Multiple approaches are being tested for the launch of the first central bank digital currency in China, said officials and experts, who expect more participation from private institutions in creating the government-backed currency. The time is almost ripe for introducing the central bank digital currency (CBDC), based on ongoing trials in some areas. But Facebook’s unveiling of its digital currency “Libra” may drive Chinese regulators to reconsider the possible model of CBDC, said experts close to the central bank. The People’s Bank of China (PBOC) is almost ready to launch its own digital currency after five years of research, said Mu Changchun, Deputy Director of the PBOC’s Payments Department. The Chinese central bank started system development work in 2018.

Experts predicted that if things go well, the Chinese government-backed digital currency may come out earlier than the official launch of Libra. The PBOC’s original plan might have been influenced by Libra as it sparked discussions among Chinese financial regulators, driving the designer to rethink various models which can involve more non-governmental institutions in the CBDC development and issuance process, Yang Dong, Director of the Research Center of Finance Technology and Cyber Security at Renmin University of China, told China Daily. “Further testing is needed before officially launching the Chinese CBDC, gaining inspiration from the Libra,” said Yang. “Multiple players, including private and state-owned companies, can join the process together with the central bank,” added Yang, who refused to disclose the names of companies involved in the pilots. Shao Fujun, Chairman of China UnionPay and a former PBOC official, said the digital currency will help track the money flow in economic activities and support making monetary policy.”

The Chinese CBDC will be controlled by the central bank, and residents will be able to exchange the digital currency in commercial institutions. The CBDC is also 100% backed by the reserves that commercial institutions pay to the central bank, according to the PBOC official.

Tianjin has taken the lead in helping top foreign experts build up pensions and qualify for other benefits, including housing and real estate loans. More benefits are in the offing, including assistance with commercial medical insurance expenses and children’s tuition fees. “The pilot project has been going for a year and has won high praise from foreign experts,” said Yu Xuefeng, Director of the Tianjin Municipal Science and Technology Bureau’s Division of Foreign Experts Affairs. Under the project, high-end foreign personnel are entitled to pensions and other benefits, known as provident funds. Previously, foreign experts in China were not entitled to the same benefits as Chinese citizens. Tianjin is now allowing certain highly-skilled foreign experts to contribute to provident funds beyond the usual retirement age of 60. Even though the experts may not have completed the 15 years of contributions ordinarily required to qualify for a pension, they can continue to pay into the funds. After they complete 15 years of contributions, regardless of when those payments began, they will qualify for retirement benefits.

Last year, the city became the first in the country to help foreign experts invest in housing provident funds, from which they can make withdrawals to buy property, pay off bank loans or qualify for a cash lump sum after retirement. To date, 112 foreign experts have opened housing provident fund accounts, Yu said. The Bureau is also offering subsidies for commercial medical insurance and tuition support so that the children of foreign experts can enroll in international schools near their homes. Foreign experts with long-term commitments are entitled to up to CNY20,000 to purchase commercial medical insurance. Those with short-term commitments qualify for up to CNY10,000. Children with foreign nationality can qualify for up to CNY150,000 in tuition payments.

In addition to the favorable policies, the city launched fast-track medical services for foreign experts through a WeChat account. In April, Tianjin ranked among the Ministry of Science and Technology’s Top 10 Amazing Cities for attracting foreign experts for the eighth time, the China Daily reports.

The U.S. government has decided to delay or set aside some tariffs against China set to take effect on September 1. The United States Trade Representative (USTR) office announced that some categories were being removed from the tariffs list because of “health, safety, national security and other factors” while tariffs on other items would be delayed until December 15. Tariffs on USD155 billion of Chinese imports would be postponed, including on “cell phones, laptop computers, video game consoles, certain toys, computer monitors, and certain items of footwear and clothing”, the USTR said. The USTR’s statement came after Chinese Vice Premier Liu He in a telephone conversation lodged a complaint about the U.S. decision announced on August 1 to increase tariffs on USD300 billion of Chinese imports to U.S. Trade Representative Robert Lighthizer and Treasury Secretary Steven Mnuchin. Donald Trump told reporters he was delaying tariffs on Chinese imports to avoid any adverse impact on U.S. shoppers before the Christmas and New Year season.

