Business and Finance

  • Leading diplomat’s five-nation tour expected to focus on 5G and Huawei as more countries ban Chinese technology giant
  • Beijing’s hard line on Hong Kong and its handling of the coronavirus pandemic have also drawn European criticism

South China Morning Post
Date: 24 Aug, 2020
By: Stuart Lau

Chinese Foreign Minister Wang Yi is expected to make Italy the first stop on his European visit. Photo: Xinhua

China’s foreign minister will begin a five-nation “damage control” tour of Europe on Tuesday and is expected to meet French President Emmanuel Macron and Dutch Prime Minister Mark Rutte.

Wang Yi’s visit follows criticism of Beijing in Europe, over its handling of the 


 as well as the hardline policy in Hong Kong. More European countries are also rejecting Chinese 



Chinese foreign ministry spokesman Zhao Lijian on Monday said Wang would visit Italy, the Netherlands, Norway, France and Germany from Tuesday to September 1. It is Wang’s first overseas trip since the coronavirus outbreak.

Zhao said China and Europe should work together to revive the global economy and protect multilateralism. China hoped Wang’s visit would further the progress of both sides’ political and economic agendas, as well as their work on stabilising supply chains after the pandemic, he added.

Lucrezia Poggetti, an expert on EU-China relations at the Mercator Institute for China Studies, said Wang’s visit would be a “damage control exercise”.

“Beijing’s main goal is to prevent the creation of a united transatlantic front against China, particularly on 5G,” she said.    [FULL  STORY]

Date: Jul 19, 2020
By: George Calhoun, Contributor

Premier Li Keqiang (R) covers his face in his hand as he and China's President Xi Jinping (L) attend the fourth plenary session of the National People's Congress at the Great Hall of the People in Beijing on March 13, 2018. China's rubber-stamp parliament on March 11 endorsed Xi's move to abolish rules limiting heads of state to 10 years in power. AFP VIA GETTY IMAGES

Dateline: March 1, 2021

A News report from the other CNN*…

  • “The announcement this week that China has invited Australia to send a team of medical research scientists and public health experts to Wuhan to help document the origins of the Covid-19 pandemic is being widely welcomed. The Aussies will join scientists from Oxford and Cambridge Universities, already working on site with their colleagues from Tsinghua University and other top Chinese scientific institutions, to sequence the latest mutations of the virus… The move is a follow-up to the joint program announced earlier this month to fully combine American and Chinese programs for vaccine research and production.  
  • “In related news, U.S. President Biden announced that all charges against Huawei, China’s leading international company, will be dropped in exchange for a pledge of full technology sharing. Huawei CFO Meng Wanzhou was welcomed in New York to ring the opening bell as Huawei shares began trading on Nasdaq, surging more than 15% in the first day on news of a major 5G order from Vodafone in the UK.
  • “Simultaneously, Beijing’s decision to fully rescind the new security laws for Hong Kong helped boost the Hang Sent index by 22%, and brought applause from financial markets everywhere. New polls showed public approval of China soaring in Europe and the United States. China’s pending elevation to membership in the G7 has met with universal support from world leaders. Xi Jinping is seen as a shoo-in for the Nobel Peace Prize.…” [fade to grey]

*The Counterfactual News Network 

(How different it all might have been.)

Beijing’s Double Strategy

Back in the real world, China is trying to master two games at the same time. On the one hand, they are learning how to be a geopolitical superpower. On the other, they are building a modern economic and financial system. These are both huge decades-long projects, running in parallel. The strategies obviously interact, and not always happily. In particular, the economic game-plan is vulnerable to inept political moves.

