Switzerland is expected to sign a memorandum of understanding with China focusing on finance and trade cooperation in third markets under the Belt and Road Initiative, Swiss President Ueli Maurer said in Shanghai yesterday.
Maurer, leading a top-level finance and business delegation, will attend the second Belt and Road Forum for International Cooperation in Beijing, which opens tomorrow.
“The MOU will strengthen cooperation between Switzerland and China, providing know-how in sophisticated financial services mastered by Switzerland for the Belt and Road Initiative,” Maurer said.
The aim of the MOU is for both parties to intensify cooperation on trade, investment and project financing in third markets along the routes of the Belt and Road Initiative countries and regions, based on a catalogue of basic principles for cooperation and in line with international standards and legislation in the countries concerned, according to a statement by the Swiss consulate in Shanghai.
Details will be published later.
Shanghai was the first stop for Maurer, who was invited by Chinese President Xi Jinping for a state visit. After arriving yesterday morning, Maurer visited some financial institutions including the Shanghai Stock Exchange, the China Pacific Insurance Group and the Pudong Development Bank. He also attended a fintech forum hosted by swissnex China — the Swiss science consulate — and the Fanhai International School of Finance under the Fudan University.
At the Shanghai Stock Exchange, Maurer witnessed the signing of an MOU for cooperation between the Shanghai bourse and its Swiss counterpart for a stock connect program. It may allow companies listed in either bourse to be traded on the other. But technical details must be studied further, said Romeo Lancher, president of financial service provider SIX Group AG.
Meeting with Shanghai Party Secretary Li Qiang, Maurer said he expected practical and effective cooperation with China. And as an international metropolis, Shanghai can play an important role.
Shanghai stocks continued to fall yesterday, dropping below 3,200 points dragged down by defense, military and communications stocks.The Shanghai Composite Index dropped another 0.51 percent to close at 3,198.59 points. The Shenzhen Component Index fell 0.97 percent to 10,124.66 points and the blue-chip CSI300 index closed 0.16 percent down at 4,019.01 points.Turnover on the two major bourses shrank sharply to 733.01 billion yuan (US$109 billion) from 804.21 billion yuan on Monday. Stocks of 78 companies listed on the A-share markets tumbled by the daily limit of 10 percent.The national defense and military sector led the fall. SSC Offshore & Marine Engineering Group slumped 9.53 percent, and China Harzone Industry Corp also dropped sharply by 8.33 percent.Media shares also posted losses. Shenzhen Capstone Industrial Co and Sichuan XunYou Network Technology Co both took a nosedive by the 10-percent daily cap.Leshi Internet Information & Technology Corp fell by the daily limit shortly after opening to be a new eight-month low.Leshi issued a notice on Monday evening announcing the pledge of 500,000 shares — or 0.01 percent of the company — owned by founder and major shareholder Jia Yueting were lifted on April 16. Leshi also once again issued a reminder that it is at risk of being suspended from listing, as its net assets in 2018 are expected to be negative. Its 2018 annual report will be released on Friday.
Telsa CEO Elon Musk said Tesla Inc robo-taxis with no human drivers would be available in some US markets next year, continuing a habit of bold pronouncements that have excited many investors while often missing deadlines.“Probably two years from now we’ll make a car with no steering wheels or pedals,” Musk predicted, while acknowledging he is often late to meet aggressive targets.Central to this promise is a new microchip for self-driving vehicles unveiled by Musk on Monday during a webcast presentation. Made by Samsung Electronics Co in Texas, the chip now in all its vehicles is hoped to give Tesla an edge over rivals and show its massive investment in autonomous driving — described by Musk as “basically our entire expense structure” — will pay off.The webcast presentation came two days before Tesla is expected to announce a quarterly loss on fewer deliveries of its Model 3 sedan, which represents Tesla’s attempt to become a volume carmaker.After launching the event with detailed technical descriptions of Tesla’s progress on hardware and software by top executives, Musk began hawking the Model 3 and its potential.“The fundamental message consumers should be taking away today is it’s financially insane to buy something other than a Tesla. It’s like buying a horse,” he said, adding Tesla was the only company to have a full self-driving suite of hardware.Tesla’s use of the term “full self-driving” garners criticism, as it sells such an option today that is not yet “Level 4,” or fully autonomous by industry standards, in which the car can handle all aspects of driving in most circumstances with no human intervention. Musk has said that with the hardware complete, improvements in software will allow vehicles to fully drive themselves in future.But the technology faces many regulatory hurdles.Global carmakers, large technology companies and startups are developing self-driving — including Alphabet Inc’s Waymo and Uber Technologies Inc.But experts say it will be years before the systems are ready for prime time.“A year from now we’ll have over a million cars with full self-driving, software, everything,” Musk predicted. Tesla has been working on a self-driving chip since 2016 and Musk had previously forecast cars would be fully self-driving by 2018.
China UnionPay’s international business arm announced yesterday it has teamed up with six Belt an Road Initiative countries in a bid to build an interconnected payment network and support personnel exchanges.UnionPay International yesterday signed agreements with institutions from Indonesia, Laos, Thailand, the UAE and Uzbekistan in Beijing to boost cooperation in traditional and digital issuance of UnionPay cards as well as the construction of local bank card payment networks.This is an important step in localizing overseas business, the Shanghai-based company said.UnionPay International signed an MOU with BCEL, Laos’ largest commercial bank, to establish a joint venture with eight local institutions and jointly operate the Lao National Bank Card Payment System. In 2015, China UnionPay helped Laos build its payment system and last year, the Bank of the Lao People’s Democratic Republic, the central bank, proposed a joint venture with UnionPay to further enhance the modernization of the country’s local financial payment infrastructure.Under the agreements, major local banks in Indonesia and Thailand will carry out their first large-scale issuance of UnionPay premium cards.Etisalat’s BOTIM, the largest real-time communication application in the UAE, also plans to issue UnionPay virtual cards on a large scale to enable its users to make payments through scanning the UnionPay QR code.Also, a package of agreements on credit card and premium card issuance were signed with Uzbekistan’s Aloqabank.Yesterday, Malaysia’s AmBank became the first major bank there to issue the UnionPay credit card. It was also the first local UnionPay credit card that supports contactless payment service.Fan Yifei, deputy governor of the People’s Bank of China, said the agreements are a “significant pathway” to realize the connectivity of policy, infrastructure, trade, finance and people along the Belt and Road.UnionPay International added that it would continue to offer innovative technical standards for bank card payment network organizations in Central and Eastern Europe, Central Asia and Southeast Asia.It will also accelerate the launch of UnionPay QR code standards overseas.
China’s continued efforts to reduce taxes have benefited more businesses and individuals, a senior tax office official said yesterday.New tax cuts saved 341.1 billion yuan (US$50 billion) for taxpayers in the January-March period, said Cai Zili, an official with the State Taxation Administration.Cai said the cut was more inclusive and sharper than before as tens of millions of small firms started to be covered by favorable policies and private enterprises became the major beneficiaries.And more than 90 million people were exempt from income tax by end-March.Most of the reduction, more than 265 billion yuan, came from measures effective since the middle of 2018, including reforms to individual income tax and cuts in value-added taxes. Policies this year, including tax breaks for small and micro firms and a further deduction of individual income tax, led to a reduction of around 72.2 billion yuan.
A DRAFT amendment to the Securities Law is under a third reading at the ongoing session of the Standing Committee of the National People’s Congress, China’s top legislature.The latest revisions to the law include rules on the newly devised science and technology innovation board, which will pilot a registration-based initial public offering system.Under the current IPO system, new listings are subject to approval from the China Securities Regulatory Commission.A new chapter is planned for the law with special provisions on stock issuance conditions, registration procedures and supervision of the country’s new high-tech board.The new board, to be launched on the Shanghai Stock Exchange, was proposed in November 2018 and approved in January.On March 1, the CSRC released regulations on trying out the registration-based IPO system on the new board, followed by more specific rules unveiled by the SSE.Previously, a draft amendment to the law was submitted to the top legislature for the first reading in April 2015, mainly to meet the legislative demand of reforming the IPO system toward a registration-based one.New revisions were submitted for a second reading in April 2017 to improve regulation on such areas as stock trading, acquisitions of listed firms, information disclosure and investor protection.The second draft demanded the State Council to gradually advance the IPO system reform in accordance with authorization granted by the top legislature.Apart from the addition of rules on the new board, the latest draft also includes other revisions made in light of further progress of reform and new developments in the capital market.The draft eases restrictions on employee stock ownership to help more employees enjoy the benefits and stimulate enterprises’ vitality.It also offers support for stock issuance with relatively small financing sums in a bid to encourage entrepreneurship and innovation, by exempting such issuances via qualified online platforms and securities firms from the approval and registration procedures under certain circumstances.The definition of securities is expanded by including depository receipts in addition to stocks and corporate bonds.The new draft vows to strengthen the crackdown on irregular market practices. Investors will be prohibited from using fiscal or banking credit funds for trading stocks.Those under investigation will face a longer suspension term for securities trading, while serious law violators will be banned from market entry for a specified period.Rules on securities dispute resolution are added to further protect investors. The shareholder derivative litigation system is also improved.
Profits of state-owned enterprises maintained stable growth in the first quarter of 2019, official data showed yesterday.The combined profits of SOEs rose 15.6 percent year on year to 819.77 billion yuan (US$122 billion), the Ministry of Finance said on its website.SOEs generated a revenue of almost 14 trillion yuan during the period, up 8.9 percent from a year earlier, and operating costs increased 9.2 percent to 13.52 trillion yuan.By the end of March, total SOE assets had reached 190.27 trillion yuan, up 9 percent in the first three months of the year, while liabilities increased 8.8 percent to 122.57 trillion yuan.The debt-to-asset ratio of SOEs dropped 0.1 percentage point to 64.4 percent, according to the MOF.SOEs in sectors including oil and transport posted robust profit growth during the period.
Sandy Gao, a young woman in Shanghai, was feeling a lot of frustration after failing her test for a driver’s license twice within several months last year. She finally triumphed, however, with the help of smart devices and Internet services.Gao is not alone in turning to technology to get her through what can be a grueling process. Every year, an estimated 25 to 30 million people in China apply for driver’s licenses. Many are hampered by a lack of training, limited instructor resources and more difficult exams initiated in 2017.Today, many successful wannabe drivers pay for technology to help them pass the requisite exams. “The learning process is now digitalized and easy,” said Huang Feng, cofounder of a company called Chelun, which is exhibiting at the ongoing Shanghai International Automobile Industry Exhibition. “This is a market with huge potential in China.” Chelun, meaning “better wheels life” in English, is a Shanghai-based startup with an expected market value of over 2 billion yuan (US$298.5 million). The driving test service, which has helped over 100 million people get their driver’s licenses, is one of Chelun’s fastest-growing businesses.The company is a market leader with its almost 700,000 professional instructors in driving schools accounting for 80 percent of the nationwide total. During the local auto show, Chelun is showcasing products that include a smart box recording drivers’ routes and operations, an application offering training videos and simulation of written tests, and a teaching application with data management and analysis.Students are willing to pay for applications that improve learning efficiency and avoid repeated visits to driving schools, which are often in far-flung suburbs. “After failing my tests, it was a nightmare for me to keep going to a driving school that was a two-hour trip away,” Gao explained. She said 38 yuan (US$5.7) to Chelun for simulated written tests. She also paid for a “smart box” as a hardware plugged into the teaching car, which helps teachers and drivers record driving exercise behavior and offers customized analysis and suggestions, including facets sometimes neglected by teachers.The cost of using the box is 30-50 yuan, based on various locations and exercise programs. Students and teachers can log in via WeChat, and driving instructors share income with Chelun. The paid user base of Chelun’s driving test services hit 1 million yuan in 2018, double from a year earlier. It’s expected to surpass 2 million yuan this year, said Huang. Each year, about 30 million people take driving tests, but the number is dropping every year because of China’s demographics and perhaps the slump in car sales. Analysts estimate the number of people seeking driver’s licenses may drop to about 25 million annually.Chelun is not worried about that, said Huang.Driving test users can be parlayed into the company’s other businesses, including assessments of new cars, creating media on green vehicles, fostering a community of car owners and related e-commerce services, Huang said.Chelun, which has finished a round of financing, is looking at the possibility of an initial public offering, including choice of the new Technology Innovation Board in Shanghai.
Electric vehicle concepts shown in Shanghai this week, such as the Audi AI:me and Infiniti QX Inspiration, point to a future of living room-like comfort in cars with flat floors and ample space for sofa-like bench seats.In the design studies, automakers have taken advantage of the space freed up by the electric motor, which takes less room than the bulky internal combustion engine, cooling apparatus and complex transmission gears needed for gasoline cars.As most batteries in an EV are laid out flat under the floor, the EVs shown in the Shanghai auto show, which runs through tomorrow, also have more height and, in fact, many are sport-utility vehicles.Both the AI:me urban car and Infiniti’s QX Inspiration SUV have flat floors, interiors large enough to accommodate what looks like a sofa in the back and more leg room and storage.Because there is no tunnel, which often houses the drive shaft and exhaust apparatus in a gasoline car, running through the length of the EV cabin, the center of the rear seat “can become just as valuable” as the space on its sides, design chief for Nissan’s premium brand Infiniti, Karim Habib, said.That in turn points to the possibility of “a return of the bench seat” in the front and the rear — a throwback to American cars of a bygone era, Habib told Reuters.The EV’s flat and slightly elevated floor allows passengers to slide into it, Habib said. “You can kind of comfortably sit into it ... You can cross your legs, stretch your legs out,” he added, referring to the QX Inspiration concept car.Audi’s AI:me concept car offers what the company’s China operations chief Thomas Owsianski described as “maximum space comfort,” despite its smallish urban car profile.“We are fundamentally changing the perception of a (urban) car, particularly car experience,” Owsianski said in Shanghai. “The AI:me has very compact dimensions but ... it shows the urban mobility, especially premium mobility, doesn’t need to feel small. Cars are becoming a living room space.”
New home-buying sentiment rebounded moderately last week, with medium to low-end properties remaining popular, the latest weekly report released yesterday shows.The area of new residential properties sold, excluding government-subsidized affordable housing, rose 4.8 percent to about 176,000 square meters in the seven days to Sunday, Shanghai Centaline Property Consultants Co said in their regular weekly report.“Fueled by new supply over previous weeks, several outlying areas registered quite robust sales last week,” said Lu Wenxi, Centaline’s senior research manager.“The recovery, however, was not strong enough, as weekly transaction volume has remained below the 200,000-square-meter threshold for several weeks.”Around the city, Jiading District topped the market with seven-day transactions surging 167 percent to about 32,000 square meters. The Nanhui area in Pudong followed with 21,000 square meters, despite a weekly drop of 32.3 percent.Qingpu District unloaded about 19,000 square meters.Citywide, new homes sold for an average 53,286 yuan (US$7,941) per square meter, a week-on-week increase of 3.2 percent.In the top 10 list in terms of transaction area, six projects sold for less than 50,000 yuan per square meter.Two commanded between 50,000 yuan and 60,000 yuan per square meter, and another two for more than 100,000 yuan per square meter.A project in Jiading was the most sought-after development after selling 9,816 square meters, or 100 units, of new homes for an average price of 29,312 yuan per square meter.Next was a housing project in the same district, which unloaded 9,740 square meters, or 85 apartments, for an average of 33,246 yuan per square meter.A total of 211,000 square meters of new housing in nine developments, most located in outer districts, were released into the market last week, a week-on-week surge of 85.5 percent, Centaline said.
