China stocks: Can the third plenum be a game changer as investors seek fresh catalysts? Chinese EV makers bypass EU and US tariff roadblock by turning towards Africa
Tesla cars included in Chinese government’s purchase catalog for the first time
Welcome to this issue of The China Brief. Today is July 5, 2024. Here at The China Brief, we bring you the latest news on China's politics, economy, and society from global media sources, along with exclusive expert analysis. If you find our content helpful, please subscribe to our newsletter.
China stocks: Can the third plenum be a game changer as investors seek fresh catalysts?
South China Morning Post
China's Communist Party will hold a plenary session from July 15 to 18 in Beijing, which is expected to provide a boost to the country's stock market. Structural issues such as fiscal and tax reforms, technology innovation and the property market will be on the agenda of the four-day conference. However, the market wants to see signs of material market-oriented reforms, which may not come to fruition. Investors have already de-risked their portfolios, as data shows that China is struggling to grow.
https://www.scmp.com/business/china-business/article/3269324/china-stocks-can-third-plenum-be-game-changer-investors-seek-fresh-catalysts?utm_source=rss_feed
Chinese EV makers bypass EU and US tariff roadblock by turning towards Africa
South China Morning Post
The imposition of higher tariffs on Chinese electric vehicles (EVs) by the US and Europe will only be a temporary setback, according to Zhou Jiang, vice-president of Chinese EV maker Neta Auto. Jiang added that such measures were pushing Chinese companies to seek alternative markets, including Africa, where Neta recently opened its first store. Jiang said Chinese EV brands were also looking to other markets in Southeast Asia, South America and Europe. The US announced in May it would quadruple tariffs for Chinese EVs to 100% from 25%, while the EU said last month it would impose additional tariffs of up to 38% on imported Chinese EVs from 4 July. Both claimed Chinese subsidies to carmakers had distorted the market. Jiang denied this and said the quality and pricing of Chinese EVs was due to over a decade of development.
https://www.scmp.com/news/china/diplomacy/article/3269234/chinese-ev-makers-bypass-eu-and-us-tariff-roadblock-turning-towards-africa?utm_source=rss_feed
Tesla cars included in Chinese government’s purchase catalog for the first time
CNN
Tesla cars have been included on a local Chinese government's purchase list for the first time. This means that government agencies and public groups can now procure Tesla vehicles as service cars, highlighting the close relationship between China and Elon Musk's electric car company. Tesla is the only foreign-owned EV car brand on the purchase catalog published by the government of Jiangsu province in eastern China. Last year, China accounted for more than half of the world's total EV sales and Tesla derived nearly a quarter of its total revenue from China. However, the US carmaker is facing rising competition from Chinese rivals, with BYD overtaking Tesla as the biggest seller of EVs in Q4 2023.
https://edition.cnn.com/2024/07/05/business/tesla-enters-chinese-government-purchase-list-for-first-time-intl-hnk/index.html
15 years after Xinjiang unrest, China fends off criticism of hardline rule
Nikkei Asia
Fifteen years ago, protests broke out in Urumqi, the capital of the northwestern Xinjiang region, resulting in a brutal crackdown by Chinese authorities. The violence prompted Beijing to adopt a tougher stance in governing Xinjiang, which continues to this day. China has faced allegations of human rights abuses and attempts to strip away Uyghur identity in the region. However, the country has found support from certain segments of the international community, particularly in Central Asia, where shared economic interests and political needs have fostered friendly ties. China recently convened the eighth China-Eurasia Expo in Urumqi, which attracted nearly 250,000 visits and resulted in contracts worth $84.67 billion. President Xi Jinping has also visited Kazakhstan and Tajikistan, two former Soviet republics that border Xinjiang, and signed joint statements with their leaders emphasizing the importance of political security and opposing interference in internal affairs. China has justified its hardline policies in Xinjiang as a fight against terrorism, but the United Nations has warned that Beijing's actions may constitute crimes against humanity. Human rights organizations have called for an independent international mechanism to monitor and investigate the situation in Xinjiang.
https://asia.nikkei.com/Politics/15-years-after-Xinjiang-unrest-China-fends-off-criticism-of-hardline-rule
China’s BYD Opens EV Factory in Thailand, Expanding Regional Presence
Diplomat
Chinese automaker BYD has opened an electric vehicle (EV) plant in Thailand, its first factory in Southeast Asia. The $486m facility, in Rayong, will employ around 10,000 workers and have an annual production capacity of 150,000 vehicles per year. BYD's move into Thailand is part of a trend by Chinese automakers to expand into the fast-growing regional EV market.
