China Business Digest: Guangdong Moves to Break Railway Operation Monopoly; China Challenges Hong Kongers’ Special British Passports
Southern China’s Guangdong takes the first step to break up the state monopoly on railway operation. American travelers may find difficulties entering Hong Kong under new policies. China’s foreign ministry raised doubts over special British passport for Hong Kongers. Meanwhile, social media sensation TikTok may soon be banned on U.S. government-issued devices.
— By Timmy Shen (firstname.lastname@example.org) and Han Wei (email@example.com)
** TOP STORIES OF THE DAY
Guangdong moves to break state control of railway operation
Southern China’s Guangdong province is testing the waters for local operation of passenger railway lines, a move to break the long monopolized industry. Guangdong said two new intercity lines launched last week are operated by local companies rather than sole state railway operator China State Railway Group Co.
Hong Kong virus control policy may block U.S. travelers
New travel policies adopted in Hong Kong may block most travelers from the U.S. as the city government struggle to contain a resurgence of the coronavirus. Hong Kong authorities added the U.S. to a list of high-risk regions from which visitors must pass a virus test within 72 hours before boarding flights to Hong Kong. However, in many parts of the U.S., getting quick results from a Covid-19 test is challenging.
China may not recognize Hong Kongers’ special British passports
China’s Foreign Ministry said the country may not recognize British National Overseas (BNO) passports as valid travel documents in an escalating clash with the U.K. over Hong Kong. The comment came after British government released a detailed plan saying people in Hong Kong with BNO status would be granted a special path to obtain U.K. citizenship starting in 2021.
U.S. Senate committee passes a bill to ban TikTok on government devices
A U.S. Senate committee passed a bill on Wednesday to bar federal employees from using TikTok, a short video app owned by Beijing-based ByteDance Ltd., on government-issued devices. The legislation is moving to a vote by the full chamber of the U.S. Senate.
Chinese companies turn to Southeast Asia for cross-border deals
International deals in Europe and the U.S. by Chinese businesses decreased in the first half of this year, while investment in Southeast Asia increased, said Alan Wang, a partner at law firm Freshfields Bruckhaus Deringer LLP, citing data from China’s Ministry of Commerce.
In the first half of this year, Chinese companies’ investment in the 10 countries of the Association of Southeast Asian Nations grew 53.1% year-on-year to $6.2 billion.
Missfresh secures $495 million in latest financing round
Beijing Missfresh Ecommerce Co. Ltd., a grocery delivery startup backed by Tencent Holdings Ltd., raised $495 million in its latest financing round, giving it a valuation of more than $3 billion, sources close to the deal told Caixin (link in Chinese).
STAR Market hosts more IPOs than any other Chinese mainland board
China’s Nasdaq-style STAR Market has become a hotbed for IPOs so far this year. By mid-July, the one-year-old high-tech board had listed 54 companies this year, far surpassing that on any other mainland board.
Hillhouse’s big biotech bet hits a wall amid tightening rules
Private equity heavyweight Hillhouse Capital Management Ltd.’s proposed 2.3 billion yuan ($328 million) investment in Shenzhen-listed Asymchem Laboratories (Tianjin) Co. Ltd. is being scrapped after the clinical testing specialist revamped its fundraising plan under new regulatory standards.
China to lower upper limit for legal interest rates that private lenders can charge
China’s Supreme People’s Court and the National Development and Reform Commission on Wednesday jointly released a document stating that authorities are looking to substantially lower the legal upper limit of interest rates protected by law that private lenders can charge, which is now capped at 24%.
** OTHER STORIES MAKING THE HEADLINES
• China has launched its first solo mission to Mars as a rocket carrying the Tianwen-1 probe blasted off from the island province of Hainan on Thursday.
• The total value of bonds issued by local government financing vehicles increased 30% year-on-year in the first half of the year, exceeding 2 trillion yuan, according to China Cheng Xin International Credit Rating Co. Ltd.
• Shares of money-losing cybersecurity specialist Qi An Xin Technology Group Inc. closed down 2% on Thursday, locking in gains after the stock more than doubled in its debut on the STAR Market the previous day.
• A Chinese official said Thursday that China had about 66 million devices, including cell phones, connected to 5G, the next-generation wireless network, (link in Chinese) at the end of June.
• Tesla Inc. recorded a net profit of $104 million in the second quarter, marking its fourth straight profitable quarter, its latest quarterly report showed.
• China General Nuclear Power Corp., a major state-owned nuclear power firm, has appointed (link in Chinese) Yang Changli, president of the company, to be its new chairman and Communist Party chief.
• China Construction Bank Corp. (CCB), one of the country’s four biggest commercial lenders, has appointed two executive vice presidents — Lü Jiajin, who was most recently an executive vice president of Bank of Communications Co. Ltd., and Wang Hao, most recently head of CCB’s provincial branch in Central China’s Hubei province.
** ON THE CORONAVIRUS
• A total of 13 companies in China are developing coronavirus vaccines (link in Chinese), nine of which have obtained approval to carry out clinical testing, according to the Ministry of Industry and Information Technology.
• On Wednesday, the Chinese mainland reported 22 new coronavirus cases with symptoms, three of which were imported, according to official data (link in Chinese). Eighteen of those were locally transmitted in the northwestern region of Xinjiang, one of the country’s latest Covid-19 hotspots.
• Hong Kong reported at least 118 new coronavirus cases on Thursday, 111 of which were locally transmitted, the highest daily increase since the epidemic began, according to data from the city’s health department.
• As of Thursday afternoon Beijing time, the number of coronavirus infections globally surpassed 15.2 million, with the death toll passing 623,000, according to data compiled by Johns Hopkins University.
Contact reporter Timmy Shen (firstname.lastname@example.org) and editors Yang Ge (email@example.com) and Joshua Dummer (firstname.lastname@example.org)
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