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Beijing International Book Fair: A Global Platform for Cultural Exchange and Publishing Cooperation

Guangming Daily reported that the five-day 30th Beijing International Book Fair (BIBF) recently concluded. The report said that, from “inviting in” to “going out” (i.e. inviting foreign publishers into China as well as publishing Chinese works abroad), this year’s BIBF achieved extensive cross-border and cross-field exchanges and integration in the publishing world. This year’s BIBF resulted in over 2,100 Sino-foreign copyright trade agreements or intentions, attracted 1,600 exhibitors from 71 countries and regions, showcased 220,000 types of Chinese and foreign books, held over 1,000 cultural events, and welcomed nearly 300,000 visitors. More Chinese stories are being widely disseminated around the world through the BIBF platform.

The continuously growing BIBF, together with renowned international book fairs such as the Frankfurt Book Fair in Germany, the New York Book Fair in the United States, and the Bologna Children’s Book Fair in Italy, is building a stage for the exchange and mutual learning of world civilizations. The BIBF, by simultaneously “inviting (foreign publishers) in” and “going out,” provides a platform and build bridges for the global “flow” of cultural achievements. Copyright transactions and international publishing cooperation between China and other countries have also become routine outside the BIBF.

Source: Guangming Daily, June 28, 2024
https://news.gmw.cn/2024-06/28/content_37406609.htm

Briefings | | |   Economy/Resources Geo-Strategic Trend Government/Politics

China Launches Access Permission and Road Drive Pilot for Intelligent Internet-Connected Vehicles

Xinhua reported that the Ministry of Industry and Information Technology, the Ministry of Public Security, the Ministry of Housing and Urban-Rural Development, and the Ministry of Transport recently released the “Basic Information on Access Permission and Road Drive Pilot for Intelligent Internet-Connected Vehicles.” They identified nine consortia composed of car manufacturers and users, including NIO and Chang‘an, which will conduct intelligent Internet-connected vehicle access and road drive pilots in seven cities, including Beijing, Shanghai, and Guangzhou. The pilot products cover three major categories: passenger cars, buses, and trucks. This signifies a crucial step forward for the large-scale application of high-level intelligent driving in China.

China’s standard on “Automated Driving Classification for Automobiles” divides autonomous driving into six levels from L0 to L5, corresponding to “emergency assistance, partial driving assistance, combined driving assistance, conditional automated driving, high-level automated driving, and fully automated driving.”

High-level intelligent driving has become the focus of competition among major car companies. Previously, multiple car brands, including Mercedes-Benz, BMW, IM Motors, Chang’an, Arcfox, Deep Blue, Avita, Seres, and BYD, announced they had obtained L3 autonomous driving test licenses. As of the end of April 2024, China has opened over 29,000 kilometers of intelligent connected vehicle test roads, issued more than 6,800 test and demonstration licenses, and the total road test mileage has exceeded 88 million kilometers.

The new pilot program is the next step, after the vehicle research and testing, to promote mass-produced intelligent models on road drive.

Source: Xinhua, June 25, 2024 http://www.news.cn/tech/20240625/d21252e6ec504019b5a65472192e578f/c.html

Briefings | | |   Economy/Resources

CCP Muted Li Qiang’s Statement That China’s Economy Cannot Take Strong Medicine

On June 25, Chinese Premier Li Qiang delivered a speech at the 2024 World Economic Forum regarding China’s economy. According to Singapore’s Lianhe Zaobao, Li Qiang emphasized the importance of addressing both immediate and fundamental issues in China’s economy, drawing an analogy from traditional Chinese medicine. He likened the Chinese economy to a patient recovering from a serious illness, stating that “according to Chinese medicine theory, this is not the time to apply strong medicine; instead, precise and gradual treatment is needed to slowly restore the foundation.”

Chinese state media, including Xinhua News Agency, only quoted Li’s phrase “restore the foundation” without mentioning the critical point about not “applying strong medicine.” The economic platform Gelonghui briefly published a report titled “Li Qiang: The Chinese Economy Cannot Apply Strong Medicine Now,” but it was quickly deleted.

Commentators noted that Li Qiang’s remarks indirectly acknowledged that the Chinese economy is in a severe and desperate condition and that Beijing may not have the ability to fix it.

Source: VOA, June 28, 2024
https://www.voachinese.com/a/china-s-censors-appear-to-delete-premier-s-strong-treatment-theory-20240628/7677019.html

Briefings | | |   Economy/Resources Government/Politics

LTN: China’s Financial Industry Asks Employees to Give Up Deferred Bonuses

Major Taiwanese news network Liberty Times Network (LTN) recently reported that, since Chinese leader Xi Jinping launched the “Shared Prosperity” campaign, several companies in China’s financial industry have implemented strict new restrictions on their senior employees to coordinate with the Xi’s policies. The era of high salaries for Chinese financial workers is coming to an end. China’s largest financial groups have asked senior employees to forego deferred bonuses and, in some cases, return salary from several years ago to comply with a pre-tax annual pay cap of RMB 2.9 million yuan (around US$399,047). Some mutual fund managers are also facing pressure to return non-compliant wages from previous years. Chinese state-owned financial institutions such as China Merchants Group, China Everbright Group and CITIC Group have conveyed the above guidance to employees in some of their departments in recent weeks, people familiar with the matter said. Highly paid financial workers, including investment bankers and fund managers, have been denounced by Beijing as “hedonistic” for their extravagant lifestyles and are among the groups hardest hit by Xi Jinping’s “shared prosperity” campaign. It is unclear at this moment how many financial institutions are subject to the guidance. The incomes of most of the high-ranking financial managers are from deferred bonuses.

