Chinese Economics Thread

[Jura The idiot]

now I read
China to push opening-up in capital markets
Xinhua| 2018-06-14 18:41:32

Please, Log in or Register to view URLs content!

China will continue to push opening-up in the capital market to better serve the country's economic development and broader opening-up strategy, a central bank official said Thursday.

"China will further open up some non-convertible items under the capital account, and those already convertible will see tradings more liberalized," said Pan Gongsheng, deputy head of the People's Bank of China, at a forum in Shanghai.

Two-way openness will be promoted in the financial market, with increasing product supplies such as China Depositary Receipts, Panda bonds and commodity futures, according to Pan, who also heads the State Administration of Foreign Exchange.

Rules on qualified institutional investors will be further improved and the scope of connectivity programs will be widened, Pan said, adding China would support domestic financial institutions to better engage in the international market.

Regulators will debate whether to allow Chinese institutions to enter offshore RMB markets as well as whether to permit securities and futures firms to conduct cross-border businesses.

The remarks followed a central bank announcement Tuesday to ease restrictions on foreign institutional investors in a step to further open its financial market.

Regulators decided to scrap a rule that limited the amount of funds a Qualified Foreign Institutional Investor (QFII) could take out of the mainland every month at 20 percent of its mainland assets as of the end of the previous year.

The requirements for a three-month capital lock-up period for QFII and RMB Qualified Foreign Institutional Investor (RQFII) redemptions will be removed, according to the new rules effective immediately.

At the forum, Pan also promised to allow the market to play a decisive role in the exchange rate formation mechanism and push for global use of the RMB.

 

[Jura The idiot]

now I read
China unveils more measures to draw foreign investment
Xinhua| 2018-06-15 23:47:06

Please, Log in or Register to view URLs content!

The State Council, China's cabinet, on Friday unveiled more foreign investor-friendly measures to further open up and promote high-quality economic development.

The country will widen market access, and revise and release negative lists on market access for foreign investment before July 1, according to a notice posted on the government website.

Financial-sector opening up will be further pushed. The mechanism regarding qualified overseas investors will be improved and foreign investors will be encouraged to participate in trading of crude oil and iron ore futures as well as underwriting local government bonds.

Foreign businesses will be encouraged to invest in central and western regions as well as sectors including agriculture, environmental protection, advanced manufacturing and services.

Interests of foreign investors will be better protected. The country will strengthen intellectual property right (IPR) protection, toughen the stance on counterfeiting and IPR infringements, and raise the ceiling of compensation for IPR infringement.

 

[Jura The idiot]

now I read
China stays tough on steel bar overcapacity
2018-06-17 15:06 GMT+8

Please, Log in or Register to view URLs content!

China's top economic planner has promised zero tolerance, and harsh punishments for the illegal production of inferior-quality steel bars as the government remains firm in its capacity-cut drive.

From May 22 to June 15, the National Development and Reform Commission (NDRC) has sent eight teams to 21 provinces and regions to inspect whether production of inferior-quality steel bars had been severely curtailed.

According to NDRC spokesperson Meng Wei, the capacity-cut drive has produced useful results, but some weak links remain in specific regions, including the illegal use of production facilities and an unlawful addition of new capacity.

Meng said the NDRC would continue to improve the monitoring mechanism to detect problems promptly and punish those responsible for malpractice.

As excess capacity has weighed on China's overall economic performance, and cutting overcapacity has been high on the government reform agenda.

China plans to cut 30 million tonnes of ineffective steel capacity and 150 million tonnes of coal capacity in 2018, according to a government work report released earlier this year.

 

[Jura The idiot]

now I read
Fiscal, financial measures on the way to help small businesses
Xinhua| 2018-06-20 23:35:15

Please, Log in or Register to view URLs content!

The Chinese government will roll out a series of incentives to make financing more accessible and affordable for small and micro businesses to promote cost-cutting in the real economy, the State Council's executive meeting chaired by Premier Li Keqiang decided on Wednesday.

It was pointed out at the meeting that the prudent and neutral monetary policy will continue to be in place. The government will work to keep liquidity sufficient and appropriate, maintain financial stability, strengthen policy coordination to boost market confidence and ensure economy performs within a reasonable range.

The Chinese government puts great emphasis on financial services for the real economy, including for the small and micro businesses. Li called for giving greater priority to small and micro businesses in providing affordable finance to energize these businesses and boost employment.

