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.
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The Wall Street Journal
- India, China Trade Accusations Over Firing of Shots at Disputed Border — The Indian and Chinese militaries accused each other of firing warning shots in what would be the first use of guns along their disputed border in decades.
- Australian Reporters Flee China After Late-Night Visits From State Security — The evacuation of two Australian journalists from China after visits and interviews with Chinese security officials has set off alarms at a nerve-racking time for foreign press in the country.
- Disney’s ‘Mulan’ Faces Controversy Over Filming in China’s Xinjiang — Walt Disney’s $200 million live-action remake of “Mulan” is taking fire from human-rights activists over the filmmakers’ cooperation with authorities in China’s Xinjiang region, where officials have been accused of committing rights abuses against Muslims.
- Chinese Car Sales Rise at Fastest Rate in More Than Two Years — Heavy discounts and new-model debuts add momentum to a second-half recovery in the world’s largest auto market after a pandemic-disrupted first six months of the year.
The Financial Times
- China alleges Australian intelligence service raided reporters’ homes — Accusations come amid intensifying diplomatic row between countries.
- US companies defy Trump’s demands to leave China — Businesses ignore ‘decoupling’ threat as economy rebounds, says American Chamber of Commerce.
- IPOs: the incredible story of China’s bottled water billionaire — How a onetime hawker of Chinese medicine’s answer to Viagra has become one of the country’s richest individuals.
- Kim Jong Un’s dependence on China grows as virus hits economy — Beijing will ensure North Korea has continued access to food and fuel, analysts say.
- China’s Middle East strategy comes at a cost to the US — Beijing gains in oil and influence as successive presidents in Washington withdraw.
- Huawei says Japan ‘extremely important’ after 50% rise in procurement — New US tech ban puts Chinese company’s Asian ties under strain.
Caixin
- China May Regulate Online Health-Care Mutual Aid Platforms — Banking and insurance commission raises idea of licensing $760 million industry dominated by Ant’s Xiang Hu Bao that has attracted 150 million participants.
- Update: China’s Consumer Inflation Slips Amid Easing Pork Prices — Growth in food prices moderated as disruptions caused by bad weather and swine fever lessened in August.
- KFC Operator Yum China’s Hong Kong IPO Oversubscribed Dozens of Times — Retail demand for restaurant company’s secondary listing outstrips supply by factor of 51.
- Wall Street Abuzz Over Chinese Data Center Operator’s IPO — Chindata, which operates nine data centers and is building six more, could raise as much as $400 million in its planned listing.
- Online Education Flourishes Due to Pandemic as 51Talk Profits Grow in Second Quarter — Fallout from the Covid-19 pandemic continues to benefit China’s online education industry in the second quarter of 2020, with online language-training platform 51Talk turning losses into gains during the period.
- Sequoia-backed iRay Technology eyes $318m in STAR Market IPO — iRay Technology Company Limited, a provider of X-ray system components used in medical, dental, veterinary and industrial imaging applications, has kicked off the subscription process of an initial public offering (IPO) on Shanghai’s Nasdaq-style STAR Market, according to a filing on Tuesday.
- Plant-Based Faux Meat Maker Beyond Meat Shifts Production Lines to China — Serving as the faux meat supplier for Starbucks plant-based menu is not enough for Beyond Meat’s China ambitions. The U.S. fake meat maker is now moving some of its production lines to China as well, a country with an estimated 50 million vegetarians.
- Costa Closes All Stores in Qingdao in China Strategy Adjustment — The former British coffee chain Costa has reportedly closed all its stores in the coastal city of Qingdao, as well as some in Beijing, Jiangsu and Zhejiang, an investigation by state broadcaster CCTV Finance on Sept. 6 found. The coffee maker says it is seeking to “optimize and adjust its business in China.”
South China Morning Post
- Demand for cloud services in China increases to quarterly record high of US$4.3 billion — China maintained its position as the world’s second-largest cloud services market amid record spending of US$4.3 billion in the second quarter, fuelled by increased demand for online services during the Covid-19 pandemic and government stimulus measures, according to a report.
