中国新年: Shanghai Disney Braces for Chinese New Year Holiday

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SHANGHAI – As the Chinese New Year approaches, Shanghai Disney said Wednesday it has started bracing for its first-ever Lunar New Year with spectacular entertainment programs for visitors.

In honor of the holiday for the Year of the Rooster, the resort is presenting a spectacular series of entertainment programs, seasonal food and beverage offerings, lucky bags and holiday-themed shopping experiences, it said.

The Chinese Lunar New Year, or the Spring Festival, falls on Jan. 28. Chinese have a weeklong holiday for the most important festival of the year.

Throughout the Spring Festival season, the highlight in Shanghai Disneyland will be the nightly program, “Ignite the Dream: A Nighttime Spectacular of Magic and Light” followed by a special event featuring new year wishes from tourists. Read the rest of this entry »


U.S. Marines Send F-35 Stealth Fighter Squadron to Japan 

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It marks the first time for that stealth aircraft to be stationed overseas.

The US Marine Corps said it has sent a squadron of F-35B fighter jets to Japan, marking the first operational overseas deployment for the controversial aircraft that is under scrutiny from president-elect Donald Trump.

The deployment of the 10 planes to Marine Corps Air Station Iwakuni on Honshu Island marks a major milestone for the F-35, which has been bedeviled by technical glitches and soaring cost overruns.

With a current development and acquisition price tag already at $379 billion for a total of 2,443 F-35 aircraft, Lockheed Martin’s F-35 is the most expensive plane in history, and costs are set to go higher still.

The Marines’s version of the plane, known as the F-35B, is capable of conducting short takeoffs and vertical landings.

Trump last month sent shockwaves through the aerospace industry when he tweeted that he wanted rival Boeing to price out a possible alternative.

“Based on the tremendous cost and cost overruns of the Lockheed Martin F-35, I have asked Boeing to price-out a comparable F-18 Super Hornet!” Trump tweeted December 22.

The F/A-18 Super Hornet does not have stealth capabilities and has been in use since the late 1990s.

Once servicing, maintenance and other costs for the F-35 are factored in over the aircraft’s lifespan through 2070, overall program costs have been projected to rise to as much as $1.5 trillion.

Proponents of the F-35 tout its speed, close air-support capabilities, airborne agility and a massive array of sensors giving pilots unparalleled access to information. Read the rest of this entry »


Hollywood’s Superheroes, Family Movies Boosted by China in 2016 

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The revenue from the world’s second-largest movie market accounted for 13 percent of the $13.5 billion generated by the top 20 movies from U.S. studios.

Lisa Richwine reports: China’s moviegoers embraced big-screen superheroes, cartoon animals and a video game-turned-action flick in 2016, adding $1.8 billion in ticket sales to Hollywood’s 20 highest-grossing films of the year.

The revenue from the world’s second-largest movie market accounted for 13 percent of the $13.5 billion generated by the top 20 movies from U.S. studios, according to a Reuters analysis of data from tracking firm Box Office Mojo. That was triple the 4 percent level five years ago.

The numbers illustrate China’s growing importance to U.S. studios such as Walt Disney Co’s (DIS.N) Disney Studios, Time Warner Inc‘s (TWX.N) Warner Bros. and Comcast Corp’s (CMCSA.O) Universal Pictures.

While China’s booming box office growth stalled this year in single digits, the country remains vital for Hollywood studios, box office analysts said. In 2016, China overtook the United States as the country with the largest number of movie screens.

Most of the top Hollywood movies would have reached the top of the film charts without China. But the additional revenue is significant, especially for blockbuster films that can cost $200 million or more to make.

“You can grab an extra hundred million (dollars) of revenue from the Chinese market,” said Jonathan Papish, film industry analyst for China Film Insider. “You can’t do that anywhere else in the world.”

