CiCM 4th July 2024

NEWS IN CHINA

Stabilizing China's Yuan and Boosting Market Confidence: China is implementing measures to stabilize the yuan amid uncertainties surrounding U.S. monetary policy. Recently, the yuan hit its weakest level against the U.S. dollar since November, driven by concerns over the potential delay in U.S. interest rate cuts. Analysts expect the yuan to fluctuate between 7.1 and 7.3 against the dollar for the rest of the year. The People's Bank of China aims to maintain yuan stability by possibly adjusting the foreign exchange reserve requirement ratio and introducing more proactive fiscal and monetary policies. Simultaneously, China is taking steps to boost investor confidence in its markets. Policies to strengthen market performance have led to significant investments in exchange-traded funds improving liquidity and investor returns. Efforts to tighten rules around initial public offerings and focus on market-driven capital allocation are also underway. Though foreign investors remain cautious, the current low valuations of Chinese assets are beginning to show positive signs, suggesting better market conditions ahead. Beijing's actions to enhance the market's stability and attract long-term investments indicate a brighter outlook for the second half of the year.
China and Kazakhstan Strengthen Ties with New Connectivity Projects: Chinese President Xi Jinping and Kazakh President Kassym-Jomart Tokayev have launched new initiatives to boost connectivity and cooperation between their countries. During Xi's visit to Kazakhstan, the leaders attended the opening of a new road transport route to a Caspian Sea port and several cultural exchange facilities. These projects aim to enhance Kazakhstan's connectivity and reinforce the longstanding friendship between the two nations. The relationship between China and Kazakhstan dates to the ancient Silk Road and has evolved over 32 years of diplomatic ties. In recent years, their trade and economic cooperation have flourished, with China becoming Kazakhstan's largest trading partner in 2023. Key exports from Kazakhstan include crude oil, metals, and agricultural products, while China supplies machinery and electronics. Both countries are committed to further strengthening their partnership through the Belt and Road Initiative, which has led to significant infrastructure developments like the China-Kazakhstan (Lianyungang) Logistics Cooperation Base and renewable energy projects such as the Zhanatas wind farm.
Taiwanese Fishing Boat Seized by China Near Disputed Waters: On Tuesday night, Chinese officials boarded and seized a Taiwanese fishing boat near the Taiwan-controlled Kinmen islands, close to China’s coast. The boat was operating in Chinese waters during China’s no-fishing period, which led to the seizure. Taiwan’s coast guard reported the incident, highlighting escalating tensions between the two. China considers Taiwan a part of its territory and has increased pressure on Taiwan since President Lai Ching-te took office. China’s coast guard claimed the Taiwanese boat was violating fishing bans and using illegal trawling equipment. Taiwan sent coast guard ships to assist but withdrew to avoid conflict. This incident marks another episode in the ongoing disputes over fishing rights between Taiwan and China. It’s not uncommon for both sides to detain each other’s fishing boats. Taiwan has detained five Chinese boats this year, while the Chinese enforcement has increased in the region. Taiwan urged China to release the fishermen and avoid using political factors in this situation. Meanwhile, the U.S. is closely monitoring the incident. Taiwan officials stressed the importance of raising alert levels for their fishing vessels and strengthening coast guard patrols.
Tesla Model Y Added to Jiangsu Government's Procurement List: For the first time, Tesla's Model Y has been included in the Jiangsu provincial government's procurement list, demonstrating China's commitment to market openness and impartiality. Despite mounting pressure from the US and EU on Chinese new-energy vehicles (NEVs), China continues to support free trade. The procurement list, publicized by the Jiangsu government, highlights a diverse selection of NEVs, including various domestic brands alongside Tesla. This move underscores China's fair approach, treating foreign and domestic companies equally, unlike some Western countries that impose high tariffs to protect their industries. The inclusion of Tesla reflects the country’s largest and most inclusive automobile market. Tesla's stock has also seen a significant rise, boosted by better-than-expected second-quarter deliveries. Tesla’s global VP, Tao Lin, highlighted the importance of the Chinese market, which has grown to over 1.7 million Tesla owners in a decade. Tesla plans to expand further in China, leveraging its vast growth potential. This development aligns with Tesla’s broader strategy to deepen ties with China and test new initiatives like robotaxis, illustrating a continued commitment to fostering industry growth and innovation.
Chinese Premier Pushes for Digital Transformation in Manufacturing: Chinese Premier Li Qiang, during his visit to Suzhou, Jiangsu Province, emphasized the importance of digital transformation in the manufacturing sector. Li highlighted the need for advanced, intelligent, and green development in manufacturing and urged companies to align with national strategies and leverage through technological innovation. Li toured an industrial automation company, and an AI firm, exploring advancements in AI software and chips, particularly for the automotive and home appliance industries. Li experienced firsthand the impact of large language models on research and development. Li stressed leveraging China’s market size and diverse demand to integrate AI with the real economy. Li identified digital transformation as crucial for strengthening China's manufacturing sector. He highlighted the role of "little giant" firms—innovative small and medium-sized enterprises specializing in niche markets with advanced technologies. He encouraged these companies to innovate and think globally. Li also called on all levels of government to support these SMEs and create favorable conditions for their growth.

