Hi everyone. I’m Stephanie LI.
Coming up on today’s program.
Chinese money managers pledge to pump 850 million yuan into own products in show of confidence;
Xiamen international investment fair prepares to welcome representatives from 100 countries and regions.
Here’s what you need to know about China in the past 24 hours
China’s largest mutual fund houses promised to buy their own equity-focused products to bolster market confidence, on bets the dip-buying strategy will help them ride out the uncertainty prevailing on the stock markets.
At least 15 firms pledged to invest in their funds as of mid-Monday, taking the total tally to 950 million yuan.
Mutual fund firms including E Fund Management, China Asset Management and Harvest Fund Management are among the 11 fund managers promising to invest 50 million yuan.
The asset management Guotai Junan said it will use its own capital of 200 million yuan to invest in its equity fund products, citing its principle to bear market risks with investors. Citic Securities followed with 100 million yuan in similar plans.
Most firms added that the reason for self-purchase was "based on the confidence in the long term healthy and stable development of China's capital market.”
The planned purchases came on the heels of renewed vows from the securities watchdog on Friday to boost markets. A rout in Chinese stocks has extended despite a string of recent measures, which included authorities asking some investment funds to avoid net selling equities and encouraging companies listed on the tech-heavy STAR Board to buy back shares.
Also, more than a dozen major mutual fund firms in China cut fees for roughly 1,500 products last month, as regulators started reforming fee practices in an effort to reduce costs to investors.
Some 60 mutual fund firms have spent more than 2.5 billion yuan buying their own funds in the first seven months this year, according to data compiled by state media.
Moving on to regional highlights
The 23rd China International Fair for Investment and Trade is scheduled to run from September 8 to 11 in Xiamen, East China's Fujian province. Chen Chunjiang, assistant minister of commerce, said Brazil, Serbia, and Qatar will be the guests of honor for the upcoming fair this year, the highest number of guest countries in a single edition. Currently, nearly 40 senior foreign government officials have confirmed their attendance. Several international organizations including the United Nations Conference on Trade and Development and the United Nations Industrial Development Organization will participate as well. The fair's organizers anticipate that representatives from nearly 100 countries and regions, 1,000 trade and business delegations, and about 80,000 participants will take part in the grand event.
Shanghai has issued new policies to further support the development of Lingang Special Area on the fourth anniversary of the special economic area being set up in the city’s free trade zone. The new policies comprise 29 measures across six fields, the Shanghai government said at a press conference, with the aim of consolidating Lingang’s special functions, creating a more attractive environment for talent, boosting the supply of funding and land, promoting the clustering and development of cutting-edge industries, supporting the innovative development of trade in services, and improving its urban service function.
Zhejiang became the fifth provincial-level region in the country to boast more than 10 million registered companies this month. Zhejiang, which only ranks eighth in the country in terms of population size, has 9.67 million private companies and around 330,000 state-owned ones, according to the latest government data. Guangdong ranked first with 17.2 million registered businesses, accounting for one-tenth of the national total. It is followed by Jiangsu, Shandong and Henan provinces.
The Chinese city of Yiwu is vigorously developing its photovoltaic industry thanks to firm government support, with five of the world’s top 10 solar companies by shipments setting up production hubs in the global capital of small commodities, media reported Monday. The output of PV firms above a designated size in Yiwu, Zhejiang province, totaled 87.2 billion yuan last year. The city now has the capacity to produce 35 gigawatts of solar cells and panels, accounting for nearly 20 percent of the global market.
A total of 29 major culture and tourism projects with a combined investment of 14.35 billion yuan were inked at a cultural industries expo held in Xi'an, capital of northwest China's Shaanxi Province, organizers have said. The 10th West China Culture Industries Expo and 2023 Xi'an Silk Road International Tourism Expo concluded on Sunday, reporting onsite cultural and tourism product sales of over 60 million yuan.
Greater Bay Area, Greater future
Cathay Pacific Airways said it plans to recruit more pilots and flight attendants from the Chinese mainland, as it aims to further strengthen its connections with the mainland and meet growing travel demand. In July, the largest carrier in Hong Kong began hiring about 200 to 300 flight attendants from the Chinese mainland for the first time. So far, more than 2,000 candidates have filed applications. Starting next year, the carrier plans to hire about 400 to 500 flight attendants annually and at least 800 cadet pilots from the mainland before 2025 to further improve its services.
A new air cargo route was launched on Sunday linking South China's Shenzhen with Port Moresby, capital of Papua New Guinea, said SF Airlines, China's largest air cargo carrier in fleet size. The Shenzhen-Port Moresby route is SF Airlines' first cargo route reaching Oceania, expanding its global air-cargo-service network that has covered Asia, Europe and North America, the company said.
Next on industry and company news
China's railways recorded 701 million railway passenger trips from July 1 to Aug. 21, data from the China State Railway Group showed Monday. The number of passenger trips handled by railways nationwide was approximately 15.69 million last Saturday, a record daily high for the summer travel rush. During the period, 10,444 trains were operating daily, marking an increase of 15.8 percent over the same period in 2019.
