China Business Digest: Wuhan Plans Massive Testing Campaign on 11 Million People; Former Head of China's Aircraft Carrier Program Probed
Wuhan will test its entire population of 11 million to prevent a resurgence of the coronavirus. A top epidemiologist says more investigation is needed to trace the origin of a cluster of Covid-19 infections in the northeastern city of Shulan. China will remove additional tariffs imposed in the U.S.-China trade war. And a retired official who headed China’s aircraft carrier development is under investigation.
— By Guo Yingzhe (firstname.lastname@example.org) and Han Wei (email@example.com)
** ON THE CORONAVIRUS
Wuhan to test everyone after new cases emerge
Wuhan plans to test its entire 11 million population after new infections appeared more than a month after the city ended a lockdown. District officials in the city confirmed that they received orders to submit plans to arrange nucleic acid tests for all residents under their purview within 10 days.
The ambitious plan reflects officials’ determination to prevent a resurgence of the virus as the economy reopens. But some experts said blanket testing will be more costly than effective.
More investigation needed to find origin of Shulan’s infections, expert says
More epidemiological investigation is needed to determine the origin of a new cluster of Covid-19 infections that has appeared in Shulan, Northeast China’s Jilin province, over the past few days, an epidemiologist said Monday.
The cluster outbreak indicates that the pandemic could have a “long tail,” meaning cases could continue to appear for a while, Wu Zunyou, chief epidemiologist with the Chinese Center for Disease Control and Prevention, said in an interview (link in Chinese).
China’s infections ease on Monday after weekend spike
As of Tuesday evening Beijing time, global infections reached about 4.2 million, with over 286,000 deaths, according to data compiled by Johns Hopkins University.
Russia now has the second-highest number of infections
Russia surpassed Spain and the United Kingdom to become the country with the second-highest number of reported cases of Covid-19, with more than 232,000 on Tuesday, according to data compiled by Johns Hopkins University.
The death toll in Russia rose to more than 2,100 on Tuesday, which is substantially lower than the figures in Spain and the U.K. The U.S. remains the worst-hit country, with more than 1.3 million infections and over 80,000 deaths as of Tuesday morning local time.
Caixin’s coverage of the new coronavirus
** TOP STORIES OF THE DAY
Former head of state shipbuilding giant under graft probe
Hu Wenming, former chairman and party chief of China Shipbuilding Industry Corp. (CSIC), is being investigated for suspected serious violations of discipline and law, China's top anti-graft agency said Tuesday. The phrase often refers to corruption. Hu, 63, was the chief commander of China's aircraft carrier program and oversaw the development of China's first two domestically built aircraft carriers. He retired in August 2019.
Luckin fires CEO, COO amid financial fraud probe
Luckin Coffee Inc. removed Chief Executive Officer Jenny Qian Zhiya and Chief Operating Officer Liu Jian amid an ongoing probe of a $310 million accounting scandal that crashed the stock in New York. Qian and Liu resigned their board positions, according to a filing Tuesday by Nasdaq-listed Luckin.
Consumer inflation eases in April
China’s consumer price index rose 3.3% year-on-year last month, marking the third straight month of deceleration, official data showed.
The producer price index fell 3.1% year-on-year for the month as the rate of decline accelerated for the third straight month.
China to remove additional tariffs for another batch of U.S. goods
China will remove additional tariffs imposed earlier in the U.S.-China trade war on another batch of American goods, according to an official statement (link in Chinese) on Tuesday. The list includes rare earth minerals and medical disinfectant.
Regulator gives German reinsurer the nod to increase capital in China
China’s top insurance regulator has given the green light for Hannover Rück SE, a major German reinsurer, to increase the capital of its Shanghai branch by about 1.6 billion yuan ($225.8 million) to 4.1 billion yuan, according to an official statement (link in Chinese).
Wuhan gives a hand to Peugeot’s sputtering China venture
The Wuhan government will help Peugeot SA dispose of idle capacity in the city as the French automaker’s local joint venture struggles with sales so low that more than two-thirds of its capacity was left idle last year.
The city’s economic development zone plans to help out by acquiring a manufacturing facility that is currently sitting unused from Dongfeng Peugeot Citroen Automobile Co. Ltd., which also goes by the name of Shenlong in China, Caixin has learned from documents from the zone’s administration.
Automakers call for stimulus as industry navigates coronavirus carnage
The Chinese government is thrashing out rescue measures such as subsidies and tax cuts in an effort to prevent the auto industry from crashing as the Covid-19 outbreak has buckled supply chains and hit sales hard.
Car manufacturer profits plunged 80.2% in the first quarter, more than twice the average industrial profit slump of 36.7%, according to official data.
** OTHER STORIES MAKING THE HEADLINES
Finance & Economy
• Sichuan Trust Co. Ltd. denied the rumors (link in Chinese) that it will be taken over by regulators.
• Beijing’s municipal banking regulator said it would take action against Bank of Beijing Co. Ltd. for violating rules related to the fraud case of Kangde Xin Composite Material Group Co. Ltd., Caixin has learned (link in Chinese).
• A client of Industrial and Commercial Bank of China Ltd. (link in Chinese) has complained that he lost out on some profits in a crude oil futures product he had invested in because the bank had closed his positions about a week earlier than specified in the product’s contract. (Read our related in-depth story.)
• Lee Wai-king, a member of China’s top political advisory body, has suggested designating 20 square kilometers (7.7 square miles) of undeveloped land which is officially part of the mainland, to Hong Kong residents to ease a housing shortage in the city.
• As people start to envision a world post-coronavirus, China’s fundamental role and responsibility is to take leadership on environmental action, including protecting the world’s oceans, Pascal Lamy, a former director-general of the World Trade Organization, said in an article published in Caixin.
Business & Tech
• New York-listed Tencent Music Entertainment Group, a subsidiary of Chinese internet giant Tencent Holdings Ltd., reported a 10% year-on-year rise in its first-quarter revenue.
• Coca-Cola Consolidated Inc. and Chinese diary producer China Mengniu Dairy Co. Ltd. have received approval to start a joint venture producing chilled milk, the two companies told Caixin (link in Chinese).
• Shipments of mobile phones in China rose 14.2% year-on-year to 41.7 million units in April, a government-backed think tank said (link in Chinese).
• Chinese express giant SF Holding Co. Ltd. is testing a new food-delivery service targeting business clients buying in bulk.
** AND FINALLY
Some 100 elementary school students in the eastern city of Hangzhou have been outfitted with “wings” to help them stay 1 meter apart now that schools have reopened around the country.
Students in Hangzhou go to school wearing “wings” on Monday to maintain a safe distance from one another according to social distancing guidelines.
** LOOKING AHEAD
May 13: Tencent reports latest quarterly results
May 15: JD.com reports latest quarterly results
May 15: China’s investment, industrial output and retail sales data
Contact reporter Guo Yingzhe (firstname.lastname@example.org) and editors Yang Ge (email@example.com) and Michael Bellart (firstname.lastname@example.org)
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