Links for Thursday, February 4, 2021

WORTH THINKING ABOUT

Pieces of news or analysis that caught our eye:

The complexity of SOE debt defaults: Nikkei Asia reports that two important state-owned firms, which sent shivers through markets last year when they defaulted on their debts, have managed to continue operating:

• Yongcheng Coal has “once again succeeded in effectively pushing back this week’s deadline to pay back the principal and the interest for the three-year bond with a value of 2 billion yuan ($310 million). In an announcement on Jan. 29, all 48 holders of the bond unanimously agreed to a conditional extension proposed by the company.” 
• Tsinghua Unigroup has continued operating normally, despite missing bond payments, due to “the group’s complex capital structure, which involves powerful state-owned enterprises and government-affiliated investment funds.”

See also:

• Tsinghua Unigroup defaults push up China’s 2021 offshore sum / Bloomberg (porous paywall)
• Chinese offshore bond defaults reach nearly 33% of 2020’s total / Bloomberg (porous paywall)

MORE NEWS FROM AROUND THE WORLD

BUSINESS AND TECHNOLOGY:

• One billion internet users, nearly
  第47次《中国互联网络发展状况统计报告》 / CNNIC
  At the end of 2020, China had 989 million internet users, according to government statistics released yesterday, up by 85.4 million from March. In comparison, the U.S. has around 284 million internet users, and India has 639 million.
  The government statistics report added that 94% of all Chinese internet users watched online videos, and 88% used short-video apps. More than 781 million people have reportedly shopped online.
  More from CNBC: China says it now has nearly 1 billion internet users.

• Slow down that Shanghai IPO
  What’s behind regulators’ backpedaling on China’s new IPO system? / Caixin (paywall)
  Shanghai’s STAR market — created to make it easier for unprofitable tech firms to go public, and to make the listing process more transparent and market-oriented — is telling would-be IPOers to slow down and submit more paperwork:
  One reason could be “the fear of investors descending into a speculative feeding frenzy for newly listed companies,” which would throw money at “lackluster IPO candidates.”

• See also on Caixin:
  Shanghai Exchange seeks more concise disclosure from IPO applicants after Ant Group debacle (paywall)
  Sponsors face tougher inspections over STAR market IPO problems (paywall)

• As China’s cars get old, Goldman and Tencent invest in repair chain
  China’s messy car repair market gets a Goldman-backed makeover / Bloomberg (porous paywall)
  Tuhu is an internet-enabled chain of branded car repair stores, which now has backing from Goldman Sachs, Carlyle Group, Sequoia Capital, and internet giant Tencent, and is valued at $4 billion. 

• SWIFT: China positioning for digital yuan?
  SWIFT sets up JV with China’s central bank / Reuters

• Food is going to get expensive
  World food bills set to keep rising on China’s crop-buying binge / Bloomberg (porous paywall)

• Huawei used company resources to apply for Annabel Yao trademarks
  Huawei founder apologizes for using company to help his daughter / Caixin (paywall)
  Related The China Project reporting: Huawei heiress Annabel Yao makes a grandiose foray into showbiz. Haters have a lot to say.

• No boycott of Canadian canola or luxury coats
  China buying spree stokes fears of Canadian canola shortage / Bloomberg via Caixin
  “Canada’s agriculture department forecast that the current crop year will end with 1.2 million tons in storage, the lowest carry-over since 2013.”
  Canada Goose profit beats estimates on robust China demand, shares soar / Reuters

• Australian wine redirects to U.K.
  Australian wine holds up even as Chinese tariffs bite / Australian Financial Review via Caixin
  “China remained the industry’s biggest market in 2020, but exports plunged after the levy of up to 212% was imposed in December.”
  Brits snap up Australian wine that didn’t go to China / BBC

• The future of Ant Group
  China’s Ant to hive off credit data in revamp; sees IPO in 2 years – sources / Reuters