SOCIAL MEDIA CHATTER

Former Chinese Footballer Fan Zhiyi Wows Social Media with Perfect Euro 2024 Predictions: Former Chinese football star Fan Zhiyi has taken social media by storm with his flawless predictions for the Euro 2024 round of 16. Known for his time at Hong Kong Rangers and Crystal Palace, Fan made his picks on the Chinese sports show Xinai Sports, accurately forecasting the outcomes of all eight knockout games. Fan correctly predicted victories for England, Spain, France, Portugal, Netherlands, and Turkey, impressing fans who remember his performance in China’s sole World Cup appearance in 2002. His spot-on predictions have left social media users in awe, with one user on Xiaohongshu exclaiming, "That's really impressive, from the round of 16 to the quarters and not one wrong. Damn." Despite his success so far, some fans are skeptical about Fan's semi-final picks, which include Germany beating Spain and France defeating Portugal. One user humorously quipped that Fan should bet on his predictions, while another expressed doubts, saying, "There must be some mistake for the semis." Fan's predictions also feature unexpected outcomes, such as Switzerland knocking out England and Turkey defeating the Netherlands. If his predictions hold true, France will eventually beat Germany and Switzerland to win the tournament. As fans eagerly await the semi-finals, Fan's predictions have made him a trending topic, with many curious to see if his remarkable streak will continue. This phenomenon underscores the intense passion for football in China, where fans avidly follow international tournaments and celebrate their football heroes.

INDIA WATCH

PIL Filed for Bridge Safety Audit in Bihar After 12 Collapses in 17 Days: China's news agency Xinhua reported that a public interest litigation (PIL) has been filed in the Supreme Court of India demanding a structural audit of bridges in Bihar after 12 bridges collapsed in just 17 days. The most recent collapse occurred on Thursday in Saran district. No casualties have been reported so far. The series of collapses began on June 18 with a bridge in Araria, and incidents have continued, including four bridges collapsing in Siwan district alone. Although the exact reasons for the collapses are unclear, officials suspect heavy rains, increased water levels, and desilting work as contributing factors. In response, Bihar's Chief Minister Nitish Kumar has ordered a survey of all old bridges in the state to identify those in need of urgent repairs. He has also called for improved maintenance policies from both the road construction and rural works departments. According to the article, the PIL highlights concerns over the safety and durability of bridges in Bihar, especially during the monsoon season when heavy rains and floods are common. The litigation seeks immediate action to prevent further incidents and ensure public safety.

Prepared By

Kriti Rai

Kriti is an undergraduate student at FLAME University pursuing Data Science and Economics. She is proficient in C++, Python, MySQL, and data visualisation tools such as Tableau. Her areas of interest lie in building predictive models and utilising machine learning to enhance decision-making and tackle real-world challenges.