The shrinking Xiaomi IPO

Access Archive

Dear Access member,

If you’re in Hangzhou, our friends at the excellent TechNode have given us ten tickets to a TechCrunch event they are co-hosting there July 2-3. There are 10 tickets available, first come first served. Click here for details and use the coupon code TCSUPCHN.

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—Jeremy Goldkorn, Editor in Chief

1. The shrinking Xiaomi IPO

“China’s Xiaomi Corp priced its Hong Kong initial public offering (IPO) at the bottom of an indicative range, raising $4.72 billion in the world’s biggest tech float in four years, people close to the transaction said on Friday,” reports Reuters.

  • Xiaomi’s IPO was expected to raise “at least $10 billion,” reported Bloomberg (paywall) on May 3. Xiaomi had originally planned to become the first Chinese company to simultaneously list on the Hong Kong stock exchange while selling Chinese depositary receipts (CDRs) in Shanghai.

  • Xiaomi’s Shanghai listing failed “when it couldn’t adequately answer 84 questions posted online by Chinese regulators and still meet its target for a Hong Kong listing,” according to Bloomberg (paywall). Bloomberg blames “intransigent regulators, lack of clarity from the central government and a company sticking by its own deadline.”

  • “Stock market turbulence triggered by fears over the escalating trade clash between the United States and China,” is the context CNN uses to frame Xiaomi’s disappointing IPO, while the Bloomberg article above says “the collapse of Xiaomi Corp.’s plan to sell stock in mainland China is an example of Beijing’s ambition getting ahead of its reality.”

2. Tech and trade war update

Today’s gloom, doom, and boom summarized for you in bullet points:


  • ZTE and Huawei banned by Pentagon: the South China Morning Post says the U.S. House of Representatives “approved a US$675 billion spending bill for the Defense Department that includes… an amendment that bars the Pentagon from buying goods or services from Chinese telecommunications giants ZTE and Huawei.”

  • ZTE still in limbo: CNBC reports that the U.S. Department of Commerce has not yet “worked out the details necessary for lifting the ban on China’s ZTE… even though an official last week said the final steps would be taken in a ‘couple of days.’” CNBC also has a report on ZTE’s board shakeup, part of its bid to clean up nice for U.S. regulators.

  • Dialing up the threat meter 1: In a New York Times op-ed (paywall) titled “The coming tech battle with China,” a Morgan Stanley executive argues that “technology will decide which country emerges as the world’s dominant economic power in the long run.”

  • Dialing up the threat meter 2: “More than 20 Silicon Valley venture capital firms have close ties to a Chinese government fund or state-owned entity,” reports Reuters, suggesting that these firms need to prepare for growing scrutiny and hostility.

Trade war victims

  • “Sharp just canceled its plan to issue new shares worth around $1.8 billion, citing the escalating trade battle between the world’s two largest economies,” reports CNN.

  • Shark fins: “A new set of Chinese tariffs on U.S. seafood including items made from shark fins could further erode what remains of the American industry for the controversial products” says the Associated Press. (That’s one business I’ll be happy to see completely destroyed.)

  • Get ready for short-term trade pain: “Two US business sources said the US embassy in Beijing told American companies on Thursday to be prepared for fallout over the short term, suggesting the trade clash with China could last some time but would be in their interest over the long run,” according to the South China Morning Post.

Skirmishes, shouts, and rumors

  • “President Trump has repeatedly told top White House officials he wants to withdraw the United States from the World Trade Organization, a move that would throw global trade into wild disarray,” reports Axios, in what they are calling a “scoop.”

  • “China has defended its record at the World Trade Organization, presenting itself as a responsible partner in international commerce as the US distances itself from multilateral institutions” reports the Financial Times (paywall).

  • State media has been making a big fuss about a white paper released by the Chinese government about how wonderful China is. The white paper is divided into four sections titled:

    • China has faithfully fulfilled its WTO accession commitments;

    • China firmly supports the multilateral trading system;

    • China’s significant contribution to the world after accession;

    • China is actively advancing opening-up to a higher level.

  • But U.S. Ambassador to China Terry Branstad “said there was ‘scepticism’ in the United States that China would follow through on its pledges to truly open up in areas such as financial services,” according to Reuters.

