China will wield big mop to clean up property mess; Amazon asks Chinese sellers not to offer cheaper prices on Temu
Ukraine war: Zelensky thanks China for supporting territorial integrity
Welcome to this issue of The China Brief. Today is December 24, 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 will wield big mop to clean up property mess
Reuters BreakingViews
China's $13 trillion real estate glut is hindering economic growth under President Xi Jinping. To stabilize the market, experts suggest shifting vacant homes to a 'bad bank' for conversion into affordable housing. With new home prices falling significantly for 16 months, Beijing's current efforts, including a 300 billion yuan relending program, have seen limited success. A proposed housing policy bank could help absorb unsold properties and regulate prices, though it would require significant investment. The situation recalls past government interventions during housing crises in other countries, highlighting the urgent need for effective solutions in China's property market.
https://www.breakingviews.com/features/china-will-wield-big-mop-to-clean-up-property-mess/
Amazon asks Chinese sellers not to offer cheaper prices on Temu
South China Morning Post
Amazon has urged some Chinese merchants to stop listing goods at lower prices on rival platform Temu, amid increasing competition from the budget retailer. Sellers reported being removed from Amazon's Featured Offer program if their prices were higher than those on Temu, which is owned by PDD Holdings. Despite Amazon claiming sellers set their own prices, many felt pressured to comply to avoid penalties. Temu's algorithm favors lower prices, pushing sellers to compete aggressively. The situation escalated with brands like Anker removing their listings on Temu, highlighting Amazon's challenge against emerging rivals like Temu.
https://www.scmp.com/tech/big-tech/article/3292130/amazon-asks-chinese-sellers-not-offer-cheaper-prices-temu?utm_source=rss_feed
Ukraine war: Zelensky thanks China for supporting territorial integrity
South China Morning Post
Ukrainian President Volodymyr Zelensky thanked China for its support of Ukraine's territorial integrity and highlighted improving bilateral relations during a meeting with China's ambassador. Zelensky expressed a desire to restore pre-war trade levels and strengthen ties. He urged China to use its influence regarding North Korea's involvement in the Ukraine war. Despite engaging in peace talks, Zelensky rejected China's six-point peace plan, warning it could allow Russia to continue the conflict. Recent diplomatic efforts between Ukraine and China have gained momentum, although China's relations with Russia remain strong, drawing scrutiny from the US and EU.
https://www.scmp.com/news/china/diplomacy/article/3292169/ukraine-war-zelensky-thanks-china-supporting-territorial-integrity?utm_source=rss_feed
China’s CATL launches EV chassis that can withstand high-speed crash
South China Morning Post
China's Contemporary Amperex Technology (CATL), the largest electric vehicle battery manufacturer globally, has introduced a new electric vehicle chassis capable of withstanding a frontal impact at 120km/h (75mph) without fire or explosion. This chassis, named "panshi" (meaning "bedrock"), boasts a battery range of approximately 1,000km per charge and reduces vehicle mass production time to 12-18 months, significantly shorter than the traditional 36 months or more. CATL aims to market this platform to premium automakers to streamline development and lower costs. Avatr, a joint venture of CATL, Changan Auto, and Huawei, will be the first to utilize this chassis for new EV models. The chassis integrates electric motors, batteries, controls, and suspensions and is considered vital for CATL's expansion plans. Additionally, CATL is exploring micro power grids and battery swapping services, holding a 37% global market share in EV batteries. The "panshi" project could reduce new EV development costs dramatically, potentially enabling niche EV firms to thrive by selling just 10,000 cars annually.
https://www.scmp.com/business/china-business/article/3292156/chinas-catl-launches-ev-chassis-can-withstand-high-speed-crash?utm_source=rss_feed
Foxconn invests in EV battery plant in China to diversify business beyond Apple’s iPhones
South China Morning Post
Foxconn Technology Group, a major supplier for Apple, is investing 600 million yuan (approximately US$82 million) into a new electric vehicle (EV) battery plant in Zhengzhou, China, where it operates the largest iPhone factory globally. This investment is part of Foxconn's strategy to diversify its revenue streams, with a focus on EVs, semiconductors, and robotics. The company established the Foxconn New Energy Battery (Zhengzhou) unit in October and initially injected 350 million yuan through its New Business Development Group, which was formed in June 2022 with a registered capital of 1 billion yuan.
