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RFA: Silicon Valley Said No to Wuzhen

Radio Free Asia (RFA) recently reported that the Fifth World Internet Conference was held in Wuzhen, Zhejiang Province, starting on November 7. Other than the CEO of Qualcomm, a U.S. chip maker, who attended the Conference and delivered a speech, no high-ranking officers from Silicon Valley showed up. Apparently, this was due to the trade war between China and the U.S. In fact, many of these companies were very upset about China’s continuous dishonest behavior, such as stealing intellectual property from them. This is one of the main triggering causes of the trade war. Some experts expressed the belief that it’s ironic for China, a country that blocks billions of netizens from freely accessing international websites, to host the international Internet conference year after year. Bill Xia, the President of a U.S. internet freedom product (Freegate) company, commented in an RFA interview that China has been hiding behind the ridiculous excuse of “internet sovereignty” to hammer freedom of speech and to apply tight controls over its own citizens.

Source: RFA Chinese, November 8, 2018
https://www.rfa.org/mandarin/yataibaodao/meiti/nu-11082018094230.html

Briefings | | |   Economy/Resources Information/Technology US-China Relations

The Canton Fair Showed a 30 Percent Decline in Exports to the U.S.

Sofreight, a Chinese national logistics and shipping information site, recently reported that, when the 124th Canton Fair (also known as the China Import and Export Fair) closed, it showed a decline of over 30 percent, to US$279 million, in the level of exports to the United States. Also, in addition to the decline of U.S. buyer attendance, the attendance of buyers from other major economies also saw a significant decline. Compared to last year, European Union buyers declined by 3.93 percent, the U.S. buyers declined by 4.07 percent, and Hong Kong declined by 6.34 percent. The Canton Fair has historically been the primary barometer to measure China’s international trade health. The export level reflected in the Fair was in line with what was demonstrated in the recent Chinese export PMI numbers. In October, the Chinese export orders index under its PMI score reached the lowest point since 2016. According to a Fair internal survey conducted by the Zhejiang Province delegation among their own 4,690 companies that participated in the Canton Fair, over 60 percent of the companies have 10 percent or more revenue dependency on exports to the U.S. Around 15 percent of companies have over 80 percent dependency on U.S. exports. Around 66 percent of the companies surveyed expected an export decline of 10 percent or more.

Source: Sofreight, November 9, 2018
http://www.sofreight.com/news_28534.html

Briefings | | |   Economy/Resources US-China Relations

BBC Chinese: Asian Stock Markets Declined after China’s New Promises

BBC Chinese recently reported that the China International Import Expo (CIIE) started on November 5. In a keynote address, Chinese leadership made promises to open up the country’s domestic market and to lower tariffs. China intends to broaden its imports and strengthen the protection of intellectual property. In the next 15 years, China expects to import over US$30 trillion worth of goods and US$10 trillion worth of services. However, many experts pointed out that China’s promises lacked tangible action items and a clear timetable. The nearby Asian stock markets reflected the concerns of the analysts. Immediately after the CIIE opening keynote address, Hong Kong’s Hang Seng Index fell 2.65 percent, while both the Shanghai Composite Index and the Shenzhen Component Index fell more than 1 percent. The Tokyo stock market fell 1.3 percent, and Singapore fell 1.8 percent. Right before the CIIE, these stock markets all increased due to the fact that U.S. President Trump commented positively on an on-going dialogue with China. However, the Chinese message appeared to be disappointing.

Source: BBC Chinese, November 5, 2018
https://www.bbc.com/zhongwen/simp/chinese-news-46094238

Briefings | | |   Economy/Resources Geo-Strategic Trend

China’s Increasing Presence in European Electricity Sector

Le Figaro, a French daily newspaper, recently carried an article on China’s increasing influence over the European electric power supply network. The article quoted from the World Energy Markets Observatory (WEMO) report of 2018, that Capgemini, a French consulting firm headquartered in Paris, had published. China, according to the report, is “the world’s second largest consumer of energy, the leading emitter of Greenhouse Gases (GHG), a significant energy equipment supplier, and a key player in critical resources. It has also become an important investor in electric companies.”

The report pointed out that a key strategy of Chinese expansion in Europe is to increase its control or influence over the continent’s electric power supply network. Chinese investment has already gained access to the electric sectors of Portugal, Italy, Greece, Malta, and the United Kingdom. It was due to the opposition of the German government that China did not have success in Germany. For energy experts, the control of the power supply network is of great strategic importance. Moreover, China is the world’s largest manufacturer of solar panels, and is in a leading position in the field of wind energy. The Chinese government is currently investing in large-scale research and development of electricity storage and aims to export Chinese-made batteries to the world in the near future.

