China Business Digest: China Orders U.S. to Shut Chengdu Consulate, More Coronavirus Cases in Xinjiang
China’s foreign ministry Friday told the U.S. to shut its consulate in Chengdu in a tit-for-tat move after Washington Tuesday ordered Beijing to close its consulate in Houston. Xinjiang, one of China’s top Covid-19 hotspots, continues to report more cases. China’s securities regulator approved registrations for initial public offerings of four companies to list on Shenzhen’s start-up ChiNext board.
— By Timmy Shen (firstname.lastname@example.org)
** TOP STORIES OF THE DAY
China orders U.S. to close consulate in Chengdu
China’s foreign ministry said Friday that it told the U.S. Embassy in China to shut its consulate in the southwestern city of Chengdu although its announcement did not give a deadline. The tit-for-tat move comes after the U.S. ordered China on Tuesday to close its consulate in Houston within 72 hours, marking what Beijing called an “unprecedented escalation” of tensions between the two powers since they normalized diplomatic relations in 1979.
China sets up 100 billion-yuan fund to deal with bond defaults by central SOEs
China has started building a 100 billion-yuan fund to deal with the fallout from any bond defaults by central government-controlled state-owned enterprises (SOEs). The fund was set up by China Reform Holdings Corp., a state-owned investment holding company, and 31 centrally controlled SOEs. The fund will provide emergency money for the central SOEs to use to repay maturing bonds that would otherwise go into default. The first batch of 10 billion yuan has already been raised from the 31 enterprises.
CSRC approves four companies’ IPO registrations on ChiNext
Cultural performing event planner Beijing FengShangShiJi Culture Media Co. Ltd., medical instruments manufacturer Contec Medical Systems Co. Ltd., electroplated diamond toolmaker Yangling Metron New Materials Inc. and measurement instrument maker Anhui Landun Photoelectron Co. Ltd. are approved to list on ChiNext after their IPO registrations were cleared by the China Securities Regulatory Commission.
Guangdong government to take over disgraced drugmaker Kangmei
State-owned Guangdong Hengjian Investment Holding Corp. will take over debt-ridden Kangmei Pharmaceutical Co. Ltd., Caixin has learned, after revelations the company committed a $12.6 billion financial fraud that included forged documents.
California inks another mask deal with China’s BYD for $316 million
Chinese carmaker BYD Co. Ltd. secured a $316 million contract to supply 420 million face masks to California. The order includes 120 million N95 masks and 300 million surgical masks, and comes after a previous deal sparked a regulatory tussle.
ByteDance seeks new investment opportunities amid global TikTok pushback
Fast-rising Chinese tech company ByteDance Ltd. is seeking more investment opportunities as its main money-spinner TikTok faces increasing scrutiny from foreign governments over data security concerns. The Beijing-based company has tasked its vice president of product and strategy, Alex Zhu, with finding promising tech firms that ByteDance could buy into, CNBC reported this week, citing a company spokesperson.
** OTHER STORIES MAKING THE HEADLINES
• China will provide a $1 billion loan for Latin American and Caribbean countries to gain access to its Covid-19 vaccine, Foreign Minister Wang Yi told top regional diplomats in a meeting, Bloomberg reported, citing the Mexican government.
• Shanghai police have broken up a ring that allegedly produced and sold counterfeit “Transformers” toys worth hundreds of millions of dollars. The gang is accused of infringing the intellectual property rights of Hasbro Inc., one of the world’s biggest toymakers.
• The construction of two intercity railways in South China’s Guangdong province has entered the final. They won’t be operated by centrally administered state firm China State Railway Group Co. Ltd., but by a local subsidiary of Guangzhou Metro Group Co. Ltd., making it the first province to allow local enterprises to operate intercity railways.
• Taiwan-based iPhone assembler Wistron Corp. announced it is paying 3 billion yuan for a 0.81% stake in China’s Luxshare Precision Industry Co. Ltd., the biggest manufacturer of Apple Inc.’s AirPods. The investment comes just days after Wistron said it would sell two mainland subsidiaries to the Shenzhen-based company.
• The Ministry of Industry and Information Technology on Friday released (link in Chinese) another batch of apps that are infringing users’ rights in some way. They include a travel booking app run by Qunar.com, an app run by Tianhong Asset Management Co. Ltd. and a livestreaming app run by Shenzhen Xunlei Networking Technologies Co. Ltd.
• Everbright Xinglong Trust Co. Ltd., a unit of China Everbright Group Ltd., was suspended from the trust financing business because its nonstandard credit business in the first half of 2020 exceeded a regulatory limit, sources told Caixin. Everbright has denied a suspension is in effect.
• Ren Zhiqiang, former chairman of state-owned developer Huayuan Property Co. Ltd., was expelled from the Communist Party for violating party discipline and faces criminal corruption and embezzlement charges, China’s anti-graft watchdog said Thursday.
** ON THE VIRUS
• On Thursday, the Chinese mainland reported 21 new coronavirus cases with symptoms, six of which were imported, and 43 new symptomless cases, according to official data (link in Chinese). Thirteen of the symptomatic cases were locally transmitted in the northwestern region of Xinjiang, one of the country’s emerging Covid-19 hotspots.
• As of Friday afternoon Beijing time, the number of coronavirus infections globally surpassed 15.5 million, with the death toll passing 633,000, according to data compiled by Johns Hopkins University. The total number of infections in the U.S. has exceeded 4 million, the data showed.
** AND FINALLY
Some 16,000 residents in the town of Guzhen in East China’s Anhui province had been evacuated by Wednesday after being trapped in their homes for more than 50 hours by floodwaters. On Sunday, flooding caused by days of torrential rains raised water levels and breached the levees that protected the town, inundating 13 villages and cutting off electricity, according to local authorities.
Floodwaters leave a villager stranded Tuesday in Guzhen, Anhui. Photo: Cai Yingli/Caixin
Contact reporter Timmy Shen (email@example.com) and editors Flynn Murphy (firstname.lastname@example.org) and Nerys Avery (email@example.com)
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