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China-Australia relations: imports of some stranded Australian coal could soon be allowed

12 days ago

[unable to retrieve full-text content]China is considering accepting some stranded Australian coal cargoes, an effort that would help ease a logjam of vessels that have stacked up off its coast for months.The shipments that could be cleared are those that arrived before a ban on Australian coal went into effect, said a person familiar with the situation, who asked not to be identified as the discussions are private.The deliberations are at an initial stage and any decision would need the approval of more senior Chinese leaders, the…

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China makes debt rating agency pay for default, in a precedent for legal and financial service firms to be responsible for their work

23 days ago

[unable to retrieve full-text content]A Chinese court ruled that a local ratings firm should help compensate some creditors for a construction firm’s 1.4 billion yuan (US$216 million) bond defaults three years ago, a first in the country as Beijing raises pressure on agencies to improve their due diligence.Dagong Global Credit Rating is responsible for repaying up to 10 per cent of at least 494 million yuan of combined debt claims to more than 400 individual bondholders of Wuyang Construction Group, according to a ruling by…

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China averts liquidity squeeze by pumping US$92 billion of funding into banks over five weeks to spare the havoc on bonds

27 days ago

[unable to retrieve full-text content]China’s central bank has pumped enough cash into the banking system to convince government bond investors that the worst is finally over.Over the past month, the People’s Bank of China has had to work especially hard to rein in borrowing costs after a surge in credit defaults damped commercial lenders’ enthusiasm to make loans. The central bank injected a net US$84 billion in one-year funding and US$8 billion of short-term cash into the financial system in the final five weeks of 2020 alone.The…

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As much as US$500 million of Australian coal sits on ships off China’s coast as spat between nations shows no sign of easing

November 24, 2020

[unable to retrieve full-text content]More than US$500 million worth of Australian coal is on ships anchored off Chinese ports, as a diplomatic spat between the two countries cuts into trade, idles a portion of the world’s dry bulk carriers and threatens to spiral into a humanitarian crisis.More than 50 vessels have been waiting a month or longer to offload coal from Australia, according to separate analyses of shipping data conducted by Bloomberg and data intelligence firm Kpler. There’s about 5.7 million tons of coal and…

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Trump’s WeChat, TikTok bans will go through, White House aide says

November 22, 2020

[unable to retrieve full-text content]US national security adviser Robert O’Brien said he expected President Donald Trump’s attempts to ban the WeChat and TikTok apps to “ultimately” succeed.Moves by the Trump administration to restrict the Chinese-owned social-media platforms in the United States for what it said were national security reasons have been put on hold as a result of court injunctions. WeChat and TikTok users have argued that the bans were motivated by election year politics rather than genuine security concerns.“We…

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China-Australia relations: wine piling up keeping Sydney exporter awake at night ahead of peak season

November 18, 2020

[unable to retrieve full-text content]Australian wine exporters should be preparing for their peak selling season, the months preceding Christmas and Lunar New Year celebrations in China. They are instead watching stockpiles of product mount in warehouses as its biggest market clamps down on shipments from the country.Already on edge after China announced two trade probes into the country’s wine industry earlier this year, people familiar with the situation said this month Beijing had also ordered traders to stop purchasing at…

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China-Australia relations: dispute leaves 400 seafarers stranded with US$200 million of Australian coal held up

November 13, 2020

[unable to retrieve full-text content]An estimated 400 seafarers and roughly 2 million tons of coal are stuck on ships off the northeast coast of China, as a spiralling diplomatic row with Australia threatens to turn into a humanitarian crisis.At least 21 bulk carriers are anchored off the Port of Jingtang, unable to offload their Australian coal cargo that could be worth around US$200 million, depending on its quality. Fifteen of the ships have been waiting since June, according to an analysis of shipping data conducted by…

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China’s central banker remind the global markets that the yuan’s challenge to the US dollar is still very much on

