China and Russia announced a joint venture to develop a wide-body jet which will challenge market leaders Boeing and Airbus. The news comes just over two weeks after the successful maiden flight of China’s first domestically developed narrow-body passenger jet, the C919. The China-Russia Commercial Aircraft International Corp, established by state-owned Commercial Aircraft Corporation of China (COMAC) and United Aircraft Corp of Russia, was officially registered and obtained a business license. The new jet’s maiden flight is planned for 2025 and the first jet should be delivered around 2028. The new plane aims to take 10% of the market from the Boeing 787 and Airbus 350. The wide-body jet will seat 280 and have a range of up to 12,000 kilometers. It will mainly be built with composite materials.

Automotive

• Guangzhou Vanlead Group Co, one of China’s leading radial tire producers, is constructing a USD1 billion plant in the U.S. state of South Carolina. The group also plans to set up a research center in Europe and a joint research facility in Akron, Ohio, which is seen as the “Silicon Valley” of the rubber industry, said Fu Shoujie, Chairman of Vanlead. In 2016,Vanlead became the first Chinese tire company to pass the tests of German testing company TUV Rheinland.

Finance

• The Central Commission for Discipline Inspection (CCDI) is investigating Yang Jiacai, Assistant Chairman of the China Banking Regulatory Commission (CBRC). He was responsible for bank supervision at the CBRC. Yang is the latest high-ranking official of a Chinese financial regulatory body to be investigated in recent weeks. Xiang Junbo, Chairman of the China Insurance Regulatory Commission (CIRC) is also under investigation.
• China Life Insurance (Group) is buying 48 commercial properties in the United States with a total value of USD950 million from ElmTree Funds, a private-equity firm based in the city of St Louis. China Life said ElmTree would retain a 5% stake and continue to jointly manage the properties, which include logistics centers, office buildings and healthcare facilities. Tenants include GE, FedEx, Caterpillar and T-Mobile.
• The interbank funding cost of Chinese banks is quickly approaching, if not exceeding, the interest rate banks charge their clients, which could lead to a reduction in bank lending or a quick rise of interest rates. The one-year Shanghai Interbank Offered rate (Shibor) rose above the one-year prime loan rate. The Shibor’s 4.3024 reading was its highest in more than two years, and marked the first time the Shibor had exceeded the prime loan rate since the data series became available in 2013.
• Ant Financial, the finance arm of Alibaba, announced the launch of its mobile wallet for Hong Kong users. AlipayHK is similar to its Chinese counterpart Alipay. Registered users are able to top up their mobile wallets and make in-store payments that are settled in Hong Kong dollars at merchants. Cashiers need only scan a QR code generated by the user’s AlipayHK app and the amount will be deducted automatically from the wallet.
• China is stepping up efforts to establish a system to gather information about every individual’s income and property. The Central Leading Group for Comprehensively Deepening Reform approved an overall plan to create an individual income and property information gathering system. It will help the government make policies on matters including tax and housing property tax reforms in a more sensible way, Kuang Xianming, Director of the Research Center for Economy under the China Institute for Reform and Development, said.
• An additional 11 Chinese commercial banks have joined SWIFT’s global payments innovation (GPI) initiative to offer faster, more transparent and traceable cross-border payments for Chinese companies. A total of 13 Chinese banks have now joined GPI, representing an estimated 80% of Chinese cross-border payments. The Bank of China (BOC) and the Industrial and Commercial Bank of China (ICBC) had already joined the initiative.
• China is to implement a new data-driven national credit system, with automatically-generated ratings, worrying some foreign companies. The full effects of the new system may be felt by 2020, according to the Meractor Institute for China Studies (Merics). Under the system, companies can be given lower scores if they do not pay loans back in a timely manner, or fail to comply with work safety standards, emissions targets, guidelines for government investment, or punctual delivery of goods bought online.
• The State Administration of Foreign Exchange (SAFE) published a list of the 10 top cases of people and firms illegally moving money abroad. It named five companies, accusing them of forging contracts or invoices to remit a combined USD226 million offshore since 2015. Ningbo Big Fortune International Trade was fined CNY22.8 million for moving USD119 million abroad “seriously disturbing the foreign exchange market order”.
• Foreign banks are divided on whether to help finance China’s Silk Road initiative, with some seeing an opportunity in providing direct financing for the government-backed project while others opt for reduced exposure, citing concerns over poor returns from large infrastructure investments and other risks.

