn Cheng
CNBC
A Mizuho report pointed out that Beijing tends to lessen its media scrutiny during an administration's second term, and Facebook may have “an opening” after Xi Jinping begins his second five-year term in November...

China Considers Lifting Foreign EV Cap in Free Trade Zones

Bloomberg
China is discussing a plan to allow foreign carmakers to set up wholly owned electric-vehicle businesses in its free-trade zones in a major revision of a fundamental principle governing the country’s auto industry policy since the 1990s, according...

Trump to Punish China outside WTO

Charles Wallace
Forbes
U.S. Trade Representative Robert Lighthizer said Monday that the Trump Administration is drawing up plans to punish China outside the World Trade Organization.

Fugitive Tycoon Guo Wengui Assailed by Businessman Who Says He Was Framed for Crimes

South China Morning Post
China’s highest profile fugitive, exiled billionaire Guo Wengui, is under attack from a former business partner who claims Guo got him framed for crimes he says he did not commit.

Africa Needs Infrastructure, China Wants to Build It. So What’s the Problem?

Eric Olander, Cobus van Staden & more
Every week seemingly brings a new announcement of a Chinese-financed mega project somewhere in Africa. Last week’s announcement of a $5.8 billion power station in Nigeria that will be financed and built by Chinese state-owned companies is typical of...

Media

09.18.17

Asia’s Reckoning: China, Japan, and the Fate of U.S. Power in the Pacific Century

Richard McGregor, Susan Shirk & more
The following is an edited transcript of a live event hosted at Asia Society in New York on September 7, 2017, and named for a new book by Richard McGregor, the former Beijing Bureau Chief of the Financial Times, “ChinaFile Presents: ‘Asia’s...

China vs US: Who Is Copying Whom?

Louise Lucas
Financial Times
China is gradually shedding its reputation as the world’s technology copycat. It still spawns lookalikes, whether they be GoPro-style action cameras or Didi Chuxing, a ride-hailing app that looked awfully like Uber until it added Chinese...

Conversation

09.15.17

Bannon Says the U.S. Is at ‘Economic War with China.’ Is He Right?

Paul Haenle, Jacqueline N. Deal & more
Steve Bannon, whose controversial views on China remain hugely influential in the White House, is visiting Hong Kong this week to speak at a China investment conference. In August, before he left his White House position as chief strategist, Bannon...

China's WeChat Crackdown Drives Bitcoin Devotees to Telegram

Lulu Yilun Chen
Bloomberg
With administrators personally liable for what is said on groups they run, users of bitcoin exchanges OKCoin, Huobi and BTCChina are migrating to services beyond the Chinese government’s reach.

G.M. Chief, in China, Challenges Planned Bans of Gasoline Cars

Keith Bradsher
New York Times
Speaking in Shanghai on Friday, Mary Barra, the chief executive of General Motors said her company was making a big push to develop electric cars but that consumers, not government dictates, should decide how cars are powered.

China Plans First Dollar-Denominated Bond Sale in a Decade

Gabriel Wildau and Jennifer Hughes
Financial Times
China is planning to sell dollar-denominated bonds for the first time in a decade, as it seeks to take advantage of investor appetite for Chinese credit amid the country’s unexpectedly strong economic growth.

China Is Stumbling Hard at Acquiring the High-Tech Chip Companies It Wants So Badly

Josh Horwitz
Quartz
US president Donald Trump on Wednesday vetoed a Chinese private-equity firm’s proposed $1.3 billion purchase of Lattice Semiconductor, an Oregon-based chip manufacturer.

VW, China Partners to Recall 4.86 Million Vehicles over Takata Airbags

Reuters Staff
Reuters
Official Chinese estimates show over 20 million cars in China had air bags made by Takata, which have been linked to at least 16 deaths and 180 injuries globally. The air bags have the potential to explode with too much force and spray shrapnel.

China's Two Largest Tech Companies Sign a Deal over the West's Biggest Music

Andrew Flanagan
NPR
Among the deals being signed that shape the way the world experiences culture, a new partnership will exert a great influence on the flow of content from the world's three remaining major record labels to an enormous and growing marketplace —...

