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Karen Yeung

Articles by Karen Yeung

Growing China human rights concerns risk curbing foreign investment needed to support economy

2 days ago

[unable to retrieve full-text content]International criticism of China’s alleged human rights violations has grown louder in recent months, putting downward pressure on Beijing’s efforts to attract foreign capital into its financial markets to support the economy, analysts said.Social issues and corporate governance have become important factors for North American and European fund managers screening their securities investments, and this is taking place amid increasing scrutiny over environmental, social and governance (ESG)…

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Could US-China tensions hinder Beijing’s plans to integrate further with global financial markets?

12 days ago

[unable to retrieve full-text content]The pressure is on for Chinese banks now the country is opening its financial sector to top-flight global competitors.That’s the message from Wang Kun, deputy general manager of the international banking department at the Industrial Commercial Bank of China (ICBC), one of China’s so-called big five banks.“We see competition, with more participants going for the same trophy not only in the traditional retail or corporate banking sectors, but it is also coming from capital markets, where Chinese…

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Could US sanctions and closer Middle East ties fuel the rise of China’s petroyuan?

15 days ago

[unable to retrieve full-text content]A string of energy-rich economies appear to be moving closer into China’s orbit, expanding economic ties and potentially fuelling the rise of the petroyuan, analysts say.Chinese Foreign Minister Wang Yi ended a week-long tour on Tuesday of Saudi Arabia, Turkey, Iran, the United Arab Emirates, Bahrain and Oman, vowing to help protect their core interests against foreign interference amid rising pressure from the United States. Facing sanctions itself, China could be looking to secure long-term…

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China’s SWIFT joint venture a ‘defensive move’ in US financial war after Alaska talks underlined ongoing tensions

24 days ago

[unable to retrieve full-text content]China’s latest joint venture with the Belgium-based SWIFT financial messaging service is a “defensive move” amid ongoing tensions with the United States, highlighted by last week’s fractious talks in Alaska. China’s central bank on Tuesday announced that a newly established joint venture with SWIFT and four Chinese institutions will offer localised financial services to make cross-border transactions more stable and secure.The decision to set up the joint venture with SWIFT comes amid souring…

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US-China tech war: state-led economy crucial to meet challenges of American sanctions, says prominent economist

25 days ago

[unable to retrieve full-text content]China’s socialist economic model that mixes strong government direction and support within a market economy is the key to faster development and meeting technology challenges posed by US sanctions, according to Bai Chong-en, dean of the School of Economics and Management at Tsinghua University.The government will play a crucial role in the development of “chokehold technologies”, areas of knowledge where the United States has weaponised its advantages by banning or sharply reducing the ability…

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China digital currency: central bank seeks to assure consumers of data, privacy protection

26 days ago

[unable to retrieve full-text content]China’s central bank is trying to build trust in the data protection measures built into the nation’s sovereign digital currency, something analysts say is crucial for widespread adoption among its citizens.Mobile users in China are worried about having to share too much personal information when downloading digital wallets, while the private sector has relatively low trust in privacy protection for anonymous payments, even if they are controlled by the central bank, research has found.Mu…

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China making strides in Industry 4.0 revolution as advanced manufacturing outpaces EU, US, Japan

March 18, 2021

[unable to retrieve full-text content]After China’s new five-year plan listed the development of seven key “frontier technologies” as the nation’s top policy priority, it is now home to the most cutting-edge advanced manufacturing facilities, ahead of the likes of the European Union, the United States and Japan.The World Economic Forum has added five Chinese sites to its Global Lighthouse Network list of the world’s most advanced factories that have successfully adopted new technologies to transform business models and value chains…

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China digital currency: US ‘worried’ as it falls ‘behind the curve’ in race for financial technology innovation

March 16, 2021

[unable to retrieve full-text content]China’s rapid development of its sovereign digital currency, the so-called digital yuan, is causing the United States to worry that it could fall behind in the race for financial technology innovation, analysts said.The digital yuan is one of the most advanced central bank digital currency (CBDC) initiatives in the world, with the People’s Bank of China having been conducting experiments and proceeding with tests for more than five years.And its potential success could not only mean a superior…