However, the problem is that in the process of producing the above-mentioned green energy products, Chinese companies will emit a large amount of greenhouse gases. In addition, China also exports a large number of its own thermal power plants. In addition, the Chinese government will obviously be unable to achieve its goal of CO2 reduction, which is the total coal-fired power generation of less than 1,100 gigawatts, by 2020.

Source: Radio France International, November 6, 2018
http://rfi.my/3Ihk.T

Briefings | | |   Economy/Resources

A Large Amount of Gold Is Flowing into China

Taiwanese online news site Tech News recently reported that multiple wealth management providers have been recommending to nearly all of their wealthy Chinese clients to stock up on gold. According to Swiss Customs data, in September, Switzerland imported 223.3 tons of gold and exported 118 tons. Both were peak points in the past two years. Most of the Swiss gold that was imported (around 70 percent) was from London and New York. The destinations for Swiss exports were mainly in Asia. India is one of the largest gold consumers; its September gold imports decreased by 115 tons. Unexpectedly, exports to Hong Kong alone increased from 3.3 tons to 28.7 tons. China and Hong Kong together saw that gold imports increased by 160 tons. Typically, gold stays in London and New York for banks to trade among themselves. However, this time physical gold has been flowing out and has never circled back.

Source: Tech News, October 30, 2018
https:// technews.tw/2018/10/30/china-rich-people-gold/

Briefings | | |   Economy/Resources

China Finance Online: CCP Politburo Met to Discuss Strategy to Stabilize the Economy

China Finance Online, China’s only online financial information service listed on NASDAQ, recently reported that the Politburo of the Chinese Communist Party met on October 31 to focus on the strategy for stabilizing the economy. The meeting reviewed the macro-economy for the past three quarters and confirmed an increase in the downward pressure, especially relating to long-term risks. The meeting also analyzed the primary cause of the current economic challenges and identified the “deep changes” that are occurring “externally.” As for the next steps, the meeting also specified the focal points for immediate action. These will include a new mention of “capital market reform” in addition to stabilizing the job market, the financial market, foreign trade, foreign investments, government investments and market expectations. Interestingly, the meeting did not mention de-leveraging policy, and did not mention real estate market adjustments. Experts expressed their belief that the meeting is an important and timely meeting, which acknowledged the significant pressure and “external changes,” and pointed in the direction of a market-oriented action list.

Source: China Finance Online, November 1, 2018
http://finance.jrj.com.cn/2018/11/01064925289316.shtml

Briefings | | |   Economy/Resources

Corrupt Officials Ran Away with Money; Depositors Made a Run on the Bank

Zigong Bank is a privately run bank in Zigong, Sichuan Province. People made a run on the bank after news spread on the Internet that the three executives of Zigong Bank fled with money they had embezzled. Many people in Zigong rushed to the bank to withdraw money.

The news of the run on Zigong Bank spread widely on the Internet. After only 20 minutes, the authorities ordered the information to be deleted, but the people had already flocked to the bank’s branches to withdraw funds. Rumors were that the bank did not have enough reserves to pay for the withdrawals.

The local government issued a notice denying the rumors and claimed that Zigong Bank is functioning normally. The police later claimed to have arrested a 31-year-old netizen.

Source: Radio France International, November 3, 2018
http://rfi.my/3I47.T

Briefings | | |   Economy/Resources

Xinhua Editorial Calls for Private Enterprises to Have Confidence in China’s Economy

After admitting that the economy is facing downward pressure, Beijing began to speak to private enterprises through its official media. The People’s Daily published an editorial claiming that private enterprises must first “enhance confidence in China’s economy” so as “to overcome difficulties and achieve greater development.”

The article, titled, “Strengthening Confidence in China’s Economic Development,” states that “the confidence of certain victory” comes from the “many favorable conditions” of China’s economic development and comes from “the strong leadership of the Chinese Communist Party and its ability to control the overall situation of the economy.”

The article points out that, domestically, with a market of 1.3 billion people, China has enormous resilience, potential, and room for maneuvering. It also has a unique institutional advantage and has the political advantage of “concentrating resources to do big things.”

Externally, the article continued, the world economy has shown signs of recovery. In the first three quarters of this year, China’s imports and exports “maintained a steady growth momentum.” It has accelerated investment and trade cooperation with countries along the “Belt and Road.”

The article said that it is necessary to unite closely around the “Central Committee of the Party with Comrade Xi Jinping as the core,” “maintain strategic composure, make progress in a steady fashion, and pay close attention to implementation of the reform.” It shows the confidence that “the vessel of the Chinese economy will be able to sail far and steady by cleaving together through the waves.”

Source: Xinhua, November 4, 2018
http://www.xinhuanet.com/politics/2018-11/04/c_1123660864.htm

Briefings | | |   Economy/Resources