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Frank Tang

Articles by Frank Tang

China’s economic strategy shift shows Xi Jinping is preparing for ‘worst case scenario’, analysts say

2 days ago

[unable to retrieve full-text content]China’s move to double down on a pivot away from export-led growth in favour of developing its domestic market reflects a strategic shift by Beijing to prepare for the “worst case scenario” after the coronavirus pandemic, according to analysts.President Xi Jinping told dozens of top economic advisers in Beijing at the weekend that China was pursuing a new development plan in which “domestic circulation plays the dominant role”.“For the future, we must treat domestic demand as the starting point…

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China’s five-year plan to focus on independence as US decoupling threat grows

3 days ago

[unable to retrieve full-text content]This is the last in a series of stories examining the issues that Chinese leaders face as they gather for their annual “two sessions” of the National People’s Congress and Chinese People’s Political Consultative Conference this week. This instalment looks at how China’s 14th five-year plan will shape its economic and political direction between 2021 and 2025.How can China survive and thrive in the face of US hostility? What does it need to take development to the next stage? And where should…

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Coronavirus: China unveils US$500 billion fiscal stimulus, but refrains from going all-in

5 days ago

[unable to retrieve full-text content]The Chinese government has unveiled a fiscal stimulus package of nearly 3.6 trillion yuan (US$506 billion), as Beijing tries to offset the economic shock caused by the coronavirus pandemic and prepare for an “unpredictable” path ahead.Premier Li Keqiang announced details of the plan in his work report at the National People’s Congress on Friday, including an increase of the budget fiscal deficit to a record high of 3.6 per cent of gross domestic product (GDP), up from 2.8 per cent last year.It…

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China overtakes US as No 1 in buying power, but still clings to developing status

6 days ago

[unable to retrieve full-text content]China’s statistics agency acknowledged that as early as 2017 the nation’s economy was larger than that of the United States when measured by purchasing power, but it has insisted it remains a “developing country” as per capita output is still only 85 per cent of the average global level.The World Bank released its new purchasing power parities (PPPs) report for 2017 this week, which showed that China’s PPP-based gross domestic product (GDP) stood at US$19.617 trillion in 2017, while the United…

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Coronavirus, US-China decoupling prompt Beijing to unveil new western development plan

9 days ago

[unable to retrieve full-text content]China is seeking a new burst of growth from its vast and energy-rich western regions, as its export-reliant eastern provinces suffer from the coronavirus pandemic and face mounting pressure amid US threats of economic decoupling.The latest “Go West” blueprint announced by Beijing on Sunday comes as the government strategises for a post-coronavirus world that is set to be less friendly and predictable for China.While top government leaders have pledged the nation will continue to open, a new…

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Coronavirus: could China’s rural land reform plan unleash a new round of economic growth?

11 days ago

[unable to retrieve full-text content]Chinese reformers are urging the government to push forward with a long-awaited rural land reform plan they argue will unleash growth, as the coronavirus pandemic and disputes with major trading partners reshape the economic environment.Some observers believe land reform will provide the world’s second largest economy with a boost in the way that housing privatisation did in 1998 and China’s ascension into the World Trade Organisation did in 2001.Though that is still a matter of debate, many…

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Coronavirus economic impact: China requires greater budget support, finance minister says

13 days ago

[unable to retrieve full-text content]China will increase fiscal expenditure this year to help offset the damage to the economy resulting from the coronavirus outbreak and ensure that the nation can reduce poverty and achieve its target of building up a comprehensively well-off society by the end of 2020, Finance Minister Liu Kun said in an article published on Thursday.The article, published a week ahead of the annual session of the National People’s Congress (NPC), provided a glimpse of how the central government will help virus…

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Coronavirus: China central bank primed for stimulus boost as pandemic continues to plague economy