Chinese regulators have resumed approving licenses for new computer games, with tougher rules covering game names, gambling and violent content in the world’s largest gaming market.Regulators stopped approving new games more than a year ago, which hit industry leaders such as Tencent and NetEase.English is now no longer allowed in official names of games published in China. Excessive violence and gambling are also banned and images of corpses should disappear “as soon as possible,” the Publicity Department of the Communist Party of China said in a statement yesterday.And virtual marriages are banned in games aimed at people under 18.The new rules on applications for publishing online games in China may bring fresh air and opportunities to the gaming industry, after the authorities stopped granting licenses in March last year. Approvals resumed in December, but without clear guidelines.The tougher rules are especially designed to protect younger gamers.
Shanghai’s residential property market is likely to remain stable with improved accessibility for medium- and low-income households, and upgrades of older residential communities will continue, the head of the city housing authority said yesterday.“The residential property market remained generally stable last year in terms of both home and land prices as well as market expectations,” said Hu Guangjie, director of Shanghai Housing Management Bureau.The floor area of new and occupied homes sold rose 2.2 percent and 5 percent in 2018, while the price indices of new and existing homes edged up 0.4 percent and slipped 2.7 percent, Hu said in a radio broadcast.And progress has been made in the multilayer housing guarantee system, aimed at ensuring housing for all levels of society.A total of 125,000 households have been covered by the city’s low-rent program, benefiting about 43,500 families. There are 176,000 public rental apartments and 500,000 households have been helped under the program. In terms of shared-ownership homes — where householders share ownership with the government — 95,000 households have contracts with the government.Later this year, the city plans to extend the program to cover all qualified non-local residents following trials in three districts.The city aims to complete work in 1,245 communities where waste water was drained through rainwater pipes and accelerate installation of elevators in older residences.
Tencent said yesterday it will keep children under 16 out of its targeted customers for online gaming, using real-name verification.Online gaming has been criticized as a cause of nearsightedness and over-indulgence in electric devices among children. The company’s move is targeted to help parents more effectively manage their kids’ online behavior.Last month, Tencent rolled out a child-lock mode. Children under 13 need their parent’s permission before unlocking and logging into the game.This month, Tencent had installed checks in 53 mobile games and 11 PC games to restrict the amount of time kids spend playing. In games reinforced with the system, children under the age of 12 are only allocated one hour a day and are not allowed to play from 9pm to 8am the next day.(Xinhua)
The Shanghai Stock Exchange and Japan Exchange Group signed an ETF (exchange-traded fund) agreement in Shanghai yesterday.The ETF Connectivity Agreement was signed at a China-Japan capital market forum, which was jointly held by seven organizations, including Shanghai and Shenzhen stock exchanges and Japan Exchange Group.Under the agreement, the Shanghai Stock Exchange and Japan Exchange Group will list each other’s ETFs, and fund companies from both sides are able to invest their fund assets in ETF products.Toshihide Endo, commissioner of Japan’s Financial Services Agency, said Japan and China had achieved many pragmatic results in financial cooperation, which is welcomed by the Japanese government.He also said it was of great importance for both Japan and China to work together to promote the reform of the capital markets, as well as boost innovation and sustainable development of economy.
Horgos Port in northwest China’s Xinjiang Uygur Autonomous Region saw a rise in imports and exports in the first quarter of this year, local authorities said.From January to March, imports and exports at this land port bordering Kazakhstan reached 8.65 million tons, an increase of 17.1 percent compared with the same period last year, mainly driven by imports, according to the Horgos Customs.The trade volume hit 26.8 billion yuan (US$4 billion), up 32.24 percent year on year.Customs said imports were mainly traditional bulk commodities such as natural gas, timber and licorice, with Turkmenistan, Uzbekistan and Kazakhstan as the major importing countries, while exports included mechanical and electrical products, garments, fruits and vegetables.Ma Lei, a local customs officer, attributes the imports and exports rise to the deepening of the Belt and Road Initiative.
Japanese authorities yesterday hit former Nissan boss Carlos Ghosn with a fresh charge of aggravated breach of trust, the fourth indictment against the former Nissan boss who promptly filed for bail.Experts say the latest charge is the most serious yet leveled against the auto sector legend, whose roller-coaster case has gripped Japan and the business world since his dramatic arrest in November over alleged financial misconduct. According to a statement from Tokyo’s prosecutors’ office, Ghosn is accused of funneling millions of dollars in Nissan funds to a dealership in the Middle East and syphoning off around US$5 million for personal use.The transfers were made “with the purpose of benefiting himself by receiving part of the money,” prosecutors charged. Shin Kukimoto from the Tokyo prosecutors’ office told reporters they had “enough evidence for guilty verdicts.”However, the 65-year-old strenuously denies all allegations against him and insists they have been cooked up in a “plot” by Nissan executives wary of his plans to bring the Japanese car giant closer to its French partner Renault.A Ghosn spokesperson said the former tycoon would “continue to vigorously defend himself against these baseless accusations and fully expects to be vindicated.”Ghosn’s lead lawyer, Junichiro Hironaka, filed for bail just hours after the charge. He said he was confident his client would be released as he prepares to fight the allegations.“In order to prove his innocence at a trial as soon as possible, we want (the court) to approve our bail request so that we can prepare a good defense,” Hironaka told reporters.Ghosn has already won bail once before — but with strict conditions such as agreeing not to leave the country and living under surveillance. Yesterday was the end of the maximum period authorities had to question Ghosn, who is now technically in pre-trial detention.
Concept cars debuting at the Shanghai auto show represent new trends in mobility, electrification and autonomous driving, offering smart systems and environmental protection.BMW showed off its Vision iNext concept car at the 18th Shanghai International Automobile Industry Exhibition, a vision of how driving may be in 2021.It is all-electric, highly automated and fully connected.BMW has a self-driving lab in Shanghai and has conducted on-road tests for Level 4 autonomous driving, the second highest of the five levels of smart and driverless driving.For the first time in Asia, Japan’s Infiniti gave a glimpse of its concept car, the Qs Inspiration. It is an all-electric sports sedan. Infiniti models will soon be manufactured in China, designed for the domestic market.Nissan debuted its electric concept cars the IMs and IMq.The IMs is 100 percent electric-powered with an autonomous mode for hands-free driving.The Nissan Sylphy showcases intelligent mobility technology that features seamless smartphone connectivity and intelligent voice commands.Drivers will be assisted to avoid hazardous situations by systems including an intelligent emergency brake.China is the global leader in car electrification, with huge demand and strong innovation.Digital mobility, electrification and autonomous cars are three “revolutions” in the auto industry, said Valeo, an auto parts company from France.The show is open to the public until Thursday.
CHINA should fine-tune monetary policy in a pre-emptive way based on economic growth and price changes, according to a top-level meeting chaired by President Xi Jinping.
“Monetary policy needs to be neither too tight, nor too loose and should be fine-tuned in a timely and pre-emptive way based on economic growth and changes in price situations,” the Central Financial and Economic Affairs Commission said.
The meeting pointed out that it is necessary to strengthen regulation of countercyclical macro policy and strive to put tax cuts and fee reduction in place as soon as possible.
Greater efforts should be made to improve business environment, accelerate the upgrading of the economic structure, improve capabilities to innovate in science and technology, and speed up green development.
President Xi also stressed targeted efforts to improve weak links in building a “moderately prosperous society in all respects.”
Xi said the country had achieved “decisive progress” in building a moderately prosperous society in all respects. However, there remain weak areas that should be faced squarely and dealt with targeted efforts.
He also called for courage and wisdom to tackle problems and good implementation of the decisions taken at the central economic work conference.
Building a moderately prosperous society in all respects is a target to be completed by 2020. Poverty-alleviation efforts should be focused on areas that are trapped in deep poverty.
On top of making sure that people in these areas are kept warm and fed, more efforts should be made to ensure that they are covered by compulsory education, basic medical care and safe housing, the meeting said.
The meeting also urged efforts to tackle prominent problems that pollute the environment in key areas, advance the work on public wellbeing by increasing input in compulsory education, basic medical care, safe housing and drinking water, as well as child and elder care.
The meeting also stressed the improvement of the subsistence allowances system.
Efforts should be made to expand supply-side structural reform, make micro-entities more dynamic, and upgrade the industrial chain.
The report was the fourth from a top-ranking policymaking body in China in less than two weeks, and comes as financial markets debate how much more additional support Beijing will provide to the world’s second-largest economy after surprisingly resilient data released last week.
The economy expanded at a steady 6.4 percent pace in the first quarter, defying expectations for a further slowdown, with industrial output, retail sales and investment in March all growing faster than expected following a raft of growth-boosting measures rolled out in recent months.
Producer and consumer price gauges in China have picked up, easing concerns about deflationary risks, but broader inflation levels are still modest.
The commission’s comments reiterated that China will step up fiscal policy and strengthen macro counter-cyclical adjustments, a phrase that usually refers to efforts to reduce pressure on the economy.
FRENCH tire giant Michelin is committed to sustainable mobility with a focus on innovation to create a safe, green and accessible lifestyle for Chinese consumers.
As one of the top tire makers in the Chinese market, Michelin this year celebrates its 30th anniversary of entering Chinese mainland — and the 130th anniversary of Michelin Group.
Last October, the company was presented with the Excellence Award for Sustainability 2018. Bruno de Feraudy, president of Michelin (China) Investment Co Ltd, who has lived in Shanghai for seven years, talked to Shanghai Daily about his vision on the future of sustainable mobility in this country.
“Sustainable mobility means that we are not just selling tires,” de Feraudy said. “We want to find solutions to make our products sustainable for consumers, the country and the environment.”
“It’s our job to work with consumers as best as we can and give them with better mobility experiences,” said de Feraudy.
Michelin has been focusing heavily on providing better solutions to guarantee safety and environmental sustainability since its entry into China.
Tire is a complex product of a mix of raw materials, including natural and synthetic rubber. The grip and rolling resistance of the tire and the raw materials used are among the key factors for “safe” and “green.”
To provide the best solution, Michelin is dedicated to extending the mileage of its tires and enhancing their long-lasting performance, so that the energy and raw materials consumed and the impact on the environment can be reduced as much as possible. This, as de Feraudy sees it, is a major change for the company and the market.
“We have to ensure lower resource consumption, without compromising on safety. It’s important to go further on the capability of tires to deliver the optimum performance and longevity,” de Feraudy said. “This is where we really make a difference.”
Michelin believes safety and environmental concerns can be reconciled through technologies that already exist and are easily available.
One of the best ways to do that is testing performance of worn tires, which would increase performance for each tire. Changing tires when the tread depth reaches 1.6mm instead of 3mm would save about 400 million tires a year worldwide, which would otherwise generate about 35 million tons of CO2 a year.
The company is leading in new-energy vehicle tire techonology, too. Take electrical vehicle as an example, the tires of which could be worn out more quickly than traditional fuel-consuming vehicles.
Therefore, Michelin strives to optimize electrical mobility by maintaining a reasonable mileage of the tires, on top of that reducing the rolling resistance of the tire to lower the battery consumption of EVs.
Michelin announced its ambition last year that by 2048, all of its tires will be manufactured using 80 percent sustainable materials (recycled and renewable materials) and that 100 percent of all tires will be recycled.
“What we want to give people is this vision we are working on. What we do now is to make sure we can reach these ultimate goals. Our target is to make it 100 percent recyclable and drastically change the level of green and safe mobility. It’s important for us to set the vision and know how to manage the progress and innovation we are making every year,” said de Feraudy.
Currently, the company is investing big on research and development, with more than 5 percent of its turnover each year. The RDI center in Shanghai now has more than 200 people and used global technology developed by Michelin to facilitate the sustainable mobility of those two key components.
This year, Michelin introduced to China the tire pressure monitoring system, which is a smart technology that indicates the pressure of each tire. This guarantees passengers’ safety and lightens their travel experience.
Track Connect, a tire solution targeting at race lovers was demonstrated in China GT last year, to meet the increasingly diversified needs of Chinese consumers.
As the mobility environment in China is changing rapidly, Michelin strives to develop more proper partnerships with local players to accelerate the ability of innovation and interaction. With the younger generations in China more eager to enjoy their lives and the digital trend, Michelin aims to provide more sustainable support to customers including maintenances and gastronomy.
Michelin has partnered with JD.com to expand its “online to offline” (O2O) services in China, so that customers can enjoy one-stop integration between online shops and offline networks involving after-sales service shops owned by its TyrePlus brand.
This digitalized move could help consumers conveniently maintain their vehicle through a seamless service, and optimize the mobility experience.
When the Michelin Guide first went to press in France in 1900, it encouraged emerging private car owners to take more journeys of discovery so that Michelin could build multi-dimensional connections with their customers.
Now the time-honored guide is gradually mapping out China, firstly Hong Kong and Macau, followed by Shanghai in 2016, Michelin Guide Guangzhou was released to the public last year. By establishing cooperation with WeChat Pay, it extends to more Chinese foodies while still focuses on consistency in the quality of cuisine.
In fact, since the Michelin guides have been launched in China, it motivates a lot of restaurants and chefs to step up their crafts, as the number of restaurants with a Michelin-star certificate is increasing every year.
“It’s hard for consumers to build emotions on tires. But if we can interact with them through guides to show you where to visit and eat, then they can interact with Michelin brand and enter the Michelin ecosystem,” replied de Feraudy.
Among all the tire names in China, Michelin has the highest net promoter score of 67, and enjoys top brand recognition of 89 percent.
“We are still facing major challenges in keeping up with the mobility pace to build connectivity in any area where we want to interact,” he said.
“There’s no business without a challenge, so we will continue to provide sustainable mobility to consumers, to think about their life and how can you interact with them,” said de Feraudy.
China will maintain policy support for the economy, which still faces “downward pressure” and difficulties after better-than-expected first-quarter growth, a top decision-making body of China has said.The statement from the Politburo came two days after China reported a steady 6.4 percent annual growth in January-March, defying expectations of a further slowdown, as industrial production jumped sharply and consumer demand showed signs of improvement.“While fully affirming the achievements, we should clearly see that there are still many difficulties and problems in economic operations,” Xinhua news agency reported, citing a Politburo meeting chaired by President Xi Jinping.“The external economic environment is generally tightening and the domestic economy is under downward pressure.”China will implement counter-cyclical adjustments “in a timely and appropriate manner,” while the proactive fiscal policy will become more forceful and effective, and the prudent monetary policy will be neither too tight nor too loose, it said.For this year, the government has unveiled tax and fee cuts amounting to 2 trillion yuan (US$298.35 billion) to ease burdens on firms, while the central bank has cut banks’ reserve requirement ratios five times since early 2018 to spur lending.Further policy easing is widely expected.Last Friday, the Politburo reiterated that the government will effectively support the private economy and the development of small- and medium-sized firms. Authorities will strike a balance between stabilizing economic growth, promoting reforms, controlling risks and improving people’s livelihoods, the Politburo said.China will push forward structural deleveraging and prevent speculation in the property market, it said.“We should adhere to the orientation that houses are used for living, not for speculation,” the Politburo said, reaffirming a city-based approach in controlling the property sector.China’s economic growth is expected to slow to a near 30-year low of 6.2 percent this year, a poll showed last week, as sluggish demand at home and abroad weighs on activity despite a flurry of policy support measures.
