Where Have All the Chinese I.P.O.s Gone?; Tech war: OpenAI to further block access by mainland China, Hong Kong-based developers
China warns against ‘vicious cycle’ of decoupling from the West
Welcome to this issue of The China Brief. Today is June 25, 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.
Where Have All the Chinese I.P.O.s Gone?
NY Times
Chinese companies are finding it increasingly difficult to raise funds through initial public offerings (IPOs) in both the US and China. The deteriorating geopolitical relationship between China and the US has made it harder for Chinese firms to list in foreign markets due to potential political scrutiny. Meanwhile, in China, regulators have tightened controls on IPOs as part of Beijing's efforts to gain greater control over the domestic market. This has resulted in a significant slowdown in the pace of listings, with only around 40 Chinese companies going public in China this year, raising less than $3 billion in total. If this trend continues, it will be the fewest Chinese IPOs worldwide in over a decade.
https://www.nytimes.com/2024/06/25/business/china-ipo-initial-public-offer.html
Tech war: OpenAI to further block access by mainland China, Hong Kong-based developers
South China Morning Post
OpenAI is blocking access to its AI services via APIs to "unsupported countries and territories", which includes mainland China and Hong Kong. The move is expected to affect Chinese companies that utilise OpenAI's large language models (LLMs) to develop their own generative AI applications. OpenAI's decision further exacerbates the AI divide between China and the US, with the Biden administration also limiting China's access to semiconductors and American investment in its AI sector.
https://www.scmp.com/tech/policy/article/3267971/tech-war-openai-further-block-access-mainland-china-hong-kong-based-developers?utm_source=rss_feed
China warns against ‘vicious cycle’ of decoupling from the West
CNN
Chinese Premier Li Qiang has warned against economic decoupling from the West, as Beijing faces growing global backlash over increasing electric vehicle (EV) exports. Li defended China against accusations that overcapacity in key green industries had led to dumping of products such as EVs and solar panels on global markets. Canada is the latest Western country to consider imposing tariffs on EVs made in China. Last month, the Biden administration quadrupled tariffs on EV imports from China. The EU, the biggest overseas buyer of Chinese EVs, announced additional provisional tariffs earlier this month due to Beijing’s unfair support for companies.
https://edition.cnn.com/2024/06/25/economy/china-li-qiang-economic-decoupling-warning-intl-hnk/index.html
CATL boss Robin Zeng urges China’s EV makers to stop cutting prices and focus on reliability
South China Morning Post
The chairman of Chinese EV battery manufacturer Contemporary Amperex Technology Ltd (CATL) has urged EV builders and car component manufacturers to end a "race to the bottom" in terms of pricing, which is putting the reliability of EV products at risk. Robin Zeng said the EV industry should be focused on technology, long-term value, sustainability and safety.
https://www.scmp.com/business/companies/article/3267975/catl-boss-robin-zeng-urges-chinas-ev-makers-stop-cutting-prices-and-focus-reliability?utm_source=rss_feed
China's Chang'e-6 mission successfully returns to Earth with historic moon samples
Yahoo US
China's Chang'e-6 mission has returned to Earth with samples from the far side of the moon. The Chang'e-6 probe collected samples from a crater known as the Pole-Aitken basin before departing the lunar surface on 4 June. The return capsule successfully separated from the orbiter and entered Earth's atmosphere on 25 June. The Chinese space agency said the mission "represents a significant milestone in the history of human lunar exploration". China is the only nation to visit the far side of the moon.
https://www.yahoo.com/news/chinas-change-6-mission-successfully-085345741.html
How to read China’s economic report card for the first 5 months of 2024
South China Morning Post
China's economic recovery is a mixed bag of joy and concern. While economic indicators show better growth compared to the same period last year, consumers, investors, and entrepreneurs lack confidence in the economic outlook. Investment is recovering at a slower pace, but excluding real estate, fixed asset investment has already recovered to pre-pandemic levels. Import and export of goods have increased, but tariffs imposed on Chinese products by the US and EU may pose challenges. Consumption, which has contributed most to GDP growth, seems to be falling short of market expectations.
