Links for Wednesday, September 22, 2021

Notable China news from around the world.


A temporary reprieve for Evergrande and cash for China’s banking system
China Evergrande’s flagship business resolves an onshore bond payment / WSJ (paywall)
“Evergrande’s flagship property business said it would make an interest payment on an onshore bond, giving the highly indebted conglomerate more time to work out what investors expect will be a lengthy and complicated restructuring.”
Evergrande: Crisis-hit firm strikes China debt deal / BBC
China Evergrande ‘resolves’ interest payment due on smaller of two bonds as it fights to avert debt default / SCMP (paywall)
China keeps adding liquidity to system amid Evergrande risks / Bloomberg (paywall)
“China’s central bank boosted its gross injection of short-term cash into the financial system after concern over a debt crisis at China Evergrande Group roiled global markets.”

But the Evergrande crisis is far from over
China Evergrande veers toward default — and a $300 billion global shock / Washington Post
‘Dead duck’s mouth’: CEO of China Evergrande’s leaked letter to employees gets panned on social media / Market Watch
The letter was posted in its entirety by several Chinese media sites.
How Evergrande hid its debt / Caixin (paywall)
How Evergrande created China’s most valuable automaker without selling a single car / Caixin (paywall)
Evergrande and the end of China’s ‘build, build, build’ model / FT (paywall)
“Valued at $41bn in 2020, the spectacular unravelling of the property group exposes deep flaws in Beijing’s growth strategy.”
Beyond Evergrande’s troubles, a slowing Chinese economy / NYT (paywall)
Warning signs include a nosedive in heavy-duty freight trucks and weak car sales.
The Evergrande troubles / NYT (paywall)
“Is China’s housing market a huge bubble that’s starting to burst?”
Evergrande crisis shows cracks in China’s property market / NYT (paywall)
“Experts are making increasingly grim predictions about the developer’s ability to hold on without a government bailout, and the consequences of a possible collapse.”

Foxconn ups bonuses by 2,500% on rising iPhone 13 demand
Foxconn, Apple’s manufacturer of choice and the largest private employer in China, is spending big to recruit as many workers as possible, per Sina Finance (in Chinese).

  • Foxconn’s profits for the first half of 2021 were up 33.4% year-on-year, thanks to iPhone 12 sales, and it’s putting that money to use: workers are being offered up to 12,700 yuan ($1,962) in bonuses, over 25 times higher than during the low season.

Zoom deal under U.S. review for ties to China
Zoom’s nearly $15 billion deal for Five9 under U.S. government review over China ties / WSJ (paywall)
“Justice Department-led Team Telecom is looking into whether Zoom’s China ties could make its acquisition of the software company a national-security risk.”
Zoom is a verb — and a target / WSJ (paywall)

Another autonomous driving unicorn is born
Yuanrong Qixing is the latest autonomous driving startup to reach $1 billion in valuation following a slate of Chinese companies such as, Wenyuan Zhixing, AutoX, and Momenta, per LatePost (in Chinese).

  • Founded in February 2019, the startup recently completed a $300 million Series B funding round led by Alibaba and including Geely, owner of Volvo.
  • The company touts an L4 autonomous driving capacity, the most advanced in the industry and one below “fully autonomous.”

There are “too many electric vehicle firms right now”
For years, China coddled and hand-held the growth of its EV sector through direct investments, infrastructure spending, and subsidies. That era is over: “We have too many EV firms on the market right now,” Xiào Yàqìng 肖亚庆, minister for industry and information technology, said at a press conference last week.

Ant to share consumer credit data with the Chinese government
Ant to fully share consumer credit data with China’s government / WSJ (paywall)
“Credit data generated by Ant’s popular consumer lending service will be fully integrated into a government credit-reporting system, a significant step in a continuing effort to bring the financial-technology giant into line with Chinese regulators’ priorities.”
Ant Group microcredit service Huabei feeds vast consumer data to China’s central bank / SCMP (paywall)
“Ant Group, operator of the world’s largest electronic payment platform, has started to feed its vast trove of consumer credit information to a database run by China’s central bank, heralding a new chapter in the regulatory oversight of the nation’s private financial technology companies.”

China pushes high-tech to fortify factory dominance
China’s high-tech push seeks to reassert global factory dominance / Reuters
“China is backing R&D efforts by high-tech manufacturers like Langyu, driven by an urgent desire to reduce reliance on imported technology and reinforce its dominance as a global factory power, even as it cracks down on other parts of the economy.”

Hai Robotics secures $200 million in funding
Chinese warehouse robotics startup Hai Robotics secures $200 million / TechNode
“Hai Robotics, a Chinese warehouse robotics startup, announced Wednesday two financing rounds totaling more than $200 million.”

India likely to block Chinese investment in LIC’s IPO
India likely to block Chinese investment in insurance giant LIC’s IPO — sources / Reuters
“New Delhi wants to block Chinese investors from buying shares in Indian insurance giant Life Insurance Corp (LIC) which is due to go public, four senior government officials and a banker told Reuters, underscoring tensions between the two nations.”

Biden export post nominee sees “Huawei as a national security threat”
Biden nominee for key China export post expects Huawei to remain blacklisted / Reuters

Chinese firms start suing for IPR violations
China goes on an intellectual property offensive / Nikkei Asia (paywall)
“Foreign businesses in China are becoming key targets in a growing number of intellectual property lawsuits filed by Chinese companies.”
“As Chinese firms have become more protective of their own IP rights, the number of IP-related lawsuits filed in China in 2020 was more than three times the figure for 2016.”


Polish gene project to drop Chinese BGI tech over data concerns
Polish gene project moves to drop Chinese tech on data concerns / Reuters
“A European Union-funded project to build a genomic map of Poland plans to drop gene-sequencing technology from China’s BGI Group over concerns about data security, one of the project’s leaders told Reuters.”