The rise of domestic Chinese sci-fi has brought about a boom in related merchandise.When Chinese sci-fi blockbuster “The Wandering Earth” took the second spot in China’s all-time box office, sales of promotional products also soared.Sources at China Film Co Ltd, producer of the film, say that it authorized dozens of companies to create merchandise in an unprecedented move.“The manufacturing industry of IP merchandise products is mature in China. What domestic enterprises are short of is creative ideas and designs,” said Gu Yi, a merchandise development director of a subsidiary brand under entertainment service Bilibili, one of the film merchandise developers.With a growing creative industry in China, Gu believes more good products will come out, bringing better sales.According to Gu, a fund-raising project initiated by the company for “The Wandering Earth” product development has collected over 5 million yuan (US$745,000) from the public, far beyond their expectation.Products linked to sci-fi books have also seen strong sales.Fans of “The Three-Body Problem” have pooled over 2.3 million yuan to sponsor an illustrated album based on the book, making it a must to print extra copies.Compared with box office earnings, development of IP merchandise can generate profits in a much longer term, according to Chen Wei, founder of Chinese merchandise brand 52TOYS.
BMW will recall 360,000 vehicles in China to replace defective airbags, according to a State Administration for Market Regulation statement.The recall, set to begin on August 30, involves 272,880 vehicles produced by BMW Brilliance Automotive Ltd between January 2, 2014, and October 16, 2017, and 87,121 imported models produced between April 5, 2000, and February 21, 2018.A defect could cause the airbags to eject debris at passengers if deployed. The defective airbags were made by now-defunct Japanese supplier Takata. Founded in 1933, Takata went out of business in 2017 because of the airbag crisis.BMW will replace the defective airbags free of charge.
Statistician Wang Ting has spent nearly four months visiting businesses and collecting data on their operation, so is well placed to sense the changes in China’s economy.Carrying a hand-held computer device, the 35-year-old from the statistics department of Nanjing in eastern Jiangsu Province is conducting China’s fourth economic census.In the four months from January, over 2 million census workers across the country, like Wang, need to survey 30 million entities and industrial units, as well as about 60 million self-employed entrepreneurs.In the “super economic check-up,” census workers said they faced a tougher-than-ever task in collecting data on enterprise structure, staff wages, financial status, production capacity, energy consumption, and research and development activities.Ning Jizhe, head of National Bureau of Statistics, has stressed the need to secure high-quality data. Calling data quality “the lifeline” of the economic census, he said the top priority was to guarantee data accuracy.As the Chinese economy is undergoing transformation and upgrade, Zhuang Jian, senior economist with Asian Development Bank, said that accurate and authentic census data was significant for future studies.To ensure accuracy and efficiency, fresh tools are being used. Wang said respondents could access the NBS terminal management application and data-checking system through a hand-held computer device.Previously, census workers had to take down the data they collected first and input to computers later.“Now we input the information collected in the presence of the respondents and ask for a confirmation signature,” Wang said. “Both efficiency and quality of our work have improved.”Credit systemThose who refuse to provide the required information or try to manipulate the data will be discredited in the country’s credit system, the NBS said.Apart from equipping census workers with new tools, the NBS has tried to make the census more accessible to the public by opening an account on popular video-sharing app Tik Tok to share amusing short clips.Compared to previous economic surveys, the current census pays more attention to the new economy, which tends to be labor- or technology-intensive but asset-light, sustainable, shows rapid growth and is in strategic areas encouraged by the government.New survey items such as R&D, production capacity, energy consumption and e-commerce sales have been factored in.“By adding these new items, the census can draw a clearer picture of the new economy while tracking new growth engines,” Zhuang said.During an on-site survey, Wang who participated in the previous economic census found more small- and medium-sized enterprises involved this time, and their business more diversified.Census workers also feel stronger public involvement. “Companies can better understand industry dynamics and market trends and optimize business decision-making through the data, and individuals can use relevant data as a reference to make smart choices in personal career development and investment,” Wang Nan, CEO of ZBJ, an emerging talent-sharing website in China noted.In the bigger picture, the census will help provide stronger statistical support for the government to conduct macroeconomic control and roll out long-term plans, Zhuang said.For Ning, the ongoing census will help the country to better pursue high-quality development through reform. It will allow the government to better evaluate economic performances, monitor and track the progress.
Tencent has won a key approval to start selling the Nintendo Switch in China, paving the way for the console to enter the world’s largest video games market two years after it was first released worldwide.Authorities in the southern Chinese province of Guangdong gave the green light yesterday to Tencent Holdings to distribute the Nintendo Switch console with a test version of the “New Super Mario Bros U Deluxe” game, a statement on the government’s website showed.The need to navigate regulations and the search for a local partner have hampered Japanese gaming company Nintendo’s efforts to bring its hybrid home-portable Switch console to China, holding back the development of console gaming there.“Launching the Nintendo Switch in China is a massive opportunity for both Nintendo and Tencent,” said Gu Tianyi, market analyst with gaming industry analytics firm Newzoo, adding that other consoles, PlayStation and Xbox, have struggled to catch on in China.“What sets Nintendo apart, however, is that its intellectual property roster — including Mario, Zelda and Pokemon — is already extremely popular in the market. What’s more, the mobile aspect of the Switch is a great fit for China’s mobile-first culture.”Tencent has to apply for approvals from authorities in Guangdong, where the company is registered. Two people familiar with the matter said the approval by the Guangdong culture ministry would allow the Switch to be sold nationwide. Tencent did not immediately comment.It has teamed up with Nintendo in the past, with Tencent releasing its “Arena of Valor” game overseas on the Switch. A spokesman for Nintendo — which has sold more than 32 million Switch units globally since its launch just over two years ago — said Tencent had applied to Guangdong authorities for approval to sell the Switch console.The statement on the website of the Guangdong Provincial Department of Culture and Tourism listed over 100 game devices, including arcade machines, that it was approving for sale.The approval also comes as industry leader Tencent tries to recover from a lengthy video game approval freeze in China last year, which has put pressure on shares of the company and other gaming-related stocks.
Leading auto chipmaker NXP Semiconductors yesterday announced a strategic partnership with Chinese radar firm Hawkeye Technology to work on radar applications for smart driving. The announcement of the deal came at the Shanghai International Automobile Industry Exhibition, which is highlighting how our cars are becoming smarter, safer and better-connected with the help of new chips, software codes, advanced radar, 5G and artificial intelligence algorithms.China’s automotive radar sensor market is growing twice the global rate. By 2020, radar technology will be used in half of all cars, especially those with smart driving features, analysts said.Radar is now widely used in applications covering blind-spot detection, automatic emergency braking, front and rear cross-traffic detection and precise environmental mapping. It’s widely seen as a key factor in building more intelligent cars and self-driving models in the future. Compared with traditional cameras and sensors, radar can detect precise distances and other factors for smart driving and safety.But radar is expensive, although volume production could reduce costs, said Suteng Innovation, a Shenzhen-based radar vendor.In a separate move, Harman, a subsidiary of Samsung, said it would offer digital services for Chinese carmakers such as Great Wall Motor and Beijing Electric Vehicle, covering connected technologies, cyber security and high-speed information services.With Samsung’s mobile and 5G communications services, audio technology and device provider Harman now offers various services for automakers. Its car audio sales in China are growing 15 percent annually — triple the industry’s growth rate. Chinese AI startups SenseTime and Horizon Robotics also announced new platforms and partnerships during the show.Meanwhile, tech upgrades on chip and code are also necessary for smart driving. The show opens to the public from tomorrow until Thursday.
Trade services providers vowed to better serve exhibitors at the second China International Import Expo in Shanghai in November.A comprehensive trade service alliance, led by Oriental International Holding Co, Donghao Lansheng Group and several professional trade services firms, will use their skills to ensure the recruitment of exhibitors and logistics firms, as well as smooth customs clearance procedures. Nearly 60 members of the alliance have vowed to offer one-stop information services to help traders better prepare for the expo.Two hundred days before the start of the second CIIE, traders and logistics, financial, insurance and law firms and consultancies said they will remain dedicated to servicing the CIIE and relevant events and will also contribute to Shanghai’s development as a global economic, finance, trade, shipping and innovation center.Construction of what will be Asia’s largest import marketplace is well under way near the CIIE venue. In about three years, a 600,000-square-meter exhibition and trade center for imports, along with bonded warehouses, will be completed in southern Hongqiao, about 3 kilometers from the main venue of the CIIE.According to a senior manager of Oriental International, a major participant of the mammoth project, the first phase will become operational in September or October.Last year, Oriental International became one of Shanghai’s officially designated permanent platforms to demonstrate and trade commodities originally exhibited at the CIIE. This year, the southern Hongqiao marketplace will greatly expand Shanghai’s capacity as a leading hub for the demonstration and trade of imports.“It will be of special help to the world’s small and medium-sized companies which hope to debut their latest brands in China,” said Cai Jun, a top manager responsible for Oriental International’s CIIE promotion as well as for the operation of the southern Hongqiao project.Professional service providers such as China Pacific Property Insurance Co said they will also ensure better service for trading groups and offer all-round safeguards.More than 1,800 companies have signed up for this year’s CIIE, the Ministry of Commerce said. Over 900 companies from 77 countries and regions have confirmed participation as exhibitors, including 180 Fortune Global 500 firms and leading enterprises in various industries, according to Gao Feng, a spokesperson for the ministry.
China’s cross-border capital flows remained basically unchanged in March, official data showed yesterday. The country’s foreign exchange regulator has also announced a slew of measures to boost the local forex market.Last month, Chinese commercial banks bought 1.01 trillion yuan (US$151.3 billion) of foreign currencies and sold 1.05 trillion yuan, resulting in a net sale of 41.2 billion yuan, the State Administration of Foreign Exchange said.Volume narrowed from the 101.3-billion-yuan deficit in February.In the first quarter, lenders recorded an aggregate net forex sale of 60.7 billion yuan, down 50 percent from that in the same period last year, according to the regulator.“Cross-border capital flows have shown positive changes in 2019,” said Wang Chunying, spokesperson, chief economist and director of the Department of Balance of Payments at the administration, citing the strength of the yuan and balanced supply-demand dynamics in the market.In the first three months, the central parity rate of the yuan strengthened 1.9 percent against the US dollar. It also gained 1.9 percent against a basket of currencies monitored by the China Foreign Exchange Trade System.SAFE said it would work to further optimize foreign exchange management policies, improve the convenience of fund transfers for foreign-owned enterprises and support qualified and capable domestic companies to carry out “real and compliant” overseas investment, Wang said.To attract more foreign players into China’s capital markets, the authority said it plans to reform the system for qualified institutional investors, simplify their market access and expand their scope of investment.Reforming the system“We will reform the QFII and RQFII systems while pushing forward the opening of capital accounts in a steady and orderly way,” Wang added.China’s Qualified Foreign Institutional Investor scheme allows approved investors to invest in a limited scope of cross-border securities products, while an RMB Qualified Foreign Institutional Investor scheme permits use of yuan funds raised in Hong Kong by the subsidiaries of domestic fund managers and securities houses in Hong Kong to invest in the domestic capital market.SAFE said it would welcome more participants, such as securities brokers and fund companies, to join the forex market. It would also support the innovation of forex derivatives and launch more options products in the future.Efforts will also be made to promote channel integration for the opening of the inter-bank bond market, standardizing the management of yuan-denominated bonds issued by overseas institutions and pushing ahead forex reforms in pilot free trade zones, the Guangdong-Hong Kong-Macau Greater Bay Area and Xiongan New Area.
Shanghai’s real estate investment market is off to a vibrant start in 2019 with transactions of major deals exceeding 90 billion yuan (US$13.38 billion) in the first quarter, property services provider Cushman & Wakefield said in its latest report.Major property deals totaled 95.9 billion yuan, compared with 117.2 billion yuan in deals settled for full-year 2018.“For three consecutive years, Shanghai saw en-bloc real estate investment exceed the 100-billion-yuan threshold, and the momentum continued to extend in the first three months of this year with even more notable strength,” said Alvin Yip, Cushman & Wakefield’s China president of capital markets. “Looking forward, foreign investors will certainly maintain their appetite for the local market whereas sentiment among their domestic counterparts will also pick up gradually.”Mixed-use developments were the most sought-after — 68 percent of the total. Office buildings trailed with a 29 percent share. Looking ahead, Cushman & Wakefield advises investors to focus on core assets with stable cash flow, high-quality assets in decentralized areas and urban renovation projects.
Chinese startup Luckin Coffee has completed its Series B+ round of financing worth US$150 million, the company said yesterday.The funding, of which US$125 million was invested by BlackRock and which came four months after the coffee chain picked up US$200 million in investment, lifts the company’s valuation to about US$2.9 billion, the company said in a statement.As an emerging market player that rivals Starbucks, Luckin Coffee started trial operation in January last year.It sells coffee at brick-and-mortar stores while also delivering products through online orders.The Xiamen-based coffee chain startup has been expanding at a fast clip since its official operation in May 2018, with over 2,000 outlets opened in 36 Chinese cities by April 10.
Foreign direct investment into the Chinese mainland expanded 8 percent year on year to reach 95.17 billion yuan (US$14.2 billion) in March, the Ministry of Commerce said yesterday.During the first quarter, FDI inflow rose 6.5 percent from one year earlier to 242.28 billion yuan, the MOC said in a statement.In dollar terms, FDI inflow grew 3.7 percent year on year to US$35.8 billion during the three-month period.The number of new overseas-funded companies established between January and March reached 9,616, MOC data showed.Investment in high-tech industries rose 50.6 percent year on year and accounted for 27.5 percent of the total FDI.The high-tech manufacturing sector attracted 25.97 billion yuan in overseas investment, up 14.8 percent, the ministry said.China’s pilot free trade zones saw FDI inflow up 10.5 percent year on year during the first quarter, accounting for 10.3 percent of the total foreign direct investment.The Ministry of Commerce data showed that FDI from Germany surged the most at a rate of 86.1 percent from one year earlier, while that from Republic of Korea and the Netherlands jumped 79.6 percent and 74.2 percent, respectively.
