NEWS

May 20, 2019

Will the escalating US-China trade war and its catastrophic aftermath push the global economy into its next recession?

Heightened trade tensions between the United States and China have raised the risk of a recession next year if the dispute between the world’s two largest economies is prolonged and escalates further, according to economists and portfolio managers.Just over two weeks ago, Washington and Beijing seemed poised to reach an agreement to end a trade war that has hurt American businesses that rely on products made in China, increased costs for US companies and consumers, and contributed to an…
May 19, 2019

US-China trade war, financial transparency to spur more belt and road projects, says Standard Chartered

The ongoing US-China trade war and Beijing’s commitment to adopt internationally recognised best financial practices will lead to more infrastructure projects in countries covered by the Belt and Road Initiative, according to Standard Chartered.The global bank, which serves Chinese clients’ project financing needs in 45 markets across belt and road, expects continued growth in business this year despite earlier criticism that some projects have mired host nations in “debt traps” because of…
May 19, 2019

China set to pick new head for state-owned enterprise regulator amid growing calls for reform

The regulator for China’s state-owned enterprises is to get a new leader amid growing calls for reform from both home and abroad.China has sought to slim down its state sector with the aim of creating a smaller number of “world-class” firms capable of competing internationally, but analysts say the effort to create more flexible management and ownership structures has put the long-term future of the State-owned Assets Supervision and Administration Commission (Sasac) in doubt.Xiao Yaqing, Sasac…
May 19, 2019

Liu Shiyu, China’s former top securities regulator, turns himself in as part of corruption investigation

China’s former securities watchdog chief Liu Shiyu has become the subject of a graft probe, the country’s super anti-corruption agency said on Sunday.Liu, who left the China Securities Regulatory Commission in a surprise reshuffle in January, was said to have turned himself in and is suspected of violating party discipline and laws, according to a terse statement issued by the National Supervisory Commission. Liu is cooperating with the investigation.Liu, 57, currently heads the All-China…
May 19, 2019

US-China trade war: here are Beijing’s options – and not one looks any good

From the volume of bellicose rhetoric in China’s state media, you might think Beijing is digging in for a bloody fight to the finish in its trade conflict with the United States.But after the US administration this month jacked up import tariffs on US$200 billion of Chinese goods to 25 per cent, and threatened equal tariffs on another US$340 billion, the Chinese government faces a problem.The policy responses it is considering are all either impossible, impractical, ineffective or expensive…
May 17, 2019

China economy to get more stimulus to fight trade war tariffs? Official drops hint help may come

The debate over whether China needs a new round of stimulus to offset weakening economic growth has returned, following disappointing April economic data and the threat by the United States to expand tariffs to cover all Chinese imports.That debate will intensify with the news that Wang Yang, a member of the ruling Communist Party’s policymaking Politburo Standing Committee, told Taiwanese businessmen at a meeting in Beijing on Thursday that the trade war, in the worst case scenario, could cut…
May 17, 2019

Trade war could slice 1 per cent off China’s economic growth, top party official says

The US-China trade war could slash one percentage point off Beijing’s economic growth this year, a senior Chinese policymaker said on Thursday.Speaking to a group of Taiwanese businesspeople whose companies are based in mainland China, Wang Yang – one of the seven members of the elite Politburo Standing Committee – said that the government had assessed the impact of the near year-long dispute and estimated that in the worst case scenario gross domestic product growth would be one percentage…
May 17, 2019

China scrapped import shipment of American pork in the biggest cancellation in more than a year as US-China trade war escalated

The same week US President Donald Trump announced sweeping increases on tariffs against Chinese goods, Chinese buyers dropped orders for 3,247 metric tonnes of US pork – the biggest cancellation in more than a year, according to US Department of Agriculture data released on Thursday.The cancellation came during the week ended May 9, a blow to the US$6.5 billion export market for American pork, vital to the burgeoning US meat industry.Prior to the trade war, China and Hong Kong combined were the…
May 16, 2019

Trade war: why next US tariffs on China could halve Taiwan’s growth

The next round of trade tariffs that the US may impose this summer as part of the escalation of its trade war with China threatens to hurt Taiwan more than other Asian countries because computers and consumer electronics will be targeted for the first time.The new tariffs, which could be implemented as soon as July, could cut Taiwanese growth this year in half to just over 1 per cent, analysts said.The tariffs of up to 25 per cent on electronic products assembled in China – including PCs and…
May 16, 2019

The US-China trade war has been a boon for Brazil’s soybean farmers. But can they keep up with Chinese demand?