Walt Disney Co’s (DIS.N) animated “Zootopia,” known in China as “Crazy Animal City,” was Hollywood’s biggest hit there, with $236 million in ticket sales, and ranked as the third-highest-grossing movie worldwide. China’s film authorities extended the movie’s theatrical run by two weeks beyond the typical 30 days for foreign films. Read the rest of this entry »


Helen Raleigh: 2017 May Be The Year China’s Chickens Come Home To Roost 

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While Americans embrace their reinstated confidence in both economics and international affairs, China seems to be going the opposite direction.

Deng probably hoped future Chinese leaders would be humble and restrained, keep a low profile, and instead of broadcasting China’s ambitions or showing off China’s economic or military muscles, quietly focus on overcoming China’s weaknesses, such as economic development. In international affairs, Deng probably would have liked to see China avoid acting like an aggressor. Instead, he would have preferred China conshun either causing any international conflict or serving as a leader of any faction within an international conflict.

[Check out Helen Raleigh’s book “Confucius Never Said” at Amazon.com]

When Deng passed away in 1997, China was still in its first decade of economic reform and its per-capita gross domestic product was less than $800, so the kind of restrained policy approach he advocated made perfect sense. No one knows how long Deng intended for this policy guidance to last. But Deng’s successors, from Hu Yaobang to Hu Jingtao (they aren’t related), pretty much followed Deng’s policy guidelines until President Xi Jinping assumed power in 2012.

No More Humility and Restraint

It seems President Xi has abandoned Deng’s strategic policy guidelines. On the domestic front, he focused on ensuring his power by purging many political rivals through the anti-graft movement. In October, he was declared the “core” leader of the Chinese Communist Party, a title last used by Chairman Mao.

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[Read the full story here, at The Federalist]

He coined the term “China dream” to counter “American dream.” While “American dream” is about any hard-working individual living to his or her full capacity in a free society, “China dream” means Chinese people can only live a better life by subjecting themselves to the Communist Party’s absolute rule. Under President Xi, the 51hkz5w3lkl-_sl250_Chinese government has ruthlessly cracked down on dissidents, including Chinese nationals and foreigners, and China has become a much less friendly place to foreign investors and companies.

[Check out Helen Raleigh’s other book “The Broken Welcome Mat: America’s un-American immigration policy, and how we should fix it” at Amazon.com]

On the foreign policy front, China doesn’t lay low any longer. President Xi has been very vocal about China’s ambitions. He seems to believe that China’s rise to replace the United States as the next superpower is unstoppable and the time is now.

He sees at least two trends in his favor. First, there’s a consensus within the Chinese leadership and public opinion that the 2008 economic crisis has produced long-lasting devastating effects to the West: most countries in Europe are still struggling economically while the United States has experienced a very timid recovery. Since China emerged from the 2008 economic crisis relatively unscathed, many people, including Xi, believed that free market economics have reached their end and it’s time to adopt the Chinese-style authoritarian mercantile economic model. Thus, China should replace the United States to set a new economic order.

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Second, based on a misguided belief that the world is a better place when the United States gives up its power and authority in a global system established since World War II, President Obama has been ready and willing to acquiesce America’s leadership in international affairs in the last eight years. President Xi quickly sized up president Obama as a weak leader, and sought to expand China’s influence and challenge America wherever opportunities rise. Read the rest of this entry »


[VIDEO] Chinese Girl Tries American Chinese Food 

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Counterfeit Electronic Products Worth HK$1.3 Million Seized in Hong Kong

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clifford-lo-250Clifford Lo reports: About 200 parcels mailed from the mainland to the United States carrying counterfeit electronic products were intercepted in a three-day joint operation mounted by Hong Kong Customs and United States authorities.

In Hong Kong, about 1,300 fakes including mobile phones, tablet computers and chargers were confiscated in 54 parcels totalling an estimated street value of HK$1.3 million, the Customs and Excise Department said.

The US authorities intercepted 140 shipments and confiscated fake electronic products that could be sold for US$1.1 million there during the operation conducted between November 15 and 17 last year.

