China’s largest chipmaker leaves NYSE

Access Archive
Jeremy Goldkorn

Dear Access members,

Please note that there will be no newsletter on Monday, May 27 (Memorial Day in the U.S.).

—Lucas Niewenhuis, Associate Editor

1. Chipmaker delisting has ‘nothing to do with the trade war and Huawei incident’

Caixin Live reports:

Leading Chinese chipmaker Semiconductor Manufacturing International Corp. (SMIC) notified the New York Stock Exchange that it plans to voluntarily delist its American depositary shares (ADSs), the company said Friday.

SMIC cited “a number of considerations,” including the limited trading volume of its ADSs relative to its worldwide trading volume. The board approved the delisting and deregistration, the company said in a filing.

SMIC’s last trading day on the NYSE will be around June 13, the company said. SMIC debuted in Hong Kong and New York in March 2004. SMIC also attributed the move to significant administrative burdens and costs of maintaining the listing and registration as well as complying with periodic reporting and related obligations.

“Investors were caught off-guard by the announcement,” the SCMP adds, noting that the company’s shares in New York fell 5 percent, and its shares in Hong Kong, where its trading will be concentrated, “dropped 4.3 percent” today.

The company denied that U.S.-China tensions have anything to do with the delisting, per CNBC:

“SMIC has been considering this migration for a long time and it has nothing to do with the trade war and Huawei incident,” a spokesperson from Semiconductor Manufacturing told CNBC. “The migration requires a long preparation and timing has coincided with the current trade rhetoric, which may lead to misconceptions.”

That’s a little hard to believe, given the way U.S.-China relations have spiraled in the past few weeks in particular, and how the semiconductor industry — particularly the parts of it with ties to Huawei — appears to be target number one for hawks pushing decoupling in Washington. Also, Trump’s former adviser Steve Bannon earlier this week specifically called for Chinese companies to be booted off American capital markets (the senior vice president of NASDAQ was not pleased). Bannon doesn’t represent the U.S. government, but for the past year, the Trump administration policy has gone fairly consistently in the direction of his particular brand of nationalist.

Even if SMIC wasn’t pressured to delist by governmental or economic forces in the U.S. or China related to the trade and tech cold war, other Chinese companies are likely to feel such pressure.

Other news related to U.S.-China relations and the trade and tech cold war today, as briefly as possible:

—Lucas Niewenhuis

2. Xiaomi’s vice president fired after sexual assault allegations

Chinese smartphone manufacturer Xiaomi has fired its vice president, Wāng Língmíng 汪凌鸣, who was accused of sexual misconduct in the workplace. In an internal letter sent to Xiaomi’s employees on May 23, the company’s human resources department announced the dismissal of Wang, saying that the decision was made after discussions at the senior level.

Click through to The China Project for more details.

3. Micro-influencers from China are buying their way onto the Cannes 2019 red carpet

This year’s Cannes Film Festival is astonishingly accessible, thanks largely to an army of internet influencers from China who have stormed the festival’s red carpets with their deep pockets and a palpable thirst for attention.

As the Hong Kong–based newspaper Oriental Daily News pointed out (in Chinese), the city of Cannes in France, where the festival is hosted, has “become a Chinatown” this year due to the perplexing presence of no-name Chinese influencers. “A group of self-proclaimed celebrities hijacked the festival,” the newspaper wrote, scathingly. “Western reporters were appalled. Internet users from mainland China felt ashamed of them.”

Click through to The China Project for more details.

—Jiayun Feng

—–

Our whole team really appreciates your support as Access members. Please chat with us on our Slack channel or contact me anytime at jeremy@thechinaproject.com.

—Jeremy Goldkorn, Editor-in-Chief

Here are the stories that caught our eye this week:

  • Huawei’s future as a company is in question as it braces for U.S. Commerce Department restrictions on its supply chain. Rén Zhèngfēi 任正非 told Chinese media that his company’s stockpiles of chips and other supplies were sufficient for it to survive, but depending on what happens, analysts are not so sure.

