CiCM 16th July 2024

NEWS IN CHINA

Global Institutions Alter China’s Growth Forecast Amidst the Third Plenum: The International Monetary Fund (IMF), in World Economic Outlook (WEO) report, revised China’s economic growth forecast to 5 percent for 2024. As a result of increased private consumption and exports in the first quarter, IMF has increased its growth expectations from 4.6 percent in April. In the report, the global economic growth prediction remained unchanged at 3.2 percent with emerging Asian economies expected to fuel the growth. Growth in the world trade volume is forecasted to increase by 3.1 percent and 3.4 percent in 2024 and 2025 respectively. Meanwhile, China’s disappointing economic growth data for the second quarter has caused investment banks to reduce their growth predictions for China. Barclays revised its prediction from 5 percent to 4.8 percent whereas Goldman Sachs reduced its forecast from 5 percent to 4.9 percent. These revisions were made after China failed to achieve its average yearly target growth of 5 percent in second quarter. Low retail sales which grew only by 2 percent year-on-year in June highlighted China’s deep-rooted problem of weak domestic demand. These institutions expect China to introduce additional policy measures to achieve China’s own target of 5 percent growth in 2024.

China Launched Plan for Low-Carbon Transformation of Coal-Fired Power: The National Development and Reform Commission and the National Energy Administration (NEA) has released a joint plan to provide increased financial support for coal-power transformation to low-carbon power. Key aspects of the plan include diversifying financing channels for low-carbon projects. This involves leveraging ultra-long special treasury bonds and encouraging methods like green bonds and technology transformation loans. Such initiatives aim to attract more private investment into the sector, thereby boosting financial resources for necessary transitions. The plan sets clear targets: by 2025, the commencement of the first batch of transformation projects is expected, aiming to reduce carbon emissions by approximately 20 percent compared to 2023 levels. By 2027, further advancements are projected, with anticipated carbon emission reductions of around 50 percent. Amidst global trends towards green energy, China has also made strides: green energy consumption now constitutes 26.4 percent of overall energy consumption, marking a significant increase from a decade prior. Experts believe the plan will bolster China's resilience in the face of global energy transitions, ensuring a smoother and more moderate path towards sustainability.

China And Russia Conduct Annual Maritime Patrol In the Pacific Ocean: As per the bilateral agreement signed by China and Russia, a joint maritime patrol was conducted on Sunday in the Northern and Western Pacific Ocean before returning to the South China Sea. In their statement, the Ministry of National Defence said that the patrol was conducted as scheduled and not as a reaction to any international or regional developments and that the patrol was bereft of any third-party target. The patrol fleet comprised China’s missile destroyer Yinchuan, Hengshui- a missile frigate, a Russian missile frigate and the Chinese supply ship Weishanhu. This was the fourth joint patrol since 2021. The joint patrol aims to build understanding and friendship between the two militaries while conducting inspections. The Ministry statement further added that this patrol underscored deepening respect, cooperation and trust between the two countries and a signifier of capabilities in combat.

Emergency Alerts Issued for 15 Provinces Due To Deadly Floods: As China’s deadly floods head towards the North, government agencies have issued warnings. The floods are expected to hit Henan Province and Hubei Province. A red storm alert was issued in Suizhou, a city in Hubei as it recorded 150 mm of rain in a day. Authorities have also issued seven red alert warnings in Xiangyang where 268 water reservoirs have breached their limit. Nine weather stations in Henan recorded the highest rainfall in China between Monday afternoon to Tuesday midday. The Meteorological Administration issued emergency response Level-2 out of 4 for rainstorms in Henan, Shandong and Sichuan. This rainfall has adversely affected major grain-producing provinces which were earlier affected by droughts. Locals were warned of overflooding of the Hai River basin and other basins that may affect cities including Beijing. In recent years, China has faced many disruptions caused by heavy rainfall. 400 people lost their lives during the 2021 floods.

China Celebrates Third Anniversary of National Carbon Emissions Trading Market: China's national carbon emissions trading market, launched three years ago, has facilitated trading of over 460 million tons of carbon emissions quotas, amounting to nearly 27 billion yuan ($3.7 billion) in value, as noted by the Ministry of Ecology and Environment. The market's impact on promoting green transformation within electricity enterprises has been notable, with carbon dioxide emission prices rising from around 40 yuan per ton initially to approximately 90 yuan per ton presently, peaking at over 100 yuan. This price increase has incentivized thermal power generators to invest in energy conservation and emission control technologies, thereby reducing their carbon footprint. Lin Boqiang, director of the China Center for Energy Economics Research, highlighted the significance of rising prices as an indicator of increased trading activity and progress towards a low-carbon industrial shift. Encompassing about 5.1 billion tons of annual carbon dioxide emissions, the Chinese market stands as the world's largest in terms of greenhouse gas trading. Recent government efforts include expanding market coverage to sectors like aluminium smelting and cement production along with new guidelines issued for carbon emissions accounting and reporting.

SOCIAL MEDIA CHATTER IN CHINA

Chinese University Delivering Admission Letters Using Drones Sparks Discussion Among Netizens: The South China University of Technology became China’s first university to deliver admission letters to students using unmanned aerial vehicles or drones. The letters were delivered in Guangdong Province. The drone took 40 minutes to deliver the packages to a distance of 7 km; the same amount of time a bicycle would have taken. The package had to be collected and delivered to the students by a staff member of China Post. The drone can carry 5 kg, needs 5 square metres to land and can deliver packages as far as 20 km. The drones were made by EHang, a domestic drone manufacturer. Netizens had varied reactions to this system. One said, “I am envious of the kids nowadays. How cool it is to have your admission notice delivered by a drone,”. Another said, “It still needs a human to deliver the packages into the hands of the students,”. “Unmanned everything is everywhere. I wish there would still be jobs left for humans,” said another.

INDIA WATCH

Increased Smartphone Usage In India May Not Result In Manufacturing Investment: Global Times, a Chinese news source, published a report on Apple’s growth in annual sales in India which increased by 33 percent which points to heightened prospects in the Indian market. Apple also produces many devices in India. The article mentions that the increased sales in India has increased hopes of further investment in India’s smartphone supply chains. In 2023-24, Apple assembled nearly $14 billion worth of iPhones in India. According to the article, however, Apple is facing hurdles as it attempts to increase investments in India. Along with low-skilled labour that affects product quality, one of the major challenges is India’s protectionist and economic nationalist policies that support local manufacturing which results in increased manufacturing costs for Apple. The Chinese smartphone manufacturers have seen positive growth in the Indian economy, and this has resulted in unfair treatment by India, according to the Chinese media source. The article also criticises India for a difficult business environment that inhibits foreign investment. The article states that growth in sales may not underscore a growing consumer market as a catalyst for attracting foreign investments in manufacturing sectors. Lastly, the report expects India to implement a business environment favourable to global manufacturers where all foreign investors can participate transparently and in a non-discriminatory manner.

Prepared By

Sanjana Shah

Sanjana Shah is a graduate in International Studies with a minor in Journalism from FLAME University, Pune. Her interests lie in exploring the nuances and intricacies of geopolitics and understanding the complexities that arise from the socio-political-economic nexus. She is deeply interested in history, defence and security studies, and humanitarian studies.