It is understood some of the parcels intercepted in the United States were confiscated based on intelligence from Hong Kong customs officials.

Initial investigation showed the fake products were mailed from the mainland and destined for the US via Hong Kong, a source said. Read the rest of this entry »


[VIDEO] Reporter Laughs at State Department Dodge on China’s Influence on North Korea

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China’s Xi Calls for ‘Socialist Family Values’ in 2017 as Anti-Beijing Sentiment Grows

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Chinese President Xi Jinping made statements last month demanding a “new trend toward socialist family values” in China.

Frances Martel reports: The Chinese state news agency Xinhua is promoting statements by President Xi Jinping made last month demanding a “new trend toward socialist family values” in China as the Communist Party faces a 2017 teeming with new challenges from separatist groups, religious minorities, and even Maoists who reject Xi’s autocratic capitalist reforms.

Xi made the comments at a conference “to honor model families” in December, according to Xinhua, defining “socialist family values” as “love for the nation, family and one another, devotion to progress and kindness, and mutual growth and sharing.” His New Year’s Eve address appeared to promote more of the same, demanding the Chinese people “work harder” to aid the Communist Party’s progress both nationally and globally.

“As long as our 1.3 billion-plus people are pulled together for a common cause, as long as the Party stands together with the people and we roll up our sleeves to work harder, we will surely succeed in a Long March of our generation,” Xi reportedly said in his address.

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He made clear that the values he seeks to see Chinese families promote are indivisible from Communist Party edicts, reminding listeners that “law is virtue put down in words, and virtue is law borne in people’s hearts.”

Wu Zhihong Nation of Giant Infants

Xi reportedly urged “fostering a belief in law, the rule of law and rules, and guiding people to voluntarily assume their statutory duties, as well as responsibilities for society and family.”

[Check out Wu Zhihong’s bookThe Giant Baby Nation” (Chinese Edition) at Amazon.com]

The Chinese Communist Party propaganda outlet The People’s Daily reported that Chinese citizens online “responded enthusiastically to President Xi Jinping’s New Year’s address, equally impressed by the content and inspirational phrasing of the speech.”

The Chinese media outlets’ emphasis on family values are contrasted with Western-style popular culture on the pages of the Global Times, another English-language propaganda outlet. While China’s president has repeatedly dwelled on “socialist family values” in recent speeches, the Times has decried reality show participants and celebrity divorcees as indicative of a trend of immaturity among young Chinese people. Read the rest of this entry »


2017: Year of the Rooster

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Ruan Hailin, a craftsman from Jiangsu Province, used paint brush to draw roosters on chicken eggs to welcome the upcoming Chinese lunar New Year, which will falls on January 28 this year. Along with the roosters in different postures, Ruan also inscribed some wishes on the eggs to signify an auspicious year. In Chinese culture, there are 12 zodiac animals to represent a year periodically, and 2017 is the Year of the Rooster.


Xi’s Power Play Foreshadows Historic Transformation of How China Is Ruled

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Party insiders say president wants to remain in office after his second term, breaking succession conventions.

BEIJING— Jeremy Page and Lingling Wei report: China’s Communist Party elite was craving a firm hand on the tiller when it chose Xi Jinping for the nation’s top job in 2012. Over the previous decade, President Hu Jintao’s power-sharing approach had led to policy drift, factional strife and corruption.

The party’s power brokers got what they wanted—and then some.

Four years on, Mr. Xi has taken personal charge of the economy, the armed forces and most other levers of power, overturning a collective-leadership system introduced to protect against one-man rule after the death of Mao Zedong in 1976.

Shattering old taboos, Mr. Xi has targeted party elders and their kin in an antigraft crusade, demanded fealty from all 89 million party members, and honed a paternalistic public image as Xi Dada, or Big Papa Xi.

Now, as he nears the end of his first five-year term, many party insiders say Mr. Xi is trying to block promotion of a potential successor next year, suggesting he wants to remain in office after his second term expires in 2022, when he would be 69 years old.