Foreign investment

• China’s plan to boost its domestic manufacturing industry has been somewhat misunderstood by foreign organizations as a move to favor local companies over foreign competition, Xin Guobin, Vice Minister of Industry and Information Technology said. He reaffirmed foreign participation in the “Made in China 2025” plan at a press briefing in Beijing. He said all companies in China, whether Chinese or foreign-funded, would receive the same treatment under the “China 2025” policies.
• Qualcomm, state-owned telecom company Datang Telecom Technology Co and two local investment groups are setting up a new joint venture in China to build chips for entry-level smartphones. JLQ Technology will have a registered capital of CNY2.98 billion. Qualcomm will pour CNY720 million into the venture for a 24% stake, as well as transfer and license technology. Datang will hold a 24% stake, with investment company JAC Capital accounting for 34.6%. Local private equity firm Wise Road Capital will have a 17.4% stake.

Foreign trade

• Asian trade ministers met in Hanoi, Vietnam, to hammer out the terms of he 16-nation Regional Comprehensive Economic Partnership (RCEP). It excludes the United States, which had been leading another regional trade pact – the Trans-Pacific Partnership (TPP) – until U.S. President Donald Trump abruptly abandoned it in January, but the 11 remaining TPP nations vowed to resuscitate the deal without the U.S.
• China’s Ministry of Commerce (MOFCOM) has restricted the export of big dredgers which it has used to build artificial islands in the South China Sea, citing national security concerns. From June 1, all export deals for dredgers that might affect national security would require State Council approval. The notice listed five types of dredgers that could dig more than 15 meters deep, had a large carrying capacity, and could dredge at high speed. Building artificial islands in the South China Sea, China has developed advanced dredging technology that it doesn’t want other countries to obtain, especially those in Southeast Asia with competing maritime claims.

Real estate

• Shanghai will expand a trial program to tear down old buildings that cannot be saved by repairing and renovating. The buildings involved had become so outdated that residents had to share kitchens, bathrooms and other facilities, and renovations to improve living conditions were not feasible. About 500,000 square meters of such residential buildings – deemed to be beyond saving – were planned to be torn down and replaced from 2016 to 2020.
• By the end of 2017, China will have made available 18 million new homes in rundown urban areas as part of a three-year program, the government said. It invested CNY1.48 trillion in 2016 to build 6.06 million new homes for shanty redevelopment, according to the Ministry of Housing and Urban-Rural Development.
• Thousands of homebuyers shrugged off rising mortgage rates and joined long queues at the offices of some of Hong Kong’s biggest developers hoping to snap up newly released flats last week. As many as 4,800 buyers registered to bid for 307 flats at K & K Property’s Victoria Skye project, which is located at the former airport site of Kai Tak. “Sales had been impressive,” said Midland Realty’s Chief Residential Executive Sammy Po.

Retail

• Cainiao Network, the logistics arm of Alibaba, said it will strengthen the deployment of artificial intelligent (AI) technology in its courier network by putting one million smart logistics vehicles into the market to cope with exploding delivery volumes in the future – expected to reach one billion a day within a decade. The smart logistics vehicles, co-manufactured with other automobile companies including SAIC Motor and Dongfeng Motor, will optimize the delivery route for the couriers based on Cainiao’s advanced big data and algorithms.
• China’s consumer confidence climbed to the highest level in two years, edging up 2 points from a quarter earlier to 110 points at the end of the first quarter, Nielsen said in a report.
• Walmart has opened of its flagship online store on JD.com, nearly a year after both companies formed a strategic alliance. Walmart had 433 bricks-and-mortar retail sites in China as of October last year. It picked more than 1,700 of the most-purchased items to offer on Walmart’s flagship online store. Walmart made a USD50 million investment last October in New Dada, the joint venture between JD.com and delivery specialist Dada that operates China’s largest on-demand logistics and online-to-offline grocery platform. JD.com had 236.5 million active customer accounts at the end of March. The average online shopper in the country is forecast to spend CNY12,198 online this year, a 7% increase over last year.