Still, U.S. stocks fell sharply on August 14 on rising worries that Trump’s move to delay some of the tariffs that were set to be imposed on China in September would not be enough to keep the escalating U.S.-China trade conflict from pushing the world into recession. U.S. Commerce Secretary Wilbur Ross said that the United States and China have not determined when to hold their next round of face-to-face trade talks. Instead, the next step in the long-running negotiations is “perhaps another phone call in a couple of weeks”.

Wang Jun, Chief Economist at Zhongyuan Bank, said postponement of tariffs was more of a gesture rather than a concession from the U.S. side. He doubted whether the decision would stand, given Washington’s flip-flop approach in trade negotiations.

China warned that if the U.S. still imposed 10% tariffs on USD130 billion of the USD300 billion of Chinese exports on September 1, it would retaliate. The warning came after Trump appeared to link the outlook for trade talks with China to a resolution of the Hong Kong protests and suggested another meeting with Chinese President Xi Jinping. Chinese diplomatic observers said the situation in Hong Kong might have given Trump fresh leverage over Beijing, but the chances of Xi agreeing to meet him remained slim. Trump called for Beijing to handle the protests in Hong Kong “humanely” and for the first time appeared to link the outlook for trade talks with China with a resolution of the Hong Kong protests. “Of course China wants to make a deal. Let them work humanely with Hong Kong first!”, Trump tweeted. Shi Yinhong, Director of the Center of American Studies at Renmin University, said: “It is absolutely impossible that Xi would meet Trump over Hong Kong. China’s fundamental position is that Hong Kong is it own internal affair, so agreeing to that would discredit its stance.”

Frank Lavin, Director of the International Trade Administration for the U.S. Department of Commerce under President George W. Bush, said Trump is “taking a step backwards, away from conflict, in the hopes that China might move”. “Is Trump really going to accept an offer or is he going to view an offer as a negotiating ploy, and just want more and more? So there has to be a way for Trump to signal that he realizes it is a good faith offer.”

Joerg Wuttke, President of the European Union Chamber of Commerce in China, said EU companies had to be realistic about the trade war and plan for an extended stand-off. “The path of least resistance is for the two sides to muddle through, avoiding the economic damage of further escalation but not making the political sacrifice to complete a final agreement,” he said. “China needs wide-ranging reforms, and the right amount of strategic pressure can help move things in that direction, but there doesn’t appear to be anything strategic about the latest tariffs,” Wuttke said. “At a time when the U.S.-China economic relationship is badly in need of thoughtful and meaningful repair, this tariff wrecking ball, which will effectively impact everything Americans buy from China, will only empower Chinese voices calling for self-reliance and disengagement,” Wuttke concluded.

A new Pew Research Center poll discovered that 60% of Americans have an unfavorable view of China – up from 47% last year – to the highest proportion since Pew started asking the question 14 years ago. The survey found that 24% of Americans regard China as America’s top threat for the future, the same percentage that said so of Russia. North Korea (12%) was the only other country to draw double-digit concern. Still, the poll finds that only 41% of Americans believe that China’s growing economy is a bad thing for the United States, compared with 50% who called it a good thing.

Meanwhile, the U.S. Department of Commerce’s Bureau of Industry and Security has added four Chinese nuclear power enterprises to its Entity List, restricting them from receiving U.S. exports. The four are China General Nuclear Power Group and its subsidiaries China General Nuclear Power Co, China Nuclear Power Technology Research Institute Co and Suzhou Nuclear Power Research Institute Co. Chinese experts said the new U.S. move is just part of its concerted efforts to hinder China’s fast-growing nuclear industry, but such attempts will be in vain. China has home-grown nuclear power technologies and is able to design and manufacture most of the components and devices domestically, while among the few imported items, very few are from the U.S.

China is actively embracing the burgeoning e-commerce sector, generating CNY4.82 trillion in online retail sales during the first six months of this year. Online retail sales surged 17.8% year-on-year in the first half, accounting for nearly 20% of the overall retail sales of consumer goods.

During the first half, business-to-consumer (B2C) online retail accounted for about 75.8% of the online retail market, a 4.1 percentage points rise from the same period last year. Specifically, sales of consumer goods such as cosmetics, smart home, and healthcare products increased rapidly, with year-on-year growth exceeding 30%. Chinese major e-commerce platforms continued to break records in online sales during this year’s shopping festival from June 1 to 18. JD said sales for the 18-day festival period hit CNY201.5 billion, compared with CNY159.2 billion in 2018. Alibaba also reported strong sales for the annual shopping event, with more than 110 brands on its Tmall platform reporting a turnover of over CNY100 million.

