China Business Digest: EU Extends Ban on U.S. Travelers as Virus Rages; India Bans 59 Chinese Apps
The European Union reopens borders to travelers from more than a dozen countries after months of closure, but Americans are still barred. China’s central bank cut rediscount and relending rates to support smaller companies and rural sectors. Shoppers will have greater freedom for duty-free shopping in Hainan. Meantime, India bans 59 Chinese apps amid escalating tensions between the two countries. And Beijing enacts the national security law on Hong Kong.
— By Timmy Shen (firstname.lastname@example.org) and Han Wei (email@example.com)
** TOP STORIES OF THE DAY
Europe extends travel ban for U.S. travelers
The European Union will continue blocking American residents from crossing its borders for nonessential reasons out of concerns over the uncontrolled U.S. spread of the coronavirus. The EU is opening borders to visitors from more than a dozen of other countries deemed safe.
In a major step to ease travel restrictions imposed earlier this year, the bloc released a list of nations Tuesday whose citizens will be allowed to enter starting July 1, including Canada, Australia and Japan. China is on the list, but the EU said travel restrictions for Chinese residents will be lifted only on the condition that Beijing confirms equivalent treatment for EU citizens.
Less restriction for duty-free shopping in Hainan
New rules taking effect Wednesday will ease restrictions on duty-free shopping in southern China’s island province Hainan. Shoppers will have a higher annual quota for buying tariff-free products in the region and enjoy fewer limits on purchase under rules that are part of a master plan to develop the region into a new international commerce hub.
China central bank to cut rediscount, relending rates
China’s central bank will cut the rediscount and relending rates by 25 basis points, or a quarter of a percentage point, effective July 1 to reduce funding costs for smaller businesses and rural sectors. It is the first change in the rediscount rate since 2010.
China’s official manufacturing PMI expanded further in June
The official manufacturing Purchasing Managers Index (PMI) for June came in at 50.9, up from 50.6 the previous month, according to official data (link in Chinese) released Tuesday. The official nonmanufacturing PMI rose to 54.4 in June from 53.6 the month before. A number above 50 indicates an expansion in activity, while a figure below that points to contraction.
India bans 59 Chinese apps including TikTok and WeChat
Chinese short-video sensation TikTok, owned by tech unicorn ByteDance Ltd., has become China’s latest homegrown technology superstar to encounter growing resistance from foreign governments wary about the risk those companies pose due to perceived ties to Beijing and inexperience in data protection. India on Monday said it has banned 59 Chinese apps, including TikTok, WeChat and Weibo. (Read our full story here.)
China’s top legislative body on Tuesday passed a national security law on Hong Kong. On Sunday, the Standing Committee of the National People’s Congress held a meeting to deliberate on the draft legislation.
Galanz withdraws lawsuit against Alibaba
Guangdong Galanz Group Co. Ltd., a leading microwave manufacturer, has withdrawn its lawsuit against Alibaba Group Holding Ltd., Caixin has learned from Galanz. Last year, Galanz sued the e-commerce giant for using its dominant market position to demand exclusivity, the first lawsuit of its type challenging a common practice in China’s highly competitive e-commerce sector. The business cooperation between the two has returned to normal, Galanz said.
Bohai Bank to raise up to $1.85 billion in Hong Kong IPO
China Bohai Bank Co. Ltd., one of the country’s 12 national joint-stock commercial lenders, plans to raise up to HK$14.34 billion ($1.85 billion) in a Hong Kong listing, according to its prospectus. The subscription period is scheduled to end July 9, and trading is set to commence on July 16.
Self-dealing dispute lies at heart of Arm Ltd.’s dustup with China CEO
British chip designer Arm Ltd. announced earlier this month that it was removing Allen Wu as CEO of Arm Technology (China) Co. Ltd., only to see Wu refuse to quit and mobilize his staff behind him. Wu clashed with U.K.-based managers over control issues, but the last straw came when he allegedly set up an investment fund without telling his bosses. (Read our in-depth story here.)
** OTHER STORIES MAKING THE HEADLINES
Finance & Economy
• Chinese crypto mining giant Ebang International Holdings Inc. plans to launch an offshore exchange for digital assets this year. (Bloomberg)
• Scandal-plagued state-owned asset manager China Huarong Asset Management Co. Ltd. has welcomed veteran regulatory official Pang Xuefeng as the new head for its discipline inspection commission, sources told Caixin. Pang, 48, was previously a deputy head of the nonbank financial institution supervision bureau of the China Banking and Insurance Regulatory Commission.
• Debt-ridden Kangde Xin Composite Material Group Co. Ltd. recorded a 6.8 billion yuan net loss attributable to shareholders last year, according to its 2019 annual report (link in Chinese) released on the last day as required.
Business & Tech
• Chinese ride-hailing giant Didi Chuxing Technology Co. Ltd. said it will entirely halt its taxi-hailing service in 11 prefectures in Japan due to the coronavirus.
• Major Chinese laundry detergent maker Blue Moon Group Holdings Ltd. filed for an IPO on Monday with the Hong Kong Stock Exchange. The Guangzhou-based company is reportedly seeking to raise as much as $1 billion.
** ON THE CORONAVIRUS
• A top infectious diseases expert at the Chinese Center for Disease Control and Prevention predicted Monday that Beijing may be free of new coronavirus cases “in about a week” as authorities continue to fight a recent flare-up of Covid-19 in the capital.
• The Chinese mainland reported (link in Chinese) 19 new coronavirus cases with symptoms Monday, consisting seven local cases in Beijing and a single local case in Shanghai. The remaining 11 cases were imported. The mainland added four new asymptomatic cases on the same day.
• As of Tuesday afternoon Beijing time, the number of coronavirus infections globally had reached over 10.3 million, with the death toll over 505,000, according to data compiled by Johns Hopkins University.
** AND FINALLY
China’s southern region has been suffering from floods lately. Torrential rain in the southwestern municipality of Chongqing has affected 28 districts and counties, according to the local government. The downpour has flooded some regions, leading to the evacuation of thousands, with many homes damaged or destroyed.
Trees sit partially under water Sunday in Chongqing’s Qianjiang district.
** LOOKING AHEAD
July 1: Release of Caixin China manufacturing PMI
July 3: Release of Caixin China services PMI
Contact reporter Timmy Shen (firstname.lastname@example.org) and editor Yang Ge (email@example.com)
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