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
- U.S. Imposes Visa, Export Restrictions on Chinese Firms and Executives Active in Contested South China Sea — The U.S. unveiled a set of visa and export restrictions targeting Chinese state-owned companies and their executives involved in advancing Beijing’s territorial claims in the contested South China Sea, a new challenge to China involving the strategic waters.
- Vanguard Scales Back in Asia — The indexing giant plans to close its operations in Hong Kong and Japan, as it focuses on individual investors and mainland China.
- Ant Group’s $200 Billion Hill Could Soon Become Mountainous — Chinese financial-technology company Ant Group may sound small, but it could ride China’s technology-investment wave to grow into a market behemoth.
- U.S. Firms in China Say Trump’s WeChat Ban Will Hit Them Where It Hurts — U.S. businesses in China are pushing back against a looming Trump administration ban on Tencent’s WeChat app, with a report shedding light on just how vital the tool is to companies doing business in the world’s second-largest economy.
- China’s STAR Board Defies Financial Gravity in a Hot Market — Shares listed on the mainland’s year-old Nasdaq-style technology board are trading at huge premiums to near-identical stocks in Hong Kong.
- This Chinese Metal Stock Is Alluring — Industrial metals are benefiting from China’s economic recovery—and the weak dollar—but aluminum in particular is enjoying some tailwinds it hasn’t seen in a while.
- Chinese Diplomats Helped Military Scholars Visiting the U.S. Evade FBI Scrutiny, U.S. Says — The U.S. closed the Chinese consulate in Houston and ordered China to remove the researchers after finding what officials say was an intelligence-gathering operation aided by diplomats to collect cutting-edge scientific research from American universities.
- China’s Top Diplomat Begins Europe Tour Aiming to Rekindle Cooling Ties — China’s top diplomat began a weeklong tour of Europe seeking to counter growing wariness of Beijing’s increasingly assertive foreign policy amid the coronavirus pandemic and worsening relations between Beijing and Washington.
The Financial Times
- Hong Kong police arrest pro-democracy lawmakers — Detentions are latest crackdown on opposition in city after passing of security law.
- Japan sets its sights on ‘Six Eyes’ intelligence status — Defence minister expresses ‘grave concerns’ about China’s growing military expansion.
- Ant Group reveals $2.6bn profit as it files for blockbuster IPO — Chinese payments company said to be targeting $30bn share sale at valuation of $200bn-$300bn.
Caixin
- Banks Let Loose With Loans to Manufacturers Amid China’s Self-Sufficiency Drive — Banks issued $232 billion in new manufacturing loans over the first seven months of this year, already more than the whole of 2019.
- PBOC: Lowering Banks’ Capital Adequacy Hurdle Would Be ‘Fooling Ourselves’ — Central bank’s Liu Guoqiang calls for banks to find ways to shore up capital and says People’s Bank of China is working on innovative approaches.
- China’s Rare Earth Exports Fall to Over Five-Year Low as Pandemic Devastates Demand — Year-on-year slump of two-thirds in July is due to pandemic’s impact on demand for vital minerals, official says.
- Chinese Electric Vehicle Startup Byton Said to Register New Firm as It Struggles to Resume Production — Chinese electric vehicle startup Byton has applied to register a new tech company as part of ongoing efforts to resume its China operations halted in July because it couldn’t pay the bills.
- ‘Washed-Up’ Phone Maker BlackBerry Provides Autonomous Vehicle Safety System to Xpeng — Once the phone of choice for U.S. presidents, the “washed-up” Canadian smartphone maker BlackBerry has announced its IPU-03 system, a mass-produced autonomous driving domain controller, will be used in Chinese electric vehicle startup Xpeng’s newly launched P7 electric sports sedans.
South China Morning Post
- As Huawei struggles to find alternatives to US chip tech, it finds itself a pawn in a much bigger power game — As China’s telecoms champion and 5G powerhouse, Huawei Technologies is used to playing the role of king. Lately though, it is finding itself more like a pawn in the great power game between the world’s two superpowers.
- Cryptocurrencies help Chinese evade capital and currency controls in moving billions overseas — Cryptocurrencies appear to be emerging as the latest means for Chinese citizens to move their assets overseas and evade the nation’s strict capital controls amid escalating tensions in US-China relations.
- Canada’s China critic takes helm of opposition party as Trudeau seeks new mandate — The election of a China critic as leader of Canada’s Conservative Party on Monday shows the ranks of political leaders in the West calling for a tougher stance against Beijing growing ever larger.