Stock markets

• Yanzhou Coal Mining has seen its Hong Kong share price tumble 21% from this year’s high, on the back of profit-taking and a slumping coal price. But the drop in the share price could offer investors an ideal entry point, according to some analysts. They cite the company’s strong production growth outlook, powered both by domestic and overseas mine development, as well as an impending acquisition of a major producer in Australia. Shandong-based Yanzhou’s management said in March it aimed to raise coal output by 29.2% to CNY78.6 million tons this year.
• The China Securities Regulatory Commission (CSRC) has fined Citic Securities, Haitong Securities, and Guosen Securities, blaming them for their role in the 2015 stock market crash. Citic Securities had broken rules on margin financing and its securities lending business by “failing to execute business contracts with its customers in accordance with the relevant provisions”, the investigation by the CSRC found. It was fined CNY308.3 million and had a further CNY61.7 million of “illegal proceeds” confiscated. Haitong was fined CNY2.5 million, while Guosen was fined CNY105 million.
• China is considering allowing foreign investors to trade domestic crude oil and iron ore futures as part of financial reforms, Fang Xinghai, Vice Chairman of the China Securities Regulatory Commission (CSRC) said. The regulators are also studying new futures such as pulp, hog, jujube and apple, and will allow commercial banks to participate in the treasury futures market.
• China’s securities regulator has ordered substantial shareholders to spread the disposals of their stakes in publicly traded companies, anxious to manage any sharp jumps or plunges in stock prices. Substantial shareholders are barred from selling their holdings through so-called block trades, in a manner that may “maliciously” cause prices to plunge and hurt public confidence, the China Securities Regulatory Commission (CSRC) announced.

Travel

• The Chinese government has issued a first set of draft rules for the country’s bicycle-sharing industry, with more than 30 companies emerging in major cities in less than a year. Customers who use smartphone applications to rent bicycles must register their true identities, and can no longer be anonymous. Users must be older than 12 years, and be insured for personal accidents and third-party liability. Any illegal acts committed, or “uncivilized behavior”, will be marked on the user’s credit record. Customers can pick up a bicycle and leave it anywhere after use.
• By year’s end, mobile payment will be accepted on all public buses in Hangzhou, the first city in China to do so. Mobile payment terminals will be installed in all buses. Passengers can use Alipay and UnionPay flash payment cards, as well as ApplePay, SamsungPay, HuaweiPay, MiPay and AndroidPay with smartphones or smart watches.
• Sales of DJI, the world’s largest maker of recreational drones, declined in the domestic market in recent days after the Civil Aviation Administration of China (CAAC) issued a ruling that all civil-use drones weighing more than 250 gram have to be registered online starting June 1. More than 240 airline flights were disrupted by drones flying near Chongqing Jiangbei International Airport in April. The real-name rule covers nearly all DJI products, including its popular Phantom and Mavic models. DJI has installed “no-fly zone” software on all its drones to better ensure aviation safety, preventing the drones from flying too close to airports. DJI currently dominates 70% of the world’s market for drones, with sales surging 60% to top CNY10 billion in 2016.
• Chinese regulators will submit proposals to reform the management of the country’s airspace by the end of this month in a bid to ease flight delays and boost aviation growth, Cai Jun, Deputy Director of the Air Traffic Control Commission, said at a forum in Beijing. The plan aimed to eventually integrate civilian and military management of China’s airspace and improve the country’s flight route network.
• The number of passengers on domestic flights in China rose 15% last year, while the number of air travelers on international flights arriving or departing the country increased by 26%. The number of people flying to, from and within China will almost double to 927 million annually by 2025, from 487 million in 2015. By comparison, passenger numbers in the U.S. will increase to 904 million by 2025 from 657 million in 2015, according to forecasts.
• CRRC Zhuzhou Locomotive Co, China’s top train manufacturer, received the country’s first certificate to export rolling stock to Europe from Germany’s safety standards firm TUV Rheinland. With the certificate, CRRC’s bullet trains will firstly be exported to Macedonia, followed by Turkey and other nations along the Belt and Road. TUV Rheinland has spent three years in testing and supporting CRRC to meet the technical standards.