16 days ago

[unable to retrieve full-text content]China’s central bank promised at the weekend to implement greater policy support to offset the economic damage of the coronavirus pandemic, but continued to indicate its reluctance to enact a massive stimulus effort like that following the global financial crisis in 2008.The statement from the People’s Bank of China (PBOC) comes amid increasingly heated debate between Beijing’s top policymakers about the appropriate scale of an economic rescue package and how to pay for it. The discord has…

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Coronavirus: nations must work together to support global economy, ex-PBOC chief says

18 days ago

[unable to retrieve full-text content]The former head of China’s central bank has appealed for global cooperation to counter the economic impact of the coronavirus pandemic, amid growing calls for the United States to refrain from engaging in unilateralist and protectionist actions.“The international community should be vigilant to the risks of inward looking in some countries, unstable global supply chains and escalating trade frictions,” Zhou Xiaochuan told an online symposium organised by the Boao Forum for Asia on Friday.While…

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China urged to focus on domestic economy in next five-year plan to counter more hostile world

19 days ago

[unable to retrieve full-text content]China’s will face an increasingly hostile world over the next five years, meaning its policy plan should be focused on its vast domestic market, home-grown technological innovation and improving its citizens’ welfare, according to recommendations in a new paper.The report by the Chinese Academy of Social Sciences (CASS), a think tank affiliated with the State Council, foresees the next five years presenting “major changes unseen in a century” for China, as “the strategic game between…

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China coronavirus stimulus: what measures have been used to combat the economic impact of Covid 19?

19 days ago

[unable to retrieve full-text content]In response to the global financial crisis in 2008, China rolled out a massive 4 trillion yuan (US$564 billion) stimulus package.With the coronavirus posing an even greater threat to the economy, the outbreak left the top leadership with a decision to make, as the efforts in 2008 also left the nation with a mountain of debt.Before the outbreak, China had already cut the top tier of the value-added tax (VAT) rate to 13 per cent from 16 per cent in April 2019, after a one percentage point cut in…

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Coronavirus: China’s ‘sober-minded’ officials urged to focus on domestic recovery, not international disputes

20 days ago

[unable to retrieve full-text content]China’s officials must stay “sober-minded” to handle the variety of coronavirus-related challenges that lie ahead, as mistakes could undermine relations with major developed nations and harm the country’s economic outlook, according to outspoken former Chongqing mayor Huang Qifan.Issues over the origin of the virus, compensation claims by the United States and decoupling worries have all appeared in the wake of the outbreak, but for Huang, the government should focus on domestic recovery after…

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Coronavirus: China’s central bank, finance ministry at odds over funding for economic recovery

21 days ago

[unable to retrieve full-text content]China’s top economic policymakers have been engaged in heated debate over whether the country’s central bank should directly buy special bonds issued by the finance ministry to help the government’s economic support measures.The discord reflects the differing schools of thought in China over how best to help the world’s second largest economy recover from the coronavirus.The National People’s Congress (NPC), which is due to meet in less than three weeks, is expected to provide clearer signals…

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Coronavirus: China exports outlook dims as US and EU economies tank in first quarter of 2020

26 days ago

[unable to retrieve full-text content]New economic data released by the United States and the European Union this week underscored the challenge facing China’s millions of exporters due to the impact of the coronavirus pandemic on its major trading partners.The economies of both the US and the European Union contracted in the first quarter, with the downturns expected to deepen in the second quarter.This is already creating a huge demand shock for Chinese exporters, testing Beijing’s policy response to the unprecedented crisis,…

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Coronavirus: China cancels high-profile Boao Forum annual meeting

27 days ago

[unable to retrieve full-text content]China has formally cancelled a high-profile annual conference that brings together Chinese and foreign politicians and business leaders to discuss policies and promote the country’s international image, as a result of the continued global spread of the coronavirus pandemic.The annual conference of the Boao Forum for Asia, originally scheduled from March 24-27 on China’s southernmost island province of Hainan, was called off, after its initial postponement, its organiser said on Thursday morning…

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Coronavirus: China risks local government debt surge as Beijing tries to spur economic growth