- China-US ties: phase one trade deal must be separate from other parts of relationship to succeed, Beijing says — The implementation of the phase one China-US trade deal needs a better political atmosphere and to be separated from other aspects of the volatile relationship between the two countries, Chinese state media said, despite “constructive” trade talks on Tuesday.
- China could weaponise drug exports to retaliate against US chip restrictions, Beijing adviser says — China should weaponise its exports of medicines and drug precursors if the US cuts the country’s access to computer chips, a prominent Chinese academic and government adviser says, as supply chain security emerges as a key theme in the upcoming American presidential election.
- Ant Group’s mega IPO will reward staff and early investors, including the businesses of two of Hong Kong’s wealthiest families — Ant Group’s upcoming dual listing, likely to be the largest in global financial history, will reward the staff and early investors of the world’s biggest fintech company, including companies controlled by two of Hong Kong’s wealthiest families.
- China ‘stuck’ as rigid controls on capital outflows becoming harder to peel back — China’s onerous capital account controls were all too apparent for Oziter Mao during a recent trip to a state bank.
- Hong Kong trade woes worsen with exports falling 3 per cent as coronavirus and US-China tensions continue to take toll — The recent decline in Hong Kong trade worsened in July, with exports falling 3 per cent from a year earlier, exacerbated by a combination of the coronavirus pandemic and snowballing US-China tensions.
Bloomberg
- U.S. Blasts HSBC for Siding With China Over Future of Hong Kong — HSBC Holdings Plc has been accused by U.S. Secretary of State Michael Pompeo of aiding the Chinese government’s clampdown on Hong Kong.
- Some Countries Don’t Want to Wait for Superpowers’ Vaccines — After Covid-19’s emergence in Buenos Aires led to a strict lockdown in March, Juliana Cassataro and her fellow vaccine researchers grew concerned. The U.S., Europe and China had already revved up their quests to obtain shots; how far back in line would Argentina have to wait for supplies?
- VW to Test Fleet of Self-Driving Cars in China’s Newest EV Hub — Volkswagen AG plans to roll out its first fleet of self-driving test cars in Hefei, an eastern Chinese city that’s emerging as a hot spot for the nation’s electric vehicle ambitions.
- South Sudan to Let CNPC Operator Pact Lapse, Take Over by 2027 — South Sudan will let China National Petroleum Corp.’s contract as operator in some oilfields expire, allowing state-owned Nile Petroleum Corp. to take over the role.
- China Makes Concessions in Call for Talks on U.S. Audit Standoff — China says it has made concessions in proposing to let U.S. regulators to audit some of its most sensitive companies and is calling for direct talks to solve a years-long dispute that threatens global markets.
- Xiaomi Profit Beats After Growing Premium Phone Share — Xiaomi Corp. reported better-than-expected profit after cracking the Chinese market for high-end smartphones and growing its share of overseas markets like Europe and India.
- Vanguard Pulls Out of Hong Kong and Japan, Cutting Jobs — Vanguard Group Inc. said it plans to end its onshore presence in Hong Kong and Japan to focus on individual investors in faster-growing parts of Asia, resulting in an undisclosed number of job losses.
- China Life Profit Drop Narrows as Virus Hits Investment Returns — China Life Insurance Co., the nation’s largest life insurer, said first-half profit fell 19% as the coronavirus pandemic hit investment returns and policy sales.
- China Said to Expect Record U.S. Soybean Purchases in 2020 — China is set to buy a record amount of American soybeans this year as lower prices help the Asian nation boost purchases pledged under the phase-one trade deal, according to people familiar with the matter. Soy futures in Chicago climbed to a seven-month high.
- China’s Biggest Banks Face $940 Billion Capital Shortage by 2024 — China’s four largest lenders are facing a funding gap in the trillions of yuan to meet global capital requirements designed to protect the public and the financial system against massive bank failures, according to S&P Global Ratings.
- Chinese Demand For Hong Kong Property Climbs Amid State Support — Mainland Chinese are returning to Hong Kong’s real estate market, snapping up millions of dollars in land and office blocks, bolstered by China’s support for Hong Kong’s status as a financial hub.
- TikTok’s Legal Arguments Must Overcome Trump’s Broad Power — TikTok Inc. sued President Donald Trump to overturn his Aug. 6 executive order that in effect will ban the Chinese-owned social media app in the U.S. next month. TikTok said in its lawsuit that the order was motivated by election-year politics and that Trump exceeded his authority because there’s no real national emergency justifying the order.