https://www.scmp.com/opinion/china-opinion/article/3267915/how-read-chinas-economic-report-card-first-5-months-2024?utm_source=rss_feed
China’s premier slams trade tensions as EV exports are hit by tariffs
Associated Press
Chinese Premier Li Qiang has emphasized the importance of open markets and green technologies for stabilizing global growth. Speaking at the World Economic Forum Annual Meeting of the New Champions, Li urged countries to work together and reject trade tensions, bloc confrontation, and decoupling. He also stressed that the green transition should not be slowed down in exchange for short-term economic growth nor should protectionism be practiced in the name of green development or environmental protection. Li's comments come as China faces pushback over its electric vehicle exports, with several countries considering surtaxes on Chinese EVs.
https://apnews.com/article/china-qiang-evs-trade-davos-77cb6141b3506c435e9b60eb447a1ecb
Outrage in Japan as ‘indoctrination’ blamed for stabbings of woman, child in China
South China Morning Post
An attack on a Japanese woman and her young son in China has led to a backlash in Japan, with many people blaming years of anti-Japanese “indoctrination” in Chinese schools and state-run media. The woman and her child were attacked on Monday along with a Chinese woman as they waited for a bus in Suzhou. The Japanese embassy in Beijing issued a statement calling on its nationals to be alert in the wake of the attack, which came two weeks after four university lecturers from Cornell College were stabbed at a public park in China’s Jilin province.
https://www.scmp.com/week-asia/politics/article/3267957/outrage-japan-indoctrination-blamed-stabbings-woman-child-china?utm_source=rss_feed
Chinese premier rebuffs ‘bloc confrontation’, talks up open markets in ‘Summer Davos’ address
South China Morning Post
Chinese Premier Li Qiang has spoken out against efforts from the West to "decouple" their economies from China and engage in "bloc confrontation". Speaking at the World Economic Forum's Annual Meeting of the New Champions, Li affirmed that China's market would remain open and Beijing would continue to optimise the country's business environment. Li also defended China's new energy sector against accusations of overcapacity. China is currently facing a two-front conflict over trade, as the US and EU move to penalise imports of Chinese EVs and other green products over allegations of subsidies and excess capacity.
https://www.scmp.com/economy/china-economy/article/3267954/chinese-premier-rebuffs-bloc-confrontation-talks-open-markets-summer-davos-address?utm_source=rss_feed
Chinese EV makers shielded by hefty margins as EU unleashes tariff blitz
South China Morning Post
Chinese-made electric cars are set to continue gaining market share in Europe despite the European Union's punitive tariffs on Chinese pure EVs. The EU will impose additional tariffs ranging from 17.4% to 38.1% on Chinese-made pure EVs from 4 July. Analysts say the duties will not be enough to shut Chinese EVs out of the EU, as Chinese EV makers enjoy a significant cost advantage over their European rivals. China overtook Japan to become the world's largest vehicle exporter last year, with 1.2 million of the 4.91 million units shipped being powered by batteries.
https://www.scmp.com/business/china-business/article/3267933/chinese-ev-makers-shielded-hefty-margins-eu-unleashes-tariff-blitz?utm_source=rss_feed
What is at stake for China-founded Shein as EU rule looms
Japan Times
Shein, the China-founded e-commerce giant, may face more trademark scrutiny under new EU rules that tighten oversight on intellectual property rights. The company, which is pushing for a London IPO, will be required to prevent product listings that violate intellectual property rights and to prevent the listing or selling of counterfeits to its 108 million monthly active users in the EU. The new rules will come into effect at the end of August.
https://www.japantimes.co.jp/business/2024/06/25/companies/china-ecommerce-shein-eu-rule/
China’s rich spend millions on Shanghai property, bucking crisis
Japan Times
Shanghai's luxury real estate market is thriving despite a slump in China's overall property sector. Wealthy Chinese investors are still buying luxury properties in Shanghai as they see it as a safe investment. The recent buyers are attracted to Shanghai's financial hub status, the scarcity of luxury properties, and the discounts offered on new properties compared to existing ones.
https://www.japantimes.co.jp/business/2024/06/25/markets/china-rich-shanghai-property/
Hong Kong Disneyland posts 83% reduction in losses as post-pandemic recovery continues
South China Morning Post
Hong Kong Disneyland Resort reported an 83% decrease in net losses to HKD 356 million ($45.6 million) in 2023, marking a strong recovery after the pandemic. The theme park also broke records in financial indicators such as revenue, EBITDA, and net profit in the first quarter of this year. While this is a positive development, 2023 still marked the company's ninth consecutive year of losses. The recovery was attributed to increased demand from mainland Chinese and Southeast Asian visitors, as well as new attractions and shows. However, the recovery of long-haul visitors remained constrained by flight capacity. Hong Kong Disneyland Resort is 52% owned by the Hong Kong government and the rest by Walt Disney Company.