Taiwan applies to join CPTPP
Taiwan applies to join Pacific trade deal just days after China / Bloomberg (paywall)

Taiwan has submitted an application to join a Pacific trade deal, just days after China sent its own request to become a member of the agreement which was once pushed by the U.S. as a way to isolate Beijing and solidify American dominance in the region.

The Taiwanese application to join the Comprehensive and Progressive Agreement for Trans-Pacific Partnership was sent to New Zealand, with a public announcement scheduled for as soon as Thursday morning, according to a person familiar with the situation. New Zealand is the depositary nation for the deal and will forward it to the other 10 nations.

China’s leaders are having fun with us. Who can blame them? / NYT (paywall)
Thomas L. Friedman says Beijing’s application to join the CPTPP is “a deliciously mischievous ploy.”

Lithuania steps up criticism of China
Lithuania says throw away Chinese phones due to censorship concerns / Reuters
“Lithuania’s Defense Ministry recommended that consumers avoid buying Chinese mobile phones and advised people to throw away the ones they have now after a government report found the devices had built-in censorship capabilities.”
In August: Beijing recalls Lithuania ambassador in another shock to EU-China relations.

Uyghurs struggle to find relatives in Xinjiang prisons
Overseas Uyghurs struggle to locate relatives in Xinjiang prisons / Reuters
“Murat is one of eight Uyghur people who told Reuters they have spent years searching for information on relatives who were detained and have since been charged and imprisoned in Xinjiang.”

Pakistan enlists Taliban to track down bombers of Chinese dam workers
Pakistan enlists Afghan Taliban to rein in group accused of bombing Chinese dam workers / SCMP (paywall)
“Backchannel talks are aimed at containing Tehreek-e-Taliban Pakistan insurgents, following Islamabad’s controversial offer of amnesty.”

Xí Jìnpíng 习近平 pushes back on U.S. portrayal of China
Xi’s general assembly remarks reject U.S. portrayal of China / NYT (paywall)
General Secretary Xi Jinping’s pre-recorded speech to the United Nations General Assembly “pushed back against U.S. criticism of his government as authoritarian, asserting that the world should embrace ‘civilizations of various forms.’”
Watch the speech here.

Beijing reactions to AUKUS
China says Asia needs jobs over submarines in fresh AUKUS salvo / FT (paywall)
“China said the Asia-Pacific region needs economic growth and jobs, not gunpowder and submarines, in the latest salvo from Beijing after the U.S., Australia and the U.K. announced a new trilateral security partnership.”
Here are the possible targets if China rebukes Australia over subs / Bloomberg (paywall)
“These range from sheep meat to almonds, or once borders reopen, homing in on international education — one of Australia’s top services exports in the pre-pandemic period — and tourism.”

Radio silence from journalist and activist
Chinese journalist, rights activist incommunicado, likely detained, in Guangzhou / RFA
“Feminist journalist Sophia Huang [黄雪琴 Huáng Xuěqín] and fellow activist Wáng Jiānbīng 王坚兵 are incommunicado, believed detained, ahead of Huang’s planned departure to study overseas, the Chinese rights group Weiquanwang reported on Tuesday.”

When the National Security Law is not enough: Hong Kong to pass new legislation
Explainer: How Hong Kong plans a series of new laws to further tighten its grip / HKFP
“A ‘fake news’ law, anti-doxxing legislation and another security law are all on the way. HKFP rounds up the new government proposals, 14 months after Beijing enacted the national security law.”

U.S. State Department to ramp up China “watch” officers
State Department plans ‘China house’ to counter Beijing / Foreign Policy
“The U.S. State Department is planning to expand the number of officials dedicated to monitoring China, in a bid to track Beijing’s growing footprint in key countries around the world.”
“The changes would include a boost for regional China ‘watch’ officers: a category of officials first created during the Trump administration to track Beijing’s activities around the world under the State Department’s regional bureaus.”

The accursed China Initiative
The U.S. is unfairly targeting Chinese scientists over industrial spying, says report / MIT Technology Review
“A new study of economic espionage cases in the U.S. says people of Chinese heritage are more likely to be charged with crimes — and less likely to be convicted.”


Beijingers love Universal theme park
Sold out Universal theme park shows China’s love for Hollywood / WSJ (paywall)
“Universal’s first theme park in China opened this week after years of construction and delays. Tickets sold out, indicating the country’s enthusiasm for franchises like Harry Potter and Kung Fu Panda, as NBCUniversal looks for growth in the Chinese market.”
Video here.

RTHK’s abandoned center
RTHK’s ETV – exploring Hong Kong’s abandoned TV center / HKFP
“Perched at the foot of Hong Kong’s Lion Rock for about half a century, Hong Kong broadcaster RTHK’s Educational Television Centre (ETV Centre) will soon be demolished following its sale to private developers.”

Will the tutoring ban hit working-class families the hardest?
Taking aim at China’s ‘3:30 p.m. dilemma’ / Sixth Tone
“Known as shuāngjiān 雙鐧, or the ‘double reduction’ policy, the reforms are meant to reduce the burdens on students and parents alike by decreasing the amount of time children in grades 1 through 9 spend on homework and in private tutoring classes.”

China’s mail-order pet craze leaves kittens and puppies abandoned in boxes
‘Blind boxes’ containing more than 100 live kittens and puppies found dumped as China’s latest mail-order pet craze continues / SCMP (paywall)
“More than 100 puppies and kittens believed to have been purchased online as ‘blind boxes’ were found abandoned in suburban Shanghai earlier this week, the latest case in China’s notorious live animal mail-order craze.”
On SupChina in May 2021: Puppies and kittens are the latest casualties of China’s blind-box craze.