- Biotech Firm Brii Said to Weigh Up to $400 Million Hong Kong IPO — Brii Biosciences, which focuses on treatments for diseases such as Covid-19 and HIV, is considering an initial public offering in Hong Kong as soon as the first quarter of next year, according to people familiar with the matter.
- China Seen Skipping Winter LNG Feast With Storage Brimming — Don’t expect an LNG buying binge ahead of winter from the world’s fastest growing consumer of the fuel.
Reuters
- China to import $300 billion of chips for third straight year: industry group — China is likely to import at least $300 billion worth of semiconductors for the third year running, an industry association official said, in a sign of continuing reliance on foreign know-how despite efforts to gain local capability.
- BlueCity, owner of China’s biggest gay dating app, buys lesbian platform — BlueCity , the owner of China’s biggest gay men dating app Blued, said on Wednesday it had bought a Chinese lesbian dating app LESDO, marking the first ever deal within the country’s LGBT market.
- China’s private refiners hire new executives for Singapore desks — Private Chinese oil refiner and petrochemical manufacturers Hengli Petrochemical Corp and Rongsheng Petrochemical Corp have each hired a new executive for its Singapore trading desk, company officials said on Wednesday.
- China’s EV maker Xpeng raises U.S. IPO pricing — Chinese electric vehicle maker Xpeng could raise as much as $1.275 billion from its U.S. initial public offering (IPO) after flagging that its shares would be priced at $15, two sources with direct knowledge of the matter said.
- Asset managers in China tech ETF race as U.S. tensions stir investor fever — Asset managers are racing to launch index funds tracking China’s top technology companies, capitalising on investor fervour stirred by Sino-U.S. tensions, and fuelled by Ant Group’s blockbuster listing.
- China will release funds to local governments more quickly to boost economy — China will speed up the release of special funds to local governments to support the economy, vice finance minister Xu Hongcai told reporters on Wednesday.
- ‘All girls, buy it!’ In China, Perfect Diary gives cosmetics world a makeover with live streams, low prices — With chat groups, video streams and low prices for foundation, China’s Perfect Diary has emerged from nowhere four years ago to become a cosmetics giant for the digital age, trailing only L’Oreal and LVMH in the world’s no. 2 market for make-up.
- China central bank injects $29 billion via reverse repos — China’s central bank said it has injected 200 billion yuan ($28.94 billion) through 14-day reverse repo operations into the banking system on Wednesday.
- Stocks rise as U.S.-China phone call boosts optimism, euro gains — The euro rose on better-than-expected German business morale data on Tuesday while global equity markets gained, with the S&P 500 and Nasdaq setting new closing highs, after a phone call cooled a recent flare-up in U.S.-China trade tensions.
- U.S. imposes sanctions on Chinese national over fentanyl trafficking — The U.S. Treasury Department on Tuesday imposed sanctions on a Chinese national whom it accused of trafficking fentanyl to the United States.
- Canada has effectively moved to block China’s Huawei from 5G, but can’t say so — Canada is the only member of the Five Eyes intelligence-sharing network that has not formally blocked Huawei from 5G networks, but it has effectively done just that, delaying a decision long enough to force telecom companies to exclude the Chinese gear maker.
- Italy says China a key strategic partner, despite U.S. concerns — Italy and China need to forge closer ties, Italian Foreign Minister Luigi Di Maio said on Tuesday, potentially putting Rome at odds with Washington, which has raised alarm over Beijing’s economic ambitions.
- China’s Sinovac enters supply deal with Indonesia for COVID-19 vaccine doses — Sinovac Biotech Ltd said on Tuesday it would help Indonesia’s state-owned drugmaker Bio Farma produce in the country at least 40 million doses of its potential coronavirus vaccine before March 2021.
Other Publications
- POLITICO: Trump administration weighs accusing China of ‘genocide’ over Uighurs — The United States is weighing formally labeling China’s brutal repression of ethnic Muslim minority Uighurs a “genocide,” two Trump administration officials said.
- Nikkei Asian Review: Taiwan hits Alibaba in crackdown on ‘hidden’ Chinese investment — Taiwan has taken on China’s biggest e-commerce group in its latest action against companies accused of circumventing tighter regulations on mainland investment in this market.