https://www.scmp.com/news/hong-kong/hong-kong-economy/article/3267948/hong-kong-disneyland-posts-83-reduction-losses-post-pandemic-recovery-continues?utm_source=rss_feed
Undeterred by cooling demand, Singapore moves to spur private home building
South China Morning Post
The Singapore government plans to release the highest amount of private housing supply since 2013, despite a lack of interest from developers. The Ministry of National Development said it would supply land that could yield 11,110 private residential units this year. The property market in Singapore has cooled due to higher interest rates and a lack of demand from wealthy foreigners. However, the government is seeking to tackle a surge in residential rents, which remain near multi-year highs. Developers are growing cautious and are reluctant to take on new projects.
https://www.scmp.com/news/asia/southeast-asia/article/3267935/undeterred-cooling-demand-singapore-moves-spur-private-home-building?utm_source=rss_feed
‘Polite’ China thief steals watch, laptop from firm, leaves note advising boss to upgrade security
South China Morning Post
A burglar in Shanghai, China, left a note for the owner of the business he robbed, asking them to improve their anti-theft system. The man stole a watch and an Apple MacBook before leaving the note, which also included his contact information. The police were able to track down the thief using surveillance cameras and the phone number he left, and he was caught with the stolen items while trying to leave the city on a train. The incident has amused internet users, who have dubbed the thief the "kind thief" and made jokes about his actions. This incident follows a similar one in 2022, where a burglar in Chongqing stole items and left a note promising to return them, along with a payment, within three days.
https://www.scmp.com/news/people-culture/trending-china/article/3266636/polite-china-thief-steals-watch-laptop-firm-leaves-note-advising-boss-upgrade-security?utm_source=rss_feed
U.S. probing Chinese telcos over internet and cloud risks
Japan Times
The Biden administration is investigating China Mobile, China Telecom, and China Unicom over concerns that the companies could potentially exploit access to American data through their U.S. cloud and internet businesses and provide it to Beijing. The investigation is being conducted by the Commerce Department, and the companies have been subpoenaed. While China Mobile and China Telecom have undergone "risk-based analyses," the probe into China Unicom is less advanced. Although the companies are no longer allowed to provide telephone and retail internet services in the United States, they still have a small presence in the country, including providing cloud services and routing wholesale U.S. internet traffic, which could potentially allow them access to American data.
https://www.japantimes.co.jp/business/2024/06/25/tech/us-china-telecom-risks/
Distinguished Economist Spots the Lodestar in China’s Economy
South China Morning Post
China's economy is facing challenges from global and domestic uncertainties, and Professor Justin LIN Yifu recently delivered a lecture at City University of Hong Kong to discuss these challenges and opportunities. Lin highlighted the impact of China's rapid economic growth on the global order, particularly in relation to Sino-American relations. He also noted China's potential in developing innovative technologies and driving growth in high-value-added sectors. The lecture concluded with a discussion on the importance of the Chinese market to global economic stability and the need for government policies to promote investment and address youth unemployment and skill shortages.
https://www.scmp.com/presented/news/hong-kong/education/topics/harmony-urban-jungle/article/3267025/distinguished-economist-spots-lodestar-chinas-economy?utm_source=rss_feed
Bad manners: China coffee shop chain feels heat after hard-worked staff lose it with patrons
South China Morning Post
A café server in China has been fired after throwing coffee granules at a customer. The incident was caught on surveillance camera and posted online, quickly going viral. The incident sparked a debate about workers' rights in China's service industry. Two similar incidents involving staff and customers at other branches of the coffee shop chain were also reported. The incidents have led to criticism of the brand for putting its employees under pressure. The coffee shop company has apologized to the customers involved and said it will train employees and improve working conditions.
https://www.scmp.com/news/people-culture/trending-china/article/3267899/bad-manners-china-coffee-shop-chain-feels-heat-after-hard-worked-staff-lose-it-patrons?utm_source=rss_feed
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