CiCM 3rd September 2024

NEWS IN CHINA

Guidelines to Boost Service Trade and Opening Up Issued by State Council: The State Council has released new guidelines aimed at promoting high-quality development of trade in services through increased opening up. The guidelines outline 20 major tasks across five key areas, focusing on accelerating digital, intelligent, and green development in the service trade sector. Key objectives include expanding the scale, optimizing structure, improving efficiency, and enhancing the strength of service trade to contribute to building a higher-level open economy in China. The guidelines emphasize promoting institutional opening up, implementing a negative list management system for cross-border service trade, and improving standardization. They also stress the importance of facilitating cross-border flow of production factors and fostering innovative development in key areas such as international transportation, tourism, and financial services. Additionally, the guidelines call for expanding international market presence, deepening international cooperation, and creating a supportive environment that promotes openness, innovation, fair competition, and order in the service trade sector.
Trade Probes Announced in Response to Canadian Tariff Hikes: China has declared its intention to launch multiple trade investigations in response to Canada's recent tariff increases on Chinese imports. The Chinese Ministry of Commerce announced plans for an anti-discrimination probe into Canada's decision to impose a 100% tariff on Chinese-made electric vehicles and a 25% duty on Chinese steel and aluminum. China will initiate anti-dumping investigations into rapeseed imports and related chemical products from Canada. This move follows reports of a significant increase in Canadian rapeseed exports to China, which reached $3.47 billion in 2023, representing a 170% year-on-year increase in quantity. China expressed strong dissatisfaction with Canada's unilateral trade restrictions and plans to bring the matter to the WTO dispute resolution mechanism. These actions highlight escalating trade tensions between the two countries and China's determination to counter what it perceives as unfair competition.
China Launches First National Policy to Protect Migrant Children: China has unveiled its first state-level action plan for the care and protection of migrant children, as announced by the Ministry of Civil Affairs. This comprehensive policy, jointly developed by 21 government departments, aims to create a supportive environment for the healthy growth and development of children who have relocated with their parents or guardians. The plan defines migrant children as those under 16 who have moved away from their registered household for over six months. Key features include establishing a monitoring system to identify and assist vulnerable migrant children, ensuring equal access to education and healthcare, and promoting their integration into urban communities. The policy outlines 19 specific services across six areas including nursing, education, and accommodation. It also calls for the creation of a grassroots network of support institutions and emphasizes community involvement to help migrant children adapt to their new environments. This initiative marks a significant step in addressing the challenges faced by China's mobile population and their children.
China Launches New Remote Sensing Satellites for Low-Orbit Constellation Tests: China successfully launched a new group of remote sensing satellites on Tuesday, from the Xichang Satellite Launch Center in Sichuan Province. The Yaogan-43 02 satellites were carried into orbit by a Long March-4B carrier rocket at 9:22 a.m. Beijing Time. These satellites will be primarily used to conduct tests on new technologies for low-orbit constellation systems. The launch marks the 533rd flight mission of the Long March rockets. The Long March-4B is a three-stage liquid-fueled rocket capable of launching various satellite types into different orbits, with a payload capacity of up to 2.5 tonnes for sun-synchronous circular orbits. This mission contributes to China's ongoing efforts to expand its space capabilities and develop advanced satellite technologies.
Policy Discussions Intensify Amid Mixed Manufacturing Data: China's manufacturing sector showed mixed performance in August, prompting calls for additional policy support to achieve the country's annual growth target. The Caixin China General Manufacturing PMI rose to 50.4 in August, indicating slight expansion, while the official PMI dropped to 49.1, remaining in contraction territory. This conflicting data has intensified discussions on the need for further economic stimulus. Experts highlight persistent issues such as insufficient domestic demand and weak market optimism. The People's Bank of China has signaled a supportive monetary policy stance, injecting liquidity through bond purchases. Economists suggest potential measures including reserve requirement ratio reductions and interest rate cuts. Despite challenges, China's economy is expected to continue its recovery as existing stimulus policies gradually take effect. Policymakers are considering new incremental policies to optimize fund utilization and revitalize government assets to support major national strategies and drive economic growth.

SOCIAL MEDIA CHATTER

Elderly Man's Reversal of Property Promise Ignites Online Debate: The case of a 99-year-old Shanghai man who changed his mind about gifting his flat to a former colleague has sparked intense discussions on mainland Chinese social media. The story, which involves a 2005 agreement where the elderly man, surnamed Tan, promised his flat to his colleague Gu in exchange for care and companionship, has drawn significant attention online. After Tan remarried at 93 and sued to annul the agreement, social media users overwhelmingly sided with Gu, criticizing Tan's change of heart. Comments reflected a strong sense of moral obligation, with one user asking, "What would have happened to you all these years if your colleague did not support you well?" Another emphasized the importance of keeping promises, especially after receiving years of care. The debate touches on broader issues of elder care, property rights, and social responsibilities in modern China. Despite Tan's legal attempts to reclaim his property, the court upheld the original agreement, ruling that Gu can inherit the flat after Tan's death, a decision that appears to align with the dominant sentiment expressed on social media platforms.

INDIA WATCH

South Review Article on India’s Efforts to Become a Global Semiconductor Manufacturing Hub: Chinese news agency South Review reports that India is making a concerted effort to become a major player in the global semiconductor industry. As per the article, Prime Minister Narendra Modi aims to position India among the top five semiconductor manufacturing nations within five years and the Indian government has introduced generous subsidy plans to support this initiative. The article reports that three semiconductor projects have recently been approved, including a $11 billion wafer plant in Gujarat, a $3.26 billion packaging and testing facility in Assam, and a $900 million packaging and testing equipment plant in Gujarat. The government's incentive scheme offers up to 70% in combined central and state subsidies for semiconductor projects. According to the article, this push is driven by India's desire to reduce reliance on chip imports and capitalize on geopolitical shifts in the tech industry. The article argues that India faces challenges in business environment, infrastructure and supply chain development, but boasts a significant pool of chip design talent, with over 125,000 integrated circuit design professionals. The article also claims that incentive policies are highly localised and very limited in the context of other industrial policies in South Korea, Vietnam, Malaysia and so on.

Prepared By

Vanshika Patel

Vanshika is a recent graduate from Ashoka University with a degree in Economics and a minor in Computer Science. Her interests lie in understanding the global economy and its impact on international communities, policy-making, and the social sector. She is particularly drawn to quantitative analysis and has a keen interest in international economics, aiming to contribute to data-driven decision-making in global economic contexts.