A senior Beijing official with the rank of Vice Premier or above should be appointed to coordinate a development strategy for a city cluster, including Hong Kong and Macao, in southern China following a key reshuffle of the Communist Party’s leadership, scholars have said. The 19th Party Congress is likely to discuss a more detailed plan to develop a cluster of 11 cities in the Pearl River Delta, known as the “Greater Bay Area”, and the appointment of a powerful leader to oversee the initiative and prevent protectionism by individual cities.

“If you want to have efficient coordination between cities and to implement some special policies, a higher level committee needs to be set up, with supervision of a higher ranking official, preferably Vice Premier or above,” Regina Ip, Executive Councillor to Hong Kong’s Chief Executive said. Her suggestion is echoed by scholars in Hong Kong and mainland China, as well as business leaders.
“Integrating the Greater Bay Area has been a sensitive plan, because it is also seen as a political mission,” Ding Li, Professor at the Guangdong Academy of Social Sciences, said.

The formula of “one country, two systems” implemented in Hong Kong and Macao only promises 50 years of unchanged economic and political systems, which expires in 2047. “But the problem is how important the Greater Bay Area development plan is to the central government. We will have a clearer picture after the 19th Party Congress,” he added.

The regional development was mentioned in the address during President Xi Jinping’s visit to Hong Kong in June and the government work report delivered by Premier Li Keqiang in March. The area is also expected to act as a powerhouse for Xi Jinping’s flagship “Belt and Road Initiative”, the South China Morning Post reports.

China’s expenditure on technology research and development rose 10.6% to CNY1.57 trillion in 2016, the fastest annual growth since 2014, as the nation increases its investment in new driving forces to stabilize the economy. The National Bureau of Statistics (NBS) said the growth rate rebounded for the first time after declining for four years. It was 8.9% in 2015 and 9.9% in 2014. The expenditure accounted for 2.11% of last year’s total gross domestic product (GDP), compared with 2.06% in 2015. It has exceeded the average level of 2.08% in the EU, while the ratio for OECD countries was 2.40%.

R&D expenditure includes labor costs, raw material cost, and expenses on fixed-asset construction and management, the NBS said. Pan Jiancheng, Deputy Director of the Bureau’s Economic Monitoring Center, said the increasing proportion of R&D expenditure to GDP indicates that the driving force of economic growth is switching to a focus on innovation from the traditional factors of exports and investment. The government will also encourage companies to invest more in research.

NBS Director Ning Jizhe said at a news conference that investment in manufacturing technology upgrading was faster than overall investment growth during the past year. New driving forces, including new industries and business models – such as the shared economy and online sales – contributed 14.8% of the country’s total GDP in 2015. “The ratio was expected to be higher in 2016,” said Ning. Since July 2016 R&D expenditure has been added to GDP figures based on the requirements of the United Nations System of National Accounts, the China Daily reports.

China’s Lenovo Group held on to its position as the world’s second-largest supplier of personal computers in the third quarter, despite flat shipment growth that saw it struggle with weak notebook sales in North America. Hong Kong-listed Lenovo shipped 14.5 million personal computers worldwide in the quarter ended September 30 to grab a 21.6% share of the global market, behind market leader HP’s 22.8% share on shipments of 15.3 million units, according to preliminary industry estimates from research firm IDC.

The results of the top two players last quarter marked some stability in the personal computer industry, which recorded a 0.5% year-on-year decrease in shipments to 60.3 million units during the period – better than IDC’s earlier prediction of a 1.4% decline. Research firm Gartner, however, estimated a 3.6% year-on-year fall in total global personal computer shipments to 67 million units in the third quarter. “Business PC demand, led by Windows 10 upgrades, continued to drive PC shipments across all regions, but its refresh schedule varies by region,” said Gartner Analyst Mika Kitagawa. Gartner indicated a much closer race between HP and Lenovo. It saw HP ship 14.6 million personal computers in the third quarter for a 21.8% global share, while Lenovo secured a 21.4% share on shipments of 14.3 million units in the same period.

IDC said competitive pressures further cemented the dominance of the world’s top five personal computer suppliers, which accounted for nearly 75% of the total market. Third-ranked Dell shipped 10.8 million units for a 16.1% global market share. Apple seized a 7.3% share on shipments of 4.9 million units, while Taiwan’s Asus had a 6.2% share on shipments of 4.2 million.

China continues to be the world’s most attractive market for renewable energy development and investment, according to a new study by London-based financial services firm EY. The Renewable Energy Country Attractiveness Index – which is compiled twice a year by EY – highlighted the large quantities of public and private funds pouring into renewable power projects in China, as well as several energy-efficiency policies. The United States remains in third place behind Germany, while the UK ranks 10th among 40 economies.

Earlier this year, China’s National Energy Administration (NEA) announced it would spend USD363 billion by 2020 on developing renewable power capacity. The investment will see renewables account for half of all new generated capacity and create 13 million jobs. Solar capacity in China rose by 21 gigawatt (GW) during the past six months, and the government has set new targets to cancel or defer 106 GW of coal power. “The index highlights that government policy is pivotal in driving renewable energy development globally,” said Ben Warren, corporate finance leader for global power and utilities at EY.

Broken down by sector, China topped the EY rankings for both onshore wind and solar power. EY declared the UK to be the most attractive economy for offshore wind investment, followed by China and Germany. The 50th issue of the EY listing includes projections that new wind and solar power will account for 34% of global electricity generation by 2040. In 2015, China contributed 36% of the global total for new investment in renewable power and fuels, according to the UN Environment Program. China accounted for more than 40% of capacity growth in global renewable energy in 2016, the China Daily reports.

Asahi Group, Japan’s largest beer producer, is considering bailing out of its share in Tsingtao, one of China’s largest beer makers, in another clear sign that Chinese drinkers are moving upmarket. Experts say the domestic beer market has dropped significantly by volume, as buyers opted to cut back on cheaper products. But higher-quality beer brands and sales of traditional Chinese clear liquor, or baijiu, are doing fine.

Total national beer production has seen three straight years of declines, before slightly rebounding 0.8% in the first seven months of this year, according to the National Bureau of Statistics (NBS). As overall sales fall, however, demand for quality lager (imported and local), and traditional liquor such as Moutai, have continued strongly. Kweichow Moutai, the country’s biggest premium baijiu producer, reported first-half gross profit margins of 90% giving it a market value of nearly CNY700 billion.

Asahi, Tsingtao’s second largest shareholder with a 19.99% share, is considering the transfer of all or part of its 270 million H shares, the Chinese brewer said in an exchange filing. Asahi’s holding was worth about USD1.2 billion. In 2009, the company spent USD667 million acquiring the stock. In a Bloomberg interview earlier this year, Asahi President Akiyoshi Koji noted Tsingtao’s “worsened” earnings result and said “ownership without control doesn’t make much sense”. Tsingtao’s share price has fallen 4% in the past six months and has halved compared with the beginning of 2014. Shares in Kweichow Moutai, meanwhile, gained 70% so far this year, making it one of the world’s most valuable liquor brands. The stock has increased more than fourfold in value compared to the beginning of 2014.

“Beer demand is sluggish as China’s population continues ageing. Cheap lagers, which account for more than 70% of total sales, are becoming less popular,” said Iris Zhang, Analyst for Guotai Junan Securities. Tsingtao reported 30% and 14% declines in net profits, respectively in 2016 and 2015. For the first half of this year, however, net income grew 7% as the company shifted to selling more premium products, inside and outside the country. “Growth potential is limited for the beer market in future,” Zhang said. “Companies can no longer expand by offering just low prices,” the South China Morning Post reports.