3. Other China newsletters worth your time

You’re an Access member already, and you may subscribe to Sinocism. If that’s not enough China news in your inbox, here is a non-exhaustive list of others we might recommend:

—Jeremy Goldkorn

4. Belt and Ridiculous

This has not been a good week of news and publicity for China’s Belt and Road initiative.

  • China’s hardline negotiations with Sri Lanka, which included generous financial support of ex-president Mahinda Rajapaksa, an expectation of intelligence sharing despite agreements of no military presence, and a series of high-interest loans and debt that ended in 99-year Chinese ownership of the Hambantota Port, were revealed in a New York Times story (paywall) on June 25.

  • If you haven’t read it yet, here is Jeremy’s rundown for SupChina Access members on how Sri Lanka is “The canary in the Belt and Road coal mine.”

  • Nepal continues to waver on whether to let China build the $1.8 billion dam in West Seti, according to two local reporters writing in Chinadialogue.

  • Chinese officials have begun “voicing worries that Chinese institutions need to be careful how much they lend under the [Belt and Road] program — and make sure their international borrowers can pay it back,” the Times reported today (paywall).

  • Beijing has even “begun a broad, interagency review of how many deals have already been done, on what financial terms and with which countries,” sources “close to Chinese economic policymaking” told the Times.

  • The “Sicomines” project in the Congo and its extraordinary difficulties were detailed in a piece in Foreign Policy (paywall).

Since its inception, the Belt and Road has received criticism for being too vaguely defined. The People’s Daily didn’t help China’s case against this criticism with this tweet:

<div class=”tweet” data-attrs=”{“url”:”″,”html”:”

From next week, the UK’s only direct flight between the UK and China’s 4th biggest city Chengdu will launch. This development is boosted by China’s #BeltandRoad, an initiative to stimulate trade and economic growth across Asia and beyond.

“,”author”:”PDChina”,”author_name”:”People’s Daily,China”,”date”:”June 28, 2018″}”>People’s Daily,China@PDChina

From next week, the UK’s only direct flight between the UK and China’s 4th biggest city Chengdu will launch. This development is boosted by China’s #BeltandRoad, an initiative to stimulate trade and economic growth across Asia and beyond.

June 28, 2018Former American diplomat Evan Feigenbaum, who has recently argued that China is outsmarting the U.S. when it comes to influence in Asia, pointed out the absurdity of this:

<div class=”tweet” data-attrs=”{“url”:”″,”html”:”

So now, even a commercial passenger jet flying from Europe to China is being called “Belt and Road”? If it’s everything everywhere, then it is nothing nowhere. Practically every economic activity beyond China’s borders seems to be called a BRI-related activity …

“,”author”:”EvanFeigenbaum”,”author_name”:”Evan Feigenbaum”,”date”:”June 28, 2018″}”>Evan Feigenbaum@EvanFeigenbaum

So now, even a commercial passenger jet flying from Europe to China is being called “Belt and Road”? If it’s everything everywhere, then it is nothing nowhere. Practically every economic activity beyond China’s borders seems to be called a BRI-related activity …

June 28, 2018—Lucas Niewenhuis

5. Two last things

If you have some idle time this weekend:

—Jeremy Goldkorn

Here are the stories that caught our eye this week:

  • The trade war turbulence continued. As global markets prepare for tariffs to set in on July 6, the United States and China’s economic co-dependency is becoming ever more clear. Stocks have been down all week as companies scramble to alter their supply chains and maintain profit levels. Chinese currency also has devalued against the dollar, prompting speculation that the trade war could become a currency war aimed at making Chinese goods cheaper in American and American-importing markets. To understand the policy at the heart of the trade war, check out our explainer on Made in China 2025.

  • Trump backtracked on investment restrictions, allowing Congress to go ahead with legislation to strengthen the Committee on Foreign Investment in the U.S. (CFIUS), instead of taking executive action. This right after Xi Jinping told American and European CEOs that China will “punch back” in the trade war.

  • People’s Liberation Army veterans took to the streets to protest mistreatment, poor healthcare, and inadequate job prospects. Although PLA protests are nothing new, this round was notable for its improved national organization and the government’s increasingly militarized response.

