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Caixin: September Manufacturing PMI Showed Significantly Weakened Market Confidence

Caixin just released its official Chinese Manufacturing PMI numbers for September. Caixin PMI is a well-respected economic indicator monitored globally by financial institutions. Caixin’s China Manufacturing PMI recorded 48.1 for last month, the lowest point in five months. Mainly affected by the rebound of Covid and its related government control measures, China’s manufacturing production and demand weakened in September and the industry’s prosperity continued to decline in the contraction range. The numbers dropped on both supply and demand sides. The surveyed companies reported that the Covid prevention controls have restricted production arrangements and supply chains. In particular, travel and business restrictions have led to setbacks in demand. Among the three major manufacturing categories of products, the output of the investment category declined the most, while the sales in the consumer goods category declined the most. Demand for Chinese-manufactured products in overseas markets has declined at an accelerating rate. The manufacturing employment index is falling into contractionary territory in September. Considering the decline in costs and sluggish demand, companies have generally cut prices, thus driving the factory price index to the newest low since 2016. The overall performance of the supply chain remains poor. In September, the manufacturing purchasing volume index and the raw material inventory index continued to decline below the line of prosperity and decline. At present, the main contradiction in economic operation lies in insufficient employment, sluggish demand, and unstable expectations.

Source: Caixin, September 30, 2022

Over 5 Million Chinese Students Will Apply for Graduate Programs

As China’s enrollment examination for a 2023 Master’s degree has just opened for registration, it is estimated that the number of applicants will approximate or even exceed 5.2 million. Due to the Covid-19 epidemic and economic slowdown, many college graduates are considering further education as an escape from the tough job market.

Chinese students take a nationwide enrollment examination so as to apply for the Master’s program. Last year, the number of applicants for the 2022 Master’s program was 4.57 million. Li Lin, the director of the graduate programs at the New Oriental Education & Technology Group, a provider of private educational services in China, recently said that, out of the 5.2 million applicants, 1.3 million will be admitted. The number of applicants for the 2017 Master’s program was only 2 million.

According to the Ministry of Education, this year, the number of fresh graduates from China’s colleges and universities set a record, reaching 10.76 million. It is the first time that the number has exceeded 10 million.

Source: Central News Agency (Taiwan), September 25, 2022

Lianhe Zaobao: Pressure of Foreign Capital Withdrawing from China Increased Again

Singapore’s primary Chinese language newspaper Lianhe Zaobao recently reported that the uncertainty of the Chinese Covid control as well as the crisis in the Taiwan Strait has had an effect. It has made the voice of “foreign capital withdrawing from China” increase again. The European Union Chamber of Commerce in China released a report not long ago saying that China’s attractiveness as an investment destination is eroding and its strict Covid control measures have made EU companies in China lose confidence. Nearly a quarter of EU companies surveyed are considering moving existing or planned investments out of China. This is the highest number in the past ten years. Just about a month ago, a survey report released by the U.S.-China Business Council (USCBS) showed that optimism about the outlook for China’s business environment among U.S. companies in China fell to a record low. Around 96 percent of the U.S. companies surveyed say that their business in China has been negatively affected by the Covid control measures. More than half of the U.S. companies have suspended, postponed or canceled their investment plans in China due to the Covid measures. Citigroup chief Jane Fraser also said a few days ago that if China attacks Taiwan, the bank could significantly reduce its presence in mainland China. The latest EU Chamber of Commerce report, which collected data from 1,800 members, pointed out that China’s Zero-Covid policy has created “enormous uncertainty” and caused a “negative shock” to the operations of 75 percent of its members. The total number of EU citizens living in China has halved since the outbreak began. By the end of the summer of 2022, this number may be halved again. Not just Covid, the report also mentioned that the predictability, reliability and efficiency of the Chinese market are all decreasing. For example, the sudden power outage in 2021, the government’s sudden rectification of the technology and education/training industries, and other incidents all brought great uncertainty.