There are winners and losers in any spat, and they are often not the parties at loggerheads.Brazil’s soybean farmers, for example, have triumphed spectacularly in the US-China trade war. In fact, they’ve done so well they may become victims of their own success, according to the head of a Brazilian trade promotion agency.After their shipments to China jumped by almost a third last year to fill the void left by soybean imported from the US, the South American growers may struggle to maintain the…
May 16, 2019

Chinese companies moving to Vietnam keep quiet on trade war to avoid wrath of authorities and staff

Chinese state media may have launched a fierce propaganda campaign, placing the blame for the trade war squarely at the feet of the US government. But many manufacturers in China are keeping their heads below the parapet, for fear of reprisals from both inside and outside the country.Interviews reveal that many factory owners and operators feel that they are caught in the middle of forceful rhetoric from both sides in the trade war. And rather than face direct retaliation from officials,…
May 16, 2019

US investment in China in sharp decline, as trade war continues to hamper business

American direct investment in China grew by 24.3 per cent in the January to April period compared with the same period last year, a sharp deceleration from the 71.3 per cent growth in the first quarter of 2019, the Chinese Ministry of Commerce announced on Thursday.The deceleration implies a sharp decline in foreign direct investment (FDI) in April, though the ministry did not release figures for the month alone.The decline in yuan terms comes as the ongoing trade war between the world’s two…
May 16, 2019

New home prices rise in almost all Chinese cities as lower mortgage rates, lighter restrictions spur demand

New home prices rose in almost all of the 70 Chinese cities monitored by the government in April, as upbeat sentiment extended its reach.The average cost of a new house increased by 0.62 per cent, about the same as the rise in March and higher than the 0.53 per cent gain in February, according to a Bloomberg calculations based on National Bureau of Statistics data released on Thursday morning.Prices climbed in 67 out of the 70 cities tracked by the bureau, a jump from 65 and 57 cities in March…
May 15, 2019

Will a falling yuan ‘torpedo’ China’s trade talks with the US?

The value of China’s yuan dropped to a four-month low against the US dollar this week after the latest flare up in US-China trade tensions as a promise by Beijing that it will not use depreciation as a tool to fight the trade war did little to allay investor concerns.The Chinese currency’s 2 per cent decline over the last two days to around 6.90 has pared much of this year’s gain on a strengthening view that Beijing might let the exchange rate weaken as part of its retaliation to mitigate the…
May 15, 2019

US-China trade war could push Macau’s growth below 4 per cent this year, IMF warns

The escalating trade war between China and the United States could further dampen growth in Macau, the International Monetary Fund has said.The gambling hub is already suffering from the slowdown in the mainland’s economy and efforts to curb big-money betting, but the trade war “has the potential to drag Macau SAR’s growth below our medium-term projection of about 4 per cent”, Mariana Colacelli, the IMF mission chief for Macau, said.In a report released last Friday, the fund projected that…
May 15, 2019

Property mogul Wang Jianlin’s Wanda Group to invest US$11.7b in world-class tourism project in rust-belt city of Shenyang

Wanda Group, the profligate Chinese conglomerate that is halfway through a massive debt-shedding exercise, has unveiled one of the largest ever investments in the northeastern Chinese city of Shenyang totalling 80 billion yuan (US$11.7 billion).The property-to-entertainment conglomerate controlled by tycoon Wang Jianlin said on Wednesday that the new investment will go towards building a “world-class” cultural tourism project, an international hospital, an international school and five Wanda…
May 15, 2019

Dalian Wanda, halfway through its debt-shedding exercise, is spending US$21 billion in a month buying real estate projects

Wanda Group, the profligate Chinese conglomerate that is halfway through a massive debt-shedding exercise, is back with its shopping spree, investing as much as 147 billion yuan (US$21 billion) over the past month in several real estate projects in the country.Tycoon Wang Jianlin’s property-to-entertainment conglomerate, which unveiled an 80 billion yuan project in Shenyang said its “world-class” cultural tourism project will comprise an international hospital, an international school and five…
May 15, 2019

Trade war to hit high-end US fashion brands dependent on specialised Chinese manufacturing

High-end US fashion brands have become more reliant on China for manufacturing, making them more vulnerable to an increase in trade war tariffs, a new study shows.While imports of basic apparel items such as T-shirts and underwear can easily be shifted to lower-cost production hubs such as Vietnam, Cambodia or Bangladesh, China has become so specialised in the manufacturing of higher-value goods such as accessories and coats, that US brands may be forced to stomach the tariff hike.Research from…
May 15, 2019

China’s exporters of Donald Trump wigs and American flags ‘had no idea’ they face higher trade war tariffs

On Tuesday, US President Donald Trump was greeted by the Louisiana Lieutenant Governor Billy Nungesser, who proudly brandished socks featuring the president’s face and distinctive hair.The socks were manufactured by Gumball Poodle, a California-based company, whose website proudly states: “All our socks are proudly made in the USA.”However, users of the Chinese e-commerce portal Alibaba can buy almost identical socks in bulk from Yiwu Hodeang E-Commerce, a Chinese manufacturer who said he ships…
May 15, 2019

China’s biggest companies can weather US-China trade war escalation, says rating agency S&P

S&P Global Ratings said the biggest Chinese companies it rates should be able to withstand the escalation of a trade war between the US and China in the near term, but prolonged uncertainty and lagging market confidence could make it harder for them to refinance debt if it persists.The rating agency said it estimates that only about 8 per cent of the companies that it assesses have direct exposure to the increased tariffs on exports to the US and most have sufficient buffers or alternative…