November 6, 2020

[unable to retrieve full-text content]Investors wondering how China plans to evolve its financial markets in the coming years need look no further than the commentary from the weekend’s Bund Summit in Shanghai for guidance.People’s Bank of China governor Yi Gang said that promoting broader use of the yuan will continue alongside the opening of markets. “The regulator’s main job is to reduce restrictions on the cross-border use of the currency, and let it take its own course,” he said.Those comments were echoed by Zhu Jun, director…

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China-Australia cattle trade continues despite tensions

October 20, 2020

[unable to retrieve full-text content]China’s allowed 3,600 cattle to enter from Australia last week, a sign that heightened tensions between the two countries have not hindered all areas of trade.Beijing has unleashed a raft of actions against Australian exports following Canberra’s push for an independent inquiry into the origins of the coronavirus outbreak.Australia’s cotton industry last week feared it may become the latest casualty of worsening ties after barley was hit by tariffs and wine was subjected to anti-subsidy and…

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China moves to shield its own advanced tech in fight with US by expanding arsenal of export restrictions

October 16, 2020

[unable to retrieve full-text content]China is set to pass a new law that would restrict sensitive exports vital to national security, expanding its toolkit of policy options as competition grows with the US over access to technologies that will drive the modern economy.China’s top legislative body, the National People’s Congress Standing Committee, is expected to adopt the measure in a session that concludes on Saturday. The Export Control Law primarily aims to protect China’s national security by regulating the export of…

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China is building mega refineries with capacity to process more crude oil than the UK’s combined, just as fuel demand stalls

October 7, 2020

[unable to retrieve full-text content]China is investing tens of billions of dollars in new mega-refineries even as its fuel demand is expected to peak within five years, raising the risk it will flood the region with cheap exports.At least four projects with about 1.4 million barrels a day of crude-processing capacity, more than all the refineries in the UK combined, are under construction. That’s after the country already added 1 million barrels since the start of 2019. All that capacity will add more petroleum products and…

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China’s currency takes on the sheen of safe haven asset against volatility, ending third quarter with its biggest gains in 12 years

October 2, 2020

[unable to retrieve full-text content]The Chinese yuan is drawing attention as a haven from volatility after its best quarter in 12 years.The onshore renminbi gained 3.8 per cent in the three-month period ending September 30, the most since early 2008, while its offshore counterpart advanced more than 4 per cent.That was more than Group-of-10 currencies including traditional refuges like the Swiss franc and Japanese yen, a remarkable turnaround considering the yuan’s devaluation just five years ago triggered a broad market rout…

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China allows currency traders to push the renminbi toward its best quarter since 1981 against the US dollar as economy picks up pace

September 16, 2020

[unable to retrieve full-text content]China’s policymakers are in no rush to rein in a rapid advance in the yuan, as traders push the currency toward its largest quarterly rally on record.The yuan has strengthened 4.4 per cent since the end of June to 6.7620 per dollar, set for the biggest ever quarterly gain in Bloomberg data going back to 1981. The currency is the best performer in Asia in the third quarter, with the buying momentum close to the strongest since January.The yuan is being supported by a slump in the dollar, while…

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China car sales rebound accelerated in August as coronavirus pressures eased

September 8, 2020

[unable to retrieve full-text content]China’s car sales increased for a second straight month in August, raising optimism that a two-year slump in the world’s biggest market is nearing an end.Retail sales of sedans, SUVs, minivans and multipurpose vehicles increased 8.8 per cent last month from a year earlier to 1.73 million units, the China Passenger Car Association said on Tuesday. That followed a 7.9 per cent gain in July.Showrooms and shopping centres have reopened as the coronavirus pandemic eases in China, a boon for everyone…

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China Construction Bank posts worst earnings in more than a decade on bad loan surge

August 30, 2020

[unable to retrieve full-text content]China Construction Bank, the world’s second-largest lender by assets, reported its worst earnings in more than a decade as a cascade of loans to businesses across China are going bad.Net income fell 11 per cent to 137.6 billion yuan (US$20 billion) in the six months through June from 154.2 billion yuan a year earlier, the Beijing-based lender said in an exchange filing on Sunday. Loan loss provisions jumped 49 per cent.China’s US$45 trillion banking system has been put on the front-line of…

