CiCM 28th November 2023

NEWS IN CHINA

The People's Bank of China (PBOC) expresses its commitment to maintaining the stability of Renminbi: The PBOC emphasized the importance of correcting cyclical market behaviors, confronting any disturbances in market order, and preventing the renminbi exchange rate from excessive fluctuations. The Renminbi’s central parity rate against the US dollar has reached its strongest level since June, signaling a stable trend for the currency. The bank reiterated its dedication to the continued stability of the Renminbi exchange rate, as a response to the temporary weakening of the Chinese currency. Experts note that the PBOC’s strong resolve in ensuring foreign exchange market stability can be attributed to declining US Treasury yields and positive domestic economic recovery indicators.
China's space program delegation visits Hong Kong and Macao: A delegation from China's manned space program, led by Lin Xiqiang of the CMSA comprising of astronauts and experts, were welcomed by HKSAR's Chief Executive John Lee. Aimed at sharing China's aerospace achievements and deepen understanding of its space technologies the delegation's visit to Hong Kong enabled residents to share the nation's pride in China's manned space development from close range, and develop a deeper understanding of the country's developments in aerospace technologies, said Lee. The delegation, participating in various activities including a media briefing and the "China Manned Space Exhibition," highlighting the growing involvement of Hong Kong and Macao in China's space program.
Following the increase of flu cases, hospitals optimize resources to support respiratory wards in time for New Year’s: In China, hospitals are experiencing a surge in respiratory illnesses, with a notable increase in adult patients and an anticipated rise in elderly infections by mid-December. Pediatric departments, infectious disease, and respiratory units in Beijing hospitals are fully booked. The Children's Hospital has been operating at full capacity since late September, with a significant increase in children with respiratory infections. Despite the surge, medical resources are adequate, and response mechanisms are optimized. Hospitals are expanding facilities and staff to manage the increase in patients. Medical experts anticipate the flu peak may last another one or two weeks, mostly affecting children and young people. The elderly are expected to be the main group affected during the New Year's Day holidays, potentially leading to another peak in respiratory diseases. Health authorities recommend flu vaccinations for the elderly, their families, medical staff, and nursing home staff.
China implements several free relief and tax measures to support business development: China has amplified its tax and fee relief measures to support business development and strengthen the real economy. In the first 10 months of 2023, these measures resulted in tax refunds, cuts, and deferrals totaling 1.66 trillion yuan (approximately 233.28 billion U.S. dollars), as reported by the State Taxation Administration (STA). The private sector emerged as the primary beneficiary, with nearly 1.24 trillion yuan of tax and fee payments rebated, deducted, or deferred, accounting for about 75% of the total relief. The manufacturing sector and associated wholesale and retail industries gained the most from these support measures.
Huawei expands smart car joint ventures with Chinese carmakers: Huawei Technologies is inviting four carmakers, including Seres Group, Chery Automobile, JAC Motors, and BAIC Motor, to invest in a new smart car joint venture with Changan Automobile. This move signifies Huawei's deepening commitment to the electric vehicle (EV) industry, amidst U.S. sanctions. The joint venture aims to enhance Huawei's smart car system. The partnership with these smaller carmakers, currently collaborating under the Huawei Select model, could also include larger state-owned firms like FAW Group. The new enterprise will see Huawei transferring its smart car system business, offering employees incentives to join the venture. Huawei's foray into the EV market, marked by the launch of the Luxeed S7 sedan, challenges competitors like Tesla, despite currently holding a small market share.
Mainland spokesperson reiterates “No Room for Taiwan Independence”, citing Anti-Secession Law: Chen Binhua, a spokesperson from the China’s State Council Taiwan Affairs Office, emphasized China’s commitment to peaceful reunification with Taiwan. Binhua also mentioned that China firmly opposes any separatist activities aimed at Taiwan Independence. The statement was in response to remarks by Taiwanese Democratic Progressive Party politicians Lai Ching-te and Hsiao Bi-Khim, who suggested that there was no imminent plan for a mainland attack on Taiwan. Binhua warned that the mainland will not show leniency towards actions promoting “Taiwan Independence”, citing the Anti-Cessation Law which legitimizes non-peaceful means to protect China’s sovereignty. Binhua stressed that “Taiwan Independence means War”, cautioning voters ahead of Taiwan’s 2024 leadership elections.

SOCIAL MEDIA CHATTER IN CHINA

Family struggles with the Real Estate Market in China Garners Support and Skepticism on Chinese Social Media: The story of Li Jun and Liang Liang, a Chinese couple struggling with real estate challenges, has sparked a significant online response. Their journey, starting optimistically with the purchase of an apartment in Zhengzhou, turned sour as the developer faced financial troubles, halting construction. This led to severe financial strain for the couple, compounded by Li Jun's pay cut. The situation worsened when they were denied a promised rebate and allegedly assaulted by the developer's staff. Their plight has resonated deeply with netizens, who have expressed a mix of sympathy, anger, and skepticism. Many online users relate to their struggles, seeing them as representative of broader issues in China's real estate market and the challenges faced by ordinary people in achieving the 'Chinese dream'. However, there's also a stream of criticism and suspicion, with some suggesting the couple's story was exaggerated for clout or sympathy. The couple's narrative took a complex turn when they announced a sudden resolution involving police intervention, followed by their decision to relocate to their hometown, and then a change of plans to start a business in Zhengzhou. These developments have led to speculations of intervention by local authorities and debates on social media about the authenticity of their story and the couple's decision-making.

INDIA WATCH

India’s potential involvement in the Taiwan issue and the overarching “One China Policy” is nuanced, given its complex geopolitical relationships and strategic interests. The mainland’s firm stance against Taiwan Independence separatist activities, as reiterated by a spokesman for the State Council Taiwan Affairs Office recently, underscores the sensitivity and potential volatility of cross-strait relations. India, traditionally adhering to its policy of non-interference in the internal affairs of other countries, faces a delicate balancing act in this scenario. A neutral or tacit stance might be seen as India lending tacit support for the “One China Policy”. Concurrently, India’s relationship with the US and other democratic nations which have been showing varying degrees of support for Taiwan further complicates India’s position on the matter. Aligning closely with the US on the Taiwan issue could strengthen India’s strategic ties with Western democracies at the cost of further antagonizing China. This antagonisation extends beyond just economic and security dimensions as escalation of tensions in the Taiwan Strait could disrupt global trade routes, affecting India’s economy while also impacting geopolitical dynamics in Asia, where New Delhi undoubtedly has strategic interests.

Prepared By

Krisha Trivedi

Krisha Trivedi is a student of International Studies and Business Analytics at FLAME University. Her active involvement in risk analysis is supplemented with her corporate experience in asset and fund management. She is also involved in research projects relating to economic policies, international law and geopolitics. In addition, her skillset includes proficiency in Programming languages, Japanese, French and German.