https://thediplomat.com/2024/07/chinas-byd-opens-ev-factory-in-thailand-expanding-regional-presence/
China and Russia's security bloc tightens bonds as it expands
Nikkei Asia
Leaders from China, Russia, Central Asia and beyond gathered in Kazakhstan this week and signed a declaration to strengthen cooperation on everything from economic development, trade and energy to counterterrorism and anti-narcotics policies. The venue was the annual meeting of the China-led Shanghai Cooperation Organization (SCO), a regional security grouping that sees itself as a potential counterweight to the West's influence but comprises disparate countries with varying interests.
https://asia.nikkei.com/Politics/International-relations/China-and-Russia-s-security-bloc-tightens-bonds-as-it-expands
China's central bank readies bonds to sell by tapping major banks
Japan Times
China's central bank, the People's Bank of China, has announced that it has "hundreds of billions" of yuan worth of government bonds at its disposal to borrow, after signing agreements with several major financial institutions. The move is seen as an attempt to cool down a record-breaking rally in government bonds. This announcement comes after months of speculation about the central bank's intentions.
https://www.japantimes.co.jp/business/2024/07/05/markets/china-pboc-bonds-major-banks/
China, struggling to exploit an energy storage boom, calls for more
Japan Times
China has built its largest energy storage facility, a 795 MW plant in Shandong province, which can hold up to 1 million kWh of electricity. The project is part of China's increasing investment in energy storage to boost renewable electricity and alleviate grid congestion.
https://www.japantimes.co.jp/business/2024/07/05/tech/china-boom-energy-storage/
China youth playfully list jobs, colleagues for sale online to rid of work pressures
South China Morning Post
Chinese workers are "selling" their jobs and colleagues on second-hand e-commerce platforms to relieve stress. Alibaba's Xianyu platform features more than 500 posts selling "annoying jobs", "terrible bosses", and "hated colleagues" at prices from 2 yuan ($0.30) to 80,000 yuan ($11,000). The sellers ensure the ads do not result in a cash transaction. However, the practice of selling personal information could lead to fines or a 10-day detention in China. The trend is part of a growing movement to promote a healthier work-life balance among Chinese young people.
https://www.scmp.com/news/people-culture/trending-china/article/3268638/china-youth-playfully-list-jobs-colleagues-sale-online-rid-work-pressures?utm_source=rss_feed
China unveils next steps in EU brandy probe as EV tariffs take effect
Nikkei Asia
China has announced the next stage of its anti-dumping investigation into European brandy imports, escalating tensions on the same day the European Commission's provisional tariffs on Chinese-made electric vehicles (EVs) took effect. The country has called on the EU to cancel the EV tariffs, but threatened wide-ranging retaliation if they are not. China has opened investigations into European brandy and pork imports since January, in a bid to persuade France and Spain to join Germany, which wants the EV tariffs stopped.
https://asia.nikkei.com/Economy/Trade-war/China-unveils-next-steps-in-EU-brandy-probe-as-EV-tariffs-take-effect
Hong Kong start-ups shine at China’s largest AI show amid city’s drive for Asian tech hub status
South China Morning Post
Hong Kong start-ups showcased their artificial intelligence (AI) products and services at the World Artificial Intelligence Conference (WAIC) in Shanghai. The city's cyberport, Hong Kong Science and Technology Parks and the Hong Kong Trade Development Council brought 15 companies to the event, in line with the city's drive to become a tech hub. The start-ups presented AI image generation, industrial quality-control solutions, large language models, internet of things systems and AI-powered rescue drones.
https://www.scmp.com/tech/big-tech/article/3269294/hong-kong-start-ups-shine-chinas-largest-ai-show-amid-citys-drive-asian-tech-hub-status?utm_source=rss_feed
Hong Kong stocks decline as EU unveils tariffs on Chinese EVs; BYD, Li Auto lead losses
South China Morning Post
Hong Kong stocks fell on Friday after the European Union imposed tariffs on Chinese electric vehicle imports. The Hang Seng Index dropped 0.7% and the Tech Index weakened 1.1%. The Shanghai Composite Index declined 0.6% and hit a five-month low. BYD's stock fell 0.6% to HKD233.20 ($30), and Geely Auto tumbled 3.7% to HKD8.38, after the EU raised tariffs on the two firms by 17.4% and 19.9% respectively. However, the Hang Seng Index has gained 1.2% this week as mainland investors targeted high-yielding stocks.
https://www.scmp.com/business/markets/article/3269246/hong-kong-stocks-decline-eu-unveils-tariffs-chinese-evs-byd-li-auto-lead-losses?utm_source=rss_feed
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