Mr. Xi, who is president, party chief and military commander, “wants to keep going” after 2022 and to explore a leadership structure “just like the Putin model,” says one party official who meets regularly with top leaders. Several others with access to party leaders and their relatives say similar things. The government’s main press office declined to comment for this article, and Mr. Xi couldn’t be reached for comment.

[Read the full story here, at WSJ]

Mr. Xi’s efforts to secure greater authority may help ensure political stability in the short run, as an era-defining economic boom starts to falter. But they risk upending conventions developed since Mao’s death to allow flexibility in government and ensure a regular and orderly transition of power.

Concern is rising among China’s elite that the nation is shifting toward a rigid form of autocracy ill-suited to managing a complex economy. China’s array of challenges includes weaning the economy off debt-fueled stimulus spending, breaking up state monopolies and cleaning up the environment.

“His dilemma is that he can’t get things done without power,” says Huang Jing, an expert on Chinese politics at the National University of Singapore. “He feels the need to centralize, but then he risks undermining these institutions designed to prevent a very powerful leader becoming a dictator.”

Chinese President Xi Jinping, left, and Premier Li Keqiang arrived for the opening session of the National People's Congress in March.
Chinese President Xi Jinping, left, and Premier Li Keqiang arrived for the opening session of the National People’s Congress in March. Photo: Agence France-Presse/Getty Image

Mr. Xi’s supporters say he still faces resistance within the party, and needs to modernize leadership structures to confront the slowing economy and a hostile West.

At a meeting of 348 party leaders in October that granted Mr. Xi another title—“core” leader—he railed against indiscipline and warned of senior officials who “lusted for power, feigned compliance and formed factions and gangs.”

Since then, many party members have signed written pledges of “absolute loyalty.” In a speech in October, the party chief of Henan province, Xie Fuzhan, hailed Mr. Xi as a “great leader”—words usually reserved for Mao.

[Read the more here, at WSJ]

Hours before Donald Trump’s election victory, China officially launched its own convoluted process for selecting a new national leadership team, to be unveiled at a twice-a-decade party congress next fall. Up to five of the seven members of the Politburo Standing Committee, China’s top leadership body, are due to retire.

Only Mr. Xi and Premier Li Keqiang would remain if the party observes the precedent, established in 2002, that leaders over age 67 step down. Read the rest of this entry »


China’s ‘Social Credit’ System: Turning Big Data Into Mass Surveillance 

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The declared aim of this ambitious plan for a social-credit system is to build a ‘culture of sincerity.’ At this stage in China’s history, it is questionable whether the party-state can build any kind of culture.

Stanley Lubman writes: The Chinese government is taking the first steps in an evolving plan to employ big data to establish a nationwide system of mass surveillance of the entire population. This “social-credit system” would mobilize technology to collect information on all citizens and use that information to rate their behavior, including financial creditworthiness and personal conduct. The local experiments have provoked mixed reactions.

“The Communist Party, since it gained power in 1949, has endeavored to monitor and control the behavior and thoughts of the population. In the era of Mao Zedong it established ‘residents’ committees’ in the cities and ‘village committees’ in the countryside to monitor citizens’ behavior and report to local police. These continue to operate today, if in slightly different forms.”

The declared aim of this ambitious plan for a social-credit system is to build a “culture of sincerity.” At this stage in China’s history, it is questionable whether the party-state can build any kind of culture. The center cannot effectively control local governments, a large share of economic profits is going to the wealthy, corruption remains widespread and neither the economy nor the populace will tolerate the absence of rule of law indefinitely.

The Communist Party, since it gained power in 1949, has endeavored to monitor and control the behavior and thoughts of the population. In the era of Mao Zedong it established “residents’ committees” in the cities and 51p37hyvrll-_sl250_“village committees” in the countryside to monitor citizens’ behavior and report to local police. These continue to operate today, if in slightly different forms.

