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
- U.S. Versus China: Japan’s New Prime Minister’s Tough Balancing Act — Yoshihide Suga, who succeeded Shinzo Abe as Japan’s prime minister, will face the increasingly difficult challenge of balancing the country’s relationship with the U.S. and China as tensions between the two escalate. WSJ’s Alastair Gale explains the tough choices ahead for the Suga government. Photo: Kimimasa Mayama/Shutterstock
- Rich Economies Set to Recover More Quickly From Covid-19 Contractions — China and the rich countries will suffer less economic damage from the coronavirus pandemic than previously feared, but the global public-health emergency will exact a higher toll on the economies of poor countries.
- Alibaba-Backed Courier to List in Hong Kong — ZTO Express plans to raise up to $1.56 billion, becoming the latest Chinese company to seek a secondary listing in Hong Kong as tensions between the U.S. and China rise.
- Chinese Companies in Pentagon Spotlight Hire Global Banks to Sell Dollar Bonds — ChemChina and Three Gorges, designated by the U.S. Defense Department as “Communist Chinese military companies,” are pursuing bond deals with the help of Western banks.
- China’s ByteDance to Keep Majority TikTok Stake in Oracle Deal Under U.S. Consideration — The proposal being reviewed by national-security regulators has China’s ByteDance retaining a majority stake in its TikTok app with Oracle as a technology partner and minority holder in a U.S.-based company.
- U.S. Sanctions Chinese Firm Helping Build Military Base in Cambodia — The U.S. imposed sanctions against a Chinese company that it said is responsible for helping to build a military base for Beijing in Cambodia, a new phase in a U.S. effort to pressure firms helping in China’s military expansion around the world.
The Financial Times
- Money-launderers use Chinese online shopping sites to funnel cash offshore — Police busts show people topping up offshore gambling accounts using fake transactions on popular platforms.
- China’s great power play puts Asia on edge — Domestic insecurity, ambition and the pandemic blamed for Beijing’s belligerence.
- WTO rules US tariffs on Chinese imports broke global trade rules — Rebuke likely to increase Trump administration’s animosity towards trade body.
- Chinese exports benefit from west’s Covid stimulus response — Developed nations’ fiscal policies have increased global demand for ‘Made in China’ products.
- Chinese retail sales grow for first time since coronavirus outbreak — Rise in consumer spending is latest indicator of wider economic recovery.
The New York Times
- A Chinese Billionaire Is Barred From Spending Over Unpaid Debts — A court-ordered ban on first-class flights and vacations is a humbling turn of events for Chen Feng, the head of the once high-flying conglomerate HNA Group.
- Will Oracle Solve Trump’s TikTok Problem? — Forcing the unspooling of a complex global company is not as easy as yelling about the “China menace.”
- Citing New Security Law, U.S. Warns of Hong Kong Travel Risk — The measure is unlikely to have much of an immediate effect because of the city’s coronavirus restrictions, but it could worsen fraying U.S.-China ties.
Caixin
- BlackRock’s New Exchange-Traded Fund Highlights China Tech’s Growing Global Sway — iShares Hang Seng Tech ETF will track the 30 largest tech companies listed in Hong Kong, including titans like Tencent and Alibaba.
- Exclusive: China Tightens Rules on Shipping Routes With U.S. to Get Runaway Costs Under Control — Shipping costs have doubled since last fall to almost $5,000 per standard container.
- China Takes Aim at Wasted Grain as Food Security Concerns Linger — Policymakers expand campaign to include waste during harvest, transportation and storage.
- Douyin Wants to Double What Users Make From Livestreaming — Douyin’s 22 million content creators brought in $6.1 billion in the year to August; ByteDance China CEO Zhang Nan wants to double that to $12 billion.
- Major Chipmakers Seek U.S. Approval to Supply Huawei — Qualcomm, Micron and Samsung are among companies who have applied for permission to sell to controversial Chinese company.
- Chinese Owners Resurrect Venerable U.K. Travel Brand Thomas Cook — Fosun Tourism relaunches the brand as an online-only travel agency, a year after its dramatic collapse left more than 100,000 travelers stranded.