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Brush up on Mandarin, as China’s banks are hiring tens of thousands of graduates in latest rescue mission to prop up jobs

August 25, 2020

[unable to retrieve full-text content]China’s mega banks are ramping up their recruitment of fresh graduates as a record number enter the labour market, joining other state-owned firms in boosting employment even as lenders deal with plunging earnings and ballooning bad debt.The four biggest state banks, led by Industrial & Commercial Bank of China, this month kicked off their autumn campus hiring, instead of in November as in previous years. China Construction Bank plans to add 16,000 graduates this year, up from 13,000 last year…

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China’s banks must innovate to help small businesses weather ‘complex and severe’ economic environment

August 24, 2020

[unable to retrieve full-text content]People’s Bank of China governor Yi Gang has urged banks to support smaller companies through innovations in financial services and products to help nurse them through the “complex and severe” economic situation facing the country.Yi told a seminar in the eastern city of Hefei on Friday that banks should adapt financial services and products, increase investment in fintech research and technology and integrate on-site and online financial services, according to a statement posted on the central…

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Defaults in China’s US$4.1 trillion corporate bond market could hit record high this year as recovery remains fragile

August 23, 2020

[unable to retrieve full-text content]China’s fragile economic recovery is ushering in a dangerous new phase for the nation’s US$4.1 trillion corporate bond market.With the economy now strong enough for policymakers to dial back financial support but still too weak to save the most distressed borrowers, some fund managers are bracing for defaults on domestic Chinese debt to hit record highs this year. Delinquencies have already started rising after a remarkably quiet second quarter, and pressure on borrowers is set to grow as 3.65…

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Quantitative easing with Chinese characteristics? China’s July bond data hint at central bank’s rare move to buy government debt

August 13, 2020

[unable to retrieve full-text content]The People’s Bank of China may have bought government bonds from domestic banks in July, a rare move that has analysts puzzling over the monetary authority’s policy intentions amid a record amount of government debt issuance. Sovereign bonds held by “other” investors – a category that includes central banks and clearing houses -rose by 196.5 billion yuan to 1.78 trillion yuan (US$256 billion) last month, according to data released by China Central Depository & Clearing last week. The increase…

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US lighting company Alpan joins an exodus of manufacturers leaving China to get around higher tariffs from trade war

July 4, 2020

[unable to retrieve full-text content]Alpan Lighting Products, a US manufacturer of solar lamps, is shifting production from China to Indonesia, joining droves of companies looking to escape higher tariffs triggered by the trade war with the US.PT CDS Asia, a unit of Alpan, will invest US$14 million to build a factory in an industrial zone in Central Java, Indonesia’s Investment Coordinating Board said in a statement. The export-oriented facility is scheduled to begin production later this year and may employee 3,500 people, it…

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Goodbye seems to be the hardest word for Europe’s manufacturers when it comes to China’s low-cost labour force and supply chain

June 30, 2020

[unable to retrieve full-text content]European leaders talk of shortening supply chains and curbing China’s “Belt and Road” plan. But on the ground in Italy, Gimmi Baldinini says his designer footwear company is in no position to cut ties with the Chinese.“Chinese workers have a better hand with gym shoes,” said the chairman of Baldinini, founded by his family in 1910 in northern Italy, where it still has the main production hub for the top segment of his goods. To produce sports shoes, the company relies on a Chinese plant in the…

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China to step up US agriculture purchases under phase one trade war deal after Hawaii talks, sources say

June 19, 2020

[unable to retrieve full-text content]China plans to accelerate purchases of American farm goods to comply with the phase one trade deal with the United States following talks in Hawaii this week.The world’s top soybean importer intends to step up buying of everything from soybeans to corn and ethanol after purchases fell behind due to coronavirus disruptions, said two people familiar with the matter, who asked not to be named because the information is private.A separate person said the Chinese government has asked state-owned…

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China car sales rose for first time in almost a year in May, industry body says