Amazon.com Inc plans to close its domestic marketplace in China by mid-July, people familiar with the matter said, focusing efforts on more lucrative businesses selling overseas goods and cloud services in the world’s most populous nation.Amazon shoppers in China will no longer be able to buy goods from third-party merchants in the country, but they still will be able to order from the United States, Britain, Germany and Japan via the firm’s global store. Amazon expects to close fulfillment centers and wind down support for domestic-selling merchants in China in the next 90 days, one of the people said.The move underscores how entrenched, home-grown e-commerce rivals have made it difficult for Amazon’s marketplace to gain a foothold. Consumer insights firm iResearch Global said Alibaba Group Holding Ltd’s Tmall marketplace and JD.com Inc controlled 81.9 percent of the Chinese market last year.“They’re pulling out because it’s not profitable and not growing,” said analyst Michael Pachter at Wedbush Securities.Ker Zheng, marketing specialist at Shenzhen-based e-commerce consultancy Azoya, said Amazon had no major competitive advantage in China over its domestic rivals. Unless someone is searching for a very specific imported good that can’t be found elsewhere, “there’s no reason for a consumer to pick Amazon because they’re not going to be able to ship things as fast as Tmall or JD,” he said.Amazon’s customers in China will still be able to purchase the firm’s Kindle e-readers and online content, said the sources, who spoke on condition of anonymity. Amazon Web Services, the company’s cloud computing unit that sells data storage and computing power to enterprises, will remain as well.The US-listed shares of Alibaba and JD.com rose 1 percent on Wednesday after Reuters first reported the move, before paring gains later in the day. Amazon’s shares closed flat.The withdrawal of the world’s largest online retailer, founded by the world’s richest person, comes amid a broader e-commerce slowdown in China. Alibaba in January reported its lowest quarterly earnings growth since 2016, while JD.com is responding to the changing business environment with staff cuts.It also follows the Chinese e-commerce retreat of other big-name Western retailers. Wal-Mart Stores Inc sold its Chinese online shopping platform to JD.com in 2016 in return for a stake in JD.com to focus on its bricks-and-mortar stores.Similarly, the country appears to factor less in the global aspirations of fellow US tech majors Netflix Inc, Facebook Inc and Alphabet Inc’s Google, Pachter said.Amazon bought Chinese online shopping website Joyo.com in 2004 for US$75 million, rebranding the business in 2011 as Amazon China. But in a sign of Tmall’s dominance, Amazon nevertheless opened an online store on the Alibaba site in 2015.
SHANGHAI will focus on building a new pattern of open innovation, bring together global resources and talent, and strengthen intellectual property protection, the city’s Mayor Ying Yong said yesterday.
He was speaking at the seventh China (Shanghai) International Technology Fair, which opened yesterday at the Shanghai World Expo Exhibition and Convention Center and will continue till tomorrow.
The fair is exhibiting leading international technologies with special emphasis on the intellectual property protection.
The CSITF, which is cohosted by the Ministry of Commerce, Ministry of Science and Technology, State Intellectual Property Office and Shanghai Municipal Government, is a national-level fair specifically focused on international technology trade.
Mayor Ying said that innovation has always been the primary driving force for high-quality development, and Shanghai is speeding up its development as an international center for economy, finance, trade, shipping, technology as well as become a modern metropolis with global influence.
“We will enhance our innovation abilities, aim at the cutting-edge technologies and keep in line with the strategic needs of the country, and launch a batch of special projects and plans to achieve breakthroughs,” Ying said.
Shanghai will especially promote technology trade and innovation cooperation, Ying told the assembled guests.
He Zhimin, deputy director of the State Intellectual Property Office, said that intellectual property rights, as a necessity for innovation-driven development and a standard for international trade, are crucial to enhance China’s international competitiveness, and are playing an increasingly important role in promoting the reform and opening-up and the Belt and Road Initiative.
In 2018, the State Intellectual Property Office completed its reorganization in line with the reforms suggested by the central and state institutions. The office has promoted the management of patents, trademarks and integrated circuit design, and has enhanced the protection of intellectual property rights.
In line with Shanghai’s 22 measures on promoting the development of artificial intelligence, which was released recently, AIhas also become one of the highlights of the fair this year.
There is an immersive AIexperience platform that brings together advanced technologies and leading companies in the field.
Shanghai Keenon Robotics Co brought their “Peanut” delivery robots, which are being used by HaiDiLao Hotpot.
Yunji Technology’s intelligent robot for commercial service, “Run,” was designed mainly for use in hotels. It can take the elevator on its own, deliver goods and lead the way. They have been working with hotel groups including Marriott Hotel, InterContinental Hotels Group, Ascott Hotel, and Wyndham Hotels.
Xiaoxiaoniu Creative Technologies exhibited their patented Wonder Painter technology, which can turn drawings into vivid animations.
It has cooperated with South Korea’s LG, with the Wonder Painter Software Development Kit being used in LGU+ for storytelling, and Baidu’s AIartist online game that is powered by Wonder Painter Cloud.
The fair has become an important platform for exhibiting leading technologies, linking innovation resources, and promoting communication and cooperation among the small and medium-sized innovation enterprises, Ying said.
“We hope to make full use of the innovative resources and the support of all parties to make the CSITF an international event as well as an important window for deepening international cooperation on innovation and boosting the development of technology trade,” Ying said.
CHINA will work to further reduce financing cost of micro and small enterprises, with an aim to increase outstanding loans offered by five large state-owned commercial banks to MSEs by more than 30 percent this year comparing with 2018, the State Council executive meeting chaired by Premier Li Keqiang decided yesterday.
Premier Li pointed out repeatedly that it is imperative to take a multi-pronged approach to significantly ease the financing woes MSEs face, and set out clear goals for cutting their financing cost. “Lowering the MSEs’ financing cost is a prominent issue in our economy today,” Li said. “Our prudent monetary policy should be eased or tightened to the right degree to keep liquidity reasonably sufficient. We need to exercise well-timed regulation, rather than flood the economy with stimulus measures.”
It was decided at the meeting that the government must make flexible use of various monetary policy instruments. The scale of re-lending and rediscount will be expanded and more targeted cuts in the required reserve ratio for small and medium-sized banks will be made. A policy framework for applying a fairly low RRR for small and medium-sized banks will be established, as was urged at the meeting. Funds that are newly freed up from these measures will be used for lending to private companies and MSEs.
Bond financing support instruments will be promoted to see that the scale of both bond financing by private firms and special bonds issued by financial institutions for MSEs exceed the 2018 level.
Banks need to improve the evaluation and incentive mechanism to strengthen their confidence, readiness and capacity lending to MSEs, the meeting urged. The government will support banks in formulating inclusive finance plans dedicated to MSEs and guide banks toward proper pricing of lending.
CHINA’S economy remained stable in the first quarter, with the gross domestic production posting a faster-than-expected growth year on year, as industrial production jumped sharply and consumer demand showed signs of improvement.
The GDP rose from a year earlier to 21.34 trillion yuan (US$3.19 trillion) in the first three months, up 6.4 percent, which was unchanged from the fourth quarter of 2018 and higher than the expected 6.3 percent, according to the National Bureau of Statistics.
On a month-on-month basis, the GDP grew 1.4 percent in the first quarter as expected, retreating slightly from the 1.5 percent growth posted in the previous quarter — a new low since the first quarter of 2018.
The bureau said the market expectations have markedly improved and confidence in development had increased.
China’s economy operated within a reasonable range in the first quarter. The positive factors gradually increased, laying a good foundation for steady economic development throughout the year, said Mao Shengyong, spokesperson for the NBS.
However, the acute structural imbalance and downward pressure still exist, Mao said, adding that greater efforts should be made in further promoting reforms.
China has rolled out many policies to support growth — the key is to implement them, Mao said.
The value-added industrial output of designated large enterprises — with an annual turnover of at least 20 million yuan — grew 6.5 percent year on year in the first quarter, dipping 0.3 percentage points from the same period last year.
The figure was up 1.2 percentage points compared with the January-February figure, and was 0.8 percentage points faster than the fourth quarter last year.
Share markets and most currencies in Asia rose in relief. The yuan rose 0.4 percent to a 7-week high, Reuters reported yesterday.
For March, the value-added industrial output of major enterprises grew 8.5 percent year on year, 3.2 percentage points faster than the January-February period, and rose 1 percent from the previous month.
The March year-on-year pickup was mainly driven by the mining and manufacturing sectors, according to Nomura, where industrial output growth rose to 4.6 percent year on year and 9.0 percent, respectively, in March from 0.3 percent and 5.6 percent in the January-February period.
Industrial output growth in the utilities sector also rose last month, albeit less significantly, to 7.7 percent from 6.8 percent in the first two months.
By industry, output in the mining sector grew 2.2 percent year on year in the first quarter, that in the utility sector rose 7.1 percent and the manufacturing sector rose by 7.2 percent.
Of note, the industrial high-tech sectors jumped 7.8 percent in the first three months from the same period last year, 1.3 percentage points faster than the overall figure for the industrial production of major enterprises.
The emerging industrial sectors also rose at a 0.2-percentage-point faster pace than the headline industrial output figure, rising 6.7 percent from a year earlier.
The service sector expanded steadily by 7 percent year on year in January-March to 12.23 trillion yuan.
Among them, the leasing and business service sector increased by 8.3 percent year on year, the financial sector up 7 percent, the accommodation and catering sector grew 6 percent, and wholesale and retail sales advanced by 5.8 percent, all higher than the pace in the fourth quarter of last year.
The information transmission, software and information technology service industry extended its rapid growth, jumping 21.2 percent.
Fixed-asset investment grew by 6.3 percent year on year in the first quarter, an acceleration of 0.2 percentage points compared with January-February, but fell from the 7.5 percent year-on-year growth in the first quarter last year.
Retail sales growth ticked up to a stronger-than-expected 8.7 percent year on year in March from 8.2 percent in January-February. However, passenger car sales growth was deep in the negative category, dropping by 11.7 percent in March from a year earlier, against the 9.7 percent year-on-year decline in January-February.
Sales growth of property-related products rose broadly, mainly led by home-use electronics and furniture sales, growth of which jumped to 15.2 percent year on year and 12.8 percent, respectively, in March from 3.3 percent and 0.7 percent in January-February.
“The improved sales of property-related products was largely due to the ongoing recovery of the property sector in big cities, although we believe it is likely to be moderate and short-lived,” Nomura said in a note.
“We remain cautious on property markets of lower-tier cities, as downside pressures still loom, especially from tapering pledged supplementary lending, contracting land sales and rising bond repayment pressures amid mounting outstanding debt for developers. This does not bode well for consumption growth in upstream and downstream industries of the property sector in coming quarters,” said Lu Ting, chief China economist of Nomura.
“As the growth momentum of the Chinese economy picks up, we believe that policymakers will re-assess the need for further stimulus. The government will maintain a counter-cyclical stance, which will primarily be expressed through measures that support structural transformation,” according to the Australia and New Zealand Banking Group.
The ANZ Group expected a recovery in the second quarter to be largely domestically stimulated, with investment being the first sector to signal a rising trend. They also revise their GDP forecast to 6.4 percent for full-year 2019, from 6.3 percent previously.
The National Development and Reform Commission had approved 800 billion yuan of FAI projects in December 2018, equivalent to the amount of all projects approved in January-November 2018. Local governments have also started intensive issuance of special local government bonds amounting to 539 billion yuan in the first quarter of 2019.
“Despite the limited room for easing, Beijing might still need to continue its easing stance for a while. We expect Beijing to especially push forward its non-conventional policy easing measures, such as providing special support to the private sector, cutting taxes and deregulating the property markets in big cities,” Nomura’s Lu said.
Auto parts suppliers are optimistic about the Chinese car market, as well as new opportunities created by advances in e-mobility and autonomous driving, industry representatives said at the ongoing Shanghai International Automobile Industry Exhibition.German automotive and industrial supplier Schaeffler expects its China business to double in the next five to seven years and has been readying itself for a transformation in transportation and mobility services. Matthias Zink, CEO of Automotive OEM at Schaeffler, told reporters the company expects to prepare for the technology shift by offering bottom-up upgrades and solutions and addressing safety concerns in autonomous driving. Schaeffler China President Zhang Yilin said half its China business comes from local automakers and while the market saw a dip last year, it has not reached its peak. Strong trend to e-mobilitySchaeffler is presenting an extensive range of products for application in various types of powertrains at the exhibition.It also announced the start of production of axles for electric SUVs at its plant in Taicang, eastern Jiangsu Province. Germany’s leading mechatronics provider, Brose, is eying an investment of at least 300 million euros (US$339 million) in the next three years to expand production capacity and strengthen R&D. Kurt Sauernheimer, CEO of Brose Group, said last year China sales grew 5 percent against an overall drop in the market. “We expect China to represent 30 percent of our global business very soon and we will grow our customer portfolio in Asia, and especially China,” he said. The trend toward e-mobility will bring new opportunities for Brose’s mechatronics offerings, said Brose China President Jenny Xiang in an interview. Brose also noted increasing local demand for comfortable, functional and tailor-made interiors and it will continue to roll out localized product offerings for the domestic market.The China Association of Automobile Manufacturers estimates that new-energy vehicle sales in the country are set to reach 1.6 million units this year.NEV sales in China are soaring as the overall market falls, surging 85.4 percent year on year in March, compared with a 6.9 percent decrease in total sales.Faurecia, another leading automotive technology supplier, plans to double its sales in China over the next four to five years, thanks to growing demand for sustainable mobility and personalized on-board experiences.“China is one of Faurecia’s key and strategic markets, and represented about 15 percent of the group’s sales last year,” Li Jingcheng, vice president of strategy and development at Faurecia, told Shanghai Daily. “We expect this figure to exceed 20 percent within the next four to five years.”Meanwhile, parts giant Continental will invest heavily in new Chinese production sites in coming years, including a “sharp expansion” in powertrain production capacity in Tianjin and Changzhou. It expects “diversified demands” from the Chinese market, despite the recent slump.
US electronics giant Intel has said it was withdrawing from the 5G smartphone modem business, hours after Apple and American microchip manufacturer Qualcomm announced they had clinched an agreement to end a battle over royalty payments.Smartphone modems were at the center of the battle between Apple and Qualcomm.Intel said on Tuesday it will “complete an assessment of the opportunities for 4G and 5G modems in PCs, Internet of Things devices and other data-centric devices,” while pursuing investment opportunities in its 5G network infrastructure business.“5G continues to be a strategic priority across Intel, and our team has developed a valuable portfolio of wireless products and intellectual property,” CEO Bob Swan said in a statement. “We are assessing our options to realize the value we have created, including the opportunities in a wide variety of data-centric platforms and devices in a 5G world.”Intel will meet commitments to customers for its 4G smartphone modem products, though it has no plans to launch 5G smartphone modem products, including those previously set to premiere in 2020.
PRICES in China’s urban housing markets were mixed last month, official data released yesterday showed.
Prices of both new and pre-occupied homes in all-tiered cities in China rose at a mild pace from a month earlier, as policies to either cool speculation or promote the healthy development of the industry remained consistent, according to the National Bureau of Statistics, which monitors home prices in 70 major cities.
New home prices in the four first-tier cities climbed an average of 0.2 percent, easing from 0.3 percent growth in February. Prices gained 0.4 percent and 0.8 percent in Beijing and Guangzhou, and lost 0.1 percent and 0.3 percent, respectively, in Shanghai and Shenzhen.
