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Government: People’s Daily Reported Fantasia Holdings Missed Its U.S. Debt Payment

Fantasia Holdings announced that it was unable to make a U.S. debt payment of $206 million on its due date of October 4. The company was owned by Zeng Baobao, the niece of Zeng Qinghong, a former Chinese Communist Party (CCP) top official and the right-hand man of former CCP head Jiang Zemin. Many media have reported that Zeng heads the Jiang faction since Jiang has been in poor health and their group has taken many actions against Xi Jinping.

People’s Daily reported on Fantasia’s missing the $206 million debt payment. It also reported that Fantasia raised 3.3 billion yuan (US$ 512 million) by selling a core business Li Li Le (邻里乐) from Color Life, a property management company that Fantasia owns, to Country Garden Services Holdings, another real estate giant in China.

The fact that People’s Daily, the official newspaper of the CCP Central Committee, reported the negative news about Fantasia, may convey a strong political message.

Also, an article analyzing Fantasia has appeared in many Chinese media. The article said that Fantasia appeared to have plenty of money when it reported its bank balance and its cash of 27.1 billion yuan (US$ 4.21 billion) on June 30, 2021. Actually, however, for real estate companies, the cash they hold may be the cash deposits from different house buyers, so banks will freeze that. Also, Fantasia may not have mentioned other debts that it has hidden from its report.

The article commented that Fantasia might have been blocked from issuing bonds and it therefore had no choice but to borrow money on the capital market. By June 30, 2021, its capital debt was 67 percent of its total debt, with the U.S. dollar debt accounting for 53 percent of the total debt. Among the 12 U.S. dollar debts that it has, only one has an interest rate lower than 8 percent; the other 11 all have rates of around 10 percent or higher, way above the average 7.5 percent interest rate on Renminbi debt.

Related postings on Chinascope:

Sources:
1. People’s Daily, October 11, 2021
http://finance.people.com.cn/n1/2021/1011/c1004-32249384.html
2. 163.com, October 9, 2021
https://www.163.com/dy/article/GLT66O960515VS38.html

Pandemic: COVID Has Spread to Xinjiang

COVID-19 has spread to Xinjiang. On October 3, Beijing reported two asymptomatic patients in Yili, Xinjiang. The authorities quarantined 192 people who had close contact with them. The Chinese Communist Party (CCP) is known for hiding the details about the actual spread of COVID in China. Also, it has initiated many strict measures in Xinjiang and always tries to keep such measures hidden from the world. Therefore the actual COVID infection situation there is unknown.

Airports in several Xinjiang cities, including Urumqi and Yiyi, cancelled a massive number of flights. The Yili train station stopped operating. Authorities imposed traffic control in Yili and also announced that the tourists in Yili may not leave the city.

Related postings on Chinascope:

September 22, 2021, Pandemic Report: COVID Spreading in China
September 15, 2021, Pandemic Report: COVID Spreading in China

Source:
Epoch Times, October 4, 2021
https://www.epochtimes.com/gb/21/10/4/n13279609.htm

Government & Leadership: After Meng Wanzhou, China Wants U.S. to Fix All Its Wrongs on Two Lists

Hua Chunying, the spokeswoman for China’s Ministry of Foreign Affairs, said, during a press conference on September 28, that Xi Jinping, himself, gave directions on Meng Wanzhou’s case and requested the United States to resolve it properly.

Hua stated that Xi Jinping has given his personal attention to Meng’s case since she had been detained in early December 2018. The Chinese government representatives at all levels have worked to their full strength in every situation to help Meng.

Hua pointed out, in the recent China-U.S. diplomat meeting at Tianjin, that China gave the U.S. two lists. One list included the wrong talks and actions that the U.S. must stop. The other one included the key cases to which China pays attention. Both lists clearly requested that the U.S. should cancel its wrong accusation against Meng and let her return to China quickly.

“When the two state heads talked (Editor’s Note: referring to the Biden-Xi talk on September 9),  … Meng said, “President Xi Jinping clearly made an effort on Meng’s case. He stated China’s stand and requested the U.S. to resolve the situation properly.”