- Hong Kong’s hotel investment market reels from coronavirus, protests, with prices tumbling and landlords suing — Hong Kong’s hotel investment market is reeling from the impact of Covid-19 on tourism, with only one transaction taking place this year and landlords suing hotels for millions in rent arrears.
- China’s economic recovery continues as pressure eases on consumers, manufacturers in August — China’s consumer inflation rate eased in August, while downward price pressure on the manufacturing sector following the impact of the coronavirus also improved, data released on Wednesday showed.
- China continues to sweet-talk foreign firms, but business groups ‘need something solid’ — Beijing has doubled down on its charm offensive to convince foreign businesses to stay in China, as the central government struggles to protect the nation’s role in global value chains amid continued threats by US President Donald Trump to cut bilateral economic ties.
- China-Europe freight trains gather steam amid surge in B2B goods bought online — The China-Europe Railway Express left Chongqing in southwestern China last week, bound for Budapest, Hungary, making it the first train dedicated exclusively to delivering goods ordered by European businesses via e-commerce platforms, according to the General Administration of Customs.
- Japan’s largest online broker SBI says it may downsize in Hong Kong as city’s financial future comes under threat by security law — SBI Holdings, Japan’s largest online broker, is considering whether to downsize its Hong Kong operations in the next one to two years, becoming the first Japanese financial institution to retreat from the city amid rising concern about the city’s financial role under China’s national security law.
- China’s human rights abuses: 321 NGOs call for UN investigation into violations by Beijing — More than 320 rights groups and other organisations called on the United Nations on Wednesday to launch an international investigation into Beijing’s human rights abuses, demanding “decisive action”.
- China signals shift to stronger yuan exchange rate policy to help develop domestic demand, analysts say — China’s preference for a relatively weak exchange rate to help exporters and stimulate economic growth might soon be coming to an end, according to a growing number of analysts.
Bloomberg
- Vatican, China Set to Renew Deal on Long Path to Diplomatic Ties — The Vatican is close to renewing a historic agreement with China on the appointment of bishops in the country, as the two states inch toward restoring diplomatic relations after almost 70 years.
- U.S.-China Showdown Over Big Data to Leave Decades-Long Impact — TikTok, WeChat and Huawei Technologies Co. are just the beginning. What comes next has the potential to reshape the global economy for decades to come.President Donald Trump’s moves to prevent some of China’s biggest companies from accessing the private data of Americans — restrictions set to take effect this month — are part of a broader effort to create “clean networks” the Communist Party can’t touch. That initiative, involving everything from 5G networks to cloud services to undersea cable
- China Mulls Crackdown on Local Fundraising, Trading Venues — China’s securities regulator is considering a crackdown on venues facilitating over-the-counter transactions for real estate developers and online finance firms across the country as it seeks to control risks in the world’s second-largest economy.
- China Bank Stocks Lose $194 Billion in Perpetual Value Trap — Chinese bank stocks: never this cheap, rarely so unloved.
- China Clean Energy Offshore Corporate Loans Drop 40% This Year — Clean energy companies in China are borrowing less offshore and that’s unlikely to improve anytime soon.
- Rich Families From Asia to France Profit From Jack Ma Ties — Jack Ma’s Ant Group is creating a new group of super wealthy people in China while also giving a boost to some older fortunes globally.
- World’s Top 10 Airline Stocks Are All Chinese, Except One — Chinese carriers are in a sweet spot, relative to their Covid-battered peers at least. The country’s 1.4-billion-strong population is eager to travel, the yuan is rallying and oil is getting cheaper.
- Japanese Brokerage SBI Weighs Leaving Hong Kong Amid Turmoil — SBI Holdings Inc. may become the first major Japanese financial firm to withdraw from Hong Kong following the political turmoil there.