- Xiaomi Vice Chairman Promises Not Sell More Stock After Selling Over $1 Billion in Company Shares — Xiaomi vice chairman and executive director Lin Bin has pledged that he will not dispose of any more shares in the company over the next five years in an effort to maintain market confidence in the Chinese smartphone maker, according to a stock filing Tuesday.
- Video Streamer iQiyi Kicks Up Its Sports Game with FC Barcelona Tie-Up — iQiyi Sports, a joint venture between Baidu-backed iQiyi and Super Sports Media, is teaming up with FC Barcelona to create a dedicated channel in China for the top-tier Spanish football club in the 2020/2021 season, the company said on Tuesday.
- Global First as Potential Nasal Spray Covid-19 Vaccine Proceeds to Clinical Trial Phase — China has begun human trials of a nasal spray Covid-19 candidate vaccine that could serve as an alternative to injections.
- JD.com’s Fintech Unit Plans to Spend $230 Million to Get Second Payment License — Chinese e-commerce giant JD.com Inc.’s fintech unit plans to spend 1.6 billion yuan ($230 million) to get its hands on a second payment license, sources familiar with the matter told Caixin, as it seeks to expand its growing financial services business for brick-and-mortar merchants.
South China Morning Post
- China food security concerns prompt rethink of soybean expansion — China should halt the expansion of soybean farms to leave space for strategic crops including rice, wheat and corn to ensure adequate domestic food supply in light of rising tensions with the United States, industry leaders have said.
- Hong Kong retail sector fortunes polarised as fresh food shops get pandemic boost — Hong Kong’s shops have become more polarised during the coronavirus crisis, say industry players. Those selling fresh produce are doing a roaring trade while other high-street retailers struggle amid a near-total lack of tourists.
- China-Australia relations: infiltration allegations against Chinese consul ‘vicious slander’ — China’s consulate in Sydney has dismissed allegations of political interference following reports a consular official has been identified in an investigation by Australian federal police.
- Hong Kong formally demands US drops ‘Made-in-China’ labelling regulations by Trump — Hong Kong has formally written to Washington demanding it drops new regulations requiring locally made products exported to the US to be labelled “Made In China”, saying the city could take the matter to the World Trade Organisation.
- Tencent to mitigate setbacks in US, India with new regional hub in Singapore, analysts say — Chinese internet giant Tencent Holdings is expected to mitigate its recent setbacks in the United States and India, according to analysts, with the opening of a new office in Singapore, a move designed to broaden its operations across Southeast Asia.
- Australia formally names China in foreign interference investigation — Australia has formally named China in a court document as the foreign state under investigation by police in the nation’s first foreign interference investigation.
- Health in China: exhaust fumes from animal vaccine plant leave thousands sick with brucellosis — Thousands of residents of a northwest China city have been diagnosed with a highly infectious bacterial disease known as brucellosis after being exposed to polluted air from a pharmaceutical company last year.
- China allows currency traders to push the renminbi toward its best quarter since 1981 against the US dollar as economy picks up pace — China’s policymakers are in no rush to rein in a rapid advance in the yuan, as traders push the currency toward its largest quarterly rally on record.
- Vacancy in Hong Kong’s storage facilities, warehouses and logistics real estate may double as retailers end leases, slash stock — Vacancy among Hong Kong’s warehouses, storage facilities and other logistics property is expected to double this year, as retailers hobbled by the city’s worst recession in decades slash their inventory and give up their leases, according to a forecast by JLL.
- Alibaba to ramp up digital transformation in China’s US$4 trillion manufacturing sector — Alibaba Group Holding, which runs the world’s biggest e-commerce platform, aims to provide small companies with an advanced digital manufacturing infrastructure that could help transform how China produces and brings goods to market.
- Coronavirus: Hong Kong’s embattled businesses frustrated as subsidies in third round of relief fail to meet expectations — Businesses forced to slash operations amid Hong Kong’s sweeping social-distancing measures are expressing deep frustration with the size of subsidies included in a new HK$24 billion (US$3.1 billion) relief package that left a few hard-hit sectors out entirely.
- China-US tension: America pushes major weapons sales to Taiwan, putting pressure on Beijing, say insiders — The United States plans to sell as many as seven major weapons systems, including mines, cruise missiles and drones to Taiwan, four people familiar with the discussions said, as the Trump administration ramps up pressure on China.
