Caixin
Jan 07, 2022 09:11 AM
CX DAILY

CX Daily: China’s Property Market Set for Gloomy Year After 2021 Ends in a Funk

Property /

China’s property market set for gloomy year after 2021 ends in a funk

China’s property sector, traditionally a key driver of the country’s economic growth, had a rollercoaster year in 2021 as a booming performance in the first half turned into a slump triggered by the debt crisis at China Evergrande Group and regulatory curbs on borrowing. Analysts expect housing sales to continue falling this year and foresee more debt defaults by developers, which could become a drag on GDP.

Sales of new homes by China’s top 100 property developers dropped 3.5% to 11.1 trillion yuan ($1.8 trillion) in 2021, the first annual decline in more than a decade, data compiled by China Real Estate Information Corp. (CRIC) show. Almost 40% of the developers on the list saw a deterioration in their performance, and 36 recorded negative growth compared with 16 in 2020, according to a report released by the property consultancy on Dec. 31.

Health code /

Xi’an data chief suspended after Covid-19 tracing app crashes

A top data management official in Xi’an was suspended from his post after the city’s health code system malfunctioned twice, preventing people from checking in to venues as the virus spread around the city.

It came as a local Covid-19 outbreak, first detected in December, neared 1,800 cases.

The system is critical for verifying the health status of residents and granting access to public places such as office buildings and supermarkets. It also contains Covid-19 test results needed for making trips between provinces.

FINANCE & ECONOMY

The headquarters of the People's Bank of China in Beijing. Photo: VCG

Fintech /

PBOC’s new fintech development plan flags more regulation in the pipeline

China’s central bank indicated that strengthening regulation of the country’s booming financial technology (fintech) sector, which was hit by a series of crackdowns last year, will be one of its top priorities over the next four years along with promoting data application and green financial services.

Regulation is listed as one of eight key tasks in a summary of the Fintech Development Plan (2022-2025) announced by the People’s Bank of China (PBOC) Tuesday, which outlines its strategy for developing fintech and driving the digital transformation of finance. The proposals are based on China’s 14th Five-Year Plan, a roadmap for the country’s overall economic and social development from 2021 to 2025, and its long-term goals through 2035, the central bank said.

PMI /

China’s services industry growth accelerates, Caixin PMI shows

Activity in China’s services sector expanded at a faster pace in December as total new business orders continued to grow, a Caixin-sponsored survey showed.

The Caixin China General Services Business Activity Index, which gives an independent snapshot of operating conditions in the sector, rose to 53.1 from 52.1 the previous month, according to the survey report released Thursday. Readings greater than 50 signal expansion.

The Caixin China General Composite PMI, which covers both manufacturing and services sectors, rose to 53 in December from 51.2 the previous month, according to the Thursday survey report.

Bourse /

Environmental technology firm to invest $73.6 million in Baotou Steel unit

An environment technology business traded on China’s new Beijing Stock Exchange plans to acquire an energy unit of state-owned Baotou Iron and Steel Group (Baotou Steel), marking the first major asset acquisition filed with the fledgling bourse.

Beijing ZHTD Environmental Protection Technology Co. plans to spend 468 million yuan ($73.6 million) for a 34% stake in Baotou Steel Group Energy Conservation and Environmental Protection Technology Industry Co. Ltd., ZHTD disclosed Wednesday. The deal will include a 209 million yuan purchase of newly issued shares of the Baotou Steel unit and a 259 million yuan stake purchase from the current controlling shareholder, according to a ZHTD filing with the Beijing exchange.

Covid-19 /

Xi’an Covid outbreak is China’s worst since Wuhan, disease expert says

The Covid-19 outbreak in Xi’an is “the most serious” to hit China since the Wuhan outbreak, a top Chinese epidemiologist said, noting that the more transmissible delta variant is making it “extremely arduous” to control the disease in the city.

Zeng Guang, former chief epidemiologist of the Chinese Center for Disease Control and Prevention (China CDC), said in a state media interview that the capital of Northwest China’s Shaanxi province is battling a variant that spreads much faster than the Covid strain detected in Wuhan, Central China’s Hubei province, at the start of the pandemic. The outbreak has spread along multiple chains of transmission that have been harder for authorities to trace than in previous outbreaks in China, Zeng said.

Hong Kong scraps flights, shuts bars, gyms on omicron threat

Trending in China: Online fury ignited after woman miscarried while forced to wait outside hospital

BUSINESS & TECH

Garment workers manufacture protective clothing in Linyi, Shandong province. Photo: VCG

Textiles /

Textile, apparel companies clock off early for Lunar New Year as demand slumps

Key Chinese textile, dyeing and clothing factories are shutting down for Lunar New Year weeks early due to a combination of sluggish orders and supply disruptions caused by strict measures to contain regional Covid-19 flare-ups.

Managers of several midsize textile enterprises in the provinces of Hebei, Shandong and Hubei said they would be starting the break weeks earlier than in previous years. New orders have languished since mid-December on weak overseas demand, and the supply of raw materials has been disrupted by a recent Covid-19 resurgence, Caixin learned.

It comes after 10 locally-transmitted cases were reported in Ningbo, Zhejiang, this month at a clothing factory owned by Shenzhou International Holdings Ltd., one of the world’s largest garment-making equipment manufacturers. In early December, a Covid outbreak in Shaoxing, another city in Zhejiang, forced the closure of key fabric factories there.

Trip.com /

Trip.com loses lawsuit over undisclosed third-party bookings

Trip.com lost a fraud lawsuit after the Chinese travel giant failed to notify a customer he was buying a hotel room from a third-party agent on its platform, leading the court to criticize the company for allowing price gouging.

Nasdaq-listed Trip.com Group Ltd. must pay the plaintiff, surnamed Hu, a total of 6,045.48 yuan ($948.50), according to a Tuesday ruling (link in Chinese) by the Shaoxing Intermediate People’s Court in East China’s Zhejiang province. The court upheld a decision made by a lower court in the city in July last year.

Fines /

China tech giants slapped with fresh round of fines for antitrust violations

China’s market regulator slapped tech giants with a fresh round of fines for violating anti-monopoly rules — this time for failing to report their acquisition of stakes on other companies that gave them controlling power.

Tencent Holdings Ltd., Alibaba Group Holding Ltd., Bilibili Inc. and some private-equity investment companies were fined 500,000 yuan ($78,500) for each unlawful deal — 13 in total — according to notices published Wednesday by the State Administration for Market Regulation.

Railway /

China Railway 2021 revenue basically flat from year before

China’s deeply indebted national railway operator said revenue reached 1.14 trillion yuan ($180 billion) last year, basically flat with 2020, even as passenger numbers bounced back from the first year of the pandemic.

China State Railway Group Co. Ltd. revealed the revenue figure, which represented a year-on-year increase of 0.34%, at an annual working conference Tuesday, where it did not disclose its net profits or debt-to-asset ratio for the whole year.

However, China Railway said its expenses, debts and debt-to-asset ratio were brought under “positive control” last year.

Quick hits /

Minmetals expects strong profits from boom year for metals

Evergrande seeks to delay early payment option on yuan bonds

GALLERY

Hong Kong cruise cut short by Covid

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