• KFC cashes in with meal kits
  KFC operator Yum China posts profit, revenue gains on new store openings / Caixin
  “The nation’s largest fast-food operator saw revenue and profits rise 11% and 68% in the fourth quarter, respectively, even as same-store sales fell 4%.”
  Meal kits and buckets of bubble tea: How Yum China is pivoting / CNN

• Insurance giant Ping An’s performance
  Investment in developer leaves $8.4 billion question mark on Ping An’s books / Caixin (paywall, or see Reuters summary)
  Ping An’s fintech subsidiary OneConnect narrows net loss in 2020 / Caixin

• Electric vehicles and batteries
  Ford Motor terminates electric vehicle plans with China’s Zotye / Reuters
  Tesla puts China supercharger plant into production / Caixin
  EV-battery giant CATL to boost capacity with $4.5bn investment / Nikkei Asia (paywall)

SCIENCE, HEALTH, AND THE ENVIRONMENT: 

• When might China formally approve its second COVID-19 shot?
  Sinovac applies for conditional approval of COVID-19 vaccine in China / Caixin (paywall)
  Note: A study from Hebei indicating the Sinovac shot is safe has just been published in The Lancet. Full clinical trial data on the effectiveness of the vaccine is not yet public.
  Pakistan says China’s Sinopharm vaccine not effective for people over 60 years / Times of India
  China administered 31.2 million doses of COVID-19 vaccines for key groups as of February 3 / Reuters
  Sinopharm vaccine effective against South African variant: study / Nikkei Asia (paywall)

• Related, on The China Project:
  China ramps up COVID-19 vaccinations, approves Sinopharm shot
  What if China’s COVID-19 vaccines are the least effective?

• WHO in Wuhan
  WHO team in Wuhan says discussions open, meetings frank / AP
  China bat caves need exploring in search for COVID origins, WHO team member says / Reuters
  WHO team probing COVID-19 visits Wuhan lab, meets ‘Bat Woman’ / Reuters
  Peter Daszak on Twitter: “Extremely important meeting today with staff at WIV including Dr Shi Zhengli. Frank, open discussion. Key questions asked and answered.”

• Vaccine diplomacy
  India rivals China in COVID-19 vaccine diplomacy with million doses for South Africa / SCMP
  China’s Sinopharm vaccine offered to elite few in UAE tourist deal / Guardian
  Cambodia approves emergency use of China’s Sinopharm COVID-19 vaccine / Xinhua

POLITICS AND CURRENT AFFAIRS:

• A positive signal on U.S.-China climate change collaboration
  Climate veteran Xie Zhenhua returns as China’s special envoy / Climate Change News
  The move is “seen as a ‘bright spot’ for U.S.-China cooperation, given his strong relationship with US special climate envoy John Kerry…While Xie’s appointment has not been publicly announced, sources say officials at the environment ministry have confirmed the move.”
  Related, on The China Project: Beijing rejects idea of climate as ‘standalone issue’ in U.S.-China relations.

• U.S. says stance on Taiwan has “not changed”
  U.S. reaffirms commitment to ‘one China’ policy / Caixin
  Jessica Drun on Twitter: “Friendly reminder that the US “One China” policy(美國的一中政策) is guided by the Taiwan Relations Act, the Six Assurances, the Three Joint Communiques, and a number of other US policy statements. It is not Beijing’s “One China” Principle （一中原則).”
  First US warship transits Taiwan Strait since Biden inauguration / AFP via Channel NewsAsia
  China-US relations: Beijing says it’s keeping a close eye on US Navy maneuvers near Taiwan / SCMP

• Beijing 2022 Olympics
  U.S. signals no plans to boycott 2022 Beijing Winter Olympics after genocide designation / Reuters
  “‘We’re not currently talking about changing our posture or our plans as it relates to the Beijing Olympics,’ White House spokeswoman Jen Psaki told a news briefing on Wednesday.”
  Anti-China activists in Japan call for boycott of Beijing 2022 Games / Reuters
  Beijing 2022: 180 human rights groups call for Winter Olympics boycott / Guardian