In the existing housing market, prices in the four cities edged up 0.3 percent month on month, compared with a 0.1 percent increase in February. They were up 0.4 percent, 0.3 percent and 0.7 percent in Beijing, Shanghai and Shenzhen, and shed 0.5 percent in Guangzhou, the bureau said.
In 31 second-tier cities, new home prices rose an average of 0.6 percent last month, compared with 0.7 percent in February. Prices of existing homes jumped 1.2 percent, compared with a 0.2 percent slip in February.
New home prices in 35 third-tier cities advanced 0.7 percent on average last month, accelerating from 0.4 percent growth in February. In the pre-occupied housing market, prices gained by an average of 0.5 percent, compared with a 0.2 percent rise in February.
New home prices in Dandong, in northeastern Liaoning Province, registered the biggest month-on-month increase of 1.9 percent.
On a year-on-year basis, prices of new homes in all-tiered cities also increased in March. They climbed 4.2 percent, 12.2 percent and 11.4 percent, respectively, in first-, second- and third-tier cities. In the pre-occupied residential market, they climbed 0.5 percent, 8.2 percent and 8.4 percent from the same period a year ago.
THE Commercial Aircraft Corporation of China unveiled its first CBJ business jet at the opening of the Asian Business Aviation Conference & Exhibition at Hongqiao Airport yesterday.
The CBJ aircraft is one of the ARJ21 serial products and follows the same production as China’s first home-developed regional jet.
COMAC is taking part in the exhibition for the first time this year and displaying a model and drawings of the CBJ, which is expected to compete with foreign rivals.
The CBJ business jet features more cabin space than rivals in the same class. It can be configured with 12 to 29 seats, a separate VIP bedroom, lounge, meeting room, sitting room and dining section, depending on the demands of the customer.
The domestically made jet also has better soundproofing, cutting engine noise to 55 decibels — quieter than that on a busy street. With a range of 5,500 kilometers, it can adapt to a wide variety of flying conditions, from extreme temperatures to high altitudes and strong crosswinds.
COMAC said it will introduce the development of its business aviation sector and negotiate with potential clients during the exhibition.
The annual business aviation exhibition has been dominated by foreign manufacturers since it began in 2012.
This year, more than 30 of the world’s most advanced business aircraft from Airbus, Embraer, Dassault, Textron and Bombardier were showcased on the tarmac at Hongqiao as part of the exhibition which ends tomorrow.
The ARJ21 began commercial flights on June 28, 2016, with mass production starting from September 2017.
Currently, Chengdu Airlines operates 11 ARJ21s to 20 Chinese cities. The jet has also been delivered to its second operator, the newly established Genghis Khan Airlines based in Inner Mongolia.
The ARJ21 fleet has transported about 320,000 passengers since 2016, COMAC said yesterday.
More than 100 ARJ21s will be delivered in the next five years, as COMAC takes on the regional jets market leaders Bombardier and Embraer.
SHANGHAI’S existing housing index rose last month for the first time in over a year as sales rebounded.
The index, which tracks month-over-month price changes in 130 areas across the city, gained 0.52 percent, or 22 points, to 3,905 in March, the Shanghai Existing Housing Index Office said in its latest report.
Citywide, about 25,930 pre-occupied homes changed hands, an increase of 167.1 percent from February and 50.1 percent from the same period a year ago, the office's data showed.
Pre-owned homes costing less than 3 million yuan (US$447,020) accounted for 66.6 percent of the total. Those worth 5 million yuan or more made up 10.5 percent. Prices of pre-occupied homes climbed in 95 areas, fell in 16 and were flat in 19.
Pujiang in Minhang District, Sanlin and Shangnan in the Pudong New Area were the three most sought-after areas in March, with sales of 660, 634 and 567 pre-used homes.
Last week saw Chinese and EU leaders come together at a summit which saw discussions at the highest levels about how flows of goods, services and capital between the two economic superpowers could deliver mutual benefit.This included a joint declaration to avoid forced transfer of technology as well as a commitment toward “non-discriminatory” market access, both of which are now enshrined in China’s new Foreign Investment Law.These discussions touched on subjects against the backdrop of US-China trade talks, coupled with European governments’ increased scrutiny of investments into strategically sensitive sectors.China’s recent passing of the new Foreign Investment Law, aimed at liberalizing capital flows into the country, signals a watershed moment not only for the Chinese economy, but also for Europe and the rest of the world. The new law is expected to bring in an additional US$1.5 trillion of inbound mergers and acquisitions (M&A) over the next decade.China’s move up the value chain has been supported by a program of outbound investment into foreign assets. That strategy, dented somewhat by increasing concerns in the US and Europe surrounding investments into sensitive sectors such as technology and infrastructure, is now being supported by the liberalization of inbound investment into the country. This creates an alternative route toward an even more sophisticated industrial base, and one over which the Chinese government has more control.In parallel to this emerging middle class is a significant demographic shift. The number of Chinese people over the age of 60 is projected to grow to nearly a quarter of the population in the next 10 years. That will drive significant demand in less-developed sectors such as health care, pensions and life insurance. And despite the aging population, more than 200 million Chinese people are expected to start families in the same period, driving huge growth in the real estate, automotive and education sectors.Alongside these shifting demographics is the launch of initiatives reflecting the country’s desire to move up the value chain and transition toward being a high-end manufacturer. China is already the world’s largest investor in industrial R&D, as well as the most prolific writer of scientific papers.The automotive industry provides an illustration of the complexity of inbound M&A in China. The sector has evolved to incorporate a complex ecosystem of businesses working in subsectors such as electric and autonomous vehicles across a much wider range of size, maturity and structure typical in other developed economies. The potential investment routes are correspondingly wide, including everything from full acquisition, partial investment, joint venture, consortia, incubation, commercial contracts, raising money on capital markets. Finding the right advice and insight to navigate these options will not be easy for outsiders and crucial to any deal’s success will be bringing the right partners together with the right structure.In relation to differing norms of disclosure, the quality of information provided to acquirers and investors along with the timing of a deal process can vary widely in markets like China cautiously opening up to foreign investors. They will have to work harder and more diligently to ensure that information is presented in an organized, accurate and transparent way, drawing on every ounce of their international deal experience.Macro-factors such as the US-China trade talks will likely have an impact on the ability of inbound investment deals into China, particularly given the new Foreign Investment Law’s language on allowing China to take measures against countries that discriminate against Chinese investment. To succeed, dealmakers will need to be smarter and pay much more attention to restrictions being placed on other foreign investment deals than before. To supplement this, they should also become adept at convening networks of senior local businesspeople, policymakers and other stakeholders to ensure continuous dialogue and understanding about the mutual benefits of investment into China.Last week’s summit, along with China’s new Foreign Investment Law, presented an extraordinary opportunity for dealmakers, but making this a reality will take time, trust and a good deal of hard work. However, the result is the unlocking of increased prosperity between China and Europe and is a goal worth pursuing.
Asia’s Internet firms are challenging the region’s traditional banks for consumer finances, tapping their massive user networks for business and following a trail blazed in China by tech giants Alibaba and Tencent.The push into banking by companies better known for their messaging apps, cute emojis and online holiday bookings comes as regulators across Asia open up their banking sectors to a new breed of digital players.The shift is in its infancy but contrasts sharply with the banking markets of Europe and North America, where change is slower and such startups tend to be backed by venture capital funds and financial sector incumbents, not tech firms.Asia’s tech entrants see their advantage in the way they can seamlessly integrate banking services with their users’ regular online activities and the efficiency that comes from their technology.“If you want to open a bank account (in Hong Kong) you need to go to a branch, answer questions for an hour, and you still won’t get the account opened without followup calls,” said Wayne Xu, president of ZhongAn International, a unit of Chinese online insurer ZhongAn, setting up a virtual bank. “However, all the information needed at the counter can already be collected on a mobile phone.”Hong Kong’s banking regulator last month issued one of four so-called “virtual banking licenses” to ZhongAn in what could be the biggest shake-up in years in a city dominated by HSBC and Standard Chartered. Last week, the regulator said on it was making progress on four additional applications.In South Korea, authorities have issued two online only bank licenses, one of them to Kakao Bank in 2017, which is operated by the company behind the country’s largest chat app.“The 45 million monthly average users of our messaging app Kakao Talk is a huge plus for us when advertising our bank,” a spokesman for Kakao Bank said. He added the bank uses Kakao’s artificial intelligence technology for its automated customer support systems. The bank had 8.9 million users as of March.Other Asian markets set to approve online-only banks include Taiwan — where a group led by a unit of Japanese messaging app operator Line Corp has applied for a license — and Malaysia, which plans guidelines by the end of the year. Bank of Thailand Governor Veerathai Santiprabhob said the central bank was exploring the issue.“Large technology companies are seeing this as a land-grab opportunity where they can build out new sets of financial services that can be cross-sold to their existing users,” said Jeff Galvin, a Hong Kong-based partner at McKinsey.Digital AsiaDriving the shift in Asia is mobile technology’s deep penetration across all aspects of consumer life.Such trends were forged by Alibaba and Tencent in China where the two upended financial services and drove a revolution in the cashless economy with their digital payment applications.In contrast, US tech giants such as Amazon and Alphabet Inc’s Google have focused their financial industry efforts on providing tech and consulting services to incumbents.Asian consumers are far more willing to bank with tech firms than elsewhere in the world.More than 90 percent of consumers under 35 in China and India would bank with a technology firm, according to Bain research, compared to 75 percent in the United States and just 51 percent in France.The online-only banks in Hong Kong plan to start-off by offering services such as savings accounts, credit cards, personal loans and travel insurance.“What we are seeing in Asia is technology companies moving sideways into finance, inspired by or even threatened by the examples of Alibaba and Tencent,” said James Lloyd, partner and APAC fintech leader at consultancy EY.In Asia, the emergence of tech gains in the banking sector comes at a difficult time for the region’s incumbents who have begun reassessing the vast branch networks that, until recently, were seen as their competitive advantage.The number of bank branches in Hong Kong, Japan, Malaysia, South Korea and Thailand has declined in the last couple of years, dropping by between 1 percent and 7 percent in 2017 from 2015, according to the International Monetary Fund. That compares with growth of as much as 8 percent a decade ago.To be sure, legacy banks in Asia have their own plans to stay relevant in the changing space with some tying up with new rivals.Among the new Hong Kong digital banking licensees is a joint venture between StanChart, Chinese holiday booking giant Ctrip and local telco PCCW.“We think that the ecosystem we can build together will be a great integration of lifestyle into banking,” Mary Huen chief executive of StanChart Hong Kong, and chairman of the new virtual bank, said at a press conference.
China’s fiscal revenue rose 6.2 percent year on year to over 5.36 trillion yuan (US$800 billion) in the first quarter, new data showed yesterday.The central government collected about 2.53 trillion yuan in fiscal revenue during the period, up 5.4 percent year on year, while local governments saw fiscal revenue rise 6.8 percent to around 2.83 trillion yuan, according to statistics from the Ministry of Finance.Tax revenue climbed 5.4 percent to 4.67 trillion yuan, but growth continued to slow, dropping 11.9 percentage points year on year. The slide was attributed to newly revised tax exemption and deduction policies.Revenue from individual income tax plunged 29.7 percent year on year to 323.9 billion yuan.Revenue from stock trading stamp duty dipped 4.2 percent over the same period last year to 39.7 billion yuan, while that from tariffs dropped 4.8 percent.China’s fiscal spending expanded 15 percent year on year to more than 5.86 trillion yuan in Q1, the ministry said.Social security, employment and education took the lion’s share of fiscal spending, while expenditure on transport, energy conservation and environmental protection maintained a fast-growing pace.China will implement an employment-first policy this year, aiming to create more than 11 million new urban jobs, according to the government work report delivered to the annual session of China’s top legislature on March 5.The country will maintain a proactive fiscal policy stance in 2019, with a higher deficit-to-GDP ratio to leave policy space to address potential risks.From April 1, China started to slash value-added taxes in multiple industries, including manufacturing, transportation and construction, which will affect revenue growth.But the reforms will ease the burden on business, stimulate market vitality and strengthen the stability of the macro-economic growth, said the MOF, adding China will meet its annual revenue growth target.In 2018, taxes and fees levied on enterprises and individuals were reduced by around 1.3 trillion yuan as a result of multiple tax-reduction policies.
Swedish telecom giant Ericsson said yesterday that China’s market regulator was investigating the company over licensing issues as countries and regions around the world prepare to roll out the next generation of mobile networks.China’s State Administration of Market Regulation is investigating the firm due to complaints against its intellectual property rights licensing in China, a spokesperson for Ericsson said.The telecom gear maker earns about 7 percent of its revenue in China, according to its 2018 annual report.Twenty investigators dispatched by China’s market regulator visited Ericsson’s Beijing office on Friday, the Wall Street Journal reported earlier.“Ericsson is fully cooperating with the investigation,” a spokesperson for the company said, without making further comments.Ericsson and its US-based competitor Qualcomm own a large portion of patents connected to 3G and 4G mobile networks and devices and have come under fire for their high licensing royalties.Qualcomm in 2015 agreed to pay a 6.1-billion-yuan (US$$1-billion) fine and said it would modify its business practices in China to end an official anti-trust investigation triggered after it was accused by unnamed industry players of abusing its market dominance to charge high prices.“At Ericsson, we license our industry-leading patent portfolio on FRAND (Fair, Reasonable and Non-Discriminatory) terms and conditions and have always been committed to these FRAND principles,” a spokesperson said.
China’s centrally administered state-owned enterprises reported steady profit growth in the first quarter of 2019, official data showed yesterday.The combined profits of central SOEs saw a year-on-year increase of 13.1 percent to 426.5 billion yuan (US$63.6 billion), according to the State-owned Assets Supervision and Administration Commission.In March alone, profits of central SOEs were 188.28 billion yuan, up 10.8 percent from a year earlier. Sectors such as mining and construction outperformed the others.Fixed-asset investments at petroleum and petrochemical companies surged 39.3 percent in the quarter, said SASAC spokesman Peng Huagang, adding that investments in the steel and coal sectors fell.Central SOEs reported combined Q1 revenue of 6.8 trillion yuan, up 6.3 percent from a year earlier.They made 384.02 billion yuan of fixed-asset investment in Q1, up 9.7 percent from a year earlier.The debt-to-asset ratio continued to fall as regulators took measures to contain debt in the sector. At end-March, the average ratio stood at 65.7 percent, down 0.2 percentage points,.Their average ratio of interest-bearing liability to assets stood at 40.2 percent, a fall of 0.3 percentage points from a year earlier.As central authorities have made curbing financial risks an economic priority, SASAC has put the capital structure, financing leverage, investment and risk of central SOEs under greater scrutiny in recent years.The country has set a timetable for SOEs deleveraging as part of its efforts to defuse financial risks.