The Rise and Rise of China's Xiaomi in India

Abhishek Baxi
Forbes
A couple of years ago in 2015, MIT Technology Review ranked Xiaomi number 2 on their list of 50 Smartest Companies -- a list that also had companies like Apple, Google, and Microsoft who were rated far below the Chinese smartphone and smart home...

What the World's Emptiest International Airport Says about China's Influence

Brook Larmer
New York Times
The four-lane highway leading out of the Sri Lankan town of Hambantota gets so little traffic that it sometimes attracts more wild elephants than automobiles. The pachyderms are intelligent — they seem to use the road as a jungle shortcut — but not...

China Just Reversed Two Policies Designed to Keep the Yuan from Sliding

Elena Holodny
Business Insider
China is reversing course and loosening some financial restrictions after the yuan's appreciation in 2017...

China Fossil Fuel Deadline Shifts Focus to Electric Car Race

Bloomberg
China will set a deadline for automakers to end sales of fossil-fuel-powered vehicles, becoming the biggest market to do so in a move that will accelerate the push into the electric car market led by companies including BYD Co. and BAIC Motor Corp.

Smuggling Operations at Sea Targeted in Latest UN Sanctions against North Korea

Liu Zhen
South China Morning Post
The UN has called on member states to use “new tools” to clamp down on smuggling activities at sea under the latest sanctions against North Korea following its nuclear test last week.

Sinica Podcast

09.11.17

China’s Tightening Grip on Cyberspace

Kaiser Kuo, Jeremy Goldkorn & more from Sinica Podcast
Adam Segal returns to Sinica to comment on China’s recent cybersecurity law—where it came from, how it changed as it was being drafted, and how it may shape the flow of information in China in the future. Other issues discussed include the...

Next Stop for the Steve Bannon Insurgency: China

Mark Landler
New York Times
Stephen K. Bannon plans to travel to Hong Kong to deliver a keynote address at an investor conference, where he will articulate his call for a much tougher American policy toward China.

Renminbi Slides after China Relaxes Currency Controls

Gabriel Wildau, Tom Mitchell, Jennifer...
Financial Times
The renminbi suffered its worst day in three months after China’s central bank scrapped two rules intended to bolster the currency in a sign that official nervousness about currency depreciation and capital flight has eased.

China to Shut Bitcoin Exchanges

Chao Deng
Wall Street Journal
Chinese authorities are ordering domestic bitcoin exchanges to shut down, delivering a heavy blow to once-thriving trading hubs that helped popularize the virtual currency pushing it to recent record highs.

China Steps up Curbs on Virtual Currency Trading

Peng Qinqin, Wu Yujian and Han Wei
Chinese regulators ordered a halt to all virtual currency trading platforms in the country, acting to further rein in risks related to cryptocurrencies, Caixin learned from a source close to regulators.

China's Export Engine Slows as Imports Maintain Steady Gains

Bloomberg News
Bloomberg
China’s export growth slowed as global demand for the country’s products moderated, while imports remained robust as investment at home aided demand.

Blocked in China, Facebook Is Said to Seek a Shanghai Office

Paul Mozur
New York Times
The social media giant in recent months has quietly scouted for office space in Shanghai, according to two people with knowledge of its efforts there. Those offices would house employees working on Facebook’s effort to make hardware but could also...

Wanda Sues over 'False' Reports on Chairman Wang Jianlin

Wayne Ma
Wall Street Journal
Dalian Wanda Group, the property and entertainment giant controlled by billionaire Wang Jianlin, has filed defamation suits against at least 10 Chinese social media accounts that published reports the company says sent its shares and bonds tumbling.

Trump May Have Pushed Mexico into the Arms of China's Alibaba

Sophia Yan
CNBC
Mexico's Ministry of Economy and Alibaba will partner to get more Mexican products onto the tech firm's popular e-commerce platforms...

‘Dunkirk’ Conquers China's Box Office

Gaochang Zhang
Los Angeles Times
The World War II rescue tale “Dunkirk” dominated the box office in China last week, building on its international success.