June 9, 2020

[unable to retrieve full-text content]Car sales in China rose for the first time in almost a year last month, evidence that the world’s largest market is rebounding from the coronavirus crisis and the trade war with the United States.Retail sales of cars, SUVs and multiple-purpose vehicles increased 1.9 per cent from a year earlier to 1.64 million units in May, the China Passenger Car Association said on Monday, which was the first gain since June 2019.The government added stimulus measures such as tax rebates to attract consumers…

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China orders state traders to stop buying American farm goods, threatening phase one trade deal

June 1, 2020

[unable to retrieve full-text content]Chinese government officials told major state-run agricultural companies to pause purchases of some American farm goods including soybeans as Beijing evaluates the ongoing escalation of tensions with the US over Hong Kong, according to people familiar with the situation.State-owned traders Cofco and Sinograin were ordered to suspend purchases, according to one of the people, who asked not to be identified discussing a private matter. Chinese buyers have also cancelled an unspecified number of…

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China is exempting some foreign executives from travel ban as authorities get coronavirus outbreak under control

May 12, 2020

[unable to retrieve full-text content]China is allowing executives from some foreign companies to enter the country despite a coronavirus travel ban as it seeks to restart the economy, according to people familiar with the matter.The Ministry of Commerce told some key foreign companies they can apply for exemptions to the entry ban if they want to get executives back into China, the people said, asking not to be identified because the matter has not been made public. They would still serve a mandatory quarantine, one of the people…

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US-China trade chiefs to have call as Donald Trump and coronavirus threaten phase one deal

May 7, 2020

[unable to retrieve full-text content]Top Chinese and US trade negotiators will speak as soon as next week on progress in implementing a phase one deal after US President Donald Trump threatened to “terminate” the agreement if Beijing was not adhering to the terms.Chinese Vice-Premier Liu He will be on the call, according to people familiar with the matter. The US will be represented by US Trade Representative (USTR) Robert Lighthizer, one of the people said.The planned phone call will be the first time Liu and Lighthizer speak…

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NetEase picks banks to arrange Hong Kong secondary listing, joining Alibaba, JD.com in making a beeline for city’s stock exchange

May 5, 2020

[unable to retrieve full-text content]NetEase has picked banks for its planned second listing in Hong Kong, according to people familiar with the matter, joining other Chinese technology companies in tapping the city’s stock market for new funds.The company is working with advisers including Credit Suisse Group AG and China International Capital Corporation (CICC) on the offering, which it has confidentially filed to the stock exchange, the people said. The share sale could happen as soon as the second half of this year, one of the…

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India to lure firms fleeing China with land offering nearly double the size of Luxembourg

May 5, 2020

[unable to retrieve full-text content]India is developing a land pool nearly double the size of Luxembourg to lure businesses moving out of China, according to people with the knowledge of the matter.A total area of 461,589 hectares has been identified across the country for the purpose, the people said, asking not to be identified because they are not authorised to speak to the media. That includes 115,131 hectares of existing industrial land in states such as Gujarat, Maharashtra, Tamil Nadu and Andhra Pradesh, they said…

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Coronavirus: China injects US$7.9 billion into banking system in latest bid to shore up liquidity

April 24, 2020

[unable to retrieve full-text content]China’s central bank rolled over some of the targeted funds due on Friday while cutting interest rates on the loans, the latest in a string of measures aimed at ensuring sufficient liquidity.The People’s Bank of China (PBOC) injected 56.1 billion yuan (US$7.9 billion) into the banking system via the targeted medium-term lending facility (TMLF), just as 267.4 billion yuan of the debt comes due.The one-year funding was offered at an interest rate of 2.95 per cent, lowered from the 3.15 per cent…

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Jobs are being destroyed around the world as coronavirus pandemic pushes one economy after another into recession

April 4, 2020

[unable to retrieve full-text content]The world’s workers are reeling from the initial shock of the coronavirus recession, with job losses and welfare claims around the globe already running into the millions this week. As the International Labour Organisation warns of almost 25 million lay-offs if the virus isn’t controlled, the cuts from Austria to the US reflect the deepest peacetime recession since the 1930s as economies are frozen to beat the pandemic.“We see unemployment rates in the US and Europe getting up well up into the…

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