China’s A-share markets bounced back from early losses yesterday, lifted by strong performances from communications companies and financial institutions.The Shanghai Composite Index jumped 2.39 percent or 75.81 points to close at 3,253.60. The smaller Shenzhen Component Index added 2.33 percent to end at 10,287.64 points. The two bourses opened lower, but recovered thanks to a rally in banking and brokerage-house stocks.The ChiNext Index gained 1.84 percent to finish at 1,697.53 points.Combined turnover came to 791.0 billion yuan (US$117.7 billion), up from 775.7 billion yuan the previous trading day.5G-related companies led the day’s gains, with ZTE Corporation, a Shenzhen-based leader in telecommunications and information technology, surging by the daily maximum 10 percent to end at 33.55 yuan.Yang Hai, a senior strategist at Kaiyuan Securities, was quoted by Caixin.com as saying that countries and regions throughout the world are competing fiercely in 5G, fueling big gains in the sector.The recovery in stocks also came amid signs of resilience in the property market. Home prices in 70 major cities edged higher in March, according to the latest data from the National Bureau of Statistics.
Artificial intelligence and 5G mobile technologies — set to transform the global car market and change our daily lives — were showcased at the Shanghai auto show yesterday.Features at this year’s show, the industry’s biggest marketing event in China of the year, range from AI driver assistance to driverless trucks and buses.In addition to bringing together leading local and international automakers, the show also attracted other big names such as Huawei, China Mobile, Bosch, ZF and local startup Westwell.The media had a sneak preview of the Shanghai International Automobile Industry Exhibition offerings before it opens to professional visitors tomorrow and the public on Saturday.Huawei, attending for the first time, displayed its intelligent driving computing platform with self-developed AI chips and 5G-related infrastructure. It supports a “smooth upgrade” from L2 (vehicles with smart features) to L5 (fully self-driving).Bosch, the world’s leading auto parts vendor, showed off a concept self-driving bus which it says will “shape the future of electrified, connected, automated and personalized mobility.”Bosch’s advanced driver assistance systems saw business in China grow 30 percent in 2018 year on year and the company is looking for Chinese partners to help shape a new ecosystem for its mobility services.Shanghai-based AI startup Westwell displayed its self-driving new-energy truck, which uses AI technologies in visual recognition, environment-detection and extreme precision positioning.The truck, with an AI-featured chip developed by Westwell, is expected to be used in ports and mining operations, including in Belt and Road countries and regions, from later this year. It can be fully charged within two hours. Its Q-Truck is a totally “new AI device” to meet special demands in various areas, said Westwell CEO Tan Limin.German car parts maker ZF made the world debut of its AI driver assistance system, coPILOT.“We’re pursuing strategies that resonate with China’s goal of clean, safe and affordable transportation solutions and we’ll continue to help improve the safety and experience of the daily commute,” said CEO Wolf-Henning Scheider. “China is at the forefront of adopting innovation on a fast and broad scale and we’re confident of seeing a prosperous automotive and mobility market here for many years to come.”Based on its AI platform for semi-autonomous driving and chipmaker NVIDIA’s auto solutions, coPILOT will be ready for volume production from 2021.Scheider expects the Asia Pacific region to contribute 30 percent of global sales in the future through localizing its production and R&D capacity.Last year China accounted for about 17 percent of ZF’s global revenue. Expansion projects for four plants for chassis and transmission components are expected to be completed within 18 months.
Luxury carmakers were upbeat about the Chinese market and were also embracing new industry trends as they showcased their latest technologies and car models at the Shanghai International Automobile Industry Exhibition.The fair opens to professional visitors tomorrow and the public on Saturday.“We expect continued growth with a new product pipeline and the expansion of our dealer network and showrooms which will further improve our share in this key region,” said Aston Martin Executive Vice President and Chief Creative Officer Marek Reichman.Last year, the UK luxury vehicle maker’s sales in China grew 31 percent, compared with a sharp slowdown of growth in the overall auto sales.Its first all-electric production car model, the Lagonda Rapide E, made its worldwide debut yesterday at the Shanghai auto show.“The two biggest growth factors in our industry in the coming decade will be SUVs and electrification,” Reichman said. The limited model is expected go into production in 2022 in Wales. Chief Executive Officer of Rolls-Royce Torsten Muller-Otvos expected China to become the company’s biggest market in the “not too distant” future. China is already the BMW subsidiary’s second-largest market. “China plays a significant role in our global success and is also our youngest market, and it’s set on continuous growth pace,” he said. Catering to consumersLincoln, the luxury automotive brand of Ford Motor Company, will accelerate the introduction of its products according to the needs of Chinese customers and incorporate more Chinese elements into its products. Between 2019 and 2021, Lincoln plans to launch seven new models in China while introducing at least two limited edition models each year, according to Mao Jingbo, president of Lincoln China.“Lincoln aims to fully develop its ‘China’s first, customer first’ strategy and complete the upgrading of its products, customer experience and brand in 2019,” Mao said at the China debut of Lincoln Aviator, the first Lincoln to offer a plug-in hybrid option. “Fully considering the needs of Chinese customers, Lincoln will achieve ‘China speed’ in the highly competitive luxury car segment to brace for a breakthrough,” Mao said.Automobili Lamborghini Chairman and CEO Stefano Domenicali said it is a “delight” to see Lamborghini gain popularity worldwide, especially in China. In 2018, Lamborghini’s global sales increased 51 percent from 3,815 to 5,750 units.
It took one 330-kilometer trip from Chongqing to Chengdu in his Nio ES8, a seven-seater all-electric SUV, for its owner Wang Haichun to be consumed with buyer’s remorse.Despite being billed as capable of going 335 kilometers on a single full charge, the ES8 didn’t get anywhere near that when driving on freeways at speeds above 100 kilometers an hour, he said, adding that after 180 kilometers, there was only 50 kilometers of range left.“We had to recharge the car once and drove with a high level of anxiety throughout, constantly having to keep an eye on the range meter,” the 44-year-old manager of a property firm said. Toward the end of the trip, he shut off the air conditioner and audio system.Nio Inc said in a statement the ES8 can travel more than 200 kilometers when constantly driven at 100 kilometers an hour and that battery swap stations are available for quick recharging. It did not address Nio’s advertising of 335 kilometers on a single full charge.In real world conditions, all-electric cars can sometimes fall far short of advertised ranges, car engineers say. That’s particularly so when driving at length on freeways or hilly terrain and in hot or cold weather.The problem adds to drawbacks which have hindered wider acceptance — EVs have shorter driving ranges than gasoline vehicles, are more expensive and take a long time to recharge.China, Europe and California have set ambitious requirements for automakers to dramatically increase EV sales over the next five to 10 years, but those goals are at risk unless EVs can come close to matching gasoline engine cars in cost and ease of use.In China, some of the industry’s biggest names believe pure battery electric cars will be as cheap as gasoline counterparts by 2025. Those making that prediction include Ouyang Minggao, executive vice president of the EV100 forum.“The turning point is coming. We believe that around 2025, the price of pure electric vehicles will achieve a big breakthrough,” he said.Ouyang cited a reduction in battery costs to US$100 per kilowatt hours from US$150-US$200 and a tightening of emissions rules in China. But others in the EV industry are less optimistic.“Sure, there’s an EV boom but hybrids and plug-in hybrids will be needed as bridging technologies,” said a veteran EV engineer at Honda Motor Co.
China’s leading heavy equipment manufacturers expect to report significant profit growth in the first quarter of 2019, mirroring the country’s improving economic fundamentals.Profit of Sany Heavy Industry Co Ltd is expected to surge by 100 to 120 percent, the company said yesterday.XCMG Construction Machinery Co Ltd forecast its Q1 profit at between 950 million yuan (US$141.6 million) and 1.15 billion yuan, up by 83-121 percent, while Zoomlion Heavy Industry Science and Technology Co Ltd forecast a profit surge of 126 to 179 percent.Companies attributed the robust Q1 performance to the upturn of the construction machinery industry.XCMG expects steady expansion of revenue in Q1 from the same period last year thanks to strong market demand.Sany also said factors including the rising demand from infrastructure construction and equipment replacement contributed to the rapid growth of the construction machinery industry in Q1.Sales for China’s major excavator producers, an indicator of the vitality of an economy, also posted notable growth in Q1.The country’s 25 leading excavator makers sold 74,779 units in the first three months, climbing 24.5 percent from the previous year, data from the China Construction Machinery Association showed.Founder Securities forecast that leading construction machinery enterprises would maintain rapid growth of net profit in 2019 due to continuous demand growth of equipment replacement and export.The growth of China’s construction machinery industry was in line with the upward trend of the country’s infrastructure investment, which grew 4.3 percent year on year in January-February, up 0.5 percentage points from 2018.The country planned to boost infrastructure investment for areas including intercity transportation, logistics and civil and general aviation, investing 800 billion yuan in railway construction and 1.8 trillion yuan in road construction and waterway projects, according to the 2019 government work report.Recent data also showed more signs of an improving economic outlook for the world’s second-largest economy. China’s purchasing managers’ index for the manufacturing sector saw its first acceleration in months in March, indicating expansion of factory activity.Consumer prices rebounded solidly in March, while producer prices picked up for the first time in nine months, easing market fears over deflation.
New home sales remained subdued in Shanghai last week amid a comparative slowdown in supply, the latest weekly survey shows.Excluding government-subsidized affordable housing, sales remained unchanged at about 168,000 square meters during the seven days to Sunday, Centaline Property Consultants Co’s weekly report showed yesterday.“Robust performances registered in outer areas such as the former Nanhui District and western Qingpu District enabled weekly sales to stay above the 150,000-square-meter threshold,” said Lu Wenxi, Centaline’s senior research manager. “The average price, as a result, was dragged down a bit as medium to low-end projects dominated the top 10 list.”The former Nanhui District, part of the Pudong New Area now, recorded sales of 31,000 square meters, a week-on-week surge of 158.3 percent. Qingpu recorded sales of 24,000 square meters, up 26.3 percent, followed by Pudong — excluding Nanhui — which dropped 25 percent to about 18,000 square meters.Citywide, new homes sold for an average 51,642 yuan (US$7,695) per square meter, a week-on-week decrease of 8.7 percent.In the top 10 by transaction area, six projects sold for less than 40,000 yuan per square meter. The remaining four sold for more than 50,000 yuan.A project in Nanhui was the most sought-after development, selling 18,060 square meters, or 205 units, for an average 27,534 yuan per square meter, followed by a project in Fengxian District, which unloaded 9,353 square meters, or 83 apartments, for an average 35,665 yuan per square meter.A total of 114,000 square meters over three projects were released into the market last week, a week-on-week increase of 5.1 percent — but below the weekly average so far this year.Around the country, major property developers saw sales pick up in March as the market in first- and second-tier cities warmed up. A survey by researcher Cric China showed March was markedly better than the previous two months.
Shanghai’s Grade-A office market recorded mixed results in the first quarter, amid rising competition brought by abundant supply, industry data released by international real estate consultancies show.“Leasing demand in the traditional CBDs moderated in the first three months while that in emerging business districts remained strong,” said Anny Zhang, head of markets for JLL China. “Emerging CBDs such as Qiantan and Xuhui Bund have attracted strong interest particularly from health care, TMT (technology, media and telecom) and manufacturing companies seeking cost savings and expansion opportunities.”Grade-A office rents in Pudong CBD fell 1.4 percent quarter on quarter and those in Puxi CBD declined 0.5 percent.A separate report by Savills also found that vacancy rates at Grade-A buildings in core and decentralized areas of Shanghai both headed south during the quarter amid mounting pressure from new supply.Vacancy rates increased 0.1 percentage points to 12.5 percent in core markets while those in decentralized areas added 1.9 percentage points quarter on quarter to 33.9 percent.
New Zealand dairy company Fonterra Co-operative Group is launching a new product in China this month — Anchor fresh milk from its farm in Tangshan in Hebei Province, one of its three farms in China. Anchor fresh milk will be available through major supermarkets and online channels such as an official storefront on Tmall and on-demand delivery platform Daily Fresh.“We’ve seen positive feedback since we started to offer small batches of pasteurized fresh milk to Alibaba’s Freshippo supermarket a year ago,” Chester Cao, vice president of consumer brands for Fonterra China, told Shanghai Daily.Cao said the company’s previous experience in Anchor-branded consumer goods helped it better understand market trends and tap into consumer demand for better nutrition and taste when choosing fresh milk. “Sales of Fonterra’s products, including butter, cheese and powdered milk, have seen more than 50 percent growth each year in the past five years in China,” he said. Anchor pasteurized milk — at 23.90 yuan (US$3.50) for a 900-milliliter package — is roughly on par with its largest local competitor, Bright Dairy’s mid-end brand “Zhi You.”Market researcher Euromonitor expects China to become the world’s largest dairy market by 2022 and sales of dairy products are expected to grow 5.3 percent annually over the next three years.The New Zealand dairy company said last year it aims to triple sales of its Anchor-branded products in China in three years. Fonterra also plans to double its exhibition space at the second China International Import Expo later this year.
The Shanghai International Automobile Industry Exhibition begins on Thursday for professional visitors, with the debut of many new technologies and car models.This year’s event is set to include more than 1,000 exhibitors, including many of the world’s largest car manufacturers, many of whom will be showcasing their latest models as well as innovations in new-energy vehicles and autonomous driving.Major exhibitors include BMW, Nissan, Volkswagen and Audi, as well as domestic automakers such as SAIC Group, FAW, Dongfeng Motor, Changan Automobile, BAIC Motor and GAC Group. Over 140 new vehicle models will premiere at the weeklong event, including four never-before-seen vehicles from BMW.There will also be concept and luxury vehicles from Bentley, Lamborghini and Rolls-Royce.Leading parts firms such as Bosch, Continental and Schaeffler will also display their latest products. Huawei and iFlytek will join the show for the first time this year too, with the former displaying its latest breakthroughs in 5G technology.The theme of this year’s show is “Create a Better Life,” focusing on how cars can improve quality of life. The show will be at the National Exhibition and Convention Center in Qingpu District and cover 360,000 square meters.Despite slowing sales and uncertain macro-economic conditions, China remains one of the world’s most important and dynamic auto markets.It holds great potential for Rolls-Royce, with some owners under the age of 40, Torsten Muller-Otvos, Rolls-Royce’s CEO, told Shanghai Daily yesterday.Rolls-Royce also opened a boutique store in downtown Shanghai last month, the first of its kind in China.Xu Heyi, chairman of BAIC Group, said the boundaries of the auto industry have broadened to merge with sectors such as communication, art and entertainment. This trend has created space for further industry growth.Domestic and international automakers have also seen strengthened design cooperation, making many new models like BAIC’s Arcfox competitive in the global market, Xu said. Last month, Chinese passenger car sales totaled 2.02 million units, down 6.9 percent from a year earlier, but moderating from the 13.7 percent decrease recorded in the first quarter as a whole, according to the China Association of Automobile Manufacturers.Sales fell for the first time in more than two decades last year.CAAM forecast this year that total sales will remain flat at around 28 million.New-energy vehicles, sport-utility vehicles and autonomous driving are expected to be highlights of the show.The technologies behind them will shape the future of the industry and reflect the effort by carmakers to meet changing consumer tastes, analysts say.Carmakers will display a range of NEVs as well as plans for future clean-emission production. Despite the slack performance in the overall market, NEVs remain the bright spot.The electric vehicle market will continue to boom in the second quarter of 2019, despite subsidy cuts, Fitch Ratings said recently. In March, NEV car sales jumped 85.4 percent year on year. In the first quarter, they grew 109.7 percent, according to CAAM.Sport-utility vehicles also remain popular. Autonomous driving and driverless cars, despite growing pains in some overseas markets, are tipped as another highlight of the show.Thursday and Friday are professional days. From Saturday to next Thursday, the event will be open to the public.Nine halls will feature passenger vehicles (1H, 2H, 4.1H, 5.1H, 6.1H, 7.1H, 7.2H, 8.1H, 8.2H); one hall is for commercial vehicles and future mobility (3H); two halls are for parts manufacturers (5.2H, 6.2H). The admission for the public is 50 yuan (US$7.45) on weekdays and 100 yuan on weekends.