  • Jim Mattis visited Beijing, where Xi Jinping told the American defense secretary that China would “not lose a single inch” of land that it claims in the South China Sea.

  • Chinese scholar Yan Xuetong 阎学通 recently authored a report on the bipolar state of our world. Some of his most important points include Western liberalism’s decline alongside China’s rise, creating a bipolar dynamic in which the United States and China serve as the world’s two hegemons. At the Central Conference on Work Relating to Foreign Affairs, Xi Jinping made it clear that he sees a “historical juncture” to increase China’s influence, even as the international environment becomes more risky.

  • Batteries for electric cars are increasingly being made in China. As Chinese firms have locked down supply chains for cobalt, an essential material in the production process, Chinese auto company have ramped up production of batteries. This week, BYD started building a $1.5 billion factory in Qinghai as part of a plan to quadruple its battery output in two years.




  • Xinjiang propaganda
    Translation: Propaganda in Urumqi amid terror crackdown / China Digital Times
    Among other messages, propaganda posters urge residents to “keep in mind the mission; the unremitting struggle to realize the Chinese people’s great rejuvenation of the Chinese dream.”

  • Equal pay
    BBC apologizes to Carrie Gracie over pay / Axios
    “In acknowledging the value of my work as China editor, the BBC has awarded me several years of backdated pay. But for me this was always about the principle and not about the money,” said Gracie, who is donating the money from her settlement to a charity that campaigns for gender equality.

  • Li Ka-shing  
    Li Ka-shing gets rock-star welcome at Shantou University graduation ceremony – where he announces he will stand down as honorary chairman / SCMP
    “‘After today, I will step down from the duty of being the honorary chairman of Shantou University,’ Li told students at the university famed for its international outlook and occasionally clashing with Communist Party inspectors.”

  • Music
    Bound in beat / NeoCha
    While popular in the West, beatboxing has had a hard time catching on in China. A group of enthusiasts, however, are working to bring it into the mainstream with a documentary.

  • Pop idols
    A brief history of China’s tomboy heartthrobs / Sixth Tone
    Yang Yunqing may have stood out for her “handsome” looks compared with her competitors on the most recent season of Produce 101, but Chinese audiences have been embracing such performers since the mid-2000s.

  • Sexual assault education
    A Chinese viral video debunks sexual assault myths / Inkstone
    “It features interviews with two experts, who break down misconceptions around sexual assault and explain the challenges that victims often face when seeking justice in China.”

  • Misogynistic video games
    A sexist “harem-building” game from China is hot in South Korea
    “In the game, dozens of women fight for your attention and you can pick one to reward her with money or sex. You can even punish them for not producing smart children.”

  • Photojournalism
    Staying on point in rural China / ChinaFile
    “In this edition of Depth of Field: aspiring ballerinas, what’s beneath the gilt in a rich Zhejiang town, worn-out doctors, disappearing schools, melting snow, data farms and the powerful appeal of dancing outdoors.”

  • Traffic accidents
    Eight killed by huge fireball after truck and oil tanker collide in China / SCMP
    “Eight people — including three generations from one family — were reported dead after a collision between a truck and a petrol tanker caused a firebomb that one witness compared to an atomic bomb.”

  • Water security
    Polluted water exhibition prompts official action / Sixth Tone
    The name of ubiquitous water band Nongfu Spring “‘literally means the spring water that farmers drink,’ the 37-year-old artist told Sixth Tone, ‘but what kind of water are Chinese farmers really drinking?’”


What is China watching? This week: 3D drawings on a paddy field, a rare tornado in Shenzhen, a teenage graduation dance, and a cleaning lady riding a hoverboard. What more could you ask for?


Chinese Corner: Lamenting Chinese soccer, reality show ‘Produce 101,’ and the saga of Li Yiyi

In this week’s Chinese Corner: Lamenting Chinese soccer, reality show ‘Produce 101,’ and the saga of Li Yiyi.

