Caixin
Apr 18, 2019 03:18 PM
CX DAILY

CX Daily: Official Q1 GDP Figures Peg China's Economy at 'Stable'

Chinese economy grows at 6.4%, outstripping estimates

China’s economic growth stabilized at 6.4% in the first quarter of 2019, bucking analysts’ expectations of weaker growth, as market confidence recovered on the back of policy support and progress in Sino-U.S. trade war negotiations.

The expansion in the nation’s GDP was unchanged from the rate logged in the last three months of 2018, breaking a slowing streak in the past three consecutive quarters. It also beat a median forecast of 6.3% by economists polled by Bloomberg.

All other major activity indicators gauging investment, industrial output and consumption hit multi-month highs, according to data released by the National Bureau of Statistics.

FINANCE & ECONOMICS

tax

Government revenue from individual tax collection dropped 48.4% in March. Photo: VCG

Public coffers /

Fiscal revenue growth slowed in March amid tax cuts

Central government fiscal revenue rose 4% YOY in March, 4.4 percentage points lower than in the same month last year, according to official data released Tuesday. Government tax revenue rose 1.9% in March, down from growth of 14.3% a year ago, reflecting greater efforts to cut costs for businesses and individuals.

Individual tax collections dropped a whopping 48.4% in March from a year ago, as a result of reforms to the individual income tax regime. Government income from land sales shrank further in March, dropping 9.5% YOY. Combined, these results signal greater pressure on government coffers amid massive tax cuts to shore up economic growth.

Balancing act /

International warnings mount over potential impact of Chinese stimulus

China's stimulus measures could increase corporate debt and reverse progress made in deleveraging the economy, according to a report from the OECD, a club of rich countries. The IMF raised similar concerns earlier in April.

China has taken a series of pro-growth measures over the past few months to bolster slowing growth and mitigate trade war pressures, including a string of bank reserve requirement cuts, fiscal stimulus through tax cuts, and more infrastructure spending.

China's Nasdaq /

China rolls out detailed rule for tech board IPO sponsors

Sponsors of an IPO on the new Shanghai Science and Technology Innovation board must buy 2%-5% of the new shares they help to sell, according to a guideline published by the Shanghai Stock Exchange, clarifying a rule that required IPO sponsors to invest their own money and hold the stocks for two years.

The rule specifies different levels of IPO share subscriptions by sponsors. The aim is to ensure that sponsors conduct proper due diligence and select the best companies for the high-tech board. Some smaller brokerage firms may feel pressure from the investment requirement, which might lead to a rise in underwriting and sponsorship fees, an investment banker said.

Quick hits /

Electronics-maker punished for deceiving investors on bond repayment deal

Brokerage unit CEO departs in wake of hedge fund blow-up

BUSINESS & TECH

JD

Richard Liu, Chairman and CEO of online retailer JD.com. Photo: IC

Civil suit /

JD.com chief Richard Liu sued by woman who accused him of rape

Nearly four months after prosecutors in Minnesota decided against filing criminal charges against JD.com founder Richard Liu, the Chinese billionaire is facing a civil lawsuit filed by the student who last year accused him of rape.

The plaintiff, Jingyao Liu, who at the time of the incident was a 21-year-old undergraduate at the University of Minnesota, filed a civil lawsuit Tuesday in Hennepin County, Minnesota, against Richard Liu and the e-commerce giant JD.com Inc. The suit, categorized as a personal injury case, is seeking significant compensatory damages as well as punitive damages.

Boeing /

China assesses design changes to Boeing 737 MAX

China’s civil aviation regulator has conducted a review and responded to Boeing Co. and the U.S. Federal Aviation Administration on design changes to the 737 MAX aircraft, officials said, after the country grounded the fleet over safety concerns.

The Civil Aviation Administration of China (CAAC) said Tuesday that the administration received Boeing’s application April 2 for an airworthiness certificate. The application came via the U.S. Federal Aviation Administration (FAA), which sent Boeing’s applications to nine countries, according to CAAC.

Electric cars /

Nio looks to trim workforce following buildup

Electric-car maker Nio Inc. is planning to cut about 3% of its workforce over four months starting from late February this year, founder and President Qin Lihong told us, following a period of breakneck growth during which the company launched its first electric SUV and raised $1 billion in a New York IPO.

The company had nearly 10,000 employees at the end of last year and now looks to “optimize,” Qin said.

Compensation /

Xiaomi CEO’s peerless pay package

Lei Jun, CEO of Xiaomi Corp., may have received compensation worth more than 330 times that handed to Tencent’s head last year, the company revealed.

2

A filing the company made April 10 with the Hong Kong bourse reported that Lei Jun received more than 636.6 million shares as a bonus last year. Based on the company’s share price at Tuesday close, that bonus would be worth around HK$7.5 billion ($956 million), much more than was paid to peers such as Pony Ma, Tencent Holdings Ltd. CEO, who received a compensation package worth 38.8 million yuan ($5.7 million) last year.

Shady deals /

Mercedes-Benz dealership worked with third party to push suspicious loans: CCTV

A local Mercedes-Benz dealership in western China was colluding with a third-party company to charge customers suspicious fees, state-run broadcaster CCTV said Tuesday, following a viral video in which a Xi’an woman complained of the surprise charge and poor after-sales treatment.

CCTV said it found that the fee was charged by a third-party company called Shaanxi Yuansheng. Yuansheng had assigned staff to Xi’an Lizhixing Automobile Co., the dealership at the center of the video, to persuade car buyers to join the loan program. Mercedes-Benz said it has suspended Lizhixing’s operations and is conducting an investigation into the dealership’s practices.

Quick hits /

Machinery traders feel trade-war pinch

Tech titans need to give grueling work hours a rest

Is China’s ‘996’ work culture ever justifiable?

Government bows out of sugar cane price-setting

Australian University signs $72 million r&d deal with China

BAIC’s new-energy unit expects drop in lower-end sales as subsidies dry up

Anbang cuts registered capital, allowing creditors to demand repayment

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