For several decades, starting with the reforms led by Deng Xiaoping in the 1980s and 1990s, Beijing’s foreign policy was careful. This facilitated China’s tremendous economic growth. Encouraged, the West engaged, and made China its (junior) partner in a vast global division of labor — China as “workshop of the world” and all that – and channeled large scale trade and investment into China. Ten years ago most American leaders were inclined to support China’s emergence as a new “major player” – even an incipient superpower, a rival in some ways, but an unthreatening one. It was assumed that economics would prevail over traditional ideological differences. Lion would lay down with lamb, under the aegis of Free Trade. Liberal democracy and free market doctrines would spread a self-reinforcing prosperity. “They” would become like “us.” History would truly end.    [FULL  STORY]

Bloomberg News
Date: July 5, 2020

  • CSI 300 is most overheated since 2014 after gains accelerate
  • Brokerages surge as daily turnover tops 1 trillion yuan

Chinese stocks extended their recent rapid climb, aided by an enthusiastic chorus from the nation’s influential state media.

The CSI 300 Index jumped as much as 4.2% on Monday morning, the most since February 2019. That’s after it surged almost 7% last week. Turnover on the gauge was more than three times the average for this time of day. Brokerages led the gains after China International Capital Corp. hiked target prices for the industry, predicting the stock market will double in value in the next 5-10 years.

A front-page editorial in the Securities Times on Monday said that fostering a “healthy” bull market after the pandemic is now more important to the economy than ever. The article pinned the accelerating gains on stock market reforms and excess global liquidity, while saying the struggle between the “world’s powers” underscores the importance of a mature financial market.

China’s state media have long guided investors during key points in markets, whether talking up stocks or seeking to cool overheated speculation. While a strong domestic stock market would send a positive signal about China’s resilience to the coronavirus pandemic, as well as aid company fundraising, it also risks inviting bubbles — such as five years ago, when the equity market crashed after a debt-fueled rally.

“The state is very cautious about creating another boom-bust as seen in 2015, realizing the harm to confidence that comes from the bust is greater than the good from the ride up,” said Wang Zhuo, fund manager at Shanghai Zhuozhu Investment Management Co. “We are still staying in the sectors we already hold, which are largely undervalued, because we profit from the alpha more than the beta in the market.”    [FULL  STORY]

Yahoo Finance
Date: 28 June 2020
By: Jon Fingas

26 June 2020, North Rhine-Westphalia, Duesseldorf: Passengers wait at Düsseldorf Airport for their check-in. In North Rhine-Westphalia, the school holidays begin on Friday. Photo: Roland Weihrauch/dpa (Photo by Roland Weihrauch/picture alliance via Getty Images)

The US fight against Chinese technology appears to be extending to another category: the security screening you normally see at the airport or border. Wall Street Journal sources understand the National Security Council and other US agencies are pushing European governments (including Germany, Greece and Italy) to avoid using baggage, cargo and passenger screening systems from Nuctech, a Chinese state-run company that already has a foothold in the continent. American officials are reportedly worried any connected devices could pass sensitive data like passenger info and shipping manifests to Chinese spies.

Much like the claims against Huawei, there’s no publicly available evidence of Nuctech forwarding data to Chinese surveillance systems. The US Transportation Security Administration barred Nuctech from many US airports in 2014 following a review, although the report is classified.

Nuctech denied the assertions, claiming that data from its devices “belong to our customer[s] only,” and “by no means” go to the Chinese government. It also rejected claims that it had dominant shares of baggage and cargo screening, and that it priced anything below cost to thwart the competition. The EU found the company guilty of price dumping in 2010, but Nuctech has since set up a Polish factory to keep costs low.    [FULL  STORY]

Date: May 21, 2020

Britain's Prime Minister Boris Johnson applauds outside 10 Downing Street

Britain's Prime Minister Boris Johnson applauds outside 10 Downing Street during the Clap for our Carers campaign in support of the NHS, following the outbreak of the coronavirus disease (COVID-19), in London, Britain, May 21, 2020. REUTERS/Toby Melville
during the Clap for our Carers campaign in support of the NHS, following the outbreak of the coronavirus disease (COVID-19), in London, Britain, May 21, 2020. REUTERS/Toby Melville

(Reuters) – British Prime Minister Boris Johnson has instructed civil servants to make plans to end UK's reliance on China for vital medical supplies and other strategic imports in light of the coronavirus outbreak, The Times newspaper reported on Friday

The plans, which have been code named ‘Project Defend’, include identifying Britain’s main economic vulnerabilities to potentially hostile foreign governments as part of a broader new approach to national security, the newspaper reported, adding that the efforts are being led by Foreign Secretary Dominic Raab.