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China’s property market abuzz as authorities walk tightrope to recall illegal loans

March 15, 2021

[unable to retrieve full-text content]China’s property market was abuzz last week after a photo distributed online showed a bank letter demanding early repayment of a personal loan of nearly 300 million yuan (US$46 million).The letter, issued by the Shanghai branch of a Chinese bank, requested the full repayment of the principal loan and the interest by the end of March “because the borrower failed to fulfil the purpose of the debt according to the loan agreement.”The notification letter was posted online on Wednesday and had been…

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China’s debt-reduction campaign a 2021 priority as coronavirus drives surge in borrowing

March 9, 2021

[unable to retrieve full-text content]China is set to resume its deleveraging campaign this year, but at a modest pace, as it seeks to balance financial risks with putting excessive downward pressure on an economy still recovering from the coronavirus shock of a year ago.The government’s work report said deleveraging was one of the “five major tasks” for the government in 2021, with a goal of keeping overall leverage – the ratio of debt to gross domestic product (GDP) – “generally stable”.Beijing’s renewed emphasis on debt…

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China falls in soft power ranking but US loses its crown and tumbles

March 6, 2021

[unable to retrieve full-text content]Its disastrous handling of the Covid-19 pandemic sent the US tumbling from top spot as a soft power to sixth place, while its rival China fell three places to land at No 8, according to a British ranking.While Germany took the crown, the US was the fastest falling country in this year’s Global Soft Power Index, published by Brand Finance. It lost more than double China’s score in the overall index. In the Covid-19 metric, the US came in at the bottom of the table, out of 105 countries.US urged…

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Chinese SMEs should use Hong Kong as a channel for funding, stock exchange’s former CEO says

March 6, 2021

[unable to retrieve full-text content]Hong Kong should be used as a conduit to draw “massive amounts” of international funding into Chinese small and medium-sized enterprises, according to the former chief executive of the city’s stock exchange.In a report by the state-run China Securities Journal on Friday, Charles Li Xiaojia, who is also a member of the Chinese People’s Political Consultative Conference, suggested the creation of a “Drip Irrigation Connect”, which could be used to link sources of global capital and solve the…

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China’s strict capital controls may be eased to allow investment abroad as bubble risks grow

March 4, 2021

[unable to retrieve full-text content]Chinese authorities may finally feel the time is right for a new wave of financial opening to allow citizens to invest savings abroad, as pressure mounts from a tidal wave of liquidity resulting from aggressive stimulus policies in developed economies.Investment is flooding into China thanks to its strong economic rebound from the coronavirus pandemic, while global demand for medical protection gear and electronic devices has boosted export earnings. Improved returns from China’s stock and bond…

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What does US bond ‘taper tantrum’ mean for China’s financial markets?

February 26, 2021

[unable to retrieve full-text content]A sharp sell-off in the US Treasury bond market on Thursday – triggered by worries of higher US growth, inflation and interest rates – caused declines in financial markets around the world and evoked memories of US Federal Reserve policy moves in 2013 that resulted in a reactionary panic nicknamed the “taper tantrum”.The 10-year US Treasury yield jumped as high as 1.6085 per cent on Thursday, returning to a level last seen before the coronavirus outbreak in the United States. The resulting…

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US ‘neglect’ drives Asean towards China in superpower economic rivalry, analysts say

February 16, 2021

[unable to retrieve full-text content]US foreign policy “neglect” of Southeast Asia could drive Asean nations further into the economic orbit of China, analysts say, even as Beijing’s economic clout continues to be a source of anxiety for many in the region.Southeast Asia has emerged as a key battleground for influence between the United States and China amid an increasingly heated rivalry that extends across geopolitics, commerce and technology.Despite China’s assertiveness in the region, seven of the 10 Association of Southeast…

