Chinese Economics Thread

[sunnymaxi]

There we GOOOOOO

“State-owned media reports that Chinese nationals have withdrawn USD$76 billion of assets from the US along with a further $165 billion in assets from Switzerland, channelling most these sums eastwards to the Asian financial hubs of Singapore and Hong Kong.”.

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[tphuang]

There we GOOOOOO

“State-owned media reports that Chinese nationals have withdrawn USD$76 billion of assets from the US along with a further $165 billion in assets from Switzerland, channelling most these sums eastwards to the Asian financial hubs of Singapore and Hong Kong.”.

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yeah, this is pretty big.

According to reports, the intensity of the capital flows have forced Hong Kong banks to suspend vacations for staff, with branches of HSBC stepping up operations to open seven days a week.

One source from a bank in Hong Kong said that it had “returned to a peak period” due to the increase in the number of people coming to Hong Kong to open accounts and deposit funds as result of the SVB and Credit Suisse scandals. Three of HSBC’s branches are trialing special opening arrangements on Saturdays and Sundays to meet the increasing demand for services.

The ongoing cancellation of Covid-related movement restrictions in Hong Kong is also a key contributing factor to increased customer activity at banks in the former colony.

According to data released by the Hong Kong Special Administrative Region Immigration Department, over 628,000 visitors from mainland China have visited Hong Kong during the period from January to February 2023, which is 75 times the figure for the same period in 2022.

HSBC said the number of overseas Hong Kong residents or non-local residents using HSBC branch services has significantly increased since Hong Kong fully lifted its entry prevention and control measures related to the COVID-19 pandemic in early February.

Again, lifting covid restriction plays a role here too.

Peggy Pang, Head of Wealth Management and Personal Banking Distribution at HSBC Hong Kong, said that since the full removal of movement restrictions between Hong Kong and mainland China, the daily average number of non-local residents visiting the branch in February increased by more than double compared to the January average, mainly driven by mainland Chinese customers.

It's a real problem that mainlanders are putting money in the west. Given the recent sanction threats and other threats, why are these people still stationing money there? Must be naiivety and deep distrust of Chinese gov't. But it does appear that Western banking is finally losing allure due to its bank failures.

 

[Ash46]

Why are these people still stationing money there? Must be naiivety and deep distrust of Chinese gov't. But it does appear that Western banking is finally losing allure due to its bank failures.

Sadly this is the case with almost all the developing countries, the rich parking their money in western financial systems ..

 

[siegecrossbow]

yeah, this is pretty big.



Again, lifting covid restriction plays a role here too.

It's a real problem that mainlanders are putting money in the west. Given the recent sanction threats and other threats, why are these people still stationing money there? Must be naiivety and deep distrust of Chinese gov't. But it does appear that Western banking is finally losing allure due to its bank failures.

They drank the koolaid and are now panicking.

 

[Overbom]

Given the recent sanction threats and other threats, why are these people still stationing money there? Must be naiivety and deep distrust of Chinese gov't. But it does appear that Western banking is finally losing allure due to its bank failures.

Simple answer. Why put your money in China when you can put it in the West which is ruled by capital?

Of course there is a difference on how the West will treat Chinese millionaires/billionaires but they are still attracted to put their money there.

There is a fundamental contradiction here. Money people prefer to put their money in a money-ruled country

 

[tphuang]

Another thing to consider given the recent forced UBS/CS merger. It was passed without shareholder vote and Saudi National Bank lost their 10% investment. Given the dramatic set of events, the Saudi national bank chairman is forced to resign. They lost $1 billion in this investment.

Longer term, huge losses in its Western investment may encourage Arabs to put money in Asian banks in HK/Singapore. That will be huge.

Given the recent tightening of Saudi Arabia, with China. I wonder if deals like this will be more common. From the past 2 days in China's energy sector. Have they decided to invest in China's energy sector as a form of a new look east policy?

https://twitter.com/i/web/status/1640006755286409218

https://twitter.com/i/web/status/1640286306432425984

More on this

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[SoupDumplings]

There we GOOOOOO

“State-owned media reports that Chinese nationals have withdrawn USD$76 billion of assets from the US along with a further $165 billion in assets from Switzerland, channelling most these sums eastwards to the Asian financial hubs of Singapore and Hong Kong.”.

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[siegecrossbow]

View attachment 109908

If your eyes slant at an upward angle, you are Chinese to the US Congress. Singapore’s prosperity will be short live unless they join the Two Eyes Alliance. Think about the benefits of the arrangement: they are going to be on even footing with a 1.4 billion strong nation despite having the population and area of a Chinese county. The two countries have a lot of things in common if you think about it:

1) Both are authoritarian states ruled by CCP (Chinese Communist Party and Confucian Capitalist Party, respectively).
2) Both countries have low tolerance for drugs/drug trafficking and readily execute people for capital offenses.
3) Both are majority Chinese ethnically.
4) Both economies depend heavily on globalization to actually flourish.
5) Both started off as poor shithole countries that built itself into economic/military powerhouses (regionally for Singapore).
6) Both nations value hard work and discipline over shallow bragging.

Singapore will forever be the odd kid out of the international order unless said order changes.

 

[tphuang]

Let's keep these deals in mind

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公司公告引入战投，向沙特阿美出让10%股权加一股，对价24.3元/股，相比当前股价溢价率高达88%，利好公司资产重估。

同时双方签订战略合作协议，具体包括：1）荣盛向沙特阿美原油采购48万桶/天按照公开市场价格；2）荣盛向沙特阿美销售化工品和精炼产品；3）由荣盛向沙特阿美提供300万方原油储罐，并由沙特阿美保证一定原油库存水平；4）技术分享，共同开发满足未来市场需求的新技术、工艺和设备。

支付对价用人民币现金支付，我们之前提的“石油人民币”逻辑得到初步印证！

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Aramco will also supply 480,000 barrels of crude oil per day to

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’s refinery in the eastern province of Zhejiang over a 20-year period,
Rongsheng owns a 51% equity interest in Zhejiang Petroleum and Chemical Co., which in turn owns and operates the largest integrated refining and chemicals complex in China, with a capacity to process 800,000 barrels per day of crude oil and to produce 4.2 million metric tons of ethylene per year.

On Sunday, Aramco and other Chinese companies agreed to invest in a new $12 billion refining and petrochemical plant in China’s northeastern Liaoning province,

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that were paused during the coronavirus pandemic. Aramco will supply as much as 210,000 barrels a day of crude to the project.

Aramco’s 30% stake in the Liaoning refinery would be worth about $3.6 billion, bringing its total Chinese investments announced over the past two days to over $7 billion.

Again, I think it's interesting what's happening here.
Saudis see Chinese refineries buying cheaper Russian/Iranian oil on spot market. It's counter move is to establish long term contract for refineries that are optimized for Saudi oil. This is how it keeps its oil pricing premium. how it keep market when European demands drop over time due to 0-carbon push.

It knows what Chinese side wants -> trading in RMB. So it makes investment in Chinese companies at a massive premium (70% over market value) to own 10% in a sector that China typically does not allow foreign companies to invest. It also promises to sell in RMB in exchange for 20 year contract. Two sides share technology.

Things are moving along.

It makes me wonder if the other deal of 210k bpd of oil is also in Yuan. At this point, Chinese refineries should be asking for yuan payment in every major contract.

 

[Serb]