• Xinjiang and Uyghurs
  U.S. ‘deeply disturbed’ by reports of systematic rape of Muslims in China camps / Reuters
  US, UK governments condemn reports of systematic rape in Uyghur camps / BBC
  China’s abuse of the Uyghurs: Does the genocide label fit? / Council on Foreign Relations
  University of Manchester ends research project with Chinese firm over alleged links to Uyghur persecution / Independent
  Australia asks for UN probe into new China Uyghur abuse claims / Bloomberg (porous paywall)

• Hong Kong emigration
  Canada says Hong Kong graduates can apply for work permits, slams China on rights / Reuters
  Nearly 11,000 Hongkongers moved to Taiwan in 2020 as security law accelerates exodus / AFP via HKFP
  Related, on The China Project: U.K. prepares for mass immigration from Hong Kong.

• Teaching the children about Xi Dada
  Xi Jinping Thought: China issues guidelines for school children / Bloomberg (porous paywall)
  CPC unveils guideline for strengthening Chinese children’s organizations / Xinhua
  中共中央关于全面加强新时代少先队工作的意见 / Gov.cn

• Hong Kong drops 12 places in Economist’s democracy index
  Hong Kong downgraded from ‘flawed democracy’ to ‘hybrid regime’ as city drops 12 places in Economist’s democracy index / HKFP
  Hong Kong to impose ‘national security’ schools curriculum / FT (paywall)
  “Teachers of subjects such as geography and biology will also need to incorporate lessons about national security into the topics taught in class. The resources provided by the bureau suggested that biology students should, for example, study how the local and mainland Chinese government protected the country during the pandemic.”
  Hong Kong’s Carrie Lam says ‘normal’ legislature lets gov’t make ‘bold’ proposals, vows action on ‘fake news’ and doxxing / HKFP
  Hong Kong pro-establishment lawmakers seek to amend legislature’s house rules, in move set to further restrict their power / HKFP
  Hong Kong pro-democracy movement nominated for Nobel peace prize by US lawmakers / AFP via Guardian
  Hunting rats, defending democracy: Hong Kong’s local leaders under fire / NYT (porous paywall)
  Western alarm as Canada said Hong Kong forced a jailed dual citizen to choose nationality / AFP via HKFP
  US accuses China of harassing lawyers for 12 Hongkongers arrested at sea / SCMP

• Arms control diplomacy
  Biden to pursue arms control, seeks to engage China, U.S. envoy says / Reuters
  Robert Wood, the U.S. ambassador to the United Nations in Geneva, says the U.S. “will also seek to engage China on nuclear arms control and risk reduction.”

• East and South China Seas
  UK, Japan express serious concern over East, South China Seas situation / Reuters

• Social media propaganda campaigns
  Fake accounts gain traction as they praise China, mock US / Reuters
  Pro-China propaganda exploits U.S. Capitol assault / Washington Post
  Pro-China accounts use Capitol riot footage to condemn democracy / Bloomberg (porous paywall)

SOCIETY AND CULTURE:

• Mars rover 40-day naming poll
  China’s 1st Mars rover will get one of these 10 names, and you can vote to select the winner / Space
  “The 10 names — Hongyi, Qilin, Nezha, Chitu, Zhurong, Qiusuo, Fenghuolun, Zhuimeng, Tianxing and Xinghuo — are taken from ideas including Chinese mythological figures, Confucian concepts and legendary animals.”

• Photos from Beijing in early 2020
  Running on empty / ChinaFile

• Poetry controversy
  A critic, a poet, and divisive interpretations of craft / Sixth Tone
  “Jiǎ Qiǎnqiǎn’s 贾浅浅 poetry came under scrutiny after the WeChat account of bimonthly magazine Literature Talks published a scathing review last week, saying her writing ‘depraved Chinese literary society.’ The article accused other writers and poets of disingenuously singing Jia’s praises instead of giving honest appraisals of her work.”