Foxconn's commitment to Zhengzhou follows disruptions in iPhone production due to a Covid-19 outbreak that resulted in worker shortages and shipment delays for Apple. Despite these challenges, Foxconn is expanding its EV production capabilities, having recently broken ground on a trial manufacturing center in Zhengzhou, and has facilities outside China, including one in Ohio. The company has launched several EV models and aims to capture a 5% share of global EV manufacturing by next year.
https://www.scmp.com/tech/big-tech/article/3292148/foxconn-invests-ev-battery-plant-china-diversify-business-beyond-apples-iphones?utm_source=rss_feed
Hong Kong’s low-altitude economy plans to focus on smaller-drone services first
South China Morning Post
Hong Kong is launching a trial program for drone operations focusing on smaller devices for emergency services, inspection, delivery, and surveillance. The Low-altitude Economy Regulatory Sandbox aims to ease restrictions on autonomous drone flights, facilitating the development of regulations and infrastructure. Applications for the first batch of companies are open until December 31, with results expected in early 2024. Notable applicants include Meituan, which plans to expand its drone delivery services, and X Social Group, collaborating with Hong Kong Polytechnic University on drone technology. The initiative is part of a broader effort to develop a low-altitude economy in the region.
https://www.scmp.com/news/hong-kong/hong-kong-economy/article/3292174/low-altitude-economy-pilot-programme-will-focus-smaller-drone-services?utm_source=rss_feed
State Council guideline encourages private investment in China’s railways
South China Morning Post
China is promoting private sector involvement in its railway system to enhance integration and efficiency within the transport industry. A guideline released by the State Council outlines plans to reform natural monopolies in the transport sector, which have been caused by high infrastructure costs and entry barriers. The aim is to diversify service providers and foster competition by encouraging private investment in railway construction and operations. The guideline follows a recent action plan aimed at reducing logistics costs from 14.4% of GDP to 13.5% by 2027, with a goal of saving over 1 trillion yuan (US$137 billion) to strengthen manufacturing and stimulate domestic demand. It emphasizes market openness, fair access for businesses, and alignment with international trade standards, while also promoting low-altitude airspace management and the expansion of general aviation to enhance the transport system.
https://www.scmp.com/economy/china-economy/article/3292140/state-council-guideline-encourages-private-investment-chinas-railways?utm_source=rss_feed
Hong Kong police announce bounties on overseas pro-democracy activists
Al Jazeera
Hong Kong authorities have placed bounties of 1 million Hong Kong dollars (approximately $130,000) on six pro-democracy activists accused of threatening national security, marking the third instance of such rewards offered for information leading to the arrest of activists living abroad. The wanted list now totals 19 individuals charged with vague offenses like secession and subversion. The new additions include prominent figures such as Tony Chung and Carmen Lau, who have criticized the crackdown. The Hong Kong government has also canceled the passports of several activists already on the list. This move is part of a broader effort to suppress dissent following the protests in 2019, leading to international condemnation of the diminishing freedoms in the region. Critics argue that these actions further damage Hong Kong's international reputation and undermine efforts to restore its status as a global financial hub.
https://www.aljazeera.com/news/2024/12/24/hong-kong-police-announce-bounties-on-overseas-pro-democracy-activists
‘A sense of freedom’: China’s small bookshops relocate across the world
Guardian
On the second anniversary of a deadly fire in Xinjiang that ignited protests in China, poet Hongwei Bao gathered with others in the Netherlands to reflect on the events. His poem, "White Paper," highlights the anger over stringent COVID measures. Bao's new book, "The Passion of the Rabbit God," addresses themes of queer rights and feminism, but he doubts it could be published in China. The crackdown on civil society has led to the closure of independent bookstores like Jifeng in Shanghai, which has since reopened in Washington D.C. as JF Books, aiming to recreate its unique atmosphere.
https://www.theguardian.com/world/2024/dec/24/a-sense-of-freedom-chinas-small-bookshops-relocate-across-the-world
China's UnionPay expands QR code payments to Laos after Vietnam
Nikkei Asia
China's UnionPay International has partnered with Laos' national payment network LAPNet to enable seamless mobile payments for users of UnionPay-supported wallets in Laos. This collaboration, announced in Shanghai, follows a similar agreement with Vietnam's central bank and aims to improve cross-border payment integration in Southeast Asia. Customers can now make payments at Lao merchants using the Cloud QuickPass app and various UnionPay-linked wallets.