The US has agreed to add six more flights operated by Chinese airlines, effective September 1, according to the US Department of Transportation on Monday. The carriers are Air China, China Eastern Airlines and China Southern Airlines, mainly heading for Los Angeles and New York. The routes include Beijing to Los Angeles and Beijing to New York operated by Air China, flying once a week. China Eastern will fly from Shanghai to Los Angeles, and China Southern's flight from Guangzhou to Los Angeles, both operating twice per week.
China's smartphone brand Huawei led the country's foldable smartphone market in the first half of this year, according to a report released by research and consulting company CINNO Research on Monday, outweighing Samsung with a market share of 50 percent. In terms of sales, Huawei also took a leading role on China Market Foldable Smartphone Brand Sales Ranking due to the excellent performance of Huawei's latest product Mate X3. Sales of foldable screen mobile phones in the Chinese market increased by 72 percent year-on-year in the first half, the data showed.
华为持续领跑国内智能机市场：8月21日，CINNO Research报告显示，2023年上半年中国市场折叠屏手机销量同比增长72%。得益于Mate X3的优异表现，华为稳居市场份额第一，在万元以上超高端折叠屏市场占据半壁江山，取得50%的市场份额。该机构表示，从2019年华为Mate X进入折叠屏市场，到华为Mate Xs 2开启折叠屏轻薄时代，再到华为Mate X3引领折叠屏进入轻薄权能时代，华为依托超强的研发力量，销量和口碑都具有领先优势。
The China Consumers Association (CCA) on Monday said that it will carry out supervision on online car-hailing aggregation platforms. The association will clarify the responsibility held by car-hailing platforms and strengthen consumer rights protection from the supply side, regulating business behavior, maintaining fair competition market order, effectively maintaining industry safety and stability as well as protecting the legitimate rights and interests of passengers and drivers. In addition, the CCA clarified that online car-hailing aggregation platforms and partner companies need to implement network security precautions, strict data security protection and management.
Innovation New Material Technology, China’s biggest producer of aluminum alloy bars, said it plans to invest USD197 million to build a plant in Mexico. Its Hong Kong subsidiaries Drayton Management and Gloucester Management will set up a project company in Mexico responsible for the investment, construction, and operation of the new plant, the company announced yesterday.
创新新材1.97亿美元投建墨西哥项目：创新新材8月21日公告，公司计划在墨西哥开展汽车轻量化铝合金材料等项目。该项目由公司100%控股的香港子公司Drayton Management Limited以及全资孙公司Gloucester Management Limited在墨西哥共同设立的2家公司负责实施，项目投资总额1.97亿美元，折合人民币14.05亿元。
Earnings reports express
China’s Tongwei Group said yesterday profit rose 8.6 percent in the first half from a year earlier despite tumbling polysilicon material prices. Interim net profit was 13.3 billion yuan, while revenue jumped 23 percent to 74.1 billion yuan, with 80 percent coming from its photovoltaic business. Tongwei’s first-half earnings were better than those of its main rivals as their net profits fell on the sharp drop in main product prices, with Xinjiang Daqo New Energy reporting a 54 percent decline from a year ago, while Xinte Energy's net profit fell 15.3 percent. In a separate announcement yesterday, the world’s largest producer of solar silicon also revealed plans to build two new plants to make high-efficiency solar batteries in Leshan, Sichuan province, at a cost of 20 billion yuan. Each will have an annual capacity of 16 GW and make various products.
Switching gears to financial news
China's fiscal revenues grew by 11.5 percent year-on-year to 13.93 trillion yuan in the first seven months, the Ministry of Finance said on Monday. Meanwhile, fiscal spending over the period totaled 15.16 trillion yuan, up by 3.3 percent. Among the fiscal revenue, tax revenue totaled 11.75 trillion yuan, up 14.5 percent year-on-year, with domestic value-added tax (VAT) growing by 84.2 percent to about 4.36 trillion yuan. Non-tax revenue dropped 2.3 percent from a year ago to 2.18 trillion yuan. The ministry also said stamp duties collected during the January-July period declined by 8.3 percent to 267.9 billion yuan. In particular, stamp duties on securities trading totaled 128 billion yuan over the period, slumping 30.7 percent.
Wrapping up with a quick look at the stock market
Chinese stocks bounced on a tech rally on Tuesday, with the benchmark Shanghai Composite ending up 0.9 percent, and the Shenzhen Component ticked up 0.5 percent. Hong Kong’s Hang Seng index rose 1 percent to snap seven straight losses, while the TECH index jumped 2 percent.
Biz Word of the Day
The China International Fair for Investment and Trade (CIFIT), approved by the State Council of the People’s Republic of China, takes place on September every year in Xiamen, China. Themed on “Introducing FDI” and “Going Global”, CIFIT features a focus upon nationality and internationality, upon investment negotiation and investment policy promotion, upon coordinated development of national and regional economy, and upon economic and trade exchanges across the Taiwan Strait. CIFIT is currently China’s only international investment promotion event aimed at facilitating bilateral investment. It’s also the largest global investment event approved by UFI.
Executive Editor: Sonia YU
Editor: LI Yanxia
Host: Stephanie LI
Writer: Stephanie LI
Sound Editor: HUANG Qingyi
Graphic Designer: ZHENG Wenjing, LIAO Yuanni
Produced by 21st Century Business Herald Dept. of Overseas News.
Presented by SFC