• The Chinese government welcomed the U.S. Senate’s confirmation of Iowa Governor Terry Branstad as U.S. Ambassador to Beijing. “For a long time, Mr Branstad has been playing a positive role in promoting bilateral exchanges and friendship,” Chinese Foreign Ministry Spokeswoman Hua Chunying said. Branstad has known Chinese President Xi Jinping since the mid-1980s.
• Asia’s first commercial carbon capture and storage (CCS) project will begin to operate in Shaanxi province next year. Carbon dioxide emissions generated by power stations and steel companies are captured, then transported and pumped deep underground. The injected captured carbon will boost Yanchang’s Oil Co’s oil recovery rate by about 8%.
• The fiery Chinese liquor baijiu from Kweichow Moutai has become popular again, sending the stock of the company to new heights. The company’s flagship product, Feitian, with 53% alcohol, is in short supply across the country as retailers, wholesalers and even consumers start to hoard bottled Moutai as an inflation-proof investment. The market price for a bottle of 2014 Moutai Feitian can reach well above CNY2,000, almost double that of a year ago.
• Wei Minzhou, Vice Chairman of the Shaanxi Provincial People’s Congress, and a former Party Secretary of Xian, has been placed under investigation. The announcement came less than three hours after he appeared on the provincial evening newscast, having attended several official functions that day.
• CEOs of America’s largest steelmakers said global overcapacity is at crisis levels as they urged the U.S. government to determine that cheap steel imports are a threat to national security. China’s steel exports to the U.S. have declined by more than 67% since September 2015 and the U.S. has enough domestic supply to meet its own needs.
• Chen Xu, the former top prosecutor in Shanghai has been expelled from the Communist Party over a range of violations and is facing a lawsuit for corruption.
• China’s population may have 90 million fewer inhabitants than official data suggests, according to a group of researchers, meaning it will be replaced by India as the world’s most populous country sooner than expected. China’s real population may have been about 1.29 billion last year, according to Yi Fuxian, Researcher at the University of Wisconsin-Madison.
• Lenovo Group, the world’s largest personal-computer maker, reported a return to profit but said rising component prices could pressure its bottom line this year. Profit reached USD535 million in the year to March on revenue that fell 4%. Lenovo’s annual shipments fell 1% with its market share rising 0.4 percentage points to a record 21.4%.
• Civil servants will face new restrictions when changing jobs as the authorities move to prevent them from using official posts to make personal profit. Those in leadership positions at the county level and above will not be allowed to work in businesses or for-profit organizations related to their previous administration within three years of their resignation.
• China’s listed steel companies earned over CNY11 billion of net profits in the first quarter to post the best performance in nine years, as prices surged amid a supply cut. Baoshan Iron and Steel Co led with a quarterly net profit of CNY5.05 billion, a surge of 118.2% from a year earlier. Only three of the 33 listed steelmakers posted losses.

The Flanders-China Chamber of Commerce organized a seminar on opportunities in the Chinese healthcare market on 15 May Barco in Kortrijk.

The seminar was organized in cooperation with the Cheung Kong Graduate School of Business, Flanders Investment & Trade, Agoria Healthcare Technlogy Esscencia, MedTec Flanders and the Regional Development Agency West-Flanders.

Healthcare reform has become one of the priorities of the Chinese government. China’s healthcare market is growing quickly – around 17% per annum in recent years. It is now the second largest market in the world for medical devices and pharmaceuticals. China’s healthcare service market is also quickly becoming one of the largest in the world.