The partnership integrates UnionPay's QR standards into Laos' national payment system, LaoQR, simplifying technical updates for merchants. This ensures that all future QR payment merchants in Laos will automatically support UnionPay. UnionPay has a long-standing presence in Laos, having established a financial clearing network and issued over a million cards, dominating the bank card market in the country.
Looking ahead, Lao residents will be able to use local banking apps for QR payments at UnionPay-supported stores globally. This expansion aligns with China's Belt and Road Initiative, as UnionPay continues to grow its payment networks in Southeast Asia and beyond, now active in 110 countries.
https://asia.nikkei.com/Spotlight/Caixin/China-s-UnionPay-expands-QR-code-payments-to-Laos-after-Vietnam
Chinese court delivers suspended death sentence for SUV primary school attack
South China Morning Post
Huang Wen, who drove into a group of parents and children outside a primary school in Hunan, China, has received a suspended death sentence for injuring 30 people, including 18 children. The court ruled that he acted out of personal grievances related to investment losses and family disputes. His actions were described as heinous and targeted at innocent children, causing severe psychological trauma and endangering public safety. This swift judgment reflects rising concerns over public safety in China amid recent violent incidents, prompting authorities to enhance security measures to protect citizens.
https://www.scmp.com/news/china/politics/article/3292111/chinese-court-delivers-suspended-death-sentence-suv-primary-school-attack?utm_source=rss_feed
Chinese surveillance tech firm Dahua exits projects in Xinjiang
South China Morning Post
China's video surveillance equipment manufacturer, Zhejiang Dahua Technology, announced the termination or exit from five projects with local governments in Xinjiang. The filings revealed that some projects awarded between 2016 and 2017 had already been terminated, while others were still operational. Dahua stated it would cease operations on these projects and manage asset disposal and debt resolution. The company did not specify the reasons for the withdrawal. This decision follows a similar move by another surveillance firm, Hikvision, which also exited contracts in Xinjiang. Both companies have faced scrutiny and blacklisting from the US due to allegations of involvement in human rights abuses against Uygurs and other Muslim minorities in the region, which they have denied. The Chinese government has consistently rejected such allegations and criticized companies withdrawing from operations in Xinjiang.
https://www.scmp.com/tech/tech-war/article/3292121/chinese-surveillance-tech-firm-dahua-exits-projects-xinjiang?utm_source=rss_feed
China’s small businesses gasp for air as consumption slump deepens
South China Morning Post
Ella Chen, who opened a milk tea shop in Guangzhou after losing her job during the pandemic, is struggling to keep her business afloat amid a broader economic slowdown in China. Despite her dedication and long hours, her daily profits have plummeted from over 200 yuan to under 100 yuan as customer numbers decline. A nationwide survey reveals that micro and small enterprises (MSEs), which employ 300 to 400 million people, face severe challenges, including insufficient demand, high taxes, and rising costs. The average revenue for MSEs fell by 4.6% year-on-year, with many resorting to cost-cutting measures and downsizing. The situation is compounded by increased competition, exemplified by Liu, a hair salon owner struggling against budget salons nearby. Despite government efforts to reduce tax burdens for MSEs, the perceived tax pressure has risen among business owners. As the economic outlook remains bleak, low- and middle-income groups are expected to continue spending less, further jeopardizing the survival of small businesses like Chen’s. She fears she may have to close her shop soon, impacting her ability to support her children.