AC Milan and its uncertain future under Chinese owner Li Yonghong

With tensions ratcheting up in the U.S.-China trade war, an unlikely tug-of-war target has emerged in the middle: iconic European soccer club AC Milan. It’s currently in the hands of a previously unknown Chinese businessman, Li Yonghong, who’s prone to more than a little exaggeration — and it’s in a perilous financial state.

SupChina News Quiz, June 23–29: PLA protests, the World Cup, and our bipolar world

What’s up in China? Test your knowledge of the news with this fun eight-question quiz, and then tweet your score to @supchinanews! Check back every Friday for a new challenge.

Sinica Podcast: Kurt Campbell on U.S.-China diplomacy

Dr. Kurt Campbell talks about his tenure as undersecretary of state for East Asia and Pacific Affairs, and discusses the challenges of the U.S.-China relationship and the fascinating events that happened under his watch in China with Chongqing mayor Bo Xilai and blind activist lawyer Chen Guangcheng.

The SupChina Quiz: Religion in China

It’s the last Thursday of the month, which means it’s quiz time! Here are 15 questions to test how much you know about religion in China, everything from Nüwa to Confucius, Taoism to Christianity. Let us know how you did — tweet your score to @supchinanews.

Explainer: Made in China 2025: The domestic tech plan that sparked an international backlash

At the heart of the U.S.-China trade war is an ambitious Chinese plan to replace foreign technology with the country’s own. Here’s what you need to know about Made in China 2025.

China should stop exaggerating its technological advancements, says state-owned newspaper editor

From homegrown smartphone brands to high-speed rail, China’s desire to be a world leader in technology is no secret. But recently, a Chinese state newspaper’s editor-in-chief called upon a more realistic assessment of China’s tech sector, a comment that has provoked reflection among the Chinese public.

Who needs pensions when that money can be given to the Chinese government?

A government website based in Yichun, Jiangxi Province, recently published a rather bizarre user-submitted suggestion, one that has internet users asking: Is this for real? On June 14, an anonymous person posted a suggestion to the website of the Human Resources and Social Security bureau asking senior citizens to donate their pensions to the government.

Kuora: Three common misconceptions about China

That China’s imperial past is a long series of sequential dynasties; China always saw itself as a “middle kingdom” and the only center of civilization; China has always been a peaceful nation. Read more about the three common misconceptions about China that Kaiser Kuo has often encountered.

Announcing: The SupChina Photo Contest

Good images tell a good story. We’re launching this SupChina Photo Contest because we want to get your China story, to see how YOU see this country. All perspectives are welcome, from rural to urban, local to foreign, inland to coastal. Most importantly, we’re looking for stories, told visually. Please submit 1–3 photos to before the contest deadline of August 15.

TechBuzz China by Pandaily: After Alibaba, team Jack Ma’s newest Centacorn: Ant Financial

What do you call a unicorn worth more than $100 billion? A centacorn, of course! This month, Ant Financial was valued at over $150 billion — what does Ant do that makes it such a highly valued company?

China Unsolved: The man who knew too much

Two old friends meet in a hotel. One of them disappears forever. When the disappeared man’s father calls the other to ask what happened, he’s told that his son “knew too much.” What happened to Tang Xuanxuan and Lin Jinsong? It’s a case that remains open — but does anyone want to solve it?

The Caixin-Sinica Business Brief, episode 53

This week on the Caixin-Sinica Business Brief: Xiaomi’s timetable for its mainland share offering, prospects of China’s bike-sharing market,’s deal with Google, agreements between China and Nepal, Jason Tan on some recent developments with Chinese telecom giant Huawei, and more.

Video: Lang Lang brings Hangzhou to New Yorkers through music

On June 16, world-renowned pianist Lang Lang surprised commuters passing through Vanderbilt Hall at Grand Central Terminal in New York with a performance of Autumn Moon Over the Calm Lake (平湖秋月 pínghú qiūyuè). He also shared his views on music education in China.

Viral videos:


Incense making in Taiwan

Huang Hanrong is drying out joss (incense) sticks at the Rong Fang Tang Incense Shop, one of the few shops in Taiwan that still make them by hand, in Lukang, Changhua, Taiwan. Huang Ming Chong, the owner of the shop, said he started to make incense at the age of 14 and has been doing it for more than 68 years.

Jia Guo