  • Hikvision and other surveillance companies might be targeted with sanctions for their role in the racial profiling and mass detention of Uyghurs. Other companies in the crosshairs include Megvii, Meiya Pico, Iflytek, and Dahua, and even drone maker DJI.

  • The U.S.-China trade war is at an impasse, as the Chinese Commerce Ministry called on the Trump administration to “correct their wrong actions” and the U.S. Treasury Secretary insisted that negotiations “move forward on the basis we were.” A visit by Xi Jinping to a rare earth processing facility in Jiangxi was a clear threat to the U.S. that China could cut off access to the important minerals for technology components. Later, Xi said, “We are now embarking on a new Long March,” indicating Beijing is preparing the country for a long trade war. Meanwhile, U.S. firms are starting to feel severe pain from the toll of tariffs, according to a survey by the American Chamber of Commerce in China.

  • Anti-American rhetoric is no longer restrained in Chinese state media. After last week’s prominent featuring in state media of an editorial declaring a “people’s war” against the United States, the People’s Daily this week featured a commentary that accused “arrogant” Americans of “bullyism” (our best translation of 霸凌主义 bàlíng zhǔyì).

  • A huge wave of subsidy-free renewable energy projects was approved by Beijing, signaling that the industry is maturing in China.

  • Tongzhou District in Beijing, the capital’s subcenter that lies in the eastern suburbs near Hebei Province, has announced plans to offer rent reductions to those recognized as “talent” by the municipal government and who agree to work for a local employer for at least three years.

BUSINESS AND TECHNOLOGY:

SCIENCE, HEALTH, AND THE ENVIRONMENT:

  • Searching for aliens
    China’s massive telescope and the global quest to find aliens / That’s Guangzhou
    “Over 380,000 kilometers away from the plot of lunar land currently being explored by Chang’e-4, in a small rural county in China’s Guizhou Province, another type of galactic exploration is currently underway using the world’s largest filled-aperture radio telescope. Dubbed the Five-hundred-meter Aperture Spherical Radio Telescope, but more commonly referred to as FAST, or by its Chinese nickname Tianyan (meaning ‘Sky Eye’), the observatory was completed in 2016 and is expected to begin normal operations this year.”

POLITICS AND CURRENT AFFAIRS:

Indonesian police arrested a man on Friday accused of creating an anti-Chinese disinformation campaign to incite racial hatred, amid a proliferation of rumors alleging Chinese involvement in post-election unrest that has raised fears of ethnic violence.

Police say the suspect created a viral hoax using a photo of three Indonesian police officers at protests this week with a caption describing them as secret Chinese soldiers based on their “slanted eyes.”

SOCIETY AND CULTURE:

VIDEO ON SUPCHINA

From a ‘war of words’ to Google’s divorce from Huawei: Top news this week

From Chinese state media’s direct attack on Fox News to Google’s decision to suspend services with Huawei, here are some of the top stories we covered this week.

FEATURED ON SUPCHINA

China’s greatest propaganda film: Zhou Enlai’s historical musical ‘The East Is Red’

For all the one-dimensionality of its message, the film adaptation of The East Is Red is an aesthetic and technical marvel. Zhou Enlai and his vast crowd of collaborators created a piece of propaganda with a surprising amount of artistic merit, and the care, energy, and skill put into it clearly shine.

Qatar 2022 to stick with 32-team format, delivering massive blow to China’s World Cup hopes

FIFA confirmed that the next men’s World Cup — Qatar 2022 — would not, as originally anticipated, expand to 48 teams, remaining instead at its current size of 32. That’s a massive blow to China’s qualification hopes. Meanwhile, Marcello Lippi is returning as coach of the national team, just four months after leaving the post.

China Twitter: 100 accounts you should follow

The China Twitter community is one of the more constructive and informed groups on the platform. But don’t take our word for it, see for yourself: We’ve selected 100 of the top China-focused accounts on Twitter, comprising journalists, scholars, activists, observers, and everyday people who provide unique insights and facilitate a nuanced understanding of the country. Think we missed someone? Let us know: Email editors@thechinaproject.com.