[Order Stanley Lubman’s book “Bird in a Cage: Legal Reform in China after Mao from Amazon.com]

The current effort to expand control of personal conduct is the latest in a series of moves to control behavior that now include campaigns against corrupt officials, rights lawyers and others whose conduct and actions are considered “subversive” both in person and otherwise—such as in social media.

The new social-credit system may include “black marks for infractions such as fare cheating, jaywalking and violating family-planning rules,” according to an article in The Wall Street Journal. The article quotes planning documents stating that the system would “allow the trustworthy to roam everywhere under heaven while making it hard for the discredited to take a single step.” It is no wonder that one Chinese human rights-activist is quoted as saying “Tracking everyone that way, it is just like ‘1984’.” (The famous novel published in 1949 by George Orwell imagines a mythical regime that spies on all of its citizens using omnipresent surveillance.)

[Read the full text here, at WSJ]

Current tentative steps to test the new system have raised questions about its implementation and reach. Obvious issues include defining the criteria that would be applied to rate citizens, the government and social institutions that would perform the ratings, and the impact of those ratings on citizens’ business and professional activities and on their lives in general. A key component of the new system will be taking traditional credit-scoring and adding other data points. Sesame Credit, an affiliate of e-commerce titan Alibaba, currently surveys online shopping habits and, if users consent, posts their education levels and legal records. Businesses and some individuals such as lawyers, accountants, teachers and journalists would receive closer scrutiny of their professional behavior. Read the rest of this entry »


China Criticizes Abe’s Pearl Harbor Visit 

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BEIJING/SEOUL (Jiji Press) — China on Wednesday criticized Prime Minister Shinzo Abe’s visit to Pearl Harbor in Hawaii for his lack of deep reflection on the country’s past.

Noting that Japan waged a war of aggression against China and other Asian countries, Chinese Foreign Ministry spokeswoman Hua Chunying told a press conference, “Reconciliation between the inflicters and victims must and can only be based upon sincere reflection and apology from the inflicters.” This is the only way to realize “a genuine and lasting reconciliation,” she said. For victimized countries in Asia, “one sincere apology” is more important than “dozens of smart shows,” Hua said.

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The People’s Daily newspaper of the Communist Party of China said in its Wednesday edition that the Pearl Harbor visit is criticized both in Japan and the United States because Abe made the trip before apologizing to war victims in Asian countries that Japan invaded during the war.

Meanwhile, a South Korean Foreign Ministry official, touching on Abe’s pledge never to wage war again in the speech, said that Japan, based on a correct understanding of history, should strive further to promote reconciliation and cooperation with neighbors that fell victim to its wartime militarism. Read the rest of this entry »


Chinese Shopping Mall Marks Year of the Rooster with a Giant Statue of the Bird Sporting Donald Trump’s Infamous Hairdo

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China gives Trump the bird

A Chinese shopping mall is ringing in the Year of the Rooster with a giant sculpture of a chicken that looks like US president-elect Donald Trump.

China has gone cuckoo for the cartoonish pastiche — complete with orange pompadour — of the billionaire politician in Taiyuan, capital of the northern province of Shanxi.

The scowling statue is one of many roosters popping up around the country as it prepares to celebrate the lunar new year at the end of January.

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With its tiny wings parroting the distinctive hand gestures of Trump (who is often mocked for his allegedly small digits) replicas of the bird are available on the Chinese shopping site Taobao for as much as 12,000 yuan ($1,700) for a 10-metre version. Read the rest of this entry »


[VIDEO] Chinese Military Rattles Neighbors in South China Sea

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China Auto Glass Tycoon Cao Dewang Moves Jobs to U.S., Citing High Taxes at Home

Cao Dewang, Chairman of Fuyao Glass

Shanghai (AFP) – A Chinese auto glass tycoon has caused a stir by shifting part of his empire to the United States and setting up a factory in Ohio, citing high taxes and soaring labour costs at home.

Cao Dewang’s $600-million investment comes after Donald Trump threatened to declare Beijing a currency manipulator and slap 45 percent punitive tariffs on Chinese imports to protect American jobs.