- China’s central bank stresses its central role in new sovereign digital currency — China is developing a sovereign digital currency with the primary goal of defending the state’s monopoly on minting money, meaning the central bank will play a central role in the issuance and circulation of a digitised yuan, a deputy governor at the People’s Bank of China (PBOC) has written.
- China is only G20 country expected to see positive economic output this year, OECD says — The rapid speed with which China tackled the coronavirus outbreak domestically allowed for the timely easing of strict confinement measures and the reopening of businesses, helping the Chinese economy rebound more quickly than originally expected, according to the latest forecast by the Organisation for Economic Cooperation and Development (OECD).
- TikTok owner ByteDance continues its aggressive push in gaming with plans for 1,000 new hires in the coming year, targeting university students — TikTok maker ByteDance is once again looking to level up in gaming, listing close to 1,000 new gaming jobs in the coming year. The new recruitment drive continues ByteDance’s aggressive push into gaming, but analysts say the company’s gaming division is still too small to take on Chinese gaming giants Tencent and NetEase.
- China’s home foreclosures soar as nation’s debt-fuelled property bull run sputters on falling income and dim job prospects — China’s property foreclosures soared this year, as deteriorating job prospects and shrinking income amid the worst economic contraction in decades combined to weigh down on borrowers’ repayment ability, putting an end to the country’s debt-fuelled real estate rally.
Bloomberg
- Ant Is Hit by China’s Curbs on Micro-Lender Funding Leverage — Ant Group was dealt another blow as Chinese regulators issued new regulations to contain risks in the country’s burgeoning online lending industry while Jack Ma’s financial technology giant prepares for its initial public offering.
- If the WTO Can’t Handle U.S.-China Trade Disputes, Why Not Fix It? — Taking a flawed system and wrecking it altogether won’t strengthen the global economy.
- Chip Industry Wants $50 Billion to Keep Manufacturing in U.S. — The U.S. chip industry said as much as $50 billion in federal incentives will be needed to halt a decades-long trend of manufacturing moving overseas as China spends heavily to become a leading semiconductor producer.
- Chinese Communist Party Wants Bigger Role in Private Sector — The party called on the United Front to improve the government’s leadership role in the nation’s private sector, according to guidelines issued by the General Office of the CPC’s Central Committee on Tuesday. The front is an umbrella organization that aims to increase the party’s influence and control both domestically and internationally.
- Hong Kong’s Richest Man Steps Up Donations Amid Downturn — The charity of Hong Kong’s richest tycoon Li Ka-shing is donating HK$170 million ($22 million) to four local universities, stepping up aid to a city battered by political turmoil and an economic downturn.
- Cargill Went Shopping for China Assets on Jack Ma’s Auction Site — Taobao, China’s answer to Amazon.com, sells everything from groceries to clothes to knickknacks — and more recently has also become a platform for the top food trader to make a strategic expansion.
- China to Give Gas Guzzlers More Time While Promoting EVs — China is poised to give fossil-fuel cars more time to co-exist with electric vehicles, moving away from considerations to have a deadline for a ban on conventional automobiles.
- China Lets Traders Push Yuan Toward Best Quarter on Record — China’s policy makers are in no rush to rein in a rapid advance in the yuan, as traders push the currency toward its largest quarterly rally on record.
- Chinese-Owned Thomas Cook Reborn as Online Travel Agent — Thomas Cook relaunched Wednesday as an online travel firm that will initially sell holidays to destinations on the U.K. government’s safe travel corridor list.
- Are Batteries the Trade War China’s Already Won? — The U.S. risks the long-term viability of its auto industry and more.
- China’s Private Firms and Manufacturers are Investing Again — China’s manufacturers and private businesses ramped up investment in August, buoying sentiment hit by the U.S. trade war and a historic economic slump.
- Alibaba’s Newest Business: Modernizing China’s Factories — Alibaba Group Holding Ltd. helped modernize brick-and-mortar retail with consumer data and online services. Now it hopes to do the same for China’s multitrillion-dollar manufacturing arena.