China’s A-share markets reversed their gains yesterday, with the three major indexes all retreating into negative territory, despite data showing strong credit growth for March.The Shanghai Composite Index fell 0.34 percent, or 10.84 points, to finish at 3,177.79, after gaining more than 2 percent during morning trading.Sentiment was largely lifted by the better-than-expected credit data released by the central bank on Friday.The Shenzhen Component Index slumped 0.78 percent to end at 10,053.76 points, while the ChiNext Index was down 1.70 percent at 1,666.90 points. The combined turnover of Shanghai and Shenzhen was 775.7 billion yuan (US$115 billion), up from 657.1 billion yuan on Friday.In March, China’s newly added social financing, a broad measure of credit and liquidity in the economy, increased to 2.86 trillion yuan, up 1.28 trillion yuan year on year. The main surprises were a significant pickup in new bank loans and a revival of shadow credit, said Wang Tao, chief economist at UBS Securities.Carmakers led the losses. State-owned Jiangling Motors shed 9.98 percent to 27.95 yuan. Agricultural and communication companies were also big losers.Zhu Bin, a senior strategist at Southwest Securities, forecast the world’s second-largest economy will see a higher economic growth in the first half before slowing in the second, Caixin.com reported. The credit data confirmed a strong real economy, he said. The government introduced a new round of credit-easing in October.
Prosecutors in the German city of Braunschweig said yesterday they were pressing criminal charges against former Volkswagen Chief Executive Martin Winterkorn in connection with the carmaker’s manipulation of diesel emissions testing.Four other executives are being charged, the prosecutor’s office said in a statement, without giving their names.VW was caught using illegal engine control software to cheat US pollution tests in 2015, triggering a global backlash against diesel that has so far cost it 29 billion euros (US$32.8 billion).Prosecutors said Winterkorn was accused of a particularly serious case of fraud, breach of trust and breaching competition laws because he had not acted — despite having a special responsibility to do so as the company’s CEO — after it became clear on May 25, 2014 that diesel engines had been manipulated.He neglected to inform authorities in Europe and the US as well as customers of the illegal software and he also did not prevent the continued installation of such software, the prosecutors said.They added that this had resulted in Volkswagen being slapped with much higher fines in Germany and the United States than would have been the case had he acted. VW said it would not comment because the company was not a party to the proceedings.About a year ago, the US filed criminal charges against Winterkorn, accusing him of conspiring to cover up the cheating. Winterkorn remains in Germany, which does not typically extradite its citizens for prosecution in US courts.
Toyota Motor Corp has agreed to sell electric car technology to Singulato, its first deal with a Chinese electric vehicle startup, allowing the fledgling firm to speed up development of a planned mini EV.In return, Toyota will have preferential rights to purchase green-car credits that Singulato will generate under China’s new quota system for all-electric and plug-in hybrid vehicles.It will also gain a bird’s-eye view into how Chinese EV startups operate and the strategies they pursue in a fast-changing marketplace, said Singulato Chief Executive Shen Haiyin and two sources at the Japanese automaker.Singulato will acquire a license to use the design of Toyota’s eQ — a battery electric microcar. The deal is due to be announced today at the Shanghai auto show, where Singulato will unveil a concept car based on the eQ. Singulato plans to redesign the car, tailoring it to local tastes to come up with a model by early 2021.(Reuters)
SHANGHAI’S two airports handled fewer business jets in 2018 as the industry entered a “steady development stage,” a senior official with Shanghai Airport Authority said yesterday.
A total of 6,366 business jets took off and landed at the Hongqiao and Pudong airports last year, a 4.5 percent decline on the year, Lu Xun said ahead of the 2019 Asian Business Aviation Conference & Exhibition that opens today.
“Though the industry has entered a steady development stage, it still has great potential,” Lu told a press conference ahead of the exhibition yesterday.
“The industrial focus has shifted to quality and the prosperity of the whole industrial chain, from merely the increase of quantity,” he said.
Over 30 of the world’s most advanced business jets and helicopters will be on display at Shanghai Hongqiao International Airport as part of the annual exhibition which runs until Thursday.
Some of the top business aircraft makers and operators, including Airbus, Embraer and Bombardier, are displaying their latest products.
China’s business aviation industry started around 2010 and has gone through the rapid expanding and increasing periods, Lu said.
Business aviation facilities at the two airports were now fully sufficient to meet demand. The Hongqiao business aviation center, for example, is designed to handle 6,000 business jets annually but served a total of 3,850 last year, according to the airport authority.
China has some 230 operating general aviation airports with over 3,000 general aviation aircraft, which include business and private jets as well as those used for agriculture, construction, medical services, disaster relief and other fields. The number has tripled that of 2010, Lu said.
The Chinese mainland is operating the largest business jet fleet in the Asia-Pacific region of 338 jets in 2018, followed by Australia and India, according to Asia Sky Group, which releases business jets reports annually.
However, both the mainland and Hong Kong saw a slowdown in their fleet growth last year, Jeffery Lowe, managing director of the group, said yesterday.
The exhibition, which has been held for eight years, offers potential buyers the chance to experience the jets and a platform for industry leaders to discuss the emerging Chinese business jet market.
As one of the first deals made at the exhibition this year, Bombardier announced that Hong Kong aircraft management company HK Bellawings Jet Ltd firmed up an order for four Global 7500 business jets, the newest jet from the Canadian maker that will be making its debut at the exhibition.
One of the most eye-catching aircraft at the exhibition, it has a range of 7,700 nautical miles (14,000 kilometers) which could allow it to connect the cities of Beijing, Shanghai and Hong Kong to New York, London or Milan non-stop. The jet has a kitchen and a master suite with a permanent bed and shower.
Thousands of participants are expected to take part in the Shanghai exhibition this year, making it the largest business aviation show in Asia, according to Ed Bolen, president and chief executive of the US National Business Aviation Association, which organizes the annual event with Shanghai Airport Authority.
THE Shanghai Auto Show this year highlights the global industry’s race to make electric cars that Chinese drivers want to buy as Beijing winds down subsidies that promoted sales.
The Chinese government is imposing mandatory sales targets for electric cars.
Chinese purchases of pure-electric and hybrid sedans and SUVs soared 60 percent last year to 1.3 million — half the global total — but overall auto sales shrank 4.1 percent to 23.7 million.
Buyers of electrics were lured with subsidies of up to 50,000 yuan (US$7,400) per car, but that support was cut by half in January and ends next year.
“Competition is getting more fierce,” said industry analyst Paul Gong of UBS.
Authorities have been promoting electrics for 15 years in hopes of cleaning Chinese cities and gaining an early lead in a promising industry.
General Motors, Volkswagen, Nissan and other global majors are developing models to suit Chinese tastes. They have money and technology, but local rivals have experience: Brands including BYD Auto and BAIC Group have been selling low-priced electrics for a decade.
At the Shanghai show, which opens to the public on Saturday, automakers plan to display dozens of electrics, from luxury SUVs to micro-compacts priced under US$10,000. They aim to compete with gasoline-powered models on performance, cost and looks.
By the end of next year, “it will be very difficult for a customer to decide against an electric car,” said the CEO of Volkswagen AG, Herbert Diess.
“The cars will offer roominess, space, fast charging,” Diess said during a January visit to Beijing. “They will look exciting.”
Automakers are looking to China, their biggest global market, to drive revenue growth at a time when US and European demand is flat or declining. That gives them an incentive to cooperate with China’s campaign to promote electrics.
This week, General Motors is unveiling the first all-electric model in Buick’s China-only Velite range, which includes a hybrid based on the Chevrolet Volt. VW will display a concept SUV as part of plans to launch 50 electric models by 2025.
Nissan Motor and its Chinese partner will display the Sylphy Zero Emission, an all-electric model designed for China that went on sale in August. BYD Auto will display an all-electric sedan with an advertised range of 400 kilometers on one charge.
Pressure to shift to electrics is “more an opportunity than a threat” to Chinese automakers, said UBS’s Gong.
Low-priced Chinese brands
Latecomers to gasoline-powered vehicles, Chinese brands account for just 10 percent of global sales, mostly in low-price tiers, Gong said. But they account for 50 percent of electric sales worldwide.
“In the EV world, Chinese companies started earlier and reacted faster,” said Gong.
The government has spent billions of dollars on research and incentives to buyers.
Power companies have blanketed China with 730,000 charging stations, a vastly larger network than any other country.
Meanwhile, automakers are struggling to revive sales of traditional SUVs, minivans and sedans that fell last year for the first time in three decades.
A tariff dispute with Washington and weakening economic growth made consumers reluctant to commit to big purchases. That skid worsened this year. First-quarter sales shrank 13.7 percent from a year earlier.
Despite that, people in the industry say Chinese sales could top 30 million vehicles a year by 2025. Ford relaunched its China operation this year after 2018 sales plunged 37 percent. The company blamed an aging product lineup.
Global brands are linking up with Chinese partners with experience at low-cost production.
Ford has an electric venture with Zotye Auto. GM and its Chinese partners plan 10 electric models by next year. Mercedes Benz launched the Denza brand with BYD. VW’s electric joint venture, SOL, started selling an SUV last year.
Under the new system, automakers must earn credits for sales of electrics equal to at least 10 percent of purchases this year and 12 percent in 2020. Automakers that fall short can buy credits from competitors that exceed their targets. Regulators say targets will rise later.
An electric’s sticker price in China still is higher than a gasoline model. But charging and maintenance cost less. Industry analysts say owners who drive at least 16,000 kilometers a year save money in the long run.
China’s biggest SUV brand, Great Wall Motors, has responded to the sale quotas by launching an electric brand, Ola. Its R1 compact, while looks like a toy beside Great Wall’s hulking SUVs, went on sale in December priced as low as 59,800 yuan after the subsidy.
In a move to spur competition, China lifted ownership restrictions on electric automakers last year.
Tesla Ltd responded by announcing plans to build its first factory outside the United States in Shanghai.
Official ambitions clash with the Chinese public’s love of bulky SUVs, seen as the safest option on crowded streets. But sentiments are shifting.
A UBS survey found 71 percent of Chinese buyers are willing to try an electric, up from 58 percent a year ago. The rate for the United States and Europe was below 20 percent. “Customer willingness is always higher in China,” said Gong.
VOLKSWAGEN plans to build a fully electric sports utility vehicle for China from 2021, taking on the Chinese market leader Tesla’s Model X as the German carmaker ramps up production of zero emissions vehicles.
The planned new SUV is the latest move in Volkswagen’s aggressive growth strategy in China, where electric cars are given preferential treatment by authorities.
VW said its ID ROOMZZ, which it presented in Shanghai yesterday, will have three rows of seats and an operating range of up to 450km. The concept car is capable of a “level 4 autonomous driving,” VW said.
VW Chief Executive Herbert Diess said the ID ROOMZ will be the flagship electric car to be launched by Volkswagen in China.
“We plan to produce more than 22 million electric cars in the next 10 years,” Diess said, adding that around half of VW’s engineers were working on products destined for China.
Diess said the ID ROOMZ would eventually be rolled out to other markets.
The world’s largest aircraft took off over the Mojave Desert in California on Saturday, the first flight for the carbon-composite plane built by Stratolaunch Systems Corp, started by late Microsoft co-founder Paul Allen, as the company enters the private space market.The white airplane called Roc, which has a 117-meter wingspan and is powered by six engines on a twin fuselage, took to the air shortly before 7am and stayed aloft for more than two hours before landing safely back at the Mojave Air and Space Port as a crowd of hundreds of people cheered.“What a fantastic first flight,” Stratolaunch CEO Jean Floyd said in a statement posted on the company’s website.“Today’s flight furthers our mission to provide a flexible alternative to ground-launched systems,” Floyd said. “We are incredibly proud of the Stratolaunch team, today’s flight crew, our partners at Northrop Grumman’s Scaled Composites and the Mojave Air and Space Port.”The plane is designed to drop rockets and other space vehicles weighing up to 225 tons at an altitude of 10,670 meters and has been billed by the company as making satellite deployment as “easy as booking an airline flight.”Saturday’s flight, which saw the plane reach a maximum speed of 306 kilometers an hour and altitudes of 5,200 meters, was meant to test its performance and handling qualities, according to Stratolaunch.Allen, who co-founded Microsoft with Bill Gates in 1975, announced in 2011 that he had formed the privately funded Stratolaunch.The company seeks to cash in on higher demand in coming years for vessels that can put satellites in orbit, competing in the United States with other space entrepreneurs and industry stalwarts such as Telsa chief Elon Musk’s SpaceX and United Launch Alliance — a partnership between Boeing and Lockheed Martin.Stratolaunch plans to launch its first rockets from the Roc in 2020 at the earliest.
The 125th China Import and Export Fair, also known as the Canton Fair, China’s largest trade fair, opens today in Guangzhou, capital of southern Guangdong Province.The spring session of the biannual fair will be held in three phases. The export section will have 51 exhibition areas with 59,651 booths booked by 24,800 domestic enterprises. The first phase of the export exhibition from today to Friday will mainly showcase mechanical and electrical equipment, hardware, and building materials. The second phase, from April 23 to 27, will showcase consumer goods and gifts. The third phase from May 1 to 5 will display textiles and clothing, luggage, culture and sports, food, medical supplies and medical health products.The import exhibition will be held in the first and third phases, with 1,000 booths booked by 650 enterprises from 38 countries and regions.The first phase of the import exhibition has 616 booths displaying electronics and home appliances, building materials and hardware and mechanical equipment. There will be 384 booths in the third phase, mainly displaying food and beverage products, household goods, fabrics and home textiles.Xu Bing, a spokesperson for the Canton Fair, said yesterday that the 124th fair received exhibitors from 10 countries and regions. Xu said a chamber of commerce official from Istanbul said the fair had helped many Turkish firms explore the global market.“Design for Trade” will be a highlight this year. About 100 design companies and institutions from 15 countries and regions, including the US, Germany, France, Italy, South Korea and Japan, have registered.
