China Business Digest: China to Map Out Next Five-Year Plan at Key Meeting in Oct.; Judge Halts Trump Ban on TikTok Downloads
A U.S. judge temporarily halted a Trump administration order to ban TikTok downloads from the nation’s app stores. China’s Communist Party scheduled a key meeting to discuss the next five-year plan. A Baidu executive was detained in in illegal ad probe, and Huawei’s Meng Wanzhou appeared in court again. Meanwhile, AI-facilitated pharmaceutical company XtalPi raised $320 million in a series C round.
— By Guo Yingzhe (firstname.lastname@example.org) and Han Wei (email@example.com)
** TOP STORIES OF THE DAY
U.S. judge temporarily blocks Trump’s ban on TikTok downloads
A district court in Washington on Sunday temporarily suspended a U.S. government order for app stores to stop offering TikTok downloads starting at midnight that day. But the judge did not halt another part of the ban, which will stop U.S. internet services providers from doing business with the short video app effective Nov. 12. (Read the cover story.)
Key party gathering set in October to map out development plan
China’s Communist Party will hold a key meeting Oct.26–29 to discuss the country’s development plan for the next five years, Xinhua reported Monday. The fifth plenary session of the 19th Central Committee of the Communist Party of China will assess proposals for formulating the 14th Five-Year Plan for China’s economic and social development between 2021 and 2025, as well as draw up a long-term blueprint running through 2035, Xinhua said.
Top Baidu sales executive detained in illegal ad probe
Shi Youcai, head of Baidu’s Mobile Ecology Group, who oversees the company’s sales system, was detained by police on allegations of illegal online advertising operations, including promotions related to gambling, separate sources told Caixin. The detention of Shi followed investigations of several other Baidu staffers starting weeks ago, including Vice President Li Zhongjun.
Meng Wanzhou back in court to fight U.S. extradition
Huawei executive Meng Wanzhou appeared at a courtroom in Vancouver Monday to continue a fight to block the United States’ request to extradite her from Canada on fraud charges. Meng's lawyers argued the extradition proceedings should be halted because Canada Border Services Agency officers detained and questioned Meng without a lawyer. The five-day hearing will also decide whether to allow the defense to admit additional pieces of evidence in her favor, Reuters reported.
SMIC denies being notified of export restriction from U.S.
Leading Chinese chipmaker Semiconductor Manufacturing International Corp. (SMIC) on Sunday denied receiving a document from the Bureau of Industry and Security of the U.S. Department of Commerce that would restrict its access to exports from U.S. companies.
SMIC’s Hong Kong shares closed down 3.9% on Monday following reports of the export restrictions.
Exclusive: Pharmaceutical company XtalPi raises $320 million
Pharmaceutical company XtalPi Inc. that uses AI technology to research and develop drugs has garnered $320 million in its series C fundraising round, sources familiar with the matter told Caixin. A source at an investor who participated in the round said that the company’s valuation after this round may exceed $1 billion. (Read the full story.)
JD Health files for a Hong Kong listing
Online health products and services provider JD Health International Inc. made its first public filing for a Hong Kong listing on Sunday, becoming the latest in a flurry of assets being spun off for separate listings by e-commerce giant JD.com Inc.
The company didn’t disclose any fundraising targets for the listing, according to the prospectus. But a knowledgeable source told Caixin the amount would be between $1 billion and $2 billion. (Read the full story.)
** OTHER STORIES MAKING THE HEADLINES
Economy & Finance
• China’s economic rebound showed signs of plateauing in September, weighed down by lackluster home and car sales, a weaker stock market and worsening business confidence, the earliest available indicators show. (Bloomberg)
• Hong Kong-listed HSBC Holdings PLC closed up 9.2% on Monday, recovering from a 25-year low, as its biggest shareholder raised its stake in a bet the embattled lender will return to paying dividends. (Bloomberg & Caixin)
Business & Tech
• U.S. lawmakers are mulling subsidies of about $25 billion to encourage companies to relocate chip production facilities back home amid rising competition with China in the high-tech sector. (Nikkei Asian Review)
• A case of 572 million yuan ($83.5 million) in missing goods has led to a blame game erupting between household goods manufacturer Lonkey Industrial Co. Guangzhou and two of its storage partners. (Read the full story.)
• Three people were found dead after a fire at an unfinished research facility belonging to Huawei Technologies Co. Ltd. in Dongguan, South China’s Guangdong province, local authorities said Friday. (Read the full story.)
• Hong Kong-listed China Evergrande Group’s stock price closed up 20.6% on Monday after a selloff last week, as the property developer touted its sales as well as debt-cutting measures, and the Hong Kong Stock Exchange’s approval of its plan to spin off its property management unit.
• A coal mine accident left 16 dead in the southwestern city of Chongqing (link in Chinese) on Sunday, state broadcaster CCTV reported. The mine is owned by a subsidiary of state-owned Chongqing Energy Investment Group Co. Ltd.
** ON THE CORONAVIRUS
• The Chinese mainland reported (link in Chinese) 21 new symptomatic Covid-19 infections on Sunday, all imported. The mainland also added 14 asymptomatic cases, also all imported.
• As of Monday evening Beijing time, the number of global coronavirus infections had surpassed 33.1 million, with the death toll over 998,000, according to data compiled by Johns Hopkins University.
Caixin’s coverage of the new coronavirus
** AND FINALLY
China’s tourism market has been warming up as a pair of public holidays, for National Day and Mid-Autumn Festival, are around the corner.
Tourists walk through Dali, Southwest China’s Yunnan province, on Sept. 15.
** LOOKING AHEAD
Sept. 28: Weibo reports quarterly results
Sept. 30: Release of Caixin China manufacturing PMI
Oct. 9: Release of Caixin China services PMI
Contact reporter Guo Yingzhe (firstname.lastname@example.org) and editors Yang Ge (email@example.com) and Joshua Dummer (firstname.lastname@example.org)
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