During this seminar, Mr. Bo Ji, Chief Representative and Assistant Dean of the Cheung Kong Graduate School of Business, gave participants a better understanding of the opportunities in the fast-growing Chinese healthcare market. This was followed by testimonials from Mr. Filip Pintelon, Senior Vice-President GM Healthcare, Barco, and Mr Olivier Billiau, International Sales and Marketing Director, Televic, who shared their experiences on the Chinese market. Mr Chen Hui, Chief Representative of Weihai in Europe, gave a presentation on the investment environment of medical healthcare parks in Weihai city, Shandong province.

It was a very informative event for companies active in the Health Industry including Pharmaceuticals, Biotechnology, Nutrition, Medical Insurance, Medical devices and applications, as well as Healthcare and life sciences.

The Flanders-China Chamber of Commerce, the Flanders Cleantech Association and Flanders Investment & Trade are organizing a meeting with the China Circular Economy Delegation, which will take place on 9 June at 09h00 at the Flanders Cleantech Association, Roderveldlaan 5/1, 2600 Berchem. 

The delegation has been invited by the European Commission, DG Environment and the EU-China Business Association as a result of the Circular Economy Mission to Beijing organized by DG Environment in November last year.

The delegation is led by the China Association of Circular Economy (CACE), and co-organized by the Green Development League of National Economic and Technological Development Zones (Green Development League of NETDZs).

The purpose of this seminar is to bring together business leaders from both sides to discuss business cooperation on circular economy and to promote the EU clean-tech investment in Chinese industrial parks.

8:45 – 9:00 Registration
9:00 – 9:05 Welcome speech by Gwenn Sonck, Executive Director, Flanders-China Chamber of Commerce
9:05 – 9:25 Introduction on the Flanders Cleantech Association by Carine Van Hove, Managing Director, Flanders Cleantech
9:25 – 9:45 Speech on the Circular Economy in China by Zhao Kai Deputy President and Secretary-General, CACE
9:45 – 10:00 Speech by Zhang Yuejian, Counsel, Department of Commerce of Shanxi Province
10:00 – 10:15 Speech on the Circular Economy in Flanders and the link to the European policy by Karl Vrancken, Research Manager Sustainable Materials and Ke Wang, VITO
10:15 – 11:00 Introduction of the participating Flemish and Chinese Companies
11:00 – 11:10 Coffee break
11:10 – 13:00 Business Matching followed by a walking lunch

Description of the Chinese Delegation
The description of the Chinese Delegation and their proposals for cooperation can be consulted on the following link: goo.gl/KdHdEm

Practical information
When: Friday, 9 June 2017
Location: Flanders Cleantech Association, Roderveldlaan 5/1, 2600 Berchem
Time: 8h45 – 13h00
Participation fee:

• For members of the Flanders-China Chamber of Commerce and the Flanders Cleantech Association: Free of charge
• For non-members: € 75 (Excl. VAT)

Registration
If you are interested to participate in this meeting, please subscribe via the following link: goo.gl/KdHdEm

Please register before 2 June 2017.

Introduction to CACE

China Association of Circular Economy (CACE), a national cross-region and multi-sector
organisation in China, was founded in 2013. As a leading organisation in enabling and promoting the circular economy in China, CACE is administrated by the State-owned Assets Supervision and Administration Commission of the State Council (SASAC), and accepts guidance from the National Development and Reform Commission (NDRC). CACE has nearly 700 members nationwide while the secretariat of CACE has about 50 employees. The members of CACE cover all circular economy areas, including industrial circular economy, agricultural circular economy, waste reuse and recycling, and garbage utilisation, etc. CACE was formerly named China Association of Resource Comprehensive Utilization from 1995 to 2013.

Introduction to Green Development League of NETDZs


The Green Development League of National Economic & Technological Development Zones, founded in 2016, an unincorporated organisation is constituted of National Economic & Technological Development Zones (219 NETDZs’ GDP accounts for 14% of China). Such league as a platform aims to promote the national ecological civilisation construction strategy, and the communication among all those NETDZs on green, low carbon and circular development, which shall further facilitate the technology innovation, industrial structure optimisation, and the green transformation. The League, co-founded by TEDA and other 35 NETDZs, has a committee of experts and a secretariat, i.e. TEDA Eco Center.