China Economy: News & Discussion

[RoaringTigerHiddenDragon]

Sadly I disagree. Lol
I attend strategy meetings for investment funds and i know how they operate and think.

Their main concern is always and forever what the CCP's action and reaction will be.

I would suggest caution when you throw statements like investment managers are gods and make 100% accurate and fundamentally sound decisions.

They're handling money how clients want them to be handled and operate in the circle the clients wants exposure to.

Yeah sure. Based on greed. We can see Tesla hemorrhaging now. LoL. Apple and others wanting to get the heck out of China as quickly as they can. Just because they have an early lead does not mean they can sustain that lead. The major difference now is the western countries have imposed a lot more restrictions on where their pension systems (the biggest money bundles ever) can invest now. You cannot invest in portfolios that include companies that use labor from occupied territories like Tibet and East Turkestan. That has a material effect. The US has removed HongKong as a special investment zone. That will have an impact. The US and Canada have cracked down on illegal Chinese money flows into their real estate.
The west will find ways to restrict capital flows from there into China. Investors now need to take such restrictions into consideration. I did not say they were gods but the era of free capital flowing worldwide is dead. The west sees China’s rise as a security threat for them. China + 1 is not a PR exercise. It is a reality.
In the last 3 years, more than 2000 Japanese companies have left China. That is a reality as well. So, investors have to adjust their investment decisions. That is just practical.
I still think that investments will flow into HongKong as they do innovate quite a bit. But any further restrictions there on freedom of people there, western capital flows there would stop as well.

Restricting US capital flows into China could impact global markets, analysts warn

Proposals to restrict United States capital flows to China could have wider ramifications on Chinese firms listed on global stock exchanges, analysts have warned, potentially roiling world financial markets amid concern the China-US trade war could turn into a full-blown capital war.Media...

www.yahoo.com

I am not sure if the actual restrictions did happen but I am sure the investors are worried about it. I strongly believe that at some point, greed will have to give way and the CCP punished for massive human rights violations. Right now it is restricted to sanctions on all CCP members and leaders. But as India grows and becomes the “+1” , the CCP backed companies will suffer more and more in access to capital. If investors are not taking this trend into account, they are stupid and will lose money.
It is India, which is the wild card here for everyone in the world. And all sorts of global economics realignment will happen based on how India grows and integrates with the global supply chain.

 

[Varzone]

Yeah sure. Based on greed. We can see Tesla hemorrhaging now. LoL. Apple and others wanting to get the heck out of China as quickly as they can. Just because they have an early lead does not mean they can sustain that lead. The major difference now is the western countries have imposed a lot more restrictions on where their pension systems (the biggest money bundles ever) can invest now. You cannot invest in portfolios that include companies that use labor from occupied territories like Tibet and East Turkestan. That has a material effect. The US has removed HongKong as a special investment zone. That will have an impact. The US and Canada have cracked down on illegal Chinese money flows into their real estate.
The west will find ways to restrict capital flows from there into China. Investors now need to take such restrictions into consideration. I did not say they were gods but the era of free capital flowing worldwide is dead. The west sees China’s rise as a security threat for them. China + 1 is not a PR exercise. It is a reality.
In the last 3 years, more than 2000 Japanese companies have left China. That is a reality as well. So, investors have to adjust their investment decisions. That is just practical.
I still think that investments will flow into HongKong as they do innovate quite a bit. But any further restrictions there on freedom of people there, western capital flows there would stop as well.

Restricting US capital flows into China could impact global markets, analysts warn

Proposals to restrict United States capital flows to China could have wider ramifications on Chinese firms listed on global stock exchanges, analysts have warned, potentially roiling world financial markets amid concern the China-US trade war could turn into a full-blown capital war.Media...

www.yahoo.com

I am not sure if the actual restrictions did happen but I am sure the investors are worried about it. I strongly believe that at some point, greed will have to give way and the CCP punished for massive human rights violations. Right now it is restricted to sanctions on all CCP members and leaders. But as India grows and becomes the “+1” , the CCP backed companies will suffer more and more in access to capital. If investors are not taking this trend into account, they are stupid and will lose money.
It is India, which is the wild card here for everyone in the world. And all sorts of global economics realignment will happen based on how India grows and integrates with the global supply chain.

Brother, i am myself astounded why every AMC has belt and road funds. It's a useless strategy to invest in.
There is no punishment for unethical practices.

Big company gives contact to small company and bosses of both company go to strip club and enjoy. Terms of contract only on paper since nothing is enforced in China and police and justice system is all bought and paid for.

Pension fund manager is also enjoying but warns them that don't leak information or he's going to have to withdraw money.

Another thing you should clearly understand is that have long had relationship with Chinese and these kind of personal bonds among the elite doesn't break easily. Don't underestimate their influence and power of old boys who have made money in China for party 20 years. They don't change habits easily.