The 70-year-old tycoon’s decision to open a glass factory in the eastern American state of Ohio in October — a rare case of jobs being exported from China to the US — triggered an outpouring of criticism on social media.

The phrase “Cao Dewang has escaped” became a hot topic, generating nearly 10 million views on the Twitter-like Weibo microblog and many comments urging China to “not let Cao Dewang run away”.

Cao’s Fuyao Glass Industry Group — a supplier to big names including Volkswagen and General Motors — claims to be the biggest exporter of auto glass in the world, reporting 2.6 billion yuan ($370 million) profits last year. Read the rest of this entry »


To Problems With China’s Financial System, Add the Bond Market

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SHANGHAI — Keith Bradsher Chinese officials cheered on the country’s stock market when it reached heady new highs, offering hope that it could become a new source of money to fix China’s economic problems. Then, last year, the market crashed.

“China is struggling with its own balancing act. The Chinese bond slump also stems from Beijing’s efforts to wring excess money from its financial system and to stop potential bubbles that may lurk in shadowy, hard-to-track corners of its economy. Should it continue with those efforts, bonds could fall further.”

Now another fast-growing part of China’s vast and increasingly complicated financial market is showing signs of distress: its $9 trillion bond market.

Prices for government and corporate bonds have tumbled over the past week, a sell-off that continued on Tuesday. The situation has spooked investors, prompting the government to temporarily restrain some trading and to make emergency loans to struggling financial institutions.

“The adjustment has not yet finished. It will continue and normalize until money is put where the government can see it.”

— Miao Zuoxing, a partner at the FXM Brothers Fund

The price drops have resulted in higher borrowing costs at a time when more Chinese companies need the money to cope with slowing economic growth. Yields reached new highs again on Tuesday.

In part, China is reacting to financial shifts across the globe. With the Federal Reserve raising short-term interest rates and many expecting the presidency of Donald J. Trump to lead to heavier government spending, investors worldwide are selling bonds.

“Due to recent, relatively large market fluctuations, our company decided to cancel the issue of the current bond, and will reissue it at a chosen time.”

— Jiangsu Sumec Group

But China is struggling with its own balancing act. The Chinese bond slump also stems from Beijing’s efforts to wring excess money from its financial system and to stop potential bubbles that may lurk in shadowy, hard-to-track corners of its economy. Should it continue with those efforts, bonds could fall further.

“The adjustment has not yet finished,” said Miao Zuoxing, a partner at the FXM Brothers Fund, a Shanghai-based investment fund that trades stocks, bonds and futures. “It will continue and normalize until money is put where the government can see it.”

At least 40 companies have said they would postpone or cancel bond offerings rather than risk being forced to pay high interest rates to sell the bonds — or being unable to sell them at all. Among them was the Jiangsu Sumec Group Corporation, an industrial trading house that exports items as varied as gardening tools and auto parts; the company said on Thursday that it would not go through with the sale of $130 million in short-term bonds.

“Due to recent, relatively large market fluctuations, our company decided to cancel the issue of the current bond,” Jiangsu Sumec Group said in a statement, “and will reissue it at a chosen time.”

China has particular reason to worry. As the world’s second-largest economy, after the United States, it relies on a rickety financial system that is mired in debt and susceptible to hidden stresses. Higher overseas interest rates could also prompt more Chinese investors to move their money out of the country, either to chase higher returns elsewhere or to avoid what some see as China’s growing problems.
Read the rest of this entry »


China Not Following Through on Market Reform Promises, says German Ambassador

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Michael Clauss hits out at lack of progress in market reforms and a reality that contradicts Beijing’s declared intentions.

wendy-wuWendy Wu reports: China isn’t following through on its market reform pledges as quickly as desired, German ambassador to China Michael Clauss said in an interview.

“I regret to note that the reform initiatives taken at the third plenum apparently have lost momentum,” Clauss told the South China Morning Post in Beijing.

