Caixin
Oct 21, 2020 08:18 PM
CHINA BUSINESS DIGEST

China Business Digest: Jack Ma’s Ant OK’d for Shanghai Listing; China Moves to Expand Domestic Investment Abroad

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Top Chinese officials expect the country to achieve positive growth this year despite pandemic fallout, and the foreign exchange regulator is moving to encourage more domestic investment aboard. Ant Group moves one step closer to its highly anticipated concurrent listings in Hong Kong and Shanghai. Alibaba is buying into Swiss duty-free retailing giant Dufry. Meanwhile, Cathay Pacific is laying off 5,300 employees in Hong Kong as the pandemic hammers its operations.

— By Timmy Shen (hongmingshen@caixin.com) and Han Wei (weihan@caixin.com)

** TOP STORIES OF THE DAY

China encourages more domestic investment abroad

China will start issuing $2 billion to $3 billion of Qualified Domestic Institutional Investor (QDII) quotas each quarter and $10 billion for the full year in an expansion of the offshore investment program, an official from the State Administration of Foreign Exchange (SAFE) said Wednesday. The move came as the yuan appreciates strongly against the dollar amid accelerating post-pandemic inflows of funds.

China is likely to post positive economic growth this year, top officials say

It is highly likely that China's economy will achieve positive growth this year as policies to stabilize the economy show effects, Vice Premier Liu He told a financial forum in Beijing. That will make China the only major economy to expand this year. Central bank Governor Yi Gang is also upbeat about the country’s recovery and said China’s leverage ratio will stabilize in 2021 after a rise this year.

Ant clears regulatory review for Shanghai IPO

Chinese fintech services giant Ant Group Co. moved a step closer to its highly anticipated concurrent public listings as it received a green light from China’s securities watchdog for its share sale in Shanghai. Ant earlier won approval from the Hong Kong stock exchange. The company will need 10 more days to complete the listing procedure under China’s market rules, meaning it is likely to debut in early November.

Alibaba to buy 6.1% of Swiss duty-free retailer Dufry

Chinese e-commerce giant Alibaba Group Holding Ltd. has agreed to buy 6.1% of Dufry AG as part of the Swiss-based travel retailer’s share placement to raise roughly $900 million.

Jack Ma tops Hurun China Rich List with $58.8 billion fortune

Jack Ma, a founder of e-commerce giant Alibaba, has topped the Hurun China Rich List for the third straight year. Ma, who retired as Alibaba’s chairman a year ago, saw his fortune rise by 45% to $58.8 billion in 2020 on the back of healthy growth for the company’s online shopping platforms and the upcoming blockbuster IPO for its affiliated Ant Group Co. Ltd.

Cathay Pacific announces massive job cuts

Cathay Pacific Airways Ltd. announced Wednesday that in it will cut about 5,300 Hong Kong-based jobs in the coming weeks and eliminate another 2,600 unfilled positions as part of a restructuring plan as it suffers a major blow from fallout of the Covid-19 pandemic. It’s also closing its Cathay Dragon brand.

Former CNPC employee commits suicide after killing four

A former employee of China’s state-owned oil giant with a history of mental illness committed suicide after killing four people, including an ex-supervisor, bringing to light a years-long dispute at a subsidiary of China National Petroleum Corp. (CNPC).

China clamps down on unqualified semiconductor manufacturers

The National Development and Reform Commission said Monday that it will strengthen supervision and guidance on big integrated circuit projects, and work with other ministries to improve industrial planning as well as the industry’s geographic layout, as part of a state clampdown on unqualified players in the semiconductor sector.

Vanguard returns $21.6 billion in assets to Chinese government-controlled clients, sources say

U.S. asset management giant Vanguard Group Inc. recently returned $21.6 billion in managed assets to government-controlled clients in China, knowledgeable sources told Caixin, which they characterized as being in line with the company’s global strategy of focusing more on individual investors, while continuing to expand in the Chinese mainland market.

Digest Stock Chart 1021

** OTHER STORIES MAKING THE HEADLINES

• Hong Kong’s unemployment rate rose to 6.4% for the July-to-September period this year, up from 6.1% for the June-to-August period, official data showed. The reading was the highest since January 2005.

• Miniso Co. Ltd., a Chinese operator of discount variety shops, has grown faster than Japanese retailers Uniqlo Co. Ltd. and Muji despite often being called a copycat of the two Japanese brands. (Nikkei Asia)

• Currency traders are testing China’s tolerance for a stronger yuan, with the currency climbing about 0.4% to its strongest point since July 2018 on Wednesday, even after the central bank set its daily reference rate weaker than analysts had expected. (Bloomberg)

• There have been signs of rising domestic and overseas speculation in the grain market (link in Chinese) amid the pandemic, a senior official from China’s agriculture ministry said Wednesday.

• China Mobile Ltd. saw its profit shrink by 0.3% year-on-year in the first three quarters of this year, while its operating revenue was up 1.4%, it said in a Tuesday filing.

• Hong Kong-listed Shanghai Dongzheng Automotive Finance Co. Ltd. was suspended from the dealer loan business, and its controlling shareholder was asked by regulators to exit the company within three months, the Shanghai banking regulator said Monday.

• China Tower Corp. Ltd., the state-owned monopoly that provides the country’s major telcos with tower services, saw its profit increase by 17.8% year-on-year in the first three quarters of this year, it said on Monday.

• As of Wednesday morning Beijing time, the number of coronavirus infections globally exceeded 40.7 million, with the death toll surpassing 1.1 million, according to data compiled by Johns Hopkins University.

** AND FINALLY

Limited flight availability has prompted hundreds of Chinese to apply for Thailand’s newly introduced special tourist visas, seizing the opportunity to enter the kingdom to resume their business activities or gather with family members after a six-month separation. The new visas allow tourists from “low-risk” countries to enter Thailand for long stays of up to 270 days. (Nikkei Asia)

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Thailand's Suvarnabhumi Airport welcomes 39 Chinese tourists from Shanghai on Oct. 20.

** LOOKING AHEAD

Oct. 22: China Telecom reports third-quarter financial results

 

Contact reporter Timmy Shen (hongmingshen@caixin.com) and editors Yang Ge (geyang@caixin.com) and Gavin Cross (gavincross@caixin.com)

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