Good Morning. Welcome to The Wire’s daily news roundup. Each day, our staff gathers the top China business, finance, and economics headlines from a selection of the world’s leading news organizations.
The Wall Street Journal
- China’s Tencent Plays Master Builder as Tech Firm Plans ‘Net City’ – A number of big U.S. tech companies are moonlighting as part-time real-estate developers. China’s Tencent Holdings Ltd. is trying its hand at urban planning.
- Cathay Pacific to Get Bailout Led by Hong Kong Government – The $5 billion funding package for the city’s flagship carrier might also give the government a minority stake in the 73-year-old company.
- Chinese Electric-Car Maker Gets U.S. Approval to Supply N95 Masks – BYD can now supply millions of U.S. standard masks—designed to filter out 95% of very small particles including droplets containing the coronavirus—to California, Washington state and Japan’s SoftBank.
- Behind HSBC’s Rare Foray Into Politics Over Hong Kong – After a century and a half trying to steer a neutral course through the messy geopolitics of east versus west, HSBC has signaled its support for China over the future of Hong Kong.
The Financial Times
- UK businesses in China say opening measures have little impact – British Chamber of Commerce assessment comes amid rising tension over Hong Kong and Huawei
- Hong Kong hedge funds explore exit as national security law looms – City’s status as premier Asian destination for industry talent is at stake
- UK M&A/China: bamboo curtain call – A precautionary stance for boards would be to report any deal with a counterparty from China
- Chinese investment in Australia falls 58% – Tensions over the coronavirus pandemic have strained ties between Canberra and Beijing
Caixin
- Revenues Fall by Half for 37 Listed Chinese Brokerages – GF Securities and Southwest Securities were the only two to report a rise in profits last month
- In Depth: Why Chinese Companies May Get Booted From U.S. Stock Markets – American regulators are threatening to ban Chinese companies from trading on U.S. exchanges if they don’t comply with the same rules as everyone else
- China to Test Freer Cross-Border Capital Flow in Hainan – Under plan to create world-class free-trade port, pilot programs will test easing foreign investment while liberalizing individual access to foreign currencies
- Exclusive: Tencent-Backed WeDoctor Readies Hong Kong IPO – Online medical services provider aims to raise $700 million to $900 million by capitalizing on disruptions to traditional health care brought by Covid-19
- Ericsson to Benefit From China’s 5G Market Despite Short-Term Losses, Analysts Say – Over $100 million write-down will help secure market share for Swedish telecom-gear maker
- Chip Startup Tied to Display Giant BOE Raises $283 Million – Eswin Computing Technology hopes to capitalize on China’s drive to design and produce more high-tech microchips at home and reduce reliance on imports
- Tesla’s Locally Made Model 3 China Sales Bounce Back in May – Tesla retook the crown as China’s largest vendor of new energy vehicles in May amid the growing popularity of its domestically built Model 3 pure electric cars.
- NetEase Prices Its Hong Kong Secondary Listing – Internet giant NetEase said it has priced its Hong Kong listing at HK$ 123 ($15.87) a share, as it gets set to become the second major U.S.-listed Chinese tech firm after Alibaba to do a second listing in the city.
- TikTok rival Kuaishou builds $1.4bn data center in China – Chinese video sharing app Kuaishou will spend about 10 billion yuan ($1.41 billion) to build its largest data center, as the company looks to support a user base poised for continued growth in a post-coronavirus market.
- Oppo Confirms Move Into Custom Chips in Pursuit of Rivals Like Huawei – Top smartphone maker Oppo will step up chipmaking plans and work with chosen suppliers to co-develop its own custom-made chips, Liu Bo, head of China business for the company, said Thursday in an interview with a small group of Chinese media including Caixin.
South China Morning Post
- Coronavirus: China stimulus policies not enough to boost job growth, steady economy, experts warn – China needs to do more to steady employment this year given the damage caused by the coronavirus pandemic and calls from some trade partners to decouple from the world’s second largest economy, a panel of government advisers and academics said on Tuesday.
- Coronavirus: reeling tourism sector pushes Hong Kong government to step up efforts to create ‘travel bubbles’ with neighbours – Hong Kong’s tourism industry is desperately urging the government to set-up “travel bubbles” with neighbouring regions as a lifeline, warning the hard-hit sector will need an extended period to recover from the near-total shutdown brought on by the coronavirus pandemic.
- Global cashmere production hit as India-China border dispute deepens – As tensions between India and China deepen amid an increasing fractious border dispute, the world is heading for a shortage of cashmere wool, a highly prized and super soft material that comes from pashmina goats living on the “roof of the world”.