Two working groups have been set up as part of the project, according to the report, with one source telling The Times that the aim was to diversify supply lines to no longer depend on individual countries for non-food essentials.

Date: 24 Apr 2020
By: John Carney

JIM WATSON/AFP via Getty Images

Donald Trump does not owe the Bank of China tens of millions of dollars.

On Friday, Politico reported incorrectly that President Trump was tens of millions of dollars in debt to the state-controlled Chinese Bank. The story also incorrectly referred to “the historic precedent of a developer-turned president paying back millions to a bank controlled by a foreign government.”

The story went on to claim that Trump’s alleged “financial dealings” with the Chinese bank “complicates one of Trump’s emerging campaign attacks against Biden: that the former vice president would be a gift to the Communist country and America’s chief economic rival.”

But Donald Trump was not the borrower and Bank of China is not the creditor to the investment vehicle that owns the New York City office building that is the focus of the story.

Ali Pardo, deputy communications director for press for the Trump Campaign, said:

The far left and liberal media will stop at nothing to undermine the President. They’ll even go as far as to sensationalize stories that don’t make any logical sense. President Trump was one of the nation’s most successful businessmen before he entered public service, while people like Hunter Biden have been cashing in on his family name and unfathomably been profiting from his father’s political career.

Trump does have an investment in an office tower located at 1290 Avenue of the Americas, near Rockefeller Center in New York City. But the loan financing that building is no longer owed to the Bank of China. It was sold years ago into a securitization that is serviced by Wells Fargo and owned by a wide range of investors.

The Trump organization owns a 30 percent stake in the limited partnership that owns 1290 Avenue of Americas, making President Trump a passive minority investor. The rest of the partnership is owned by Vornado Realty Trust, one of the biggest commercial real estate investors in the U.S.

The building’s tenants include AXA Equitable Financial, Neuberger Berman, and Hachette Books.

Back in 2012, the building was refinanced with a $950 million loan from a consortium of banks that included the Bank of China, which had already become one of the largest lenders to commercial real estate in the U.S. The other lenders at the time were the commercial real estate financing units of Deutsche Bank, UBS, and Goldman Sachs.

But those loans were then packaged into bonds, commercial mortgage-backed securities, and sold to investors. Wells Fargo serves as the master servicer, meaning any payments on the loans would go to Wells rather than the Bank of China. The bonds are owned by a wide range of investors, including mutual funds managed by Vanguard, J.P. Morgan Chase and T.D. Ameritrade.

The securitization happened within days of the closing of the original loan and ended the Bank of China’s role in the loan. As a result, the Bank of China is no longer a direct lender to the building’s partnership—and Trump certainly does not owe tens of millions of dollars to the Chinese lender.    [FULL  STORY]

Date: Apr 18, 2020
By: Kenneth RapozaSenior, Contributor


Watch out for Chinese companies swooping in with buckets of cash to buy strategic stakes, or majority control in U.S. and European companies as asset prices fall due to the pandemic.

NATO sounded the alarm this week, though without naming names.

“The geopolitical effects of the pandemic could be significant,” said NATO Secretary-General Jens Stoltenberg in web conference of defense ministers on Wednesday. “Some allies (are) more vulnerable for situations where critical infrastructure can be sold out,” he said. Of course he meant China. China has been busy buying Greek ports.

It already pretty much runs Italian textiles. It’s a wonder Italy even makes an espresso machine anymore.    [FULL  STORY]

Date: April 20, 2020
By: Zak Doffman, Contributor


Huawei now looks set to be caught in the backlash as global political pressure mounts on China over its handling of the global coronavirus pandemic. Huawei had already warned that 2020 would be its toughest year yet, with “survival our first priority,” and that situation has now worsened—significantly.

Huawei is now almost entirely reliant on the Chinese market for growth—last year, sales in its home market soared 36% to account for around 60% of total revenues. Huawei is also reliant on China to wield its diplomatic broadsword against countries wavering over their 5G decisions, pour encourager les autres.