The Wednesday meeting approved a series of fiscal, tax and financial incentives. The volume of re-lending and rediscount for small and micro businesses, and for rural areas, agriculture and farmers will be raised. The re-lending interest rate for small and micro businesses will be lowered. Evaluation for financial institutions will be improved to make sure that businesses with a credit quota of 10 million yuan (1.55 million U.S. dollars) and below shall enjoy faster loan growth than other types of credit recipients.

Between September 1 this year and the end of 2020, the credit quota for small and micro businesses with loans that are eligible for value-added tax exemptions on interest revenues will be raised from one to five million yuan. Meanwhile, the state financing guaranty fund will cover no less than 80 percent of the financing guarantee for small and micro businesses.

Monetary tools will be applied to raise credit support for small and micro businesses. Targeted cuts in banks' reserve requirement ratios and other monetary policy tools will be used to boost credit supply to small and micro businesses.

Also, loans of businesses with credit quota of less than five million yuan can be included as qualified collateral for mid-term lending facility.

Banks who have yet to establish a financial inclusion department will be encouraged to open branches for communities and small businesses. It was also made clear in the Wednesday meeting that financial institutions will be prohibited to levy credit pledging fee or fund management fee on small and micro businesses to cut financing surcharges.

"The issue of lack of affordable financing for small and micro businesses must be taken seriously," Li said. "The mentality that big banks can only serve big businesses must be rejected. Financial services for small businesses and individuals must be improved."

This is the third time the State Council put the lowering of financing costs for small and micro businesses on the agenda of its weekly executive meeting since the new government assumed office in March. The establishment of a state financing guaranty fund was announced at the meeting on March 28 to help ease financing difficulties for small and micro businesses, farmers, agriculture and rural development. And banks will henceforth be evaluated for their performance on inclusive finance to ensure lower financing costs for the real economy this year, as was decided at the meeting on April 25.

"Small and micro businesses are leading job providers, and many of them have strong potential for growth. Their robust development will help achieve high-quality growth and improve people's wellbeing," Li said.

"Vigorous efforts must be made to improve the accessibility of affordable financing for small and micro businesses," he said. "The banking sector must implement policy measures in a well-coordinated way to reduce financing costs for businesses."

 

[advill]

The "Dare Game" in current Trade Wars between US & China, and US and Canada/G6 could be American self-immolation acts. We have seen the Dow Jones recent decline, & US Companies operating in China would face dire difficulties/problems in the event of Chinese retaliation against the Trump's additional 200% tariffs. Again we observed Trump with the advice of his hawkish advisors like Navarro & others are hoping that China would succumb to US threats. I don't believe most American businesses or for that matter any nation would like a Trade War, & the current brash dealings of the WH. The main WH Resident should remember this: "Don't let your pride get inflated, YOU may have to swallow it someday". Jaw Jaw NOT War War.

 

[Hendrik_2000]

That is the problem war! America take upon himself to be the policeman of this world when no one ask them to do that. So large sum of money is devoted to defense to the detrimental of real economy making the economy less efficient. One dollar goes to defense mean one dollar less for infrastructure and social spending. Add to that the laziness of American industry to invent and spend money on R&D and long range planning resulting in bifurcation of american work force where on one had you have group with high income and the rest of majority loosing their job

Frustration mounting allowing unscrupulous politician to promise " a simple and easily understandable solution to the masses" whether this will work or not that beside the point first get elected

Anyway goes back to Chinese economy water pollution from Animal husbandry run off is a serious problem in China And so do the unregulated wild settlement and over grazing
China now has a program to return the unproductive land and close to river bank to the wild
As well as moving people to the city and town
Here is an excellent video about that program

 

[Jura The idiot]

now I read
Chinese enterprises favor greenfield investment in U.S.: survey
Xinhua| 2018-06-21 09:38:00

Please, Log in or Register to view URLs content!

Greenfield investment is the most common initial structure for Chinese investors in the United States, according to a business report released Wednesday.

The report, named 2018 Annual Business Survey Report on Chinese Enterprises in the United States, was released by the China General Chamber of Commerce - USA (CGCC).

A greenfield investment is a type of foreign direct investment where a parent company builds its operations in a foreign country from the ground up.

Nearly 40 percent of the Chinese companies surveyed established their foothold in the United States with new business entities, and another 30 percent began operations through a representative office, according to the report.

Acquisition by direct purchase of an entire corporate entity or of an entity's operating assets was used by only 28 percent of survey respondents to start their business in the United States, said the report.

The report said Chinese companies prefer the greenfield strategy largely because it offers optimal managerial control over the business during its earliest days. By establishing a new business entity, companies are also more likely to receive tax credits, infrastructure improvements, and other inducements from local governments in the United States.