Source: LTN, June 27, 2024
https://news.ltn.com.tw/news/world/breakingnews/4719200

Briefings | | |   Economy/Resources Social Stability

China’s Venture Capital Crunch: Funding Decline Spurs Overseas Shift

China’s venture capital market is experiencing a sharp decline in investment funding. This downturn is attributed to global trends, such as rising U.S. interest rates, as well as specific factors like U.S.-China economic decoupling and a sluggish real estate market. As a result, some investors and entrepreneurs are shifting their focus to overseas markets like Japan.

The Hong Kong Stock Exchange recently celebrated a rare high-profile IPO by XtalPi, an AI-driven drug discovery company. However, despite efforts to attract innovative companies, Hong Kong’s IPO market is struggling, with predictions of falling to 10th place globally in the first half of 2024.

Venture capital investment in China dropped 66% in 2023 compared to its peak in 2021, with foreign investments declining by nearly 90%. This reflects the impact of U.S.-China tensions and increased U.S. scrutiny of investments in sensitive technologies.

Chinese startups are facing difficulties securing funding, with local government and private equity investments becoming scarce. Many are turning to tech giants like Tencent and Alibaba or seeking opportunities abroad.

The current situation is pushing both startups and investors to explore international markets. Japan, in particular, is attracting interest from Chinese entrepreneurs and tech talent. While China’s venture capital industry is not considered to be in decline due to its strong talent base and government support in strategic sectors, the ongoing shift towards overseas markets could reshape the future landscape of the industry.

Source: Nikkei Chinese, June 21, 2024
https://zh.cn.nikkei.com/columnviewpoint/column/55913-2024-06-21-05-00-06.html

Briefings | | |   Economy/Resources

Lianhe Zaobao: China’s Actual Use of Foreign Capital in the First Five Months Declined

Singapore’s primary Chinese language newspaper Lianhe Zaobao recently reported that China’s actual use of foreign capital fell 28.2 percent year-over-year in the first five months of this year, showing that the Chinese government still faces challenges in attracting overseas investment to boost the economy. Data just released by China’s Ministry of Commerce shows that, the actual use of foreign capital in the first four months fell by 27.9 percent year-over-year, and the decline in May further widened. The downward trend in China’s actual use of foreign capital began in June last year, reflecting a decline of 12 consecutive months. China’s business environment is unstable and economic growth prospects are bleak, with overseas capital inflows experiencing a historic decline. The continued decline in foreign direct investment shows that China is no longer attractive to foreign investors. Although foreign investors have not completely withdrawn investment in China, the number has become smaller and smaller. When Chinese Premier Li Qiang held an executive meeting of the State Council on February 23, he said that stabilizing foreign investment should be an important focus of economic work this year.

Source: Lianhe Zaobao, June 22, 2024
https://www.zaobao.com.sg/realtime/china/story20240622-3960937

Briefings | | |   Economy/Resources Geo-Strategic Trend

Oriental Daily: Hong Kong Bankruptcy Petitions Surged by 35 Percent

Oriental Daily News, Hong Kong’s number one newspaper in circulation since 1976, recently reported that, although the Hong Kong government announced a complete withdrawal of the housing market, the decline in real estate prices has not stopped. Many Hong Kong residents’ assets have evaporated and they have fallen into the black hole of insolvency. Hong Kong’s Official Receiver’s Office just announced the latest bankruptcy and liquidation petition data for May. The number of bankruptcy petitions in May rose to 871, the highest in more than two years, an increase of more than 17 percent month-over-month, and a year-over-year surge of nearly 35 percent. In the first five months to May, a total of 3,797 bankruptcy petitions were filed, an increase of 25 percent from the same period last year. There were 61 compulsory liquidation petitions in May, up nearly 85 percent year-over-year. Experts pointed out that the unemployment rate in Hong Kong is currently at a low level, and the chance of bankruptcy due to unemployment is expected to be low. It is more likely that the increase in the number of bankruptcies may be related to the bank’s collection of loans. The borrowers went bankrupt due to temporary inability to repay.

Source: Oriental Daily, June 22, 2024
https://hk.on.cc/hk/bkn/cnt/news/20240622/bkn-20240622033026593-0622_00822_001.html

Briefings | | |   Economy/Resources

Discrepancies in China’s Trade Surplus Data with the U.S.

On June 20, the U.S. Treasury Department asked China to explain the discrepancy in its two sets of trade surplus data with the U.S.

Data reported by the Chinese customs office shows China’s trade surplus for 2023 being nearly $230 billion higher than the surplus reported by China’s State Administration of Foreign Exchange (SAFE). In prior years (going back to 2000), the average discrepancy between these two sources of trade surplus data was only $7 billion. The U.S. Treasury Department called on China to provide further quantitative evidence clarifying the issue.

One commentator on China affairs gave three possible explanations for the large discrepancy in 2023 trade surplus data:

  1. The Chinese customs office may have exaggerated the country’s export trade figures.
  2. A large number of export enterprises may have, in preparation for potential exit from China, kept their dollars overseas instead of taking them back to China (i.e. instead of converting them to RMB). This could have resulted in those businesses’ trade numbers being counted by the customs but not by SAFE.
  3. There may be an acceleration in people withdrawing money to flee China.

Sources:
1. Radio France Internationale, June 21, 2024
https://www.rfi.fr/cn/美国/20240621-美财政部吁中国提高汇率透明度-并澄清贸易顺差数据出现巨额落差
2. Epoch Times, June 22, 2024
https://www.epochtimes.com/gb/24/6/22/n14275135.htm

Briefings | | |   Economy/Resources US-China Relations