Hua said that she has noticed that some media commented on how the resolution of Meng Wanzhou’s case helped to pull out a thorn that was deeply embedded in Sino-U.S. relations. “Due to the fact that the U.S. side has carried out a wrong China policy in the past period, there are many other thorns, big and small, in the Sino-U.S. relations. China hopes the U.S. will pay high attention (to them) and take substantive actions, to clear all items on the two lists.”

Sources:
1. China Press, September 28, 2021
https://www.chinapress.com.my/20210928/华春莹答覆孟晚舟事件-习近平明确部署工作!/
2. China Youth Daily, September 29, 2021
http://news.cyol.com/gb/articles/2021-09/29/content_Xx507fpEJ.html

September 22, 2021, Pandemic Report: COVID Is Spreading in China

COVID-19 continues to spread in Fujian Province, with an accumulative 418 confirmed cases from September 10 to September 21. The two major cities impacted are Xiamen and Putian. For the past four days the number of cases in Xiamen has surpassed the number in Putian. The Chinese Communist Party (CCP) is known for hiding the details about the actual spread of COVID in China, so the actual number of infections is unknown.

Vice Premier Sun Chunlan visited Xiamen and Putian on September 18. Sun usually represents the central government to visit locales about their COVID-19 work only when the local pandemic situation has become extremely severe.

Also, Harbin City, Heilongjiang Province reported eight confirmed cases from September 21 to September 22. The CCP Harbin Municipal Committee Secretary Wang Zhaoli said that the current situation in Harbin is severe and complex.

Related postings on Chinascope:

Sources:
1. Radio Free Asia, September 22, 2021
https://www.rfa.org/mandarin/Xinwen/4-09222021100621.html
2. China’s government site, September 20, 2021
http://www.gov.cn/guowuyuan/2021-09/20/content_5638441.htm
3. Lianhe Zaobao, September 22, 2021
https://www.zaobao.com.sg/realtime/china/story20210922-1196116

Military: Huanqiu Report: “PLA Warships Appeared Near the U.S. Coast”

Huanqiu reported that the U.S. Department of Defense revealed, on September 12, that China’s warships appeared near the U.S. coast. The U.S. posted a picture which showed that, on August 30, the U.S. Coast Guard patrol ship USCGC Bertholf was conducting “close surveillance” of Chinese naval vessels entering international waters in the U.S. exclusive economic zone near the Aleutian Islands. The Chinese vessels included a Type 055 destroyer, a Type 052D destroyer, and a replenishment ship.

Though Huanqiu quoted a Chinese military expert as stating that “this might be a routine ocean-going training exercise and that there is no offensive implication,” the hottest comments in this article by the Chinese netizens overwhelmingly suggested that they view it as an answer to the U.S. naval ships sailing in the South China Sea. While Beijing claims the waters there to be China’s waters, the international community does not.

Some of the comments were:

“China’s freedom of navigation has begun, and the U.S. needs to get used to it!”

“Right, we should knock on the U.S. door to see if the American Empire is home.”

“Do unto others as you would have them do unto you! You Yankees can sail freely, why can’t China sail freely? This is the best answer to you Yankees.”

“It is to provoke (confrontation). So what!”

“It’s just free sailing. Chinese warships are brave adolescents who like to wander around to any location in their own territory. So what if you don’t like it?”

Source: Huanqiu, September 14, 2021
https://world.huanqiu.com/article/44l3rQZKpOG

Leadership: Fantasia Holdings, a Business of Zeng Qinghong’s Niece, Is in Trouble

Zeng Baobao, the niece of Zeng Qinghong, owns Fantasia Holdings. Zeng Qinghong is a retired Chinese Communist Party (CCP) top official. He is former CCP head Jiang Zemin’s right-hand man, the Vice President of China, and a CCP Politburo Standing Committee member. He is still believed to have considerable political influence in China. Many media have reported him as heading a CCP faction that is against Xi Jinping.

Zeng Baobao established Fantasia Holdings in 1996. The company went IPO in Hong Kong in 2009. Its main business is real estate development.