Tell me why there is no proper audit of Chinese companies then. There have been thousands of cases of every listed Chinese company being totally fraudulent. Still investors buy and keep exposure to real estate companies for example that are defaulting.

Ask why? What does manager ask in meeting? What is CCP thinking, are they going to bail then out? If yes then buy corporates bond and enjoy high rate of interest. Sell it off when news of trouble leaks from insiders.

 

[Varzone]

At the end of the day, reality is known by people inside industry. You can't read news and be confident that you know everything.

 

[another_armchair]

Brother, i am myself astounded why every AMC has belt and road funds. It's a useless strategy to invest in.
There is no punishment for unethical practices.

Big company gives contact to small company and bosses of both company go to strip club and enjoy. Terms of contract only on paper since nothing is enforced in China and police and justice system is all bought and paid for.

Pension fund manager is also enjoying but warns them that don't leak information or he's going to have to withdraw money.

Another thing you should clearly understand is that have long had relationship with Chinese and these kind of personal bonds among the elite doesn't break easily. Don't underestimate their influence and power of old boys who have made money in China for party 20 years. They don't change habits easily.


Tell me why there is no proper audit of Chinese companies then. There have been thousands of cases of every listed Chinese company being totally fraudulent. Still investors buy and keep exposure to real estate companies for example that are defaulting.

Ask why? What does manager ask in meeting? What is CCP thinking, are they going to bail then out? If yes then buy corporates bond and enjoy high rate of interest. Sell it off when news of trouble leaks from insiders.

Those investors made 29-30% a year on junk bonds. Those risking their own money know how much to risk... its the portfolio types who are left holding the shovel to fill up the pit.

 

[Varzone]

Those investors made 29-30% a year on junk bonds. Those risking their own money know how much to risk... its the portfolio types who are left holding the shovel to fill up the pit.

Pta hai bhai, Mera hur din ka kaam hai

 

[another_armchair]

Pta hai bhai, Mera hur din ka kaam hai

haha yes.. bataya tha.

So are the money bags flocking back to China? We would like some 'exposure' to China for old times sakes.. wo investment bhi kya jismein risk aur nuksaan na ho.. bragging rights bhi toh maangta hai

 

[Varzone]

haha yes.. bataya tha.

So are the money bags flocking back to China? We would like some 'exposure' to China for old times sakes.. wo investment bhi kya jismein risk aur nuksaan na ho.. bragging rights bhi toh maangta hai

Abhi Tuesday ko meeting hai, btata tereko.

 

[RoaringTigerHiddenDragon]

At the end of the day, reality is known by people inside industry. You can't read news and be confident that you know everything.

the US companies generally do follow their country’s laws. If their local big money pension systems bars them from shady investments they probably follow that, as the US has this lawsuit system that can bankrupt an investment company if they screw up. But the US itself is greedy and has allowed a lot of shady things to happen like list fraud Chinese companies on NASDAQ. What I am saying is now the US might arm twist CCP into not outcompeting the US. It has got very little to do with human values or anything. The west feels a security threat and that is what will drive their actions. Human rights is just a front. But the US is also changing. They have a big woke crowd now, who want the US to sanction countries more for rogue behavior. And are anti large corporates.
Meanwhile, China under CCP is a security threat for us. So if the US weakens them, it is a plus for us. Let’s see how it actually plays out. Can’t say anything for sure until 2030.

Meanwhile things like this also happen giving us exposure to some cutting edge technology. India is the wild card. World’s engagement with China will depend on India’s manufacturing performance and innovation capabilities.

Joint India-US space mission later this year: Science and Technology Minister

The NASA-ISRO SAR (NISAR) Mission will measure the Earth's changing ecosystems, dynamic surfaces and ice masses to provide information about biomass, natural hazards, sea level rise and groundwater and will support a host of other applications.

economictimes.indiatimes.com

 

[SexyChineseLady]

The market right now is riding on China's opening. Without that, every bourse is simply waiting for the recession:

 

[ym888]

Not just Xiaomi oppo vivo,



Next, South Koreans......





DRI issues show cause notice to Samsung India over alleged customs duty evasion
SECTIONS
DRI issues show cause notice to Samsung India over alleged customs duty evasion
By
Rashmi Rajput
, ET BureauLast Updated: Jan 12, 2023, 04:42 PM IST
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Synopsis
The agency in the notice also asked why a penalty should not be imposed against the senior management of the company. The DRI also issued a show cause notice to PricewaterhouseCoopers Pvt Ltd (PwC) and an associate director, who was questioned during the probe.