28 days ago

[unable to retrieve full-text content]China’s huge stockpile of local government debt, one of the biggest “grey rhino” risks threatening the Chinese economy’s future, is set to rise steeply as local authorities rush to increase capital spending to help offset the damage caused by the coronavirus outbreak.As Beijing discusses increasing the central government budget deficit and monetary policy easing to spur economic growth, many local governments see the situation as a golden opportunity to realise their investment ambitions,…

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Coronavirus: China to keep monetary policy ‘normal as long as possible’ despite economic impact of Covid-19

April 27, 2020

China’s central bank has already loosened its monetary and credit stance to help combat the virus, including 1.8 trillion yuan (US$254 billion) to help virus-hit small businesses, trillions of yuan of liquidity injected to safeguard the financial markets, 7.1 trillion yuan of commercial bank loans in the first quarter, as well as multiple rate cuts to lower the cost of the real economy. Photo: AP

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Chinese households faced high debt risk before coronavirus hit

April 25, 2020

[unable to retrieve full-text content]China’s urban households were already weighed down by debt before the Covid-19 outbreak, according to a study by the central bank that sounded new alarms about the financial risk the country is facing.The survey, published by the People’s Bank of China, looked at 30,000 households nationwide last October. It was the first national survey gauging the scale of household debt released to the public by the central bank in recent years.About 56.5 per cent of the surveyed families reported debts, but…

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Coronavirus: China urged to ‘think outside the box’ to help businesses struggling for survival

April 24, 2020

[unable to retrieve full-text content]There are growing calls for China to provide direct financial support to small private sector businesses as many are struggling for survival due to the economic damage caused by the coronavirus outbreak.The Chinese government said at the end of March that it was deliberating on “a package of macroeconomic measures” to support growth, even before it announced that the economy contracted 6.8 per cent in the first quarter of 2020, the first decline since quarterly records began in 1992.But it is…

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China includes McDonald’s, Starbucks, Subway on list of foreign firms to test digital currency

April 23, 2020

[unable to retrieve full-text content]China’s central bank has accelerated the testing of its new sovereign digital currency and, for the first time, will include some foreign consumer brands in the programme.American chains Starbucks, McDonald’s and Subway were named on the People’s Bank of China (PBOC)’s list of firms that will test the digital currency in small transactions with 19 local businesses.The global names will be joined by local hotels, convenience stores, a stuffed bun shop, a bakery, a bookstore and a gym, according…

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Coronavirus: economy in China’s Covid-19 epicentre Hubei shrank 40 per cent in first quarter of 2020

April 22, 2020

[unable to retrieve full-text content]The economy of the Chinese province that was the initial epicentre of the coronavirus outbreak shrank by nearly 40 per cent in the first quarter of 2020 amid the government’s draconian lockdown measures, by far the largest economic contraction of any of China’s 31 provincial-level jurisdictions at the start of the year.Gross domestic product (GDP) in Hubei, the seventh largest provincial economy in China in 2019, lost 39.2 per cent in the first quarter compared to the same period last year,…

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Coronavirus: China extends welfare support to vast migrant labour force amid ‘unprecedented challenges’

April 21, 2020

[unable to retrieve full-text content]The Chinese government said on Tuesday it would for the first time extend unemployment benefits and other forms of emergency aid to the country’s vast population of migrant workers, as the coronavirus kills tens of millions of jobs and threatens the country’s social stability.Speaking at a State Council meeting, Premier Li Keqiang said more must be done to help China’s rural poor, as well as residents living on government handouts in cities and those unemployed as a result of the economic…

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Coronavirus: China seen pursuing lower 2020 economic growth target after historic first quarter contraction

April 21, 2020

[unable to retrieve full-text content]China will forgo its original economic growth target for 2020, believed to have been around 6 per cent, and instead pursue a much lower goal after the national economy contracted 6.8 per cent in the first quarter, according to Chinese economists and researchers.China’s new gross domestic product (GDP) target – if there is one at all – will be significantly lower than the one agreed to at the end of last year, but never officially announced, as Beijing is now more worried about stabilising…