The Communist Party, under the leadership of Xi Jinping, pledged three years ago that China would allow the market to play a “decisive” role in resources allocation. But the promises of adopting more market-oriented changes have mostly been shelved as Beijing beefs up intervention in economic activities, from coal mine operations to capital account controls.

“It seems that preserving social stability and discipline are the order of the day much more than implementing the necessary economic reforms,” Clauss said.

“Officially, China propagates a policy of open markets and unfettered access for foreign trade and investment. However, we note that very often [the] reality on the ground does not correspond to the declared intention of the Chinese government to facilitate foreign direct investment.

“On a long-term perspective, we sense a growing tendency in China towards market closure and favouring of indigenous production,” he said.

At a key policy meeting that ended on Friday, the leadership again highlighted “stability” and “financial risk prevention” as priorities for the coming year, sending a clear message that bold moves in market opening or liberalisation were off the table, observers said.

They are worried that Beijing is also unlikely to make painful cuts in the bloated state sector, for fear of possible social unrest, before the top leadership reshuffle at 19th party congress in the autumn.

[It’s time for China to honour its pledge to open up the market and society – and play fair]

Survey results of commerce chambers of China’s major trading partners have underscored the increasing difficulties of doing business in China, including ambiguous security laws, limited market access and an official favouring of domestic technology.

Last year Beijing launched “Made in China 2025” – a campaign to revamp its manufacturing sector, and establish a home-grown hi-tech powerhouse.

“We wonder whether this is what in the end China 2025 is all about: a future Chinese economy relying on its own, leaving no room for exchanges with its partners,” Clauss said, adding that plans for German companies to expand investment in China had fallen to a three-year low.

Since late last year, Beijing has strengthened controls on individuals and companies transferring funds overseas to stem capital outflows and defend the yuan’s exchange rate. Read the rest of this entry »


As Yuan Weakens, Chinese Households Rush to Open Foreign Currency Accounts

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Since October, the government has acted to slow outflows by tightening existing measures, such as approvals for foreign currency transfers, and has leant on banks to be stricter, making it harder for companies and individuals to change money and transfer money abroad.

SHANGHAI: Zhang Yuting lives and works in Shanghai, has only visited the United States once, and rarely needs to use foreign currency. But that hasn’t stopped the 29-year-old accountant from putting a slice of her bank savings into the greenback.

“Expectations of capital flight are clear. I might exchange more yuan early next year, as long as I’ve got money.”

She is not alone. In the first 11 months of 2016, official figures show that foreign currency bank deposits owned by Chinese households rose by almost 32 per cent, propelled by the yuan’s recent fall to eight-year lows against the dollar.

The rapid rise – almost four times the growth rate for total deposits in the yuan and other currencies as recorded in central bank data – comes at a time when the yuan is under intense pressure from capital outflows.

The outflows are partially a result of concerns that the yuan is going to weaken further as US interest rates rise, and because of lingering concerns about the health of the Chinese economy.

US President-elect Donald Trump’s threats to declare China a currency manipulator and to impose punitive tariffs on Chinese imports into the US, as well as tensions over Taiwan and the South China Sea, have only added to the fears.

“Expectations of capital flight are clear,” said Zhang, who used her yuan savings to buy US$10,000 this year. “I might exchange more yuan early next year, as long as I’ve got money.”

Household foreign currency deposits in China are not huge compared to the money that companies, banks and wealthy individuals have been directing into foreign currency accounts and other assets offshore.

All up, households had US$118.72 billion of foreign money in their bank accounts at the end of November, while total foreign currency deposits were US$702.56 billion.

But the high growth rate in the household forex holdings are symbolic of a growing headache for the government as it struggles to counter the yuan’s weakness.

Since October, the government has acted to slow outflows by tightening existing measures, such as approvals for foreign currency transfers, and has leant on banks to be stricter, making it harder for companies and individuals to change money and transfer money abroad. Read the rest of this entry »