Tag: China

<strong>China’s FDI inflow hits a 3-year low in January in a sign of sagging investor confidence</strong>
2Mar mmBy Joe RodriguezNo Comments
Asia

China’s FDI inflow hits a 3-year low in January in a sign of sagging investor confidence

Foreign direct investment (FDI) has long played a crucial role in China's economic growth, providing capital, technology, and employment opportunities.  However, in January 2025, FDI into China dropped by 13.4% year-on-year, marking the weakest start to the year in three years.  Data from the Chinese Ministry of Commerce indicates a sharp decline in investor confidence, raising concerns about China's economic outlook, regulatory environment, and global positioning.  The 13.4% year-on-year decline in FDI is significant for multiple reasons.  First, it highlights a cooling investment climate amid ongoing global economic uncertainties.  Second, it reflects potential structural weaknesses in China’s economy, including concerns about regulatory p...
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<strong>China’s Shift to Consumption-Driven Economy Faces Significant Hurdles</strong>
22Feb mmBy Walter ParezNo Comments
China

China’s Shift to Consumption-Driven Economy Faces Significant Hurdles

Despite the Chinese Communist Party's (CCP) success in driving rapid economic growth, the centralized control that enabled this prosperity is now a burden. The CCP's rigid power structure stifles innovation and flexibility, undermining long-term economic stability. The over-reliance on state-owned enterprises (SOEs) and stringent regulations, particularly on the tech sector, hamper competition and deter foreign investment. Efforts to transition to a consumption-driven economy face significant challenges, as households remain cautious spenders. The growing pains, exacerbated by the CCP's policies, pose a significant threat to China's economic future in the year 2025. Critics of the Chinese Communist Party’s economic strategies assert that the centralization of power suppresses c...
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<strong>The People’s Bank of China: Caught in a policy bind amid the yuan’s decline</strong>
4Feb mmBy Walter ParezNo Comments
China

The People’s Bank of China: Caught in a policy bind amid the yuan’s decline

The People’s Bank of China (PBOC), China’s central bank, finds itself in a challenging and delicate position as it grapples with the declining value of the Chinese yuan.  For years, Xi Jinping’s administration has aimed to elevate the yuan’s global status, positioning it as a potential challenger to the dominance of the US dollar in international trade and finance.  However, the current situation has complicated these ambitions.  The yuan’s ongoing depreciation is not just an economic issue but also a political one, undermining the goals set by the Chinese leadership.  Donald Trump’s election has further complicated Beijing’s already challenging policy landscape.  Even before Trump won the presidency, the PBOC was grappling with a difficult polic...
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China’s Empty Trains: New Year Travel Plummets Amid Economic Crisis
31Jan mmBy Joe RodriguezNo Comments
China

China’s Empty Trains: New Year Travel Plummets Amid Economic Crisis

This year in China, the Spring Festival lacks its usual glitter, bustling markets, and the throngs of travellers returning to their hometowns. Since the COVID-19 pandemic, China's economic situation has deteriorated significantly, resulting in the loss of hundreds of jobs. Those who are still employed are receiving only half their wages. Consequently, people are spending their limited savings very cautiously. Many have decided not to return home for the Spring Festival. As a result, the number of people traveling by road, rail, and air has been negligible. Some travellers reported that their train cars were completely empty. A passenger found himself alone in an entire first-class train car during the Spring Festival travel rush. Unlike the usual crowded scenes of previous years, t...
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German frontrunner Merz warns companies against China investment
24Jan mmBy Joe RodriguezNo Comments
China, World

German frontrunner Merz warns companies against China investment

Friedrich Merz, the conservative front-runner in the race to be Germany’s next chancellor, warned domestic companies against making bigger investments in China. “The decision to invest in China is a decision with great risk,” Merz said at a foreign policy event in Berlin on Thursday. “If you take this risk, do it in such a way that it doesn’t endanger the entire company group if you have to write off this investment from one year to the next.” The remarks by Merz, whose conservative CDU/CSU bloc is leading in the polls ahead of the Feb 23 snap election, signal a radical change from the China-friendly course of previous German governments. Following Russia’s invasion of Ukraine, Scholz’s three-party government started to implement what it called a de-risking strategy as part o...
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China announces plans to increase financial liberalization.
24Jan mmBy Joe RodriguezNo Comments
China

China announces plans to increase financial liberalization.

