China

31Oct mmBy Brian ThompsonNo Comments
Asia, China, Market

Asia Economic Monthly: Exposure to China in Asia

Australia and Singapore are the most exposed to China growth due to strong economic linkages via the commodity and trade channels, respectively. The Philippines and India are the least exposed due to weak trade and investment linkages with China. The spillover from China to the rest of Asia has weakened over the last decade due to the fall in Asia’s export share to China. China’s policy blitz China’s recent stimulus blitz is the latest addition to the various uncertainties weighing on Asia’s economic outlook. Since September 24, the nation has announced monetary policy easing, liquidity support for equity markets, government pledges to arrest the property market decline, and reports of fiscal support in the pipeline. Nomura’s China economics team has lifted its Q4 2024 GDP fo...
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31Oct mmBy Joe RodriguezNo Comments
Asia, China, Market

The October manufacturing PMI for China resumed its upward trajectory.

China's manufacturing PMI surprisingly returned to expansion China's PMI beat expectations with an uptick to 50.1 in October, which marked the first expansion since April, and marked a six-month high. The 50.1 level is the smallest possible expansion for the PMI but nonetheless bucks expectations for continued contraction, and is a positive sign that the small bounce back of industrial production that we saw in September could continue.  Looking at the subindices, there are some signs that the domestic situation could be seeing a gradual improvement. The production subindex hit a six-month high of 52.0, and new orders also returned to a neutral state of 50.0 after contracting the previous five months. While still in contraction, employment (48.4 up from 48.2...
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<strong>China’s relentless pursuit of U.S. technology</strong>
29Oct mmBy Joe RodriguezNo Comments
China, USA

China’s relentless pursuit of U.S. technology

In recent years, the United States has faced an unprecedented challenge in safeguarding its technological advancements and intellectual property from a persistent and resourceful adversary: China. A series of high-profile cases have highlighted the extent of China's efforts to acquire sensitive U.S. technology, often through illegal means. These incidents not only threaten America's economic interests but also pose significant risks to national security. The case of Chen Lin, a 65-year-old Chinese national who recently pleaded guilty to illegally exporting U.S. semiconductor equipment, exemplifies the ongoing struggle to protect critical technologies. Chen's attempt to procure a wafer-cutting machine for Chengdu GaStone Technology, a company on the U.S. Entity List, underscores the...
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<strong>IMF on China’ growth: falling and impacting others</strong>
27Oct mmBy Joe RodriguezNo Comments
China

IMF on China’ growth: falling and impacting others

The International Monetary Fund (IMF) on October 22 presented World Economic Outlook report and found China faltering with a lowered growth forecast to 4.8% in 2024 as compared to 5% in 2023 despite a number of stimulus packages injected by the Xi Jinping’s regime in the recent times. The IMF report highlighted China’s weakening property sector and low consumer spending as the major reasons for its failing economy.  IMF has forecasted China’s growth rate to be at 4.5% in 2025 even when there are good number of measures taken such as increased net exports and more funds released to support country’s growth. China’s woes don’t end here as its constant trade war with the United States has resulted in new tariffs being imposed by both the countries on each other and these trade ta...
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<strong>Client exodus sparks 70 percent revenue drop for Price Waterhouse Coopers China</strong>
21Oct mmBy Michael SmithNo Comments
China

Client exodus sparks 70 percent revenue drop for Price Waterhouse Coopers China

Price Waterhouse Coopers (PWC) faces severe repercussions following the Ever Grande financial fraud scandal. Numerous Chinese companies are terminating contracts, potentially costing PWC 561 million Yuan in audit revenue, reducing income by two-thirds. The scandal has also led to major layoffs, with employees sharing farewell messages on Xiao Hongshu, and many former PWC staff actively seeking new positions on job-seeking platform Boss Zhipin. PWC cited external factors and market demand for recent layoffs, heavily affecting the Guangzhou audit department. Similar cuts occurred in Beijing and Shenzhen. The Shanghai office required staff to take 120 unpaid hours while earning only 20% of their salary. PWC also halved the annual income of its highest-earning partners. The Ever Grande...
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Shaoguan’s vacant apartments, a representation of China’s real estate crisis
21Oct mmBy Joe RodriguezNo Comments
Asia, China

