Caixin
Jan 18, 2022 09:56 AM
CX DAILY

CX Daily: China’s 2021 GDP Grows 8.1% on Low Base

Omicron /

Cover Story: China in hand-to-hand combat with omicron

In less than two months since it was first reported, the highly contagious omicron variant of Covid-19 is storming the world, driving record-breaking case counts in the U.S. and Europe while breaking through heavily guarded borders elsewhere, including China.

On Jan. 15, Beijing reported the capital city’s first case of omicron, less than a week after the neighboring port city of Tianjin detected the country’s first local infection of the mutation.

Officials have quickly sealed off areas linked to infected people and launched massive virus testing covering millions of residents. But omicron’s rapid replication and less obvious symptoms make it much more difficult to track and control than previous variants.

Nine Chinese cities now have local omicron flare-ups

South China omicron cluster grows as travel bans imposed

Beijing reports first local omicron case

Mutual aid /

In Depth: How China’s health-care mutual aid industry folded in just three years

The shutdown of Ant Group’s Xiang Hu Bao, the largest crowdfunded health-care platform in China, completed the collapse of a booming insurance-like industry just three years after its emergence. The platforms served more than 150 million people at the peak.

Under the online mutual aid programs, participants shared the risk of becoming critically ill and collectively bore related medical expenses. Dominant player Xiang Hu Bao, whose name means “mutual protection,” provided a basic health plan covering 100 types of critical illnesses, including cancer, critical brain injury and heart attack. In 2019, each member of Xiang Hu Bao paid as little as 29 yuan ($4.56)—about the cost of a cup of Starbucks coffee — and could receive a one-time payout of as much as 300,000 yuan for an eligible claim.

FINANCE & ECONOMY

GDP /

China’s 2021 GDP grows 8.1% on low base

China’s GDP grew 8.1% in 2021 as the economy’s rapid recovery faded in the second half of the year amid power shortages and turmoil in the real estate sector, official data showed Monday.

The annual growth figure easily met the government’s target of “above 6%” that was set in March. However, this was partly thanks to a low comparison base in 2020, when the economy was disrupted by Covid-19 and grew by a mere 2.2%.

For the fourth quarter of 2021, the year-on-year growth rate was 4%, data from the National Bureau of Statistics (NBS) showed. That was the slowest quarterly figure that year, compared with 4.9% growth in the third quarter, 7.9% in the second quarter and 18.3% in the first quarter.

Funds /

China reins in Ant’s Yu’e Bao and other giant money market funds

China’s securities regulator strengthened supervision of major money market funds under draft rules published Friday in a move that could affect the largest such fund managed by Ant Group.

Major funds are defined as those with more than 200 billion yuan ($31.49 billion) in net assets, or with more than 50 million investors, according to the rules issued by the China Securities Regulatory Commission (CSRC).

The CSRC did not name any funds. But currently the only two funds that directly fit the criteria are Tianhong Yu’e Bao, a money market fund managed by Tianhong Asset Management Co. Ltd. which is 51% controlled by Ant Group, and E Fund Management Co. Ltd.’s E Fund Money Market Fund.

Corruption /

State documentary details crimes of former high-ranking police, judicial officials

A documentary series produced by China’s top graft watchdog and state broadcaster CCTV has revealed details of the cases of several former high-level officials ensnared for corruption, including a former vice minister of public security who is accused of cultivating a “political clique.”

Sun Lijun, the former vice minister who was indicted on charges including accepting bribes and illegally holding firearms, is featured in the five-episode series with on-camera confessions. At least four other former high-ranking police officers were in Sun’s faction.

Quick hits /

China cuts policy interest rate for first time since April 2020

Editorial: How to break through in market-based reform of production factors

BUSINESS & TECH

BYD showcases electric vehicle batteries at its booth at the Shanghai Auto Show on April 25. Photo: VCG

Lithium /

BYD’s $61 million Chile lithium deal hits the rocks

BYD Co. Ltd.’s multimillion-dollar lithium mining deal with Chile has been suspended by a local court, just two days after the Chinese electric-car and battery maker won a quota of 80,000 tons of the sought-after metal.

The Court of Appeals of Copiapó accepted an appeal filed by the Atacama regional government against the bid and requested the mining minister submit related reports within 10 days, according to a notice (link in Spanish) published by the court Friday.

The deal, which has met with opposition over environmental and economic development concerns, would be BYD’s first step into directly controlling its supply of lithium, a key component of the batteries that power the Shenzhen-based company’s cars.

Flights /

China suspends more international flights to Shanghai

China suspended six more international flights to Shanghai Friday after detecting 46 passengers with confirmed Covid-19 infections on the flights since Jan. 4.

The Civil Aviation Administration of China (CAAC) ordered American Airlines to cancel two more flights from Dallas to Shanghai from the week of Jan. 24, two more Delta Air Lines flights from Detroit to Shanghai, and two Lufthansa flights from Frankfurt to Shanghai from the same week.

Electric cars /

Electric-car makers hike prices after China reveals when subsidies will end

Tesla, Xpeng and several other electric-vehicle makers raised prices in China in the weeks since Beijing set a deadline for ending its financial subsidies for new-energy vehicles (NEVs).

The subsidies that car buyers receive for purchasing electric and other vehicles that don’t exclusively burn fossil fuels was cut by 30% at the beginning of 2022, the Ministry of Finance said Dec. 31 in a notice, which also confirmed that the government will no longer provide the subsidies after this year. The incentives, which have been in place since 2009, were cut by 20% in 2021 and by 10% in 2020.

Debut /

Alibaba-backed baseband chipmaker flops in Shanghai debut

Alibaba-backed Chinese consumer electronics chips developer ASR Microelectronics Co. Ltd. booked a disappointing Shanghai STAR Market debut, with the just-listed stock losing a third of its value.

Shares of the first chipmaker to sell stock on a mainland exchange this year were down 33.75% at the end of their first trading day Friday. That was despite the semiconductor industry’s bumper year, reflecting unprecedented demand during a pandemic-induced global chip shortage.

Quick hits /

Macao casino gauge jumps 12% as gaming bill eases concerns

GALLERY

China’s holiday travel rush under Covid

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