- Pound Among Most Structurally Challenged in G10: JPMorgan PB — Adam Margolis, head of foreign exchange and rates for Asia at JPMorgan Private Bank, discusses the outlook for currencies including the British pound, the U.S. dollar, the euro and the Chinese yuan. He speaks with Tom Mackenzie and Yvonne Man on “Bloomberg Markets: Asia.” (Source: Bloomberg)
- China-Backed Projects Fuel Biggest Pakistan Steel IPO in 5 Years — Agha Steel Industries Ltd. plans to raise as much as 5 billion rupees ($30 million) in an initial share sale as a construction boom in Pakistan helps boost demand for its products.
- U.S. Businesses in China Not Heeding Trump’s Call to Return Home — President Donald Trump says U.S. companies should leave China and return home. A new survey of U.S. businesses in the country shows most aren’t interested in taking him up on the offer.
- China’s Building Binge Lures Stock Pickers to Cheap Steel — The Chinese steel industry has benefited more than most as its economy takes the lead in emerging from the coronavirus-crisis and supply is hard-pressed to keep up with demand. It means that China’s beaten-down steel stocks, led by top producer Baoshan Iron & Steel Co., could be due a revival that puts the global competition in the shade.
- Australian Executives in China Keep Heads Down as Ties Get Worse — The spat between Canberra and Beijing seems to be getting worse by the day: A TV anchor detained, journalists fleeing, key imports banned. But Australians doing business in China say the risks are manageable — so far.
- China Tames Ambitions for World’s Biggest Carbon Trading Market — China’s plans to control emissions with the launch of a national carbon market, which will be the world’s biggest, may start off more fossil-fuel friendly than its existing regional systems.
- Hedge Fund Picks at Sohn 2019 Mostly Flopped After Selloff — Only a few winners have emerged among the hedge-fund managers and short-sellers who pitched their top trade ideas at last year’s Sohn Investment Conference in Hong Kong, after markets were rocked by the coronavirus outbreak.
Reuters
- U.S. firms in China increasingly fear bilateral tensions will last for years: survey — U.S. companies in China are increasingly fretful that trade tensions between the world’s two biggest economies will drag out over years and nearly a third said their ability to retain staff had been affected, a survey showed.
- U.S. money manager VanEck eyes China mutual fund license: sources — New York-based money manager VanEck is eyeing a mutual fund license in China, two sources told Reuters, which will allow it tap the country’s $2.6 trillion retail fund market that Beijing fully opened up for foreigners this year.
- China’s August zinc output hits record high in nearly five years: Antaike — China’s August refined zinc output rose 2.8% to 450,000 tonnes from last year, research house Antaike said on Wednesday, hitting a record monthly high in nearly five years as smelters boosted production.
- Australia revokes visas of two Chinese scholars — Australia has revoked the visas of two visiting Chinese academics in an apparent escalation of tension between the countries which has seen each accuse the other of inappropriate treatment of journalists.
- China’s Huawei to share progress of Google Android OS rival amid U.S. tensions — Huawei Technologies is expected to respond on Thursday to the latest salvo of U.S. technology restrictions against it and share its progress on developing a system that is seen as its best bet to replace Google’s Android mobile operating system.
- Exclusive: Baidu, investors in talks to raise $2 billion for biotech startup – source — Chinese tech giant Baidu is in talks with investors to raise up to $2 billion over three years for a biotech startup, which will use AI technology to discover new drugs and diagnose diseases, a person with direct knowledge of the matter said.
- Explainer: A peek into China’s $14.6 trillion asset management industry — China is further opening up its financial markets to overseas investors, easing restrictions on foreign investments in securities, retail funds, private funds, banking and insurance fields.
- China factory prices fall at slowest rate in five months as recovery continues — China’s factory gate prices fell at their slowest annual pace in five months in August as the world’s second-largest economy and its industries continued to recover from a slump caused by the coronavirus pandemic earlier this year.
- Data center owner ChinData files for U.S. IPO — Chinese data center owner ChinData Group filed for a U.S. initial public offering, joining several other IPOs from Chinese companies despite rising geopolitical tensions between Beijing and Washington.
- Chinese e-learning company iHuman files for U.S. IPO — E-learning company iHuman Inc filed for a U.S. listing on Tuesday, joining a string of recent initial public offerings by Chinese firms even as tensions between Beijing and Washington escalate.