China’s Former Richest Man Now Banned from Hong Kong’s Business World

Sophia Yan
CNBC
Chinese entrepreneur Li Hejun, who briefly held the title of China’s richest man, was just banned from Hong Kong’s business world.A Hong Kong court ruled to disqualify Li from being a director or being involved with the management of any Hong Kong...

Google Continues to Hire in China Even as Search Remains Blocked

David Ramli
Bloomberg
Google’s search service may be banned in China but parent Alphabet Inc. is hunting for workers in a further sign it has ambitions in the world’s biggest internet market.

China's HNA Group Sues Exiled Chinese Businessman

Julie Steinberg and Carolyn Cui
Wall Street Journal
One of China’s most acquisitive companies is suing an exiled Chinese businessman for allegedly spreading what it says are falsehoods that have hurt the conglomerate’s reputation and financial interests.

China Realizes It Needs Foreign Companies

Christopher Balding
Bloomberg
China is increasingly desperate for foreign investment. Yet foreign companies are less and less interested in what it has to offer. How this problem gets resolved may be one of the most important questions facing China's economy...

David Tang, Fashion Retailer and Raconteur, Dies at 63

Keith Bradsher and Elizabeth Paton
New York Times
David Tang, the founder of Shanghai Tang, a global chain of flashy emporiums of Chinese-inspired clothing, accessories and home furnishings, and a prominent writer and raconteur in Hong Kong and Britain, died on Tuesday in London. He was 63.

China Can Squeeze Its Neighbors When It Wants. Ask South Korea

Jethro Mullen
CNN
South Korean businesses have been suffering since early this year after the country angered the Chinese government with the deployment of a U.S. missile defense system. The victims include companies in tourism and retail, but also Hyundai (HYMTF),...

Green Gold: How China Quietly Grew into a Cannabis Superpower

Stephen Chen
South China Morning Post
Every year in April, Jiang Xingquan sets aside part of his farm in northern China to grow cannabis. The size of the plot varies with market demand but over the last few years it has been about 600 hectares.

Alibaba and Tencent Are Showing How Companies Can Get around Beijing's Crackdown on Foreign Deals

Sophia Yan
CNBC
The firms, among China’s most important tech giants, are overseeing the merger of two companies they back. Chinese delivery firm 58 Suyun is combining with Hong Kong logistics company GoGoVan — both have raised funds from Alibaba, and Tencent backs...

Power of Love: China's Latest Arranged Match Rattles Utilities

Meng Meng and Josephine Mason
Reuters
Beijing announced its latest arranged marriage by matching the country’s top coal miner with one of its biggest utilities to create a global powerhouse worth $280 billion on China’s Valentine’s Day.

New Silk Road: Japan to Counteract China in Kazakhstan with New Asia-Europe Rail Deal

Wade Shepard
Forbes
Japan continues standing in the ring with China, exchanging blow for blow as the Asian rivals both compete and cooperate with each other in the creation of the trans-Eurasian mega-project that has been...

Under Pressure: The Story behind China’s Ivory Ban

Benjamin Haas
Guardian
For years Chinese government officials were followed around the world, at every meeting, by a single issue: the scores of dead elephants across Africa, and the international community that blamed China for this “ivory “holocaust”.  

Trump on China: ‘I Want Tariffs. And I Want Someone to Bring Me Some Tariffs’

MarketWatch
President Donald Trump demanded tariffs against China at a recent White House meeting, according to a new report, dismissing concerns from his “globalist” advisers.

More Turmoil for China’s Wanda as Rumors Fly

Variety
China’s Dalian Wanda issued a stern denial Monday following rumors that company chairman Wang Jianlin had been detained by authorities as he attempted to fly abroad. The unsubstantiated reports caused stocks in Wanda’s hotel group to swoon. “Rumors...

China Is Investing $57 Billion into Pakistan

Fortune
Chinese entrepreneurs are looking to explore opportunities in Pakistan, where Beijing has pledged to spend $57 billion on infrastructure projects as part of its “Belt and Road” initiative.

China State Media Says US Will ‘Pay’ for ‘Unjust’ Sanctions

CNBC
China has come out strongly against new U.S. moves to pressure North Korea with its foreign ministry opposing the “long-arm jurisdiction” of President Donald Trump’s administration, arguing that Beijing has always met international obligations in...