China on Wednesday revealed a guideline, outlining 20 measures to expand financial opening up in the country's pilot free trade zones and a free trade port. These measures, focusing on six areas, aim to better align China's financial sector with international standards and advance institutional opening up of the sector, said the guideline jointly issued by the People's Bank of China, the Ministry of Commerce and three other government bodies. According to this document, foreign financial institutions will be granted the same treatment as their Chinese counterparts when providing new financial services not available in the country at that stage. Valid applications filed by financial institutions and cross-border financial service providers concerning financial services will be...
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Singapore becomes a haven for companies and investors fleeing tensions between the US and China.
24Jan mmBy Brian ThompsonNo Comments
China, Market, Singapore, USA

Singapore becomes a haven for companies and investors fleeing tensions between the US and China.

Its reputation of political neutrality — and strength in life sciences — is making Singapore a favoured launchpad for western investors and Chinese startups. Two years ago, Polaris Partners, the investment arm of US pharmaceutical company Polaris, opened an office in Singapore as it started to ramp up investments in the Asian country. “Singapore has an extraordinary ecosystem,” says Amy Schulman, managing partner at Polaris Partners. “It has first rate science that gets a good amount of government support. It has terrific intellectual property protection, and it has organised rule of law system that makes things very appealing.” Singapore’s favourable tax system and English-speaking business community have also made it an ideal jumping off point for international companies se...
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Trump warns China that further tariffs will be imposed on February 1.
22Jan mmBy Joe RodriguezNo Comments
China, World

Trump warns China that further tariffs will be imposed on February 1.

President Donald Trump on Tuesday warned that even more tariffs could be coming as soon as next week: This time China was his target, as Trump threatened to unleash a wave of higher taxes on imports from America’s second-biggest trading partner. In an Oval Office press conference that echoed similar off-the-cuff remarks on Monday, Trump said that he is considering a 10% across-the-board tariff on all Chinese goods starting as early as February 1. On Monday, Trump threatened 25% tariffs on Mexico and Canada but deflected on China, noting that former President Joe Biden left in place extensive tariffs that Trump imposed during his first administration. It’s unclear what prompted such a rapid change in Trump’s tariff policy, although he had promised as much as a 60% tariff on all g...
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China’s soft diplomacy and economic necessity Seeking a reversal on admission without a visa
22Jan mmBy Joe RodriguezNo Comments
China

China’s soft diplomacy and economic necessity Seeking a reversal on admission without a visa

It was once a privilege afforded to only Singapore, Brunei and Japan but now travel rules have been relaxed for dozens of countries. But are many people coming? Afew years ago, getting a visa to visit China was a “ball ache”, says Kate Murray. The Australian was going for a four-day trade show, but the visa required a formal invitation from the organisers and what felt like “a thousand forms”. “They wanted so many details about your life and personal life,” she tells the Guardian. “The paperwork was bonkers.” But were she to go back again now, Murray could just jump on the plane. Australians are among citizens of almost 40 countries for which China now waives visas for business, tourism or family visits for up to four weeks. It’s a dramatic change in Beijing’s approach to ...
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As tensions between the US and China increase, Malaysia links its fortunes to Singapore.
22Jan mmBy Brian ThompsonNo Comments
Asia, China, Singapore, USA

As tensions between the US and China increase, Malaysia links its fortunes to Singapore.

New special economic zone paves way for closer relations between one-time south-east Asian rivals As tensions ratchet up between two of Malaysia’s biggest trading partners, the US and China, the south-east Asian nation is increasingly looking to hitch its wagon to its more successful neighbour, Singapore. A special economic zone straddling the two countries — along with a raft of initiatives to build stronger ties — has been designed to help the pair withstand tougher global economic trading conditions. “We are entering a new era where global tensions are here to stay,” warned Singapore’s Prime Minister Lawrence Wong this month at the signing of an agreement to create the Johor-Singapore Special Economic Zone. “The world is becoming a more dangerous and troubled place. This...
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