Oct 12, 2020 07:30 PM

China Business Digest: China Eastern Embraces New Investors; Central Bank Steps In to Slow Yuan’s Surge



China’s economy is believed to have expanded at a faster pace, a Caixin survey found. Parent of leading airlines receives investments from new investors. Huya will buy DouYu to create game-streaming giant. China’s central bank cut its risk reserve ratio to zero from 20% for banks buying forex for clients through forwards in an attempt to restrain the yuan’s recent surge. Meanwhile, Qingdao plans to test its entire population for Covid-19 after a cluster of new cases was linked to a local hospital.

— By Tang Ziyi ( and Han Wei (


China’s economy grew 5.5% in third quarter, Caixin survey shows

China’s GDP may have grown 5.5% in the third quarter as the economy gradually recovered from the Covid-19 pandemic, Caixin’s survey of 16 domestic and overseas institutions showed. Estimates of third-quarter growth ranged between 4.8% and 6.2% with the median reading at 5.5%. That compares with the 3.2% estimate for the second quarter. Official data is to be released Oct. 19.

China Eastern gets $4.6 billion capital injection from new investors

China Eastern Air Holding Co., the parent of China Eastern Airlines, said Monday it will receive 31 billion yuan ($4.6 billion) of fresh capital from four new state-backed investors in a diversification of the central government-owned company’s shareholding structure. The investors include China Life Investment Holding Ltd., Shanghai Jiushi Group, China Reform Holdings Corp. and China Tourism Group.

Huya to buy DouYu to create Chinese game-streaming giant

Huya Inc. agreed to buy DouYu International Holdings Ltd. in an all-share deal that will create a Chinese game-streaming giant with a market value of more than $11 billion. The deal values DouYu’s equity at about $5.98 billion. Tencent Holdings Ltd., which currently owns stakes in both companies, will hold about 68% of the merged business’s voting shares.

China’s central bank lowers forex risk reserve ratio to zero

The People’s Bank of China on Saturday said financial institutions no longer need (link in Chinese) to set aside cash for risk reserves when purchasing foreign exchange for clients through forward contracts starting Monday, a move that could cool down a rally in the yuan against the U.S. dollar. Previously, financial institutions were required to hold 20% of the previous month’s yuan forwards settlement amount as risk reserves.

Standard Chartered looks to set up securities firm in China

Standard Chartered PLC has applied to set up a securities firm on the Chinese mainland, according to the website of China’s top securities regulator, as the country further opens up its domestic financial market to foreign players.

Xi to visit China’s pioneer city of reform and opening-up on Wednesday

President Xi Jinping will attend a celebration and deliver a speech in Shenzhen on Wednesday, commemorating the southern Chinese city’s 40-year history of being the country’s pioneer of reform and opening-up, the state-owned Xinhua News Agency reported Monday, in an apparent reassurance that Beijing will not close its doors to foreign investors despite decoupling pressure from the U.S.

Cover story: managing China’s $1.6 trillion private investment market

Chinese venture capitalists and private equity investment funds are at a crossroads as the 10 trillion yuan ($1.6 trillion) market faces a slowdown worsened by the Covid-19 pandemic. The once-freewheeling industry needs more effective regulatory oversight and self-discipline to stop a three-year decline, analysts said. (Read the in-depth story here.)

In depth: China’s takeout wars — is Meituan set to eat Alibaba’s lunch?

A year after Alibaba Group Holding Ltd. began a new chapter with the departure of founder Jack Ma, the e-commerce giant has found little time for rest as two of its biggest businesses face fresh assaults from younger rivals with ambitious leaders who look much like Ma in his early days. Among those, Meituan Dianping has emerged as the largest threat to Alibaba’s ambitions in local lifestyle services, with the two companies’ core takeout delivery businesses at the center of the battle. (Read the in-depth story here.)

Pakistan bans TikTok over ‘immoral and indecent’ content

Pakistan has banned Chinese social media app TikTok for circulation of content that it deemed “immoral and indecent.” The decision followed a number of complaints from different segments of society, the Pakistan Telecommunication Authority said Friday in a statement.

Digest stock chart


• State-owned China Central Television revived its coverage of the National Basketball Association on Saturday, just in time for the fifth game of the NBA Finals between the Los Angeles Lakers and the Miami Heat, according to a report in Global Times. (Bloomberg)

• Steel giant China Baowu Steel Group Corp. Ltd. is about to get bigger with a newly announced plan for it to take over Sinosteel Group Corp. Ltd., as consolidation marches ahead in China’s big state-owned enterprise-dominated steel sector.

• E-commerce giant Alibaba announced (link in Chinese) that it plans to open at least 1,000 offline stores that will sell goods with a unit price of as low as one yuan, a move that could help merchants on its Taobao online marketplace clear inventory.

• The first fund set up by state-owned energy giant China Petrochemical Corp., or Sinopec Group, is set to invest in hydrogen energy in a bid to help the company expand into the new energy sector, the fund’s general manager told Caixin in an interview.

• Insurance giant China Taiping Insurance Group Co. Ltd. is promoting Vice Chairman Wang Sidong to chairman, filling a post that has been vacant for a month, sources close to the matter told Caixin.

General Motors Co. and its joint ventures’ vehicle sales in China grew 12% year-on-year to more than 771,400 units in the third quarter this year as the Chinese auto market recovered from the effects of Covid-19.

• Money-losing car services provider Dida Inc. filed for a Hong Kong IPO on Thursday, joining global peers like Uber Technologies Inc. and Lyft Inc., and beating out larger hometown rival Didi Chuxing Technology Co. Ltd. as the first major Chinese rideshare company to go public, despite faltering financial performance.


• Authorities in China’s coastal city of Qingdao announced Monday they would conduct citywide Covid-19 tests over the next five days after the city recently reported six new cases with symptoms and six asymptomatic ones. All the cases were linked to a Qingdao hospital specializing in thoracic medicine.

• On Sunday, the Chinese mainland reported 21 new Covid-19 cases with symptoms (link in Chinese), all of which were imported, according to China’s top health body. The 21 new cases did not include Qingdao’s infections.

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Caixin’s coverage of the new coronavirus

• As of Monday afternoon Beijing time, the number of coronavirus infections globally exceeded 37.5 million, with the death toll surpassing 1.07 million, according to data compiled by Johns Hopkins University.

• India recently passed the 7 million caseload mark, second only behind the U.S. with 7.7 million cases.


Hong Kong Express Airways Ltd., a budget airline of Cathay Pacific Airways Ltd., has jumped on the flights to nowhere bandwagon, in a move to cheer up its pandemic-battered sales. The carrier will offer 90-minute sightseeing flights in November that encircle Hong Kong, which the company is billing as a chance to “rediscover the joy of travelling”. Tickets for all three tours that went on sale Friday sold out within a few hours.


Hong Kong Express Airways is offering three 90-minute sightseeing flights in November, called “UOFlycations,” which the budget airline is billing as a chance to “rediscover the joy of travelling.”


Oct. 13: Release of China’s September import and export data

Oct. 15: Release of China’s September CPI

Contact reporter Tang Ziyi ( and editor Yang Ge (

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China Business Digest: Caixin New Economy Index Records Third Straight Monthly Drop; Global Stock Markets Shake Off News of Trump’s Positive Covid-19 Test

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