China Will Use ‘All Necessary Means’ against US Trade Probe

Guardian
China’s commerce ministry has already expressed “strong dissatisfaction” with the US launch of an inquiry into alleged theft of U.S. intellectual property, calling it “irresponsible”.

China’s ‘Belt and Road’ Initiative Could Be the next Risk to the Global Financial System

CNBC
China has pitched its mammoth, pan-Eurasian “Belt and Road” infrastructure initiative as a means of promoting economic prosperity and fostering diplomatic ties on a global scale.

Balance of Power: China Extends Its Reach

Bloomberg
President Xi Jinping is spending more than $50 billion in an economic corridor in Pakistan, Afghanistan’s neighbor. The highways and gas pipelines, designed to provide China an alternative land route to the high seas, also give it an interest in...

Germany Is Trying to Stop China from Gobbling up Its Companies — but There May Be a Downside

Karen Gilchrist
CNBC
Think of Germany and it isn’t long before visions of bustling business districts and thriving manufacturing plants spring to mind. It isn’t surprising: it’s these industries that have elevated the country to rank among the world’s leading economies...

New Balance Wins $1.5 Million in Landmark China Trademark Case

Sui-Lee Wee
New York Times
A Chinese court has ruled that three domestic shoemakers must pay New Balance $1.5 million in damages and legal costs for infringing the American sportswear company’s signature slanting ”N” logo, in what lawyers said was the largest trademark...

Viewpoint

08.22.17

Burn the Books, Bury the Scholars!

Geremie R. Barmé
Chinese censorship has come a long way. During his rule in the second century B.C.E., the First Emperor of a unified China, Ying Zheng, famously quashed the intellectual diversity of his day by ‘burning the books and burying the scholars’. He not...

China, Like U.S., Struggles to Revive Industrial Heartland

Michael Schuman
New York Times
The hulking, brown–brick industrial plants lining the roads were once the backbone of this gritty city. Today, they are outdated and unwanted, and the region is one of the Chinese economy’s most troubled. 

China to Rev up Bullet Train Revolution with World's Fastest Service on Shanghai-Beijing Line

Sarah Zheng
South China Morning Post
China will soon start official operation of the world’s fastest train service, knocking an hour off the 1,318km journey between Beijing and Shanghai.

Ford in Talks to Launch Fully Electric Cars in China

Peter Campbell
Financial Times
Ford is in talks to launch fully electric cars for the Chinese market as the US carmaker plays catch up to international rivals in the race to develop battery vehicles.  

Books

08.21.17

China’s Banking Transformation

James Stent
In this timely and provocative book, James Stent, a banker with decades of experience in Asian banking and fluency in Chinese language, explains how Chinese banks work, analyzes their strengths and weaknesses, and sets forth the challenges they face in a slowing economy. Without minimizing the real issues Chinese banks face, China’s Banking Transformation challenges negative media accounts and reports of “China bears.” Based on his 13 years of service on the boards of China Minsheng Bank, a privately owned listed bank, and China Everbright Bank, a state-controlled listed bank, the author brings the informed view of an insider to the reality of Chinese banking.China’s Banking Transformation demonstrates that Chinese banks have transformed into modern, well-run commercial banks, playing a vital role supporting the country’s extraordinary economic growth. Acknowledging that China’s banks are different from Western banks, the author explains that they are hybrid banks, borrowing extensively from Western models, but at the same time operating within a traditional Chinese cultural framework and in line with China’s governance model.From his personal experience working at board level, Stent describes the governance and management of China’s banks, including the role of the Communist Party. He sees China’s banks as embedded in ancient concepts of how government and society work in China, and also as actors within a market socialist political economy. The Chinese banking system today bears similarities with banking in Northeast Asian “developmental states” of recent past, and also pre-1949 Chinese banking.As the first account of Chinese banking by a Westerner who has worked in China’s banks, China’s Banking Transformation should be read by anyone interested in the political economy of contemporary China, in Asian development issues, and in banking issues generally. The book dispels misconceptions and provides insight into the financial aspects of China’s economic growth story. —Oxford University Press{chop}