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China’s central bank downplays draining funds from banking system after worst cash crunch in six years

February 9, 2021

[unable to retrieve full-text content]China’s central bank has downplayed its decision in January to reduce liquidity in the banking system that caused the country’s worst cash crunch in nearly six years, while fueling worries about a gradual tightening of monetary policy to curb speculation and asset bubbles.In its fourth quarter monetary policy implementation report, the People’s Bank of China (PBOC) suggested financial markets should pay less attention to the adjustments in the volume of its liquidity operations and more to the…

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China debt: highly-leveraged state firms could threaten ‘efficient growth’, private investment post-pandemic

February 8, 2021

[unable to retrieve full-text content]Surging debt among Chinese state-owned enterprises (SOEs) with close ties to local governments could become a major hurdle for private sector investment and broader economic growth, analysts say.While China was the only major economy to post positive growth last year, it was partly because of a massive increase in corporate debt following aggressive monetary and fiscal policies aimed at fighting the coronavirus pandemic, according to economists.China’s deleveraging campaign of recent years,…

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China’s SWIFT joint venture shows Beijing eyeing global digital currency use, to internationalise yuan

February 4, 2021

[unable to retrieve full-text content]A joint venture between the world’s largest electronic payment messaging system and the department responsible for China’s proposed central bank digital currency is being viewed as a sign that Beijing is exploring the global use of its planned sovereign digital currency and aiding its desire to internationalise the yuan.Calls have been growing from within China for Beijing to reduce its reliance on the US dollar by increasing the global use of the yuan amid deteriorating relations with the…

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China’s forex reserves grew marginally in 2020, despite near-record trade surplus. Where did the money go?

February 3, 2021

[unable to retrieve full-text content]Coronavirus disruptions around the world fuelled strong demand for Chinese goods last year, resulting in a massive trade surplus. Meanwhile, the nation’s rapid recovery from the pandemic and China’s buoyant stock and bond markets have sucked in large amounts of foreign investment.But China’s massive US$535 billion trade surplus and capital inflows did not result in a jump in the nation’s foreign exchange reserves, as they have in the past.So where did the money go?Foreign exchange reserves rose…

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China’s state-led economy makes it clear for foreign firms: you’re either OK with regulatory requirements, or you’re out

January 29, 2021

[unable to retrieve full-text content]American and international firms are pondering whether they should enter or expand operations in China’s domestic market, which increasingly operates under state direction with lines blurred between Chinese companies and government authorities.On the one hand, the market of 1.4 billion potential consumers is difficult to ignore. Many large, Western-based companies derive significant portions of their global profits from doing business in China.But foreign companies have long complained about…

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Joe Biden’s China policy should keep trade and national security apart to avoid cold war: ex-US commerce chief

January 26, 2021

[unable to retrieve full-text content]China and the United States should keep trade dealings and national security issues on separate tracks to avoid full-blown decoupling, according to Carlos Gutierrez, a former US Commerce Secretary.Combining trade and investment with geopolitics and national security severely complicates bilateral relations, said Gutierrez, who served in the cabinet of president George W. Bush.“When we combine them with geopolitical issues, when we combine them with national security matters, it complicates…

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As US economic clout diminishes, China and Europe work to cut dollar reliance

January 22, 2021

[unable to retrieve full-text content]The European Union’s initiative to cut its reliance on the US dollar is the latest show of scepticism towards American efforts to rebuild multilateralism amid the emergence of new regional powers such as China, analysts said.The European Commission outlined plans on Tuesday to increase the role of the euro in international payments and investments, so the European Union (EU) becomes less dependent on outside financial centres and the US dollar system.European market players should cut their use…

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Coronavirus highlights ‘urgent’ need for China’s digital currency, says state-owned bank

January 19, 2021

[unable to retrieve full-text content]The economic challenges caused by the coronavirus pandemic have increased the urgency for Chinese companies to adopt the use of a digital currency, Guo Weimin, chief scientist at the Bank of China, said on Tuesday.While there is no official timetable for the launch of China’s sovereign digital currency, the People’s Bank of China is reportedly aiming to release the e-yuan, also known as the Digital Currency Electronic Payment, before the start of the Winter Olympics – an event expected to take…