https://www.scmp.com/economy/china-economy/article/3292089/chinas-small-businesses-gasp-air-consumption-slump-deepens?utm_source=rss_feed
Honda and Nissan's Chinese state-owned partners also feel the pinch
Nikkei Asia
Honda Motor and Nissan Motor's recent merger talks highlight the pressures that traditional automotive leaders face amid the transition to electric vehicles (EVs). The Chinese automotive market, now the world's largest, is a significant driver of this change, but state-owned enterprises like Guangzhou Automobile Group (GAC) and Dongfeng Motor Group, which have long relied on partnerships with foreign brands, are struggling. These companies have seen substantial drops in vehicle sales, with GAC reporting a 23% decline and Dongfeng experiencing a net loss for the first time since going public in 2005. The competition has intensified with the rise of Chinese EV manufacturers, which have outpaced these established firms in innovation and market share. Both GAC and Dongfeng's reliance on joint ventures for profits is diminishing, leading them to seek strategies that reduce dependence on foreign brands and increase their own brand sales. This shift reflects a broader industry transformation, as traditional automakers must adapt to a rapidly evolving landscape driven by new technologies and changing consumer preferences.
https://asia.nikkei.com/Business/Automobiles/Honda-and-Nissan-s-Chinese-state-owned-partners-also-feel-the-pinch
Apple’s US$1 billion investment: a win for Indonesia but also a ‘double-edged sword’?
South China Morning Post
Indonesia's strategy to compel Apple to increase its investments in the country has resulted in a US$1 billion commitment from the tech giant, enabling the sale of the new iPhone 16, which was previously banned due to non-compliance with local content regulations. These rules require at least 35% of smartphone components to be sourced locally. In response to these pressures, Apple plans to establish a manufacturing facility in Bandung and a plant on Batam Island to produce AirTags, creating about 1,000 jobs. While this investment signals progress for Indonesia's manufacturing ambitions, analysts warn that strict local content requirements could deter foreign firms, raising production costs and creating bureaucratic hurdles. Critics argue that Indonesia's regulations may hinder competitiveness and dissuade new entrants from investing, potentially driving them to more appealing markets like Vietnam and Thailand. Despite the potential for economic growth and job creation, experts emphasize the need for a balanced approach that fosters a favorable investment climate while meeting local content goals. The success of this strategy will depend on Indonesia's ability to reform its regulatory environment and enhance its technological capabilities.
https://www.scmp.com/week-asia/politics/article/3292088/apples-us1-billion-investment-win-indonesia-also-double-edged-sword?utm_source=rss_feed
Chinese EV industry’s lithium demand fuels research into ‘low-quality’ sources
South China Morning Post
As China's electric car industry faces a growing demand for lithium, researchers at Nanjing University are investigating ways to extract the metal from low-quality brines, such as seawater and salt lakes. Current extraction methods are inefficient due to low lithium concentrations and environmental concerns. The study highlights various innovative techniques, including improved precipitation methods and solvent extraction, which could enhance lithium recovery. The researchers emphasize that sustainable lithium production from these sources is essential to meet future demands, as existing reserves may be exhausted by 2050.
https://www.scmp.com/news/china/science/article/3291352/chinese-ev-industrys-lithium-demand-fuels-research-low-quality-sources?utm_source=rss_feed
‘It’s hard to tell’: is Trump serious about Greenland, Panama Canal?
South China Morning Post
Donald Trump has reignited discussions about seizing the Panama Canal, purchasing Greenland, and jokingly suggested Canada become the 51st US state, raising speculation about his seriousness. These remarks have prompted concerns that Trump may treat US allies more harshly than adversaries like Russia and China. While he positions these comments as strategic, experts suggest they could be part of his negotiating tactics or attempts to project strength. Leaders from Panama and Greenland have firmly rejected these ideas, emphasizing their sovereignty amidst Trump's unpredictable rhetoric.
https://www.scmp.com/news/world/united-states-canada/article/3292096/its-hard-tell-trump-serious-about-greenland-panama-canal?utm_source=rss_feed
Fate of US Steel’s deal with Japan’s Nippon is now up to Biden, sources say
CNN
A government committee has informed President Biden that it couldn't reach a consensus on the national security risks of Nippon Steel's acquisition of US Steel. Biden is expected to block the deal to safeguard American steel jobs. Despite US Steel's claims that the merger is vital for its survival against cheaper foreign steel, political opposition complicates its review. Nippon pledged $2.7 billion for US Steel's mills, but the deal faces hurdles from both CFIUS and the Justice Department's antitrust review. Uncertainty remains as Biden's decision could be influenced by President-elect Trump’s stance against the merger.
