Economy/Resources - 51. page

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
https://www.rfa.org/cantonese/news/nuke-09152022093318.html

Recent research by the German Economic Institute (IW) showed that Germany’s direct investment in China in the first half of the year reached a historic high. Between January and June this year, German companies directly invested 10 billion euros (US $10 billion) in China. In the past, the half year record was 6.2 billion euros.

The German government authority, the Federal Ministry of Economic Affairs & Energy, is working to modify its China policy. It will tighten the guarantee for companies’ overseas investments.

However, Germany’s automobile industry is moving in the opposite direction. Former CEO Herbert Diess of Volkswagon insisted that China’s business is important to Germany. The Chairman of Daimler AG said that sales from China accounted for one third of Mercedes-Benz sales. On June 28, Audi and its Chinese partner First Automobile Works (FAW) officially kicked off a new energy vehicle project with an investment of over 35 billion yuan (US $ 5 billion) in Changchun City, Jilin Province. On June 23, the BMW Group launched its new plant “Rida Plant” in Shenyang City, Liaoning Province. The project, costing RMB 15 billion, is by far the largest single investment by BMW in China’s market.

Source: Deutsche Welle, September 7, 2022
https://www.dw.com/zh/为什么德国部分工业界同柏林对华政策唱反调/a-63044035

Numerous unfinished real estate, also known as “rotten-tail” buildings in China, has led property owners to engage in a wave of mortgage payment suspensions, By September 6, This  involved 119 cities and a total of 340 projects, and 2022 property owners, raising concerns that the payment suspensions may continue to worsen economic development.

The wave of mortgage suspensions triggered by “rotten-tail” buildings began in July, with many property owners stopping payment on their mortgages, issuing one “loan suspension notice,0, after another, demanding that real estate developers resume their construction work in full, or they will stop paying the principal and interest to the banks.

A person involved in the suspension of loans collected some data and stored it at the online repository GitHub (WeNeedHome). The collection at this site showed, on September 6, that the suspension of mortgag payments on property cumulatively involved up to 340 sites in 119 cities across the country. The number is still climbing. Henan Province tops the list with 66 sites, followed by Shaanxi Province and Hunan Province.

On top of that, banks that could not collect on their loans were among those affected, with the share price of Shenzhen-based financier Ping An Bank falling as overdue payments on suspended homes reached 78 million yuan ($11.3 million).

Source: Radio Free Asia, August 18, 2022 (figures updated on September 6)
https://www.rfa.org/mandarin/yataibaodao/jingmao/cm-08182022120213.html

China’s economic downturn, along with the Covid epidemic and other factors, has drained local government revenues. Mainland Chinese media reported that many local governments have been resorting to the indiscriminate use of fines to generate revenue.

China NewsWeek magazine reported on August 29 that, in recent year, in many areas, the revenue from fines, penalties, and confiscations has increased significantly.

In 2021 among the 111 cities that have publicized data on fines. 80 cities saw a rise in the revenue from fines. In 15 of them the fines more than doubled. For example, the fines in Leshan in Sichuan increased by 155 percent and Nanchang in Jiangxi by 151 percent.

Qingdao, the city, ranked Number One. In 2021. The revenue from fines amounted to RMB 4.377 billion ($ 0.63 billion), an increase of 127 percent compared to 2020. In addition to Qingdao, Jiangsu Province includes 6 of the top 14 cities in terms of the highest fine revenue.

For example, in order to raise revenue, traffic police in Inner Mongolia set up check points on highways and have fined the truck drivers for violations such as “not wearing seat belts,” although in fact the drivers had actually buckled up and did not violate any traffic laws.

The newspaper quoted a researcher who reported that the source of a significant portion of local fiscal revenue is from land sales. He said that, according to the National Bureau of Statistics,, the local government revenue from land sales in the first seven months of this year was only about 1/3 of  what it had been in the same period last year, putting pressure on fiscal revenue.

Source: Central News Agency (Taiwan), August 29, 2022
https://www.cna.com.tw/news/acn/202208290196.aspxwear

Singapore’s primary Chinese language newspaper Lianhe Zaobao recently reported that satellite data showed that retail activities in China have worsened both online and offline. E-commerce demand was particularly weak, and activities in e-commerce distribution centers were even lower than in 2020. According to data shared by satellite image analysis company SpaceKnow, China’s intercity truck flow fell by 20 percent in August, and this indicator is directly related to GDP. Distribution centers faring much better during the 2020 outbreak than they are now. The data also indicated weaker earnings trend for companies like Alibaba could continue as consumers cut back on spending. The weakness also spread to brick-and-mortar retailers, with changes in the number of cars in mall parking lots in August being much lower than the same period in 2021. Chinese officials have tried to use government spending on infrastructure to reinvigorate growth. However, high-frequency data suggests that the infrastructure boost has so far not been able to offset the blow to the construction sector from a sharp drop in China’s real-estate market. Public data shows that China’s consumer confidence index fell to its lowest level in nearly a decade in April and has barely rebounded since then.

Source: Lianhe Zaobao, September 1,2022
https://www.zaobao.com.sg/realtime/china/story20220901-1308601