- Chinese voice-chat app Yalla files for U.S. IPO — Chinese voice-chat app Yalla Group Ltd on Tuesday filed for a U.S. listing, looking to enter a rebounding market for initial public offerings against the backdrop of rising tensions between Beijing and Washington.
- China to sanction senior US officials who visit Taiwan: Global Times editor — China will impose sanctions on senior U.S. officials who visit Taiwan, and American companies that they have ties with, the editor in chief of the Global Times newspaper said on Tuesday.
- China buys 664,000 tonnes of U.S. soybeans, biggest daily total in nearly seven weeks: USDA — Chinese buyers booked deals to buy 664,000 tonnes of soybeans, the largest daily total since July 22, for delivery in the 2020/21 marketing year, the U.S. Agriculture Department said on Tuesday.
Xinhua
- Int’l fair opens to boost investment, BRI cooperation — The 2020 China International Fair for Investment & Trade (CIFIT) and the Belt and Road Investment Congress opened on Tuesday in Xiamen, east China’s Fujian Province, offering opportunities to promote investment and economic cooperation worldwide.
- China to boost new consumption, economic recovery — The State Council, China’s cabinet, on Wednesday stressed measures to support new industries and new patterns to boost new types of consumption and foster economic recovery.
- Bank of China signs agreement with Malaysian business chamber on China International Import Expo — Bank of China Malaysia (BOCM) signed an agreement with the Associated Chinese Chambers of Commerce and Industry of Malaysia (ACCCIM) on Wednesday to cooperate on the third China International Import Expo (CIIE) to be held in November.
- China’s digital trade with B&R countries robust: report — China’s digital trade with countries along the Belt and Road has maintained strong momentum in recent years, as the sector continues to hold huge potential, according to a report released Tuesday.
- Chinese market becomes “most important pillar” for German carmakers in Q2: Ernst & Young — Three major German carmakers of Volkswagen, BMW and Daimler had reported more sales in China with a year-on-year increase of five percent in the second quarter (Q2) of 2020, according to a study published by global consulting firm Ernst & Young (EY) on Wednesday.
Other Publications
- Foreign Affairs: The Coming Tech Cold War With China — That policy rests on restricting the flow of technology to China, restructuring global supply chains, and investing in emerging technologies at home. Even a new U.S. administration is unlikely to stray from these fundamentals. Beijing’s counterstrategy, too, has crystallized. China is racing to develop semiconductors and other core technologies so as to reduce its vulnerability.
- Axios: Study: Hollywood casts more light-skinned actors for Chinese market — The researchers concluded U.S. film studios were casting to fulfill the aesthetic preferences of Chinese movie-goers, in a culture that places a premium on light skin — a phenomenon known as colorism.
- Nikkei Asian Review: Japan companies line up for ‘China exit’ subsidies to come home — The Japanese government has seen an overwhelming surge of interest in subsidies to bring manufacturing back as the coronavirus pandemic highlights the risk of having supply chains concentrated in a single region, particularly China.
- BBC: China claims ‘important breakthrough’ in space mission shrouded in mystery — The spacecraft – mounted on a Long March 2F rocket – was launched from the Jiuquan Satellite Launch Centre in northern China on 4 September and safely returned to Earth after two days in orbit. But unlike recent Chinese high-profile space missions, very few details have emerged about the vehicle and no visuals have been released.
- CNBC: A growing number of Chinese companies are blaming trading typos for insider stock sales — For example, Shenzhen Changfang, a manufacturer of light-emitting diode (LED) products, said in a filing that on Friday a shareholder named Nie Xianghong accidentally sold 16,000 shares by typing in the wrong stock ticker. She was acting in accordance with Li Dichu, one of the company’s top 10 investors who has a roughly 11% stake and had planned to trim his holdings by about 3% of the company’s shares, the filing said. In a publicly released response Monday to the Shenzhen Stock Exchange’s letter of concern, the company said there was no insider trading or market manipulation.