- China car sales rose for first time in almost a year in May, industry body says – Car sales in China rose for the first time in almost a year last month, evidence that the world’s largest market is rebounding from the coronavirus crisis and the trade war with the United States.
- Protest-wracked Hong Kong still world’s priciest housing market in 2019 as Asian cities dominate top five, says CBRE survey – Four of the world’s five most expensive housing markets were in Asia last year, with Hong Kong maintaining its crown as the priciest with an average price of US$1.25 million, according to a report by property consultancy CBRE.
- Li Ka-shing’s CK Asset Holdings throws weight behind Beijing’s security law for Hong Kong ahead of its biggest property launch this year – CK Asset Holdings, the second largest developer in Hong Kong by value, has sought to ease homebuyers’ concerns over China’s hugely controversial security bill ahead of its biggest property launch this year.
Bloomberg
- AllianceBernstein Favors China Investment-Grade Bonds, Zeng Says – Jenny Zeng, co-head of Asia Pacific fixed income at AllianceBernstein, discusses at the prospects for the region’s bond markets. She also looks at the steepening of U.S. Treasury yield curve. She speaks with Haslinda Amin and Yvonne Man on “Bloomberg Markets: Asia.”
- China’s Swipe at Australian Barley Sparks Quest for New Markets – Australia’s farmers are on a mission to find fresh buyers for their barley, and are targeting bigger exports this year even after the country’s top customer, China, slapped tariffs of about 80% on the grain.
- In Coronavirus Recovery, China Looks to Climate and Coal – The country announced a slate of climate-friendly stimulus priorities, but has also loosened coal regulations.
- YouTube and TikTok Are Battling Over India – It’s Google against China’s ByteDance in an internet battle with geopolitical overtones.
- Why the U.S. Can’t Easily Break China’s Grip on Supply Chains – The trade war amplified calls in the U.S. and elsewhere for reducing dependence on China for strategic goods. Now, the pandemic has politicians vowing to take action.
- China’s Investment in Australia Falls to 13-Year Low Amid Spat – Chinese investment in Australia plunged 58.4% last year to A$3.4 billion ($2.39 billion) — the lowest level since 2007, according to a report released amid a broadening diplomatic spat between the nations.
- Hong Kong’s Rush to Attract China Listings Comes With a Risk – Hong Kong exchange’s race to attract big Chinese technology listings comes with one big risk, say money managers: The city’s ability to keep the investing dollars flowing in as it’s roiled by political tensions.
- Rating Cut Raises Fresh Alarm Over Chinese Telecom Firm’s Debt – China’s largest private telecommunications services provider is under deeper stress, after a global credit risk assessor cut its rating and labeled a delayed bond repayment by the firm a de facto default.The latest ratings downgrade and warning about refinancing risk by Moody’s Investors Service deals a fresh blow to Dr. Peng Telecom & Media Group Co.
- New Breed of Gas Ships Emerges to Capture Growing Markets – The new Saga Dawn liquefied natural gas tanker shuttling between Singapore and Humen in eastern China is a sign that the fastest-growing fossil fuel is permeating into markets once thought inaccessible.
- Shanghai Renewable Subsidies to Support Solar and Offshore Wind – Shanghai’s municipal government will extend subsidies for solar and offshore wind through 2021 while ending those for onshore wind as it tries to meet its target for renewable energy generation.
- Cathay Avoids Collapse With $5 Billion Government-Backed Plan – Cathay Pacific Airways Ltd. became the latest global carrier to receive a lifeline to get through the coronavirus pandemic, with the chairman saying its plan to raise HK$39 billion ($5 billion) from the Hong Kong government and shareholders was necessary to avoid collapse.
- TSMC Scores Subsidies and Picks Site for $12 Billion U.S. Plant – Taiwan Semiconductor Manufacturing Co. has secured government subsidies for its envisioned $12 billion chip plant in Arizona, moving closer toward finalizing a facility designed to allay national security concerns and shift high-tech manufacturing to America.
- The U.S. and the World Need a WTO That Works – If allowed to do its job, the global trade-promotion agency would be a vital asset.
- Huawei’s Patents on 5G Means U.S. Will Pay Despite Trump’s Ban – Huawei Technologies Co. owns the most patents on next-generation 5G technology, ensuring the Chinese company will get paid despite Trump administration efforts to erase it from the supply chain, according to a new study.