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China’s coronavirus success shows it has caught up with West in some areas of innovation, Nobel laureate Paul Romer says

January 18, 2021

[unable to retrieve full-text content]China’s success in combating the coronavirus is a sign that it has already caught up with the United States and other Western nations in some areas of innovation, including public health policy, according to Paul Romer, co-recipient of the 2018 Nobel Prize in economics.Romer warned that the West’s response to the coronavirus pandemic was evidence of a complacent mindset on innovation, particularly in public policy.“In the response to the pandemic, part of what we saw was more effective…

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China urged to tap RCEP trade deal for future digital payments system as US sanctions loom

January 15, 2021

[unable to retrieve full-text content]China should consider using digital technology to develop an alternative to the SWIFT financial payments system as a way of insulating itself from being cut off from the US-dominated financial messaging service, according to Liu Xiaochun, deputy dean of the Shanghai New Finance Research Institute.The SWIFT system – the world’s largest electronic payment messaging system – and the US-based Clearing House Interbank Payments System (CHIPS) have afforded Washington broad powers to impose economic…

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Is US coronavirus spending and ballooning debt at risk of stoking global asset bubbles?

January 13, 2021

[unable to retrieve full-text content]Another US economic stimulus package, coupled with the Federal Reserve’s willingness to keep its monetary tap on, could see trillions of dollars pumped into the global financial system and lead to a series of asset price bubbles, analysts have warned.On Tuesday, Asian stocks and currencies were holding near highs as capital continued to flow into the region after US president-elect Joe Biden said last week he would outline new pandemic relief measures of at least a trillion dollars on top of…

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US law targeting Chinese firms on American exchanges could trigger delistings and hurt investors, finance professor says

December 21, 2020

[unable to retrieve full-text content]Legislation that could see Chinese companies booted from US stock exchanges if they do not comply with auditing standards could lead to a wave of delistings and ultimately hurt American shareholders and the financial industry, a Cornell University finance professor has said.President Donald Trump on Friday signed the Holding Foreign Companies Accountable Act, applying more pressure on Beijing as he prepares to leave office next month. The Trump administration has already targeted a range of…

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US keeps China on currency manipulator watch list as trade surplus grows

December 17, 2020

[unable to retrieve full-text content]The US Department of the Treasury has kept China on its watch list for foreign-exchange manipulation in its final report before the Trump administration leaves office.Inclusion on the list is a step short of being named a currency manipulator, a designation the US rescinded as part of the phase one trade agreement signed in January. China promised not to manipulate the yuan’s exchange rate for competitive advantage as part of the deal.While the report covers the year to June 2020, the sharp…

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Will the US dollar’s slide erode its status as the world’s currency of choice?

December 15, 2020

[unable to retrieve full-text content]The US dollar’s sharp decline this year has raised questions about it losing its status as the pre-eminent reserve currency and dominant force in the global payments.The US dollar has weakened by 13 per cent against a basket of major currencies since its peak in March, fuelled by worries about expansionary US fiscal and monetary policies and a ballooning current account deficit in response to the Covid-19 pandemic.While an imminent collapse is very unlikely, there is risk of a prolonged…

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‘Star’ Chinese banker jailed for life for stealing US$400 million from clients in Ponzi scheme

December 13, 2020

[unable to retrieve full-text content]A “star” bank manager from Beijing has been jailed for life for stealing the equivalent of US$400 million from clients and using the money to finance her lavish lifestyle.Zhang Ying, the former head of the Hangtianqiao branch of China Minsheng Bank in Beijing, was found guilty of using fake wealth management contracts to cheat customers out of 2.7 billion yuan (US$412 million) in a Ponzi scheme between 2013 and 2017, according to a court ruling published last week.Zhang was convicted at the…

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