https://edition.cnn.com/2024/12/23/business/us-steel-nippon-cfius-biden/index.html
China funeral home asks job seekers to spend 10 minutes in morgue, sparks public amusement
South China Morning Post
A Chinese funeral home is humorously attracting attention with its job posting for a "morgue manager" offering a salary of 2,200 yuan (US$302) monthly. Applicants must endure a 10-minute test in a cold morgue to qualify for an interview, along with meeting strict criteria such as being male, under 45, and having a junior secondary education. The role is contract-based and lacks job security. Online reactions range from amusement to criticism of the low salary, with some suggesting more ethical evaluation methods for psychological resilience. The funeral service market in China has significantly grown in recent years.
https://www.scmp.com/news/people-culture/trending-china/article/3291338/china-funeral-home-asks-job-seekers-spend-10-minutes-morgue-sparks-public-amusement?utm_source=rss_feed
China to remain top car exporter in 2025 despite slower growth on EU’s EV tariffs
South China Morning Post
China's car exports are expected to face challenges in 2025 due to new EU tariffs on electric vehicles (EVs), which could decrease demand for Chinese-made pure EVs. In response, leading firms like SAIC Motor plan to diversify their offerings by introducing hybrid and petrol vehicles. Despite a slowing growth rate projected at 14%, exports are still expected to exceed 5.58 million units. The EU remains a key market for Chinese automakers, who aim to maintain competitiveness by adapting their products. Overall, Chinese carmakers are expected to significantly increase their global market share in the coming years.
https://www.scmp.com/business/china-business/article/3291985/china-remain-top-car-exporter-2025-despite-slower-growth-eus-ev-tariffs?utm_source=rss_feed
Trump tariff chaos is a creating a cash cow for consultants
CNN
As President-elect Donald Trump prepares to take office, businesses in the U.S. are bracing for potential new tariffs that could significantly affect their operations and pricing strategies. Many companies are contemplating relocating production to avoid the steep tariffs he has vowed to impose, particularly on imports from China, Mexico, Canada, and European Union nations. This uncertainty is causing anxiety among businesses, especially those reliant on exports, as they scramble to adjust their supply chains and manage inventory levels in anticipation of potential price increases. In response, supply chain and trade consultants are experiencing heightened demand, as companies seek to navigate these challenges. Experts like Dan Gardner and Joseph Esteves are advising clients on optimal production locations and strategies to balance supply and demand, thereby avoiding the pitfalls seen during the pandemic. Additionally, the integration of artificial intelligence in supply chain management is becoming increasingly important, allowing firms to predict disruptions and manage costs effectively. As businesses prepare for possible tariff-related changes, consulting firms are gearing up for a surge in demand for their services.
https://edition.cnn.com/2024/12/23/economy/trump-tariffs-consultants/index.html
China’s extended visa-free tourist stays drive momentum for opening
South China Morning Post
China has introduced a visa-free transit policy allowing passport holders from 54 countries to enter via 60 ports and stay for up to 10 days. This shift follows the easing of visa requirements for citizens from 38 countries, reflecting Beijing's desire to enhance international engagement after years of strict border controls due to the "zero-Covid" strategy. The policy aims to boost tourism, trade, and foreign investment, while also fostering goodwill and a more positive image of China globally. Notably, it targets developed economies, signaling a pragmatic approach to foreign relations.
https://www.scmp.com/opinion/china-opinion/article/3291969/chinas-extended-visa-free-tourist-stays-drive-momentum-opening?utm_source=rss_feed
Trump’s TikTok love raises stakes in battle over app’s fate
South China Morning Post
President-elect Donald Trump's support for TikTok has raised hopes for a potential resolution to the app's impending ban in the U.S. after a law was passed requiring its owner, ByteDance, to sell its stake by January 19. Trump believes banning TikTok would benefit Meta, and he met with TikTok's CEO to discuss solutions. The Supreme Court is set to hear TikTok's appeal against the ban on January 10. Options for resolving the issue include a potential extension of the ban deadline, ByteDance selling its U.S. operations, or a decision by Trump’s Justice Department on national security concerns.
https://www.scmp.com/news/world/united-states-canada/article/3292082/trumps-tiktok-love-raises-stakes-battle-over-apps-fate?utm_source=rss_feed
China’s massive solar rooftop roll-out gains traction, but grid struggles to keep pace
South China Morning Post
Gao Shouguang, a former construction contractor, transitioned to becoming a solar panel distributor in Chongqing, China, as part of the country's shift towards renewable energy. His business involves installing rooftop solar panels, which not only generate electricity for sale to grid companies but also provide waterproofing for homes. The rising popularity of solar panels among homeowners, especially farmers, is evident as they can earn additional income by renting rooftop space for installations.