China will further expand the opening-up of its financial sector “in a systemic manner at the institutional level,” the deputy governor of the central bank said in a statement released on Saturday.Chen Yulu said Beijing is working toward treating Chinese and foreign-funded financial institutions “equally in a way that is more transparent and consistent with best international practices.”Chen made the statement at the ministerial meeting of the 39th meeting of the International Monetary and Financial Committee.The committee is the policy-setting body of the International Monetary Fund.“The Chinese government continues to implement the high-level opening-up strategy, through measures such as tariff cuts,” he said.“The market access for the agricultural, manufacturing and service sectors has been relaxed and the negative list for foreign access has been shortened substantially.”In addition to enhancing the two-pillar framework of monetary and macro-prudential policies, Chen said China will accelerate the development of its financial market infrastructures, and the resolution mechanism for distressed financial institutions will be improved.With respect to policies related to the exchange rate of China’s currency, Chen said: “China will continue to improve the exchange rate mechanism and keep the yuan exchange rate in line with fundamentals at an adaptive equilibrium level.”China, Chen said, will continue to improve its business environment, promote opening-up at a high level and across the board, and further expand sectors for opening-up, so as to deepen reform in a comprehensive manner.Highlighting the passage of the Foreign Investment Law at the National People’s Congress last month, the deputy chief of the People’s Bank of China said that subsequently, relevant laws and regulations will be revised in line with the principle of competitive neutrality.“Policies and measures that hamper the growth of private businesses or fail to treat domestic and foreign investors as equals will be overhauled,” he said.Noting that a fair competition review system will be implemented across all levels of government this year, Chen said, such a system will review all business-related policies, rules and measures.“And mechanisms for filing complaints and third-party evaluations will be established to forestall and redress any action that may preclude or constrain competition,” Chen said.
China is willing to deepen its cooperation with the World Bank on lending programs and knowledge sharing, finance minister Liu Kun said at a meeting with World Bank President David Malpass.The meeting was held on the sidelines of the 99th Meeting of the Development Committee launched by the World Bank and the International Monetary Fund on Friday and Saturday.There is great potential for China, the world’s largest developing country and an important partner of the World Bank, to cooperate with the international lender in the future, Liu said, according to a statement released by the Chinese Ministry of Finance.Liu said he hopes other developing countries can learn from China’s experience in successfully alleviating poverty.China expects to work with the World Bank on improving the innovation in lending programs and added value, he addedChina also looks forward to cooperating with the World Bank in such areas as improving the business environment and establishing a high-standard multilateral financing cooperation center, the minister said.Malpass said the World Bank and China share a great responsibility in combating poverty and spurring global development, noting China’s achievements in alleviating poverty.
Shanghai should cultivate local brands and offer more customer-centered, innovative products, an industry conference held by Shanghai Daily heard yesterday.“Heritage and Innovation: Chinese Brands in Global Landscape” attracted industry insiders from many multinational corporations and consultancies.Chen Qiwei, general manager of the Shanghai United Media Group, said adapting to changes and making constant innovations are key drivers for companies’ sustainable growth.As Chinese enterprises increasingly go global, they should upgrade their brands in a comprehensive way to enhance their competitiveness in international markets.From pens to cosmetics to musical instruments, time-honored Shanghai brands that have survived the tumultuous 20th century live on today and never seem to fall out of favor.“Time-honored” is an official title awarded by the Ministry of Commerce to enterprises that existed before 1956, sell products, techniques or services passed down through generations and have distinct cultural characteristics.Hero fountain pens and ink, a brand born in the 1930s, is witness to social and economic growth. Another brand, Warrior shoes (since 1927), China’s first home-grown athletic shoes at an affordable price made with thin, flexible soles and a light canvas body, have tramped through the ages. Other brands include soap maker Bee & Flower, Phoenix bicycle, Baixin stationery, men’s wear Baromon and Wang Bao He hairy crab.Pu Shaohua, chairman of Bright Dairy and Food, said at the conference: “The company has built a strong and reliable brand over the past few decades by pursuing high-quality development and providing fresh dairy products.”To better meet the changing tastes of customers, the Shanghai-based time-honored firm transformed its product innovation model from manufacturer-led to client-centered.It also launched the country’s first high-end U Best fresh milk in 2006 by adopting leading technologies, which was well received by the consumers.“Strategic transformation is essential for the brands to keep taking the lead,” said Zhou Lan, director of the market system construction department of the city’s Commission of Commerce.She said the city’s nearly century-old Warrior is an “excellent example” of brand transformation.With three strategic transformations since 2000, the traditional shoes manufacturer has revived its glory by integrating its brand culture with latest fashion elements and technologies. Warrior shoes have been showcased at the New York Fashion Week and become a fashionable brand for the young generation.Xiao Dan, head of integrated communications at lighting company Signify, shared that the practices for building and promoting a company’s image have evolved from “what we deliver” to a higher value-driven thinking.She said their company now defines itself more as one that “cares about people.”As for Shanghai’s ambition to promote its four brands, namely manufacturing, service, shopping and culture, Guo Min, editor-in-chief of Kantar, a world’s leading research, data and insight firm, said local government should spend more effort on building brands in addition to making high-quality goods.As the birthplace of China’s modern national industry, Shanghai has given birth to China’s first factories for gourmet powder, light bulbs, toothpaste, batteries, towels, cloth dyeing, enamel ware, clock, art paint and as well as the nation’s first pharmaceutical plant.Shanghai is home to 180 of the nation’s total of 1,128 time-honored brands.
Chinese stocks had a major setback yesterday with most sectors falling substantially.The Shanghai Composite Index fell 1.6 percent to close at 3,189.96 points after an intraday low of 3,185.55 points.It was the first time in six trading days that it fell below 3,200 points.The Shenzhen Component Index fell 2.65 percent to 10,158.4 points and the ChiNext lost 2.06 percent to 1,691.1 points.Turnover on the two bourses dropped to 817.3 billion yuan (US$121.67 billion) from Wednesday’s 899 billion yuan.Liquor and pharmaceutical makers — which were among the major gainers in previous trading days — led the day’s decliners.Jiugui Liquor Co plunged 9.3 percent, Wuliangye Yibin Co dived 6.73 percent and Kweichow Moutai Co dropped 2.4 percent, but remained above 900 yuan for the fourth straight day. Pharmaceutical companies fell an average 2.76 percent with Tonghua Golden-Horse Pharmaceutical Industry Co and Zhejiang Tianyu Pharmaceutical Co both losing more than 8 percent.Bucking the downward trend, automakers extended their rally for another day.The sector gained 3.28 percent following a rise of 3.58 percent on Wednesday with several companies, including Dongfeng Motor Corp, Anhui Jianghuai Automobile Co and Tianjin Faw Xiali Automobile Co hitting the 10 percent daily cap.March car sales jumped more than 48 percent month on month to 1.74 million vehicles, indicating the decline in the world’s largest auto market is turning around.Livestock- and poultry-raising firms also stayed in positive territory, gaining 0.62 percent on average, as the official consumer price index for March was released yesterday.The CPI rose 2.3 percent year on year in March.That was an increase from 1.5 percent in February.And the highest since November 2018, the National Bureau of Statistics said yesterday.Prices of pork and poultry rose 5.1 percent and 4 percent, respectively, from the same time a year ago, according to the bureau.
Shanghai has the world’s largest concentration of major global retailers after Dubai, Vice Mayor Xu Kunlin said yesterday.Xu was speaking at the China International Retail Innovation Summit, where more than 100 executives from China and over 20 other countries and regions, including the United States, Italy, France, Germany and Japan, along with other experts and scholars are discussing innovation and development in the retail sector. Xu told the conference Shanghai is working hard to promote the “Shanghai Shopping” brand. Retail sales of consumer goods are over 1 trillion yuan (US$148.83 billion) and 90 percent of the world’s well-known high-end brands have a presence here.In 2018, more than 3,000 international and domestic brands launched new products in Shanghai, and 835 new high-end international stores opened, accounting for about half of the first stores of international brands opened in China.Massimo Volpe, chairman of the Federation of International Retail Associations, said that China has made great achievements in retail innovation, especially mobile payment.Overseas retail companies can learn from China’s success and Chinese companies can also learn from advances overseas, Volpe said.
Despite slower growth in energy demand, China will remain the world’s leading energy consumer until at least 2040, accounting for 22 percent of the global market, British Petroleum’s latest energy outlook shows.Out to 2040, the country’s annual growth in energy demand will slow to an average 1.1 percent from 5.9 percent over the past 22 years, according to the annual report.Globally, energy demand is forecast to increase by around a third by 2040, driven by improvements in living standards, particularly in India, China and across Asia.In addition, China will be the world’s largest source of growth in energy production out to 2040, boosted by rapid growth in renewables and nuclear power.Between 2017 and 2040, energy production in China is set to increase 29 percent, slightly lower than the global average of 32 percent.As the country continues to adjust to a more sustainable pattern of economic growth, China’s share of coal use will decline sharply over the outlook period, falling from 60 percent in 2017 to around 35 percent in 2040.
The number of Americans filing applications for unemployment benefits dropped to a 49-and-a-half-year low last week, pointing to sustained labor market strength that could temper expectations of a sharp slowdown in economic growth.Other data yesterday showed producer prices increased by the most in five months in March amid a surge in the cost of gasoline. But underlying producer prices remained soft, the latest indication of tame inflationary pressures that strengthen the Federal Reserve’s decision to suspend further interest rate increases this year despite tight labor market conditions.Initial claims for state unemployment benefits fell 8,000 to a seasonally adjusted 196,000 for the week ended April 6, the lowest level since early October 1969, the Labor Department said. Claims have now declined for four straight weeks.Economists polled by Reuters had forecast claims would rise to 211,000 in the latest week. The four-week moving average of initial claims, considered a better measure of labor market trends as it irons out week-to-week volatility, fell 7,000 to 207,000 last week, the lowest level since early December 1969.The labor market is the main pillar of support for the economy, which appears to have lost momentum in the first quarter as the stimulus from a US$1.5 trillion tax cut package fades and a trade war between China and the United States and softening global demand hurt exports.Nonfarm payrolls increased by 196,000 jobs in March, well above the roughly 100,000 needed per month to keep up with growth in the working-age population. The unemployment rate is at 3.8 percent, close to the 3.7 percent Federal Reserve officials project it will be by the end of the year.US stock index futures pared gains slightly after the data while Treasury yields rose. The US dollar gained against a basket of currencies.In a second report yesterday, the Labor Department said its producer price index for final demand rose 0.6 percent in March, the largest increase since last October. The PPI edged up 0.1 percent in February.In the 12 months through March, the PPI rose 2.2 percent after advancing 1.9 percent in the 12 months through February. Economists polled by Reuters had forecast the PPI would climb 0.3 percent in March and increase 1.9 percent on a year-on-year basis.A key gauge of underlying producer price pressures that excludes food, energy and trade services was unchanged last month after ticking up 0.1 percent in February. The so-called core PPI increased 2.0 percent in the 12 months through March. That was the smallest annual increase since August 2017 and followed a 2.3 percent rise in February.Data on Wednesday showed consumer prices rose by the most in 14 months in March, driven by more expensive gasoline.But core inflation remained muted amid a plunge in the cost of apparel.Slowing domestic and global growth are keeping inflation contained. Wage inflation has also been moderate despite a tight labor market.
Uber is seeking to raise about US$10 billion in what would be the largest stock offering of the year, with details coming this week, the Wall Street Journal has reported.The global ride-hailing giant is seeking a valuation close to US$100 billion — an impressive figure but below some earlier estimates amid an ebbing of enthusiasm on growth and profitability, the report said.The Journal said the market debut was expected in May.The IPO comes after a mixed response to the market debut for Lyft, the main US rival of Uber.Lyft shares rose on the first day of trading and then lost ground. On Wednesday, shares were trading down more than 10 percent from the US$72 offering price.The Journal, citing unnamed sources, said Uber recently provided documents showing a potential price range of between US$48 and US$55 a share, implying a valuation of between US$90 billion and US$100 billion. These figures could change ahead of the IPO but would be below the estimated US$120 billion suggested by some investment bankers.
CHINA’S consumer inflation quickened last month, coming in at a five-month high, while factory-gate inflation picked up for the first time in nine months.
The Consumer Price Index, a main gauge of inflation, grew 2.3 percent in March from a year earlier, 0.8 percentage points faster than the previous month, the National Bureau of Statistics said yesterday.
The March figure was the highest since October and rebounded beyond 2 percent for the first time since December.
Pork prices rose in March for the first time after falling for 25 consecutive months, leading to higher food prices and boosting the CPI growth.
Pork prices jumped 5.1 percent year on year, reversing the 4.8 percent decline in February. It led to a 0.12-percentage-point increase in overall CPI growth.
On a month-on-month basis, the pork price moderately went up 1.2 percent nationwide as outbreaks of African swine fever were gradually contained, according to the statistics bureau.
Financial service group Nomura paid particular attention to the pork prices in its analysis.
“Pork prices are set to become a major source of CPI inflation this year as the stock of hog stocks and breeding sows have fallen to historically low levels,” said the Nomura.
Food prices jumped 4.1 percent year on year last month, contributing to a 0.82-percentage-point rise in the overall CPI growth.
The pace of increase was also much faster than the 0.7 percent recorded in February.
The prices of vegetables and fruits surged 16.2 percent and 7.7 percent year on year, respectively.
The sharp increase of vegetable prices can be attributed to low yields in spring and cold rainy weather.
Non-food prices posted an increase of 1.8 percent year on year last month, contributing to a 1.46-percentage-point increase in the overall CPI growth.
On a month-on-month basis, the CPI dipped 0.4 percent in March, compared with the 1 percent growth in February, with food prices down 0.9 percent and non-food prices shedding 0.2 percent.
Prices of eggs, aquatic products and vegetables declined after the Spring Festival by 6 percent, 3.6 percent and 2.6 percent respectively.
Beef, lamb and chicken prices also fell by 1.8 percent, 1.7 percent and 1.6 percent from a month earlier.
Among non-food sectors, with the shrinking number of travelers after the Spring Festival, the prices of air tickets, travel agency charges and hotel accommodation dropped by 15.9 percent, 11.1 percent and 1.5 percent respectively.
Prices for vehicle repair and maintenance, housekeeping services and haircuts fell 5.3 percent, 4.1 percent and 3.9 percent respectively, with workers returning to the cities.
The Producer Price Index, which measures costs of goods at the factory gate, rose 0.4 percent year on year in March, 0.3 percentage points faster than the previous month.
This marked the first acceleration in PPI growth since June, with the market fear over deflation risks largely abated, according to an analysis of the Bank of Communications.
Despite the high base a year earlier, the prices of mining-related products rose 4.2 percent in March, the highest since November. The prices of raw materials also improved from a 1.5 percent drop in February to rise 0.6 percent in March.
The trend is consistent with the jump in the factory output index in the manufacturing Purchasing Managers’ Index, the Australia and New Zealand Banking Group said. Prices of the hot-rolled coil have also breached 4,000 yuan (US$595) per ton as producers responded to rising iron ore prices due to Brazilian supply disruptions, according to the ANZ Group.
“China’s inflation data for March indicate that the supply shocks faced on the consumer and producer fronts have helped to mitigate deflationary risks,” said Raymond Yeung, chief China economist of the ANZ Group.
“Both CPI and PPI are unlikely to retreat in the second quarter, in our view,” Yeung said.
Analysts with the CITIC Securities Co expected the PPI to continue expanding in April on the low-base effect.
Considering the high producer price base last year and China’s reducing value-added tax rates, however, the PPI may contract in May and June of 2019, they said.