Reuters
- China’s Wangfuijing group wins duty-free retail licence – The parent company of one of China’s largest department store chains said on Tuesday that it has been granted a government licence for duty-free retail, as the government ramped up efforts to spur domestic consumption to cushion the economy.
- U.S. failed to properly oversee Chinese telecom carriers: Senate panel – A U.S. Senate report released Tuesday says the U.S. government failed to properly oversee Chinese-owned telecommunications companies for nearly two decades.
- China to cut teapot refining capacity as plans for mega complex – China’s oil hub Shandong has embarked on a plan to shut down capacity of half a million barrels per day shared among small, independent refiners to make way for a giant complex that should spur economic recovery from the coronavirus crisis.
- Chinese telecom firms urge FCC not to revoke ability to operate in U.S. – The U.S. units of China Telecom Corp’s and China Unicom urged the Federal Communications Commission (FCC) not to revoke the company’s nearly two-decade old authorization to provide international telecommunications services to and from the United States.
- China’s troubled Baoshang rescue exposes fault lines in bank reform drive – In May 2019, China’s central bank announced a shock takeover of a lender, its first such move in 20 years, citing “serious credit risks”. Creditors in small Baoshang Bank were to take a hit, assets would be sold and an example set for governance.
- Alibaba says cloud unit to recruit 5,000 staff globally this financial year – Alibaba Group said its cloud unit aims to recruit 5,000 staff globally from now until the end of this financial year, in areas including network, database, servers, chips and artificial intelligence, it said in a statement on Tuesday.
- Private equity scouts for China take-private deals amid tension, volatile markets – Private equity investors are seeking Chinese companies to take private in the hope they can snap up bargains amid the coronavirus-related sell-off, but the banks that help find such deals are proving less keen to finance them.
Xinhua
- China’s express-delivery competition intensifies amid coronavirus: Fitch – Pricing pressure in China’s express-delivery sector intensified in the first quarter of 2020 as slower economic activity caused by the novel coronavirus outbreak weighed on demand and express-delivery companies cut prices to win orders, according to a recent report by Fitch Ratings.
- Coal-rich Chinese province to close more mines – North China’s coal-rich Shanxi Province plans to close all coal mines with annual production capacity below 600,000 tonnes by the end of 2020 to further upgrade the industry, local authorities said.
- South China’s Guangzhou sees over 1 trillion yuan in foreign trade in 2019 – The imports and exports of Guangzhou, capital of south China’s Guangdong Province, exceeded over 1 trillion yuan (about 141.42 billion U.S. dollars) in 2019, according to local authorities.
Other Publications
- AP News: China’s companies emerge as global donors in virus pandemic – The pandemic marks the debut of China’s business elite as global humanitarian donors alongside their American, European and Japanese counterparts. Ma, Alibaba and other Chinese companies and tycoons are donating hundreds of millions of dollars of medical supplies, food and cash in dozens of countries.
- Pan Daily: Chinese Mobile Games Revenue Surges in May Thanks to Vacations in China and Japan – Mobile games from Chinese publishers recorded surging revenues in May as in-game promotions and events drove up user spending in the Chinese and Japanese markets, where the month started with a week-long public holiday, according to analytics firm Sensor Tower.
- Yicai Global: China’s Non-Cash Payments Dipped in First Quarter, PBOC Says – China’s non-cash payments fell a little in the first quarter due to the Covid-19 epidemic, while mobile payments maintained growth, according to new central bank data.
- NPR: With China’s Economy Battered By Pandemic, Millions Return To The Land For Work – Since the coronavirus pandemic battered China’s economy, tens of millions of urban and factory jobs have evaporated. Some workers and business owners have banded together to pressure companies or local governments for subsidies and payouts. But many of the newly unemployed have instead returned to their rural villages. China’s vast countryside now serves as an unemployment sponge, soaking up floating migrant workers in temporary agricultural work on small family plots.
- Barron’s: Where’s the Next Bull Market? China Health Care and Software, a Fund Manager Says. – China is the focus of political backlash in the U.S., with Congress and the Trump administration taking a tougher stance against the world’s second-largest economy, which is grappling with rising unemployment and sluggish growth in the wake of the pandemic. Yet allocations to China in the $38 billion Invesco Oppenheimer Developing Markets fund, one of the country’s largest, is at a decade-high.
- Forbes: China Market Update: China Health Care Fuels Exports In May – Exports showed resilience. Rumor has it that medical exports helped fuel the surprise strength in exports. Supply chains coming online likely helped as well. However, imports were hurt by the drop in commodity prices and a difficult year-over-year comparison.