China's solar power capacity has grown significantly, now accounting for 24.8% of the total installed electricity capacity, surpassing wind and hydropower. The distributed solar panel installations have expanded from sunlight-rich northern regions to more southern areas. Government incentives and decreasing costs have made solar energy an economical option for businesses, with over half of the distributed solar installations in 2022 being for commercial use. Despite this growth, challenges remain, particularly regarding grid capacity and the uneven distribution of renewable resources, which can hinder the effectiveness of solar energy systems. Nonetheless, the solar industry is expected to continue expanding, contributing to China's carbon reduction goals.
https://www.scmp.com/economy/china-economy/article/3292003/chinas-massive-solar-rooftop-roll-out-gains-traction-grid-struggles-keep-pace?utm_source=rss_feed
Chinese workers found in ‘slavery-like conditions’ at BYD construction site in Brazil
South China Morning Post
Brazilian officials discovered 163 Chinese workers living in "slavery-like conditions" at a construction site for BYD, a Chinese electric vehicle manufacturer, in Bahia state. The workers, hired in China and brought to Brazil illegally, faced long hours exceeding legal limits, sometimes working seven days a week. They lived in degrading conditions, with some having their passports withheld and needing permission to leave their accommodations. The local labor prosecutor's office reported inadequate safety measures at the site and stated that the investigation is ongoing, with fines yet to be imposed. BYD has not commented on the situation.
https://www.scmp.com/news/china/article/3292081/chinese-workers-found-slavery-conditions-byd-construction-site-brazil?utm_source=rss_feed
Toyota to make Lexus EVs at first independent China plant
Nikkei Asia
Toyota Motor plans to establish its first independently operated plant in China, focusing on the production of Lexus electric vehicles. The factory, set to open in Shanghai around 2027, will cater primarily to the Chinese market, where Lexus sold approximately 180,000 vehicles in 2023. This marks a shift from Toyota's previous joint-venture strategy in China, where it has collaborated with FAW Group and GAC Group to produce vehicles. The decision comes as other foreign automakers are reducing their presence in China, and follows the country's easing of regulations in 2018 that allowed foreign new energy vehicle manufacturers to operate independently.
https://asia.nikkei.com/Business/Automobiles/Electric-vehicles/Toyota-to-make-Lexus-EVs-at-first-independent-China-plant
China-born biologist Wang Cunyu returns from decades in US to head advanced institute
South China Morning Post
Distinguished biologist Wang Cunyu has transitioned from UCLA to Peking University, where he will lead the Institute of Advanced Clinical Medicine (IACM). Wang, who left China in 1990, expressed his honor in returning to his alma mater and aims to bridge the gap between basic research and clinical application, focusing on global medical innovation. Previously, he held significant positions at UCLA, including professor and associate dean, and contributed extensively to research in molecular signaling and cancer therapeutics. Wang has published over 150 papers, received numerous accolades, including election to the National Academy of Medicine, and is recognized for a landmark study on cancer cell death. He holds degrees from Nanjing Medical University and Peking University.
https://www.scmp.com/news/china/science/article/3292050/china-born-biologist-wang-cunyu-returns-decades-us-head-advanced-institute?utm_source=rss_feed
Stay informed about the latest news, analysis, and policy briefs from across the globe related to China with the China brief. Our team aggregates, synthesizes, and summarizes the most important information from various sources, including media outlets, think tanks, government agencies, and industry experts.
Our mission is to provide you with easily accessible and critically valuable information tailored to your specific field of interest. We understand the significance of staying up-to-date on developments related to China and aim to make this information comprehensible for our readers.
Join the conversation and stay informed about the latest news and developments related to China by visiting our website at www.6dobrief.com