Sector Report on China 03.01.2021

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Financial Authorities Declarations

Flash News !

-In 2022, the State Administration for Market Regulation (SAMR) will continue to ensure the business environment stability for all markets.

ZHANG Gong, the head of SAMR, said “While paying closer attention to market entities’ performance and needs, market regulators will improve policy accuracy and effectiveness to help market entities cope with pressure and better support their sound development […] The country will also step-up efforts to create a fair, transparent and stable institutional environment for all market entities”.

-Imports and Exports of China with the 14 members countries of the the Regional Comprehensive Economic Partnership (RCEP) stood at 10.96 trillion Yuan during January-November 2021 period according to Chinese General Administration of Customs (GAC).  This amount represents 31% of the Chinese total foreign trade value.

-The data of Ministry of Commerce (MOC) show that the number of foreign-funded firms newly established in China increased to 43 370 rising 29.3% yoy.“During the period, China saw over 30-percent increases in the number of companies funded by investors from Japan, the Republic of Korea, and the United States, while the number of Europe-funded firms went up 28.9 percent from a year ago” according to GAO Feng, a spokesperson with the MOC.

-Trade data of the State Administration of Foreign Exchange (SAFE)

  November 2021 Units
Trade Income 2.19 Trillion Yuan
Goods trade Income 1.98 Trillion Yuan
Services trade Income 207.5 Billion Yuan
Trade Expenditure 1.9 Trillion Yuan
Goods trade Expenditure 1.66 Trillion Yuan
Services trade Expenditure 239.8 Billion Yuan
Trade Surplus 287.9 Billion Yuan
Goods trade surplus 320.2 Billion Yuan
Services Trade deficit 32.3 Billion Yuan

 

-The CSRC approved IPO !

The China Securities Regulatory Commission. (CSRC) approved IPO of Shandong Sanyuan Biotechnology Co., Ltd. and Wuhan Huakang Century Medical Co., Ltd. on the ShenZhen ChiNext market.

-The State Administration of Foreign Exchange (SAFE) on Debt structure

The SAFE data highlight that the outstanding of foreign debt is around 2.7 Trillion USD at the end of September up 0.6% from June 2021.

“The scale of China’s foreign debt maintained general stability and the structure of external debt improved in the third quarter. The proportion of medium and long-term debt was 47 percent, up 3 percentage points from the end of June” said WANG Chunying, deputy director and spokesperson of SAFE.

 

Central Bank Operations and declarations

 

Date Operations Maturity Amount Interest rate
December 27 Reverse Repo 7-days 50 Billion Yuan 2.2%

 

 – People’s Bank of China (PBOC) Data

  Q4 2021 Units
Bankers  macroeconomics heat index 35.3%  
-growth -3.4 pp qoq
« Normal » macroeconomics climate 65.8% of surveyed bankers
2022 Q1 Projection 41.3%  

 

Government Declarations

  • New shortened Negative lists unveiled !

The National Development and Reform Commission (NDRC) and the Ministry of Commerce (MOC) jointly released shortened negative lists for foreign investment both for Free Trade Zone and all country effective on January 2022.

“The number of items that are off-limits for foreign investors will be cut to 31 in the 2021 version of the national negative list from 33 in the 2020 version. The number of items on the pilot FTZ negative list will be reduced to 27 from 30 in the 2020 version.” as indicated.

According to newly unveiled lists, the foreign ownerships cap on passenger car manufacturing firms is removed and the manufacturing sector is now fully open to foreign investment in FTZ !

In addition, the access to service sector in pilot FTZ will be widened as foreign investment is allowed in social survey industry and the foreign ownership cap is set to no more than 33% with a chinese citizen as legal representatives.

Foreign investors’ access to the service sector in pilot FTZs will also be widened. Foreign investment will be allowed in the social survey industry, but ownership by foreign investors should be no more than 33 percent and the legal representatives should have Chinese nationality.

  • Energy and Raw Materials supply: the 2022 challenge !

The China’s National Energy Administration (NEA) will realize “specific arrangements” to ensure energy security while promoting green and low-carbon development.

“The tone of next year’s work will be seeking progress while maintaining stability” ZHANG Jianhua, head of the NEA.

The the Ministry of Industry and Information Technology (MIIT) and two other government bodies jointly released measures including in the 14th 5-Years Plan to support the development of raw materials industry.

“By 2025, a new development pattern for China’s raw materials sector that features higher quality, better profitability and distribution, low carbon, and more security will take shape” said the plan.

  • Data published !
  December 2021 Units
Non-Manufacturing PMI 52.7 50 pts basis
-growth + 0.4 point mom
Services PMI 52 50 pts basis
-growth + 0.9 point mom
Manufacturing PMI 50.3 50 pts basis
-growth + 0.2 point mom

 

Sources : Ministry of Finance, People’s Bank of China and the State Administration of Foreign Exchange, National Bureau of Statistics, Ministry of Commerce, Ministry of Finance, General Administration of Customs, State-owned Assets Supervision and Administration Commission

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