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Coronavirus: Chinese incomes tumble for the first time on record in fresh challenge for Beijing

April 17, 2020

[unable to retrieve full-text content]Chinese people have suffered the worst start to a year in recent memory as jobs vanished and disposable income shrank for the first time on record because of the coronavirus outbreak, challenging many of Beijing’s goals from poverty alleviation to narrowing the wealth gap.Per capita disposable income dropped 3.9 per cent to 8,561 yuan (US$1,209) in the first quarter from a year ago, the first fall since the series began in 2013, according to data released by the National Bureau of Statistics on…

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Coronavirus: China’s economy set for first contraction since 1976 as Covid-19 rips up Beijing’s grand plan

April 16, 2020

[unable to retrieve full-text content]The trouble that Zhang Zhongzhou’s shoe shop in downtown Beijing is experiencing is a small, but an equally telling example of the massive damage that the coronavirus pandemic is doing to China’s economy.The full extent of the damage that almost three months of lockdowns and business closures has done will be revealed on Friday morning, when China releases its first quarter gross domestic product (GDP) data.Zhang has managed his shop in the nation’s capital for over a decade, but he now sees no…

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Coronavirus: China’s excavator sales soar as Beijing opts for old-school economic stimulus

April 15, 2020

[unable to retrieve full-text content]Sales of excavators, an engineering vehicle widely used in construction, soared in China in March in a strong sign that Beijing is relying on infrastructure spending to offset the economic shocks caused by the coronavirus pandemic.Sales by Chinese manufacturers surged 11.6 per cent from a year earlier to 49,408 units, according to data released by the China Construction Machinery Association, while domestic sales rose 11.2 per cent year on year to 46,610 units last month.It marked a strong…

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Coronavirus: American Factory boss says pandemic will change China’s role in global supply chain

April 15, 2020

[unable to retrieve full-text content]Cao Dewang, whose US automotive glass plant was featured in the award-winning documentary American Factory, says China’s role in the global supply chain could be weakened after the coronavirus, but it will be an uphill battle for rich economies to rebuild manufacturing at home.Cao, the self-made billionaire founder of Fuyao Glass Industry, said in an interview with The Beijing News that China must get ready for changes to the global industrial system.“After the epidemic, the global industrial…

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Coronavirus: China’s small firms see revenues tumble 70 per cent in March, survey shows

April 14, 2020

[unable to retrieve full-text content]China’s small and medium-sized firms saw their income plunge nearly 70 per cent in March from a year earlier, with firms in the hospitality and education sectors struggling the most to recover from the coronavirus, a study released on Tuesday showed.The results paint a bleak picture of the state of the world’s second biggest economy, which was hammered by the pandemic in the first two months of the year and is all but certain to record a first quarter contraction.Revenues for small, medium…

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Coronavirus: China’s ‘rice bowls’ cracking as big home appliance maker speeds up job cuts

April 13, 2020

[unable to retrieve full-text content]China’s unemployment situation continues to worsen as the coronavirus outbreak takes a toll on consumer demand both at home and abroad, with one of the country’s largest home appliance makers saying it is struggling to carry the “rice bowls” of tens of thousands of employees.Hisense Group, a Shandong-based manufacturer of television sets and other appliances, issued a statement on Sunday announcing that the virus was affecting business and it was speeding up its decision to let go …

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Coronavirus: China claims stimulus ‘10 times more efficient’ than US Fed, as new loans top US$1 trillion

April 10, 2020

[unable to retrieve full-text content]Chinese banks pumped more than US$1 trillion into the economy in the first quarter of the year, in an effort to stem the bleeding from the coronavirus pandemic.Quarterly lending reached an all-time high, even as the People’s Bank of China showed no intention of following the US Federal Reserve’s gung ho stimulus playbook, favouring targeted rate cuts and liquidity injections instead.Instead, at a press conference in Beijing on Friday, a senior central banker claimed China’s targeted approach…

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