Shaoguan’s vacant apartments, a representation of China’s real estate crisis

You have to arrive at night in Shaoguan, a city of 3.3 million people in southeast China, to measure the real estate crisis that has hit the country. Around the high-speed train station, inaugurated in 2019, tower blocks of buildings have sprung up like mushrooms in recent years, creating a gigantic neighborhood. But when night falls, not a single light is on. That’s because Shaoguan is drowning in empty and unsold apartments. At the current sales pace, it will take more than 10 years to sell this stock, compared to an average of two years in China, according to estimates by the China Real Estate Information Corporation. This is a record in the country, which has 28,000 billion yuan ($3.96 billion) worth of available apartments, according to Barclays. “There are so many...
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The worldwide market is being revolutionized by China’s electric car sector.
20Oct mmBy Michael SmithNo Comments
Asia, China, Market, World

The worldwide market is being revolutionized by China’s electric car sector.

The global electric vehicle market has become a critical component in the transition towards a low-carbon future. At the forefront of this revolution is China, whose rapid ascent in the EV industry has left global automakers scrambling to keep pace. Despite trade tensions and tariffs aimed at curbing its dominance, China remains the undisputed leader in the sector, producing more than 60% of the world’s EVs. China’s success in the electric vehicle industry can be traced back to a combination of forward-thinking policies, substantial investments, and a national commitment to innovation. The story begins with a strategic proposal made by Wan Gang, often referred to as the father of the EV movement in China. His vision, presented to the Chinese State Council in 2000, emphasised the need f...
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Trump says if China assaults Taiwan, he would impose heavy tariffs.
19Oct mmBy Joe RodriguezNo Comments
Asia, China, USA, World

Trump says if China assaults Taiwan, he would impose heavy tariffs.

US Republican presidential candidate and former US President Donald Trump said he would impose additional tariffs at “150% to 200%” on China if it were to "go into Taiwan," the Wall Street Journal reported Friday (Oct. 18). When asked whether he would use military force in response to a potential Chinese blockade of Taiwan, Trump said it wouldn’t be necessary because Chinese President Xi Jinping (習近平) respects him. “I wouldn’t have to, because he respects me and he knows I’m f— crazy,” Trump stated. During his presidency from 2017 to 2021, Trump took an aggressive stance on China. He imposed multiple rounds of tariffs that triggered a trade war and affected the global economy, according to Reuters. Trump also addressed Russia’s invasion of Ukraine in the interview,...
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Everyone is affected by China’s economic slowdown; it’s not just a personal issue.
19Oct mmBy Joe RodriguezNo Comments
Asia, China, Market, World

Everyone is affected by China’s economic slowdown; it’s not just a personal issue.

Issues in a country can have a rippling effect felt by its neighbours and countries far across the globe. The reason behind this is globalisation, which doubtless, has its benefits but has also increased the linkage and dependencies between countries.  For example, Sri Lanka’s economic turmoil, which began in 2019, negatively impacted the businesses of Indian companies such as Reliance, Ashok Leyland and Tata Motors, but also opened more doors for India in the tea market. Because of the crisis, Sri Lanka’s primary tea exports fell significantly, and India took this opportunity to fill this gap in the global market.  Similarly, China’s economic slowdown is causing shock waves not only in the country but also across the global economy. Here’s a detailed picture.  Why...
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18Oct mmBy Joe RodriguezNo Comments
Asia, China, Market

An Overview of the Chinese Economy, October 2024

China’s economy expanded by 4.6% yoy in Q3 2024 – broadly in line with our expectations – marginally slower than at 4.7% yoy growth recorded in Q2. We have argued for some time that the full year target of “around 5%” would be difficult to reach – indeed it would take a sizeable acceleration in activity in Q4, something we consider unlikely given the lack of meaningful fiscal stimulus to date. Should such a program occur following the National People’s Congress in late October, it likely implies more upside risk to our 2025 forecasts than 2024. Our growth forecasts are unchanged – we see an increase of 4.7% yoy in 2024, before easing to 4.6% in 2025, with the property sector and weak domestic demand remaining headwinds to growth Growth in China’s industrial production was slightly str...
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