What happened at The China Project’s third annual Women’s Conference

More than 350 people gathered at the Harmonie Club of New York on Monday for the third annual The China Project Women’s Conference, which was held to empower women from all walks of life. More than 20 high-profile speakers and moderators appeared onstage in a variety of talks and panel discussions.

The ripple effects of a complete ban on Huawei access to U.S. tech will be huge

The U.S. Commerce Department’s announcement that it is moving to cut off Huawei’s supply chain — only temporarily reprieved to allow suppliers to determine their compliance situation — signals that we may be moving toward a worst-case scenario for Huawei. That would be a Pyrrhic victory for the U.S., argue Douglas Fuller and Paul Triolo.

Kuora: Does Kaiser like baijiu? He does not.

Why don’t Western people drink Chinese baijiu? In general, Chinese baijiu has more than 1,000 years of history — but is it good?

SINICA PODCAST NETWORK

Sinica Podcast: Chinese investment: Beyond the USA

This week’s podcast was recorded at the Caixin “Talking China’s Economy: 2019 Forecasts and Strategies” conference in Chengdu in April. Kaiser spoke with Professor Hé Fān 何帆 of the Antai College of Economics and Management at Shanghai Jiaotong University, and Michael Anti, CEO of Caixin Globus, which tracks Chinese global investment. They chat about how “globalization,” which once meant “Americanization” to many Chinese, and has taken on a much broader meaning as SAFE concerns over capital flight have reeled in the “gray rhinos” after an investment spree, and as a stricter CFIUS regime has made U.S. investments more difficult.

TechBuzz China, episode 45: Totally lit or just hot air? The rise of e-cigarettes in China

In episode 45 of TechBuzz China, co-hosts Ying-Ying Lu and Rui Ma talk about the rise of what has been touted as “the next big trend” in China tech: electronic cigarettes. Despite being criticized as a trap for entrepreneurs and investors alike, as well as concerns around ethical considerations, a large number of high-profile hardware entrepreneurs and consumer internet executives in China have jumped into the fray.

NüVoices: The musical life and career of director Shuang Zou

Episode 17 of the NüVoices Podcast is here! This week, Alice Xin Liu is joined by co-host Zhāng Líjīa 张丽佳. The two interviewed Zōu Shuǎng 邹爽, a director and playwright. In 2018, she was made the artistic director of the Beijing Music Festival, following in the footsteps of legendary conductor Maestro Yú Lóng 余隆. She was recently nominated at the 2019 International Opera Awards in London in the Newcomer category for her work as a director.

Ta for Ta, episode 19: Heather White

This week on Ta for Ta, Juliana speaks with Heather White, the director of the documentary film Complicit and the founder and former executive director of Verité, a nonprofit that advocates for labor rights and partners with entities in both the public and private sector.

ChinaEconTalk: The future of U.S.-China economic relations: The case for change

This week, ChinaEconTalk launches its “Future of U.S.-China Economic Relations” miniseries with an interview featuring Melanie Hart, a senior fellow and the director of China Policy at the Center for American Progress. At the Center, Melanie specializes in U.S.-China foreign policy and explores new opportunities for bilateral cooperation on topics such as energy, climate change, and cross-border investment. In this episode, she discusses the central arguments in two of her recent articles, “Mapping China’s global governance ambitions” and “Limit, leverage, and compete: A new strategy on China,” and lays out her vision for what progressive U.S. policy making in response to new political trends in China might look like.

Middle Earth, episode 10: Ten years of selling science programming in China

Before the Beijing Olympics, foreign media groups seeking to sell or co-produce science-themed media content in China had a difficult time finding partners. Paul Lewis, an independent producer and former president of Discovery Channel Canada, was nevertheless able to co-produce two science programs in partnership with Chinese state media outlets: Daily Planet Goes to China and Factory Made/Made in China. In this episode, Paul discusses how rapidly the Chinese media landscape has evolved and the implications for science-themed content.

Subscribe to Middle Earth on Apple Podcasts, Overcast, or Stitcher, or plug the RSS feed into your favorite podcast app.

Jeremy Goldkorn worked in China for 20 years as an editor and entrepreneur. He is editor-in-chief of The China Project, and co-founder of the Sinica Podcast. Read more

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