Caixin
Jul 23, 2021 09:59 AM

CX Daily: Why Hong Kong Could Gain From China’s Foreign Share-Sale Crackdown

The Hong Kong Stock Exchange may benefit from Beijing’s crackdown on foreign share sales because it doesn’t count as “foreign” under the central government’s new cybersecurity rules. Photo: VCG
The Hong Kong Stock Exchange may benefit from Beijing’s crackdown on foreign share sales because it doesn’t count as “foreign” under the central government’s new cybersecurity rules. Photo: VCG

Hong Kong /

In Depth: Why Hong Kong could gain from China’s foreign share-sale crackdown

China’s tightening scrutiny of U.S.-traded data-heavy companies is raising the prospect of more share sales in Hong Kong, even though the city’s stock exchange is known for having stricter requirements than U.S. bourses.

Under a newly revised regulation, Chinese companies holding the personal information of 1 million or more users have to seek a government cybersecurity review before a foreign share flotation. “Foreign” under the rule doesn’t include Hong Kong, suggesting an opportunity for the exchange.

Although Hong Kong’s benchmark Hang Seng Index has declined 4% in July, shares of Hong Kong Exchange and Clearing Ltd. (HKEX) itself jumped almost 10% this month.

Heavy rains /

Death toll from Henan floods rises to 33, eight missing

The official death toll from heavy rain and flooding in Central China’s Henan province rose to 33 with eight people missing, as the region braces for several more days of severe weather that has already caused direct economic losses estimated at 1.22 billion yuan ($188.7 million).

On Thursday morning, the province’s meteorological station issued two red alerts, the highest of a four-level warning system, saying that heavy rain would continue to batter several cities after record-breaking torrential downpours triggered flooding across the provincial capital Zhengzhou.

The struggle to survive in Zhengzhou’s flooded subway

FINANCE & ECONOMY

shanghai

Shanghai will become the center of yuan asset allocation, risk management, fintech and high-quality financial talent, an official says.

Yuan /

China to back Shanghai’s trial of free use of yuan

China’s central bank will support Shanghai to take the lead in testing the free use of the yuan, explore unrestricted inflows and outflows of capital for cross-border trade and investment, and unlimited currency exchange in the city’s new free trade zone, an official said Tuesday.

The trial will take place in accordance with principles of anti-money laundering, anti-terrorist financing and anti-tax avoidance, Wang Xin, director of research at the People’s Bank of China (PBOC), said at a press conference.

Currently, the yuan is convertible for trade purposes under the current account, which records the value of exports and imports and international transfers of capital, but it is not freely convertible under the capital account, which records the net flow of investment transactions into an economy.

Pigs /

Raising pigs no longer brings home the bacon for China’s farmers

Once a bonanza for small farmers in rural China, raising pigs has become a loss-making endeavor as prices have slumped and costs have soared, forcing the government to start an emergency pork buying program and prompting a warning to producers not to use the market for speculation or gambling.

An oversupply of pigs and the rising cost of grain used to feed hogs, mostly corn and soybean meal, have been squeezing producers’ profit margins. The average market price of live hogs fell to 14.1 yuan ($2.18) per kilogram (kg) in late June, the lowest in more than two years, according to data from the National Development and Reform Commission (NDRC), while the cost of corn feed (link in Chinese) rose to a record high of 3.01 yuan per kg last month, data from the Ministry of Agriculture and Rural Affairs (MARA) show.

Covid-19 /

China rejects WHO plan to reinvestigate Covid lab-leak theory

China will not accept the World Health Organization’s plan for a second-phase investigation into the origins of coronavirus in the country, the deputy director of the National Health Commission said Thursday.

The senior health official, Zeng Yixin, said at a press conference it is “impossible” for China to accept the plan, which “disregards common sense and defies science.”

He said he was “shocked” by the plan, which includes the hypothesis that a violation of laboratory protocols resulted in leaking of the virus.

Quick hits /

China’s latest easing ripples through its debt markets

Credit Suisse hires six for North Asia private banking push

U.S.-China goods trade booms as if virus, tariffs never happened

BUSINESS & TECH

COAL

The Shaanxi Coal and Chemical Industry Group coal chemical project in Yulin. Photo: Bai Yujie/Caixin

Coal /

China coal chemical project suspended over its gluttonous energy appetite

A resource-rich province in Northwest China suspended the construction of a coal chemical project billed as the largest of its kind worldwide as the country accelerates its drive to rein in energy consumption.

After more than two years of construction, the project based in Yulin, Shaanxi province, was halted July 2. Designed to produce chemical materials from processing of raw coal, it was expected to complete all phases of construction by 2025 with 126 billion yuan ($19.4 billion) in estimated investment from state-owned Shaanxi Coal and Chemical Industry Group Co. Ltd., according to records (link in Chinese) on the company’s website.

Education /

Analysis: The impact of U.S. ban on Chinese researchers on international study plans

The U.S. may be losing its luster for some Chinese students as the Biden administration continues to impose Trump-era visa restrictions on science, technology, engineering and mathematics (STEM) students.

More than 500 Chinese science and engineering graduate students were denied study visas by the U.S. on the grounds of Presidential Proclamation 10043 signed by Trump in June last year, Chinese state-run media reported.

Property /

Evergrande stock rebounds after loan dispute settled

The stock of China Evergrande Group rose 8% Thursday in Hong Kong after the debt-ridden developer said it reached an agreement with China Guangfa Bank Co. Ltd. over a loan dispute that triggered a sell-off of the property giant’s shares and bonds.

Just days after Evergrande threatened to sue the bank, the two sides reached an agreement, according to statements (link in Chinese) from Evergrande and Guangfa Thursday that did not give further details.

Quick hits /

14 workers trapped in flooded highway tunnel found dead

Tencent and Alibaba among tech giants fined for child exploitation

Volvo Cars wants full control over its China ventures as Beijing mulls lifting foreign ownership cap

Energy Insider /

China tackles cement overcapacity; hydrogen-fueled trucks hit road in Beijing

GALLERY

henan01

Central China rains wreak more havoc

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