Source: Lianhe Zaobao, September 22, 2022

The China Railway Construction Corporation (CRCC) Is Delinquent in Malaysia

More than 50 subcontractors and local suppliers for the Light Rail Transit 3 (LRT3) packages GS05 and GS06 in Malaysia protested to China’s Railway Construction Corporation (CRCC) because they have been delinquent on payments for over a year.

The peaceful demonstration took place at Seksyen 1, Shah Alam, on September 14.

The protesters said that the China Railway 17th Bureau Group, or CRCC 17, owed them payments coming to a total of 25 million MYR (Malaysian Ringgit), or US $5.5 million. CRCC 17 has promised to make the payment several times in the past, but has never done so.

In the past couple of years, China’s real estate companies have struggled to pay their debts on time, but those were mostly private companies and related to construction projects within China. This case involves a state-owned enterprise that is delinquent on an overseas project.

Source:, September 14, 2022财经新闻/抗议拖欠2500万-承包商要中铁17局还钱

China’s Local Government Debt Issuance Up 24 Percent in the First 8 Months

According to the Choice database of East Money Information, a Chinese financial and stock information provider, the scale of total local government debt issuance in the first eight months of this year reached 6.05 trillion yuan ($870 billion), an increase of 24 percent year-on-year. Among them, the newly issued local debts issued were 4,021 billion yuan, up 62.4 percent year-on-year. Of the new local debts, 3,519.1 billion yuan ($505 billion) were  specifically for special bonds.

There were three small and medium-sized bank special bonds, one important type of special bonds, with a total amount of 48.5 billion yuan ($7.0 billion), including 5 billion yuan ($0.72 billion) by the Dalian city government, 30 billion yuan ($4.3 billion) by Gansu, and 13.5 billion yuan ($1.9 billion) by Liaoning.

The China Banking and Insurance Regulatory Commission (CBIRC) said that it has worked with the Ministry of Finance and the central bank – the People’s Bank of China (PBOC) – to accelerate the issuance of special bonds by local governments to supplement the capital of small and medium-sized banks. In the first half of this year, CBIRC allocated 103 billion yuan ($17.5 billion) of special debt quota to Liaoning province, Gansu province, Henan province, and Dalian city.

Source:, September 2, 2022

In August, China Suffered its Biggest Monthly Decline in Chip Production

According to data released by China’s National Bureau of Statistics (NBS) on September 16, 2022, China’s integrated circuits (ICs) production in August 2022 was down by 24.7 percent year on year to 24.7 billion units. It is the largest monthly decrease since 1997 when NBS started collecting data. For the first eight months of 2022, China’s total semiconductor output fell by10 percent year on year to 218.1 billion units.

According to statistics from the business database platform Qichacha, a record 3,470 companies in the semiconductor business went out of business in the first eight months of the year. Analysts attributed it to China’s zero-COVID-19 policy and sluggish consumer demand. Chinese semiconductor companies cannot hold on and have eventually withdrawn from the semiconductor business one after another.

According to the NBS, in August,the  production of microcomputers dropped by18.6 percent to 317.5 billion units, marking the largest drop since December 2015,  The microcomputer category includes personal computers, smartphones, video game consoles, and other handheld electronic devices.


China’s National Bureau of Statistics, September 16, 2022, September 14, 2022

China Builds More Nuclear Power Plants

The standing Committee of China’s State Council recently approved the Zhangzhou (Fujian Province) Nuclear Power Plant Phase Two project and the Lianjiang (Guangdong Province) Nuclear Power Plant Phase One project. Guangdong province will have ten nuclear plants which will range 30 to 250 miles away from Hong Kong.

So far this year, China has approved the new construction for 10 nuclear power generation units. This is the highest in quantity since the year 2008. In that year China approved 14 units.

As of June of this year, China had 54 nuclear power generation units in operation, ranking third in the world. It also has 23 units under construction or in the pipeline, which would give it the top ranking in the world.

Source: Radio Free Asia, September 15, 2022