Meanwhile, nearly 60 percent of respondents said headcount rose in 2017. The same percentage expect to increase their workforce in the next two years. The percentage of locally hired employees also rose year over year.

As the largest non-profit organization representing Chinese enterprises in the United States, CGCC has 1,500 member companies. The organization's Chinese member companies have collectively invested over 120 billion U.S. dollars and employ more than 200,000 throughout the United States.

 

[Jura The idiot]

now I read
Economic Watch: China's economic confidence stays strong
Xinhua| 2018-06-21 22:15:28

Please, Log in or Register to view URLs content!

With growth resilient and progress made in the pursuit of high-quality development, economic confidence remains positive in China.

In the second quarter, business confidence among Chinese entrepreneurs continued to improve, according to a central bank survey. The entrepreneur confidence index climbed for the ninth straight quarter, rising to 75.8 from 74.2 in the first quarter.

The business climate index for Q2 held steady at 58.5 percent, 3.9 percentage points higher than the same period last year, the central bank said.

Optimism has spread among officials and economists.

"China has the conditions and capability to fulfill the annual target set at the beginning of the year and ensure the stable and long-term growth of the economy," said a National Development and Reform Commission (NDRC) official.

GDP expanded 6.8 percent year on year in the Q1, above the target of around 6.5 percent.

The NDRC official pointed out that despite increasing uncertainties in the global markets, recovery in the world economy is likely to continue, offering more room for trade.

Foreign trade rose 8.6 percent year on year last month, accelerating from 7.1 percent in April. Retail sales of consumer goods grew by 8.5 percent.

"By cooperating with other countries in a more open manner, China is seeing improving external environment for its high-quality development," said Li Xunlei, chief economist with Zhongtai Securities.

Output of high-tech and equipment manufacturing sectors grew 12 percent and 9.3 percent, respectively, in the first five months, substantially outpacing the 6.9 percent growth in overall industrial output.

Wen Jianwu, head of the department of industrial statistics of the National Bureau of Statistics, said the fact that high-tech industries make up a larger share of total industrial output is a sign of more favorable conditions.

Along with a stable economy, unemployment in urban areas declined to 4.8 percent in May, down 0.1 percentage points from April and 0.1 percentage points lower than last May.

Earlier this month, the World Bank upgraded its forecast for China's economic growth in 2018 to 6.5 percent, 0.1 percentage points higher than its January forecast.

The World Bank's latest China Economic Update said that economic activity had remained resilient, and new economy sectors are now more prominent sources of growth.

"The Chinese economy is performing well and reforms are making good progress," said David Lipton, first deputy managing director of the International Monetary Fund.

"Given China's record of successful reforms in the past decades, and the authorities' strong commitment and determination, we are confident that China will rebalance to a sustainable growth model," he said upon concluding a visit to China last month.

 

[Jura The idiot]

LOL not sure what Marx would think of Unleashing the potential of blockchain in the economy
2018-06-22 21:16 GMT+8

Please, Log in or Register to view URLs content!

With “blockchain” becoming a buzzword in 2018, companies and investors are eagerly embracing the game-changing technology.

Often confused with Bitcoin, blockchain is in fact the underlying technology that powers the wider-known cryptocurrency. Now, a host of Chinese companies are exploring its potential application in a range of industries.

Traceability Chain, a blockchain company based in Beijing, has already applied blockchain technology to record a product’s journey every step of the way from the farm to the dinner table. The company is also looking to expand into medicine, children's products, alcohol, intellectual property, and other areas where tracing a product’s origin is a major concern.

Banking services is another area where blockchain can prove useful. Network-based inter-bank transactions will save lenders from independently bring their records up to date, meaning that waiting time in some cases can be reduced from hours or days to mere minutes. Bochen, a blockchain infrastructure tech company, has targeted the financial industry, providing blockchain technology for the Bank of China and other financial institutions.

According to an industry report by China’s Ministry of Industry and Information Technology, as of March of 2018, the country had more than 450 blockchain-related companies, with business scopes covering a range of areas: infrastructure, hardware, basic technology development, and platforms.

Experts say blockchain technology will give a boost to the real economy by addressing the issue of unreliable information, and that will help lower the risk and facilitate financing for businesses, especially cash-strapped small companies.

 

[Dolcevita]

Alipay and Wechat gaining popularity and becoming ubiquitous in Hong Kong.

Please, Log in or Register to view URLs content!