Statistics from the Ministry of Commerce (MOFCOM) showed online retail sales in rural areas reached CNY777.13 billion in the first half of this year, up 21% year-on-year. Agricultural products’ online retail sales amounted to CNY187.36 billion in China in the first half, a year-on-year increase of 25.3%

Cross-border e-commerce maintained rapid growth in China. In the first half, major cross-border e-commerce platforms witnessed an over 20% year-on-year increase in sales of imported goods. The top three countries from which China imported goods through e-commerce are Japan, the United States and South Korea, mainly cosmetics, cereals, oils and foodstuffs, and daily necessities. Large cities have seen a significant jump in retail sales of fresh food, cosmetics and pet supplies. The retail sales of clothing, automotive products and household appliances increased rapidly in small- and medium-sized cities and rural areas. Alibaba Group is upgrading its wholesale business by adding a new sourcing channel to better facilitate cross-border trade, particularly for small- and medium-sized enterprises. According to company figures, Alibaba.com serves 150 million registered users around the world, by giving suppliers the tools needed to reach a global audience, and helping buyers target products and suppliers across 200 economies in an efficient manner. Ant Financial, Alibaba’s financial arm, supports transactions in 22 currencies and can settle local payment in 56 economies. Alibaba.com is also seeking to launch a special digital zone featuring Yiwu, China’s hub for exports of small merchandise, in a bid to smooth cross-border transactions for millions of SMEs, part of the electronic World Trade Platform (eWTP), an initiative Alibaba proposed in 2016 to facilitate trade for global SMEs through digitalization.

According to eMarketer, China’s e-commerce sales are estimated to increase more than 30% to USD1.99 trillion in China this year, accounting for 35.3% of the country’s retail sales. The U.S. lags far behind, with only 10.9% of its real sales occurring online.

Authorities nationwide have beefed up measures to develop the nighttime economy, with steps to encourage post-dusk business activities and later closing hours at museums and art galleries. The moves follow reports that China’s economic growth slowed to 6.2% year-on-year in the second quarter, its weakest pace in at least 27 years, with consumption contributing more than 60% of GDP growth. A number of cities, including Beijing, Shanghai, Tianjin and Jinan have recently rolled out measures to shore up the nighttime economy, also known as after-hours economic activity, with longer operating hours for public transport.

The Beijing Municipal Bureau of Commerce unveiled a string of policies last month, including later closing hours at tourist spots, museums, sports grounds and art galleries. The city will extend the operating hours of several subway lines every Friday, Saturday and Sunday, and 25 night bus lines in key areas will operate more frequently. Seven new bus lines will also open to facilitate night travel for large residential communities in the city’s North. Zhao Ping, who researches the consumption economy at the China Council for the Promotion of International Trade (CCPIT), said the scope of the night-time economy extended far beyond night markets. “The catering sector is only the starting point,” she said. “There is still so much to explore in aspects of culture and tourism.”

The authorities in Shanghai unveiled a list of cultural activities and tour routes. The Municipal Culture and Tourism Bureau said 105 tourist spots, art galleries, museums and memorials across the city had taken measures to meet the growing demand for nighttime leisure activities from Shanghai residents and tourists.

A report by Meituan Dianping, China’s largest provider of on-demand online services, said spending on nighttime dining around the country rose 47% last year, higher than the daytime growth, with Beijing and Shanghai ranking first and second. The report also showed that 16 of the 20 cities with the highest spending on nighttime dining were in South China, and that people between the ages of 20 and 40 accounted for most of the spending. Meanwhile, the State Administration for Market Regulation has called for greater efforts to ensure food safety as local authorities encourage growth of the nighttime catering sector. Fu Yifu, Consumption Analyst at the Suning Institute of Finance, said growth of the nighttime economy will help boost domestic consumption and create more jobs, the China Daily reports.

In Shanghai, a 500-m road in Xintiandi will become pedestrian-only from 8 p.m. on Fridays to 5 a.m. on Mondays through September 9 in a trial to promote Shanghai’s nightlife. Street artists will entertain visitors, while business operators will have stalls on the street. Outdoor movies will be played along with other cultural events and entertainments. Shanghai is aiming to revive its nightlife after shutting down noisy late-night bars and eateries over the past few years in response to residents’ complaints. Shanghai’s Huangpu district has appointed a nightlife Director and five nightlife CEOs.