Talking of swords, this symbiotic relationship between Beijing and its number-one favorite tech giant has become somewhat double-edged. The U.S. blacklist, with its consequent impact on international sales, has removed Huawei’s international hedge. It cannot risk annoying Beijing, it needs to toe the political line.

We saw this last year with Xinjiang. Huawei has always maintained that sales of its technology into the surveillance state targeting China’s Uighur Muslim minority were through third-parties—it had no direct engagement. This was refuted by a new report that claimed Huawei was much more closely and directly involved.    [FULL  STORY]

Date: Mar 31 20209
By: Arjun Kharpal

Reuters reported that senior officials in the Trump administration have drawn up new rules that could hurt the supply of chips to China’s Huawei.

“The Chinese government would not sit there and watch Huawei being slaughtered. I believe there would be counter-measures,” Eric Xu, rotating chairman at Huawei, told CNBC.

Xu said the company would have alternative companies to make chips for it however, if the U.S. rule change came into force.

China will not sit and watch Huawei get ‘slaughtered’, says executive

Beijing will not sit and watch Huawei get “slaughtered” and could retaliate if there are further sanctions on the Chinese technology giant, a top Huawei executive told CNBC on Tuesday.

The comments came in response to a Reuters report that suggested senior officials in the Trump administration had drawn up new rules that would require chipmakers to obtain a license if they use American equipment to make components sold to Huawei.    [FULL  STORY]

National Review
Date: March 31, 2020
By: Christopher O'Dea

Police officers in front of a cargo container ship at a port in Qingdao, China, in 2018. (Stringer/Reuters)

China’s ambition is nothing less than world domination through control of maritime trade.

By quietly acquiring a global network of commercial ports from countries and investors unable or unwilling to maintain their critical economic infrastructure, China has reverse-engineered the logic of conquest: Chinese state-owned companies now control a base network of the sort that previous global hegemons obtained through military victory. Expect China to use the coronavirus crisis to accelerate its efforts to use that economic leverage to pull host countries deeper into Beijing’s political orbit.

It’s too early to say that the coronavirus crisis spells the end of globalization, but as the pandemic unfolds, the outlines of a new international trade and political order are emerging in the Mediterranean region. Call it “globalization with Chinese characteristics.”

As the death toll in Italy soared, China flew in a team of medical experts and nearly 30 tons of medical equipment. On a phone call a week later with Italian prime minister Giuseppe Conte, Chinese president Xi Jinping pledged additional supplies and medical personnel. China also shipped medical equipment to Spain, Austria, and the Czech Republic, and millions of protective masks to France, the Netherlands, Greece, and other nations. But the aid was too late. By late March the death toll in Italy had surpassed the total that China was officially reporting, and even the news that the number of cases had dropped for the first time was accompanied by photos of Italian-army trucks carrying the dead on their final journey.

That was not the visual backdrop Italian leaders were seeking less than a year ago when they signed a memorandum of understanding with China, committing Italy to Xi Jinping’s Belt and Road Initiative. Italy also signed nearly 20 related agreements to build new port and road infrastructure, initiate scientific cooperation in space science and satellite technology, boost exports of frozen pork and citrus fruit to China, and tap Chinese investment funds to pay for many of the projects. Despite the wide-ranging commitments agreed to in Rome in March, China apparently did not believe it had any responsibility to tell its new partner that a dangerous virus had been on the loose in Wuhan in December, and that many of the Chinese arriving in Northern Italy during the winter might be carriers. The decimation of Italy’s elderly highlights how China handles partner nations, and it’s a dark future.

Receiving less attention are papers and articles in the last few days in which leading Chinese academics and industrial leaders present the virus crisis as an opportunity to make epidemic control a major Chinese export. From surveillance drones, disinfection robots, and AI-powered epidemic-forecasting systems to no-contact technology for online education and new factories to make fabric for protective masks, the virus is a boon for Chinese business. In the People’s Daily, the former head of China’s state cement company, Song Zhiping, wrote that “these areas are bound to become the focus of attention of the entire society and have great potential for development”— as if deaths in Turin were market research for China’s new industry.    [FULL  STORY]