- Global Hedge Funds Miss Out to China Rivals as Stocks Boom — Global hedge funds seeking to tap China’s $9 trillion wealthy investor market are getting left behind as their local rivals attract the lion’s share of new money amid the biggest stock rally since 2015.
- Trump Nears Decision on Oracle-TikTok Bid After Review — President Donald Trump is preparing to decide whether to approve Oracle Corp.’s alliance with the Chinese-owned video app TikTok after security experts examined the companies’ proposal.
- Italy Hardens Stance on China, In Line With EU Investment Push — Italy is pledging to march in line with European Union allies as the bloc toughens its stance on China, after the U.S. and EU took Rome to task for cozying up to the Asian power early last year.
- Li Ka-shing’s U.K. Carrier Cuts 7% of Workforce in Revamp — CK Hutchison Holdings Ltd., the Hong Kong-based conglomerate founded by tycoon Li Ka-shing, is cutting about 280 jobs at British phone company Three under new Chief Executive Officer Robert Finnegan.
- Australia Eyes Trade With India as China Spat Exposes Dependence — Australia’s escalating tensions with Beijing have shown up its reliance on China trade and propelled a push to increase links with Asia’s other giant economy, India.
- Autohome Is Said to Plan $1 Billion Hong Kong Second Listing — Autohome Inc., a Chinese online car-sales website, is planning a second listing in Hong Kong that could raise about $1 billion, people familiar with the matter said.
- Oil Climbs With Economic Data Warding Off Gloomy Demand Signals — Oil rose to its highest in more than a week after economic data from China to the U.S. fueled optimism that factories are getting back to work.
- Covid Pandemic: Why Indonesia Became Testing Ground for China’s Covid-19 Vaccine — The country is home to Asia’s second-worst Covid-19 outbreak, and it’s eager to take the risks.
- European Stocks Climb a Third Day as H&M, Ocado Boost Retailers — European stocks rose for a third day as positive corporate updates boosted retailers and miners rose on data showing an acceleration in China’s economic recovery.
Reuters
- Arm China investor sues company, escalating CEO spat amid sale — The Chinese division of UK-based chip designer Arm Ltd has been sued by an investor over its board’s attempt to oust the unit’s chief executive, escalating an internal dispute at a time when the tech group is on the verge of being taken over in a $40 billion deal.
- Construction of China-funded railway in Indonesia seen completed in 2023 amid delays — Indonesia expects its $6 billion high-speed railway project connecting its capital Jakarta to the city of Bandung to be completed about two years later than initially scheduled, a deputy minister said on Wednesday.
- Turkey begins Phase III trials of Chinese coronavirus vaccine: media — Turkey began final Phase III trials of an experimental Chinese coronavirus vaccine on Wednesday, Turkish media reported.
- German pork exports to China more than doubled in first-half, before swine fever hit — German pork exports to China more than doubled in the first half of this year, the Federal Statistics Office said on Wednesday, highlighting the likely impact of a ban on pork imports there after Germany confirmed its first case of African swine fever.
- HNA Group chairman barred from flying, vacationing on firm’s failure to pay court-ordered $5,300 — The chairman of cash-strapped HNA Group has been barred from taking flights and high-speed trains and going on vacations due to the Chinese conglomerate’s failure to pay a court-ordered $5,300 in a lawsuit, a court document showed.
- Alibaba Group opens China factory as part of new manufacturing initiative — Alibaba Group Holding Ltd on Wednesday unveiled a pilot factory in the eastern Chinese city of Hangzhou as part of its “smart manufacturing” business initiative.
- Exclusive: Alibaba, China Mobile weigh $443 million investment in blacklisted Dahua – sources — Alibaba Group Holding Ltd and China Mobile Communications Group Co Ltd are considering investing 3 billion yuan ($443 million) in Zhejiang Dahua Technology Co Ltd, three people with knowledge of the matter said.
- Pandemic sharpens ‘battle for the soul’ of United Nations between U.S. and China — Long-simmering tensions between the United States and China have hit boiling point at the United Nations over the coronavirus pandemic, spotlighting Beijing’s bid for greater multilateral influence in a challenge to Washington’s traditional leadership.