Recently, Citibank and Credit Suisse gave a zero loan value to Fantasia’s notes, meaning that their private wealth management customers can no longer use Fantasia’s notes as collateral for loans. On September 14, S&P Global Ratings announced a negative outlook on the company and affirmed a “B” rating, as the company’s large foreign debt maturity will weigh on its financials.

Many real estate companies in China are facing cash flow problems. However, the fact that Fantasia Holdings is facing trouble may also carry a political message. It may mean that Zeng Qinghong is likely to be in bad shape. He is not able to save his family’s company.

Sources:
1. Liberty Times, September 7, 2021
https://ec.ltn.com.tw/article/breakingnews/3663843
2. Sina, September 15, 2021
https://finance.sina.com.cn/roll/2021-09-15/doc-iktzqtyt6156639.shtml

September 15, 2021, Pandemic Report: COVID Spreading in China

On September 10, Beijing announced that there were two COVID-19 cases in Fujian Province. From then until the end of September 13, that is within 4 days, Fujian Province reported a total of 139 cases. The Chinese Communist Party (CCP) is known for hiding the details about the actual spread of COVID in China, so the real number of infections is unknown.

The infection in Fujian Province started in Putian City and quickly spread to Quanzhou City and Xiamen City. Many children have been infected. Among the 85 positive cases in Putian City, 36 are students. The number includes 8 kindergarteners and 28 elementary school students.

Related postings on Chinascope:

Source: China News Service, September 15, 2021
http://www.fj.chinanews.com/news/fj_zxsj/2021/2021-09-15/490072.html

U.S.-China Relations: Huanqiu’s Editorial on the U.S.-Taiwan Connection

Huanqiu published an editorial regarding two developments in U.S.-Taiwan relations. The first was a report that the U.S. is considering Taiwan’s proposal to rename Taiwan’s representative office in Washington from the “Taipei Economic and Cultural Representative Office” to the “Taiwan Representative Office.” The second development was that senior U.S. officials had an in-person meeting with the Taiwan Foreign Minister in Annapolis, MD, which is a one hour drive away from Washington, DC.

Huanqiu’s editorial said,

“The U.S. side is well aware that this is not a trivial matter, and they are now in the stage of releasing information and testing the reaction of mainland China.

What is there to test? They want to push the matter to the tipping point of a showdown. Mainland China has no choice but to meet the challenge and prepare for a showdown with them.

If the U.S. changes the name of the Taiwan Representative Office, the mainland’s diplomatic response will not be lower than our response to Lithuania at all. It can fully expected that China will recall its Ambassador from the U.S.

Having only a diplomatic response is obviously not enough. If the U.S. and Taiwan rename Taiwan’s office, they have violated the red line of (China’s) Anti-Secession Law. Mainland China needs to take severe economic and military measures to combat the arrogance of the U.S. and Taiwan. The mainland should apply severe economic sanctions against Taiwan or even impose an economic blockade, depending on the situation.

Militarily, mainland warplanes should fly over the sky of the Taiwan island and include Taiwan’s airspace as part of the People’s Liberation Army’s (PLA’s) cruising patrol. This is a step that mainland China must take sooner or later, and the office renaming will provide a sufficient reason for the mainland to assert its sovereignty over Taiwan. We expect that the Taiwanese military will dare not stop the PLA warplanes from flying over Taiwan. If they dare to open fire, let us deliver a decisive and devastating blow to the ‘Taiwan independence’ forces without hesitation.

Actually, the Taiwan issue is a willpower contest. Since Beijing has declared that Taiwan is China’s core interest, we will act resolutely to guard this bottom line of our national interest and pay any price for it.

It seems that sooner or later, a big, earth-shaking storm will come to the Taiwan Strait. Even if the U.S. and Taiwan retreat their foot this time, their foot will cross the line the next time. Now we need to get ready to ‘break their legs’ in the Taiwan Strait at any time.”

Source: Huanqiu, September 12, 2021
https://opinion.huanqiu.com/article/44k3twGoFQh