- China sends satellites into space in first sea-based commercial launch — China has successfully sent nine satellites into orbit in its first commercial launch of a rocket from a platform at sea, state media reported on Wednesday.
- China approves $13 billion worth of fixed-asset investment projects in August — China’s state planner said on Wednesday it had approved six fixed-asset investment projects across the country worth a combined 88.2 billion yuan ($13.03 billion) in August.
- China suspends poultry imports from second U.S. plant over COVID-19, industry group says — China has suspended imports from an OK Foods poultry plant in Fort Smith, Arkansas, because of coronavirus cases among workers, the USA Poultry & Egg Export Council said on Tuesday.
Xinhua
- China’s central bank injects liquidity into market — China’s central bank on Wednesday continued to pump cash into the banking system via reverse repos to maintain liquidity.
- Economic Watch: Yuan strength reveals market confidence in Chinese economy — The Chinese yuan strengthened against the greenback Wednesday, extending gains to hit a 16-month high and notching the largest daily surge since April 8 this year.
- 5G-powered unmanned driving system put into use in NW China — A 5G-powered unmanned driving system has been put into use in northwest China’s Gansu Province, according to its developer.
- Goldman Sachs says U.S. companies moving out of China limited to specific sectors — Only a limited number of U.S. companies in specific industries are moving out of China while few in many other industries are doing so, according to a recent report released by investment bank Goldman Sachs.
- Chinese shares close lower on Wednesday — Chinese stocks closed lower on Wednesday, with the benchmark Shanghai Composite Index down 0.36 percent to 3,283.92 points.
Other Publications
- Business Insider: Hackers working for China have successfully compromised US government systems, according to a federal cybersecurity agency — The hackers are taking advantage of publicly available code and exploits that have already been publicized in order to hack into US entities. The report suggests that, after vulnerabilities are discovered and publicized by US defenders, hackers are often able to exploit the vulnerabilities before government agencies patch them.
- Brookings: China’s system of oppression in Xinjiang: How it developed and how to curb it — Since 2016, an intensified regime of technologically-driven mass surveillance, internment, indoctrination, family separation, birth suppression, and forced labor has implicated the provinces and municipalities of eastern China that fund the Xinjiang gulag through the Pairing Assistance Program, as well as potentially thousands of Chinese and international corporations that directly and indirectly supply and benefit from the system. To meet these challenges and increase public awareness, we provide a slate of policy recommendations for the United States, its allies, and China.
- Foreign Policy: China Is Merkel’s Biggest Failure in Office — Angela Merkel has made it clear that she will step down after Germany’s next general election in the fall of 2021. By then she will draw level with Chancellor Helmut Kohl’s 16-year reign, who entered the history books for paving the way to German reunification. Merkel wants to leave behind an equally impressive achievement in Germany’s relationship with China, which she has visited an unprecedented 12 times during her chancellorship—but the odds, and the actions of the Chinese Communist Party (CCP), are against her.
- TechCrunch: China Tops 110 Million 5G Users in Less Than a Year — Over 110 million users in China have signed up for 5G plans, announced president of the China Academy for Information and Communications Technology (CAICT), a think tank under the telecoms watchdog Ministry of Industry and Information Technology, at an industry event on Wednesday. That makes China the largest 5G market in terms of user size, the think tank president said. The milestone came in less than a year after China’s top carriers rolled out 5G plans for consumers, and just over a year after the authority began issuing 5G licenses for commercial use.
- Nikkei Asian Review: Nvidia’s $40bn Arm deal faces China risks and industry pushback — Softbank’s $40 billion sale of Arm Ltd. to Nvidia is a generational transaction for the semiconductor industry — the world’s most important mobile chip IP provider, being delivered into the hands of America’s most valuable chipmaker, in the sector’s biggest ever deal.
- Forbes: Bribery, Guanxi And Direct Marketing In The Herbalife China Settlement — China has prohibited multilevel marketing—arrangements in which an individual’s compensation is based on the number of “downstream” salespeople they recruit— since 2005, and has required licenses for other forms of direct sales. According to case documents, Herbalife China circumvented these regulations by paying bribes to secure licenses, to shut down investigations into its improper business practices and to remove unfavorable coverage of its practices from state-run media.