Reuters
The Directorate of Revenue Intelligence (DRI) has issued a show cause notice to Samsung India Electronics (SIEL), asking why the agency should not recover 1,728.47 crore as duty along with interest from the subsidiary of South Korea’s Samsung Electronics for alleged customs duty evasion. Based on a case registered by DRI, the notice was issued by Nhava Sheva Customs earlier this week.

The agency in the notice also asked why a penalty should not be imposed against the senior management of the company. The DRI also issued a show

 

[ym888]

India's trade deficit with China hits $100bn for first time
Agencies / Updated: Jan 14, 2023, 08:09 IST




ARTICLES

BEIJING: Trade between India and China touched an all-time high of $136 billion in 2022, overtaking the $125-billion mark a year earlier even as New Delhi's trade deficit with Beijing crossed the $100-billion mark for the first time despite frosty bilateral relations, according to data released by the Chinese customs on Friday.
China's exports to India climbed to $119 billion, a year-on-year increase of 22%. During 2022, China's imports from India dwindled to $17.5 billion, a year-on-year decline of 38%. The trade deficit for India stood at $101 billion, crossing the 2021 figure of $69.4 billion. In 2021, the overall trade with China totalled $126 billion, an increase of 43% year-on-year crossing the $100-billion mark for the first time. The trade deficit in 2021 stood at $ 69.6 billion as India's imports from China witnessed an increase of 46% to reach $98 billion.
India's exports to China increased by 34.3% year-on-year to reach $28 billion in 2021. The trade between the two countries continued to boom despite border tensions following the military standoff in eastern Ladakh in May 2020. According to an official brief posted on the Indian embassy website in Beijing, the rapid expansion of bilateral trade since the beginning of this century has propelled China to emerge as India's largest goods trading partner by 2008.From 2015 to 2021, India-China bilateral trade grew by 75%, an average yearly growth of 13%, it said.

 

[SexyChineseLady]

India's trade deficit with China hits $100bn for first time
Agencies / Updated: Jan 14, 2023, 08:09 IST




ARTICLES

BEIJING: Trade between India and China touched an all-time high of $136 billion in 2022, overtaking the $125-billion mark a year earlier even as New Delhi's trade deficit with Beijing crossed the $100-billion mark for the first time despite frosty bilateral relations, according to data released by the Chinese customs on Friday.
China's exports to India climbed to $119 billion, a year-on-year increase of 22%. During 2022, China's imports from India dwindled to $17.5 billion, a year-on-year decline of 38%. The trade deficit for India stood at $101 billion, crossing the 2021 figure of $69.4 billion. In 2021, the overall trade with China totalled $126 billion, an increase of 43% year-on-year crossing the $100-billion mark for the first time. The trade deficit in 2021 stood at $ 69.6 billion as India's imports from China witnessed an increase of 46% to reach $98 billion.
India's exports to China increased by 34.3% year-on-year to reach $28 billion in 2021. The trade between the two countries continued to boom despite border tensions following the military standoff in eastern Ladakh in May 2020. According to an official brief posted on the Indian embassy website in Beijing, the rapid expansion of bilateral trade since the beginning of this century has propelled China to emerge as India's largest goods trading partner by 2008.From 2015 to 2021, India-China bilateral trade grew by 75%, an average yearly growth of 13%, it said.

If India is becoming like Vietnam
who is also breaking trade deficit records every year with China then it is a good thing for India!

Vietnam imports more and more from China as it exports more and more to the US!

The reason is China manufactures to scale the components for practically every industry on earth. The more you export, the more you need to import from China.

https://www.businesstimes.com.sg/international/vietnam-posts-record-2022-trade-surplus-us-china-deficit-rises

 

[Varzone]

If India is becoming like Vietnam
who is also breaking trade deficit records every year with China then it is a good thing for India!

Vietnam imports more and more from China as it exports more and more to the US!

The reason is China manufactures to scale the components for practically every industry on earth. The more you export, the more you need to import from China.

https://www.businesstimes.com.sg/international/vietnam-posts-record-2022-trade-surplus-us-china-deficit-rises

The key is getting the suppliers to move from China to India.
Simply moving assembly chains will not help India to gain economic superpower status.

It's much more easier to get Foxconn or Winstron but incredibly difficult and taxing to move the hundreds of suppliers that the apple supply chain has in China.

If it was so easy then China wouldn't have become the behemoth it is today. Only a few can achieve it and across many industries.

 

[SexyChineseLady]

The key is getting the suppliers to move from China to India.
Simply moving assembly chains will not help India to gain economic superpower status.

It's much more easier to get Foxconn or Winstron but incredibly difficult and taxing to move the hundreds of suppliers that the apple supply chain has in China.

If it was so easy then China wouldn't have become the behemoth it is today.

The suppliers in China serve the home market first and then exports second. Western companies hook into this ecosystem. They do not have to build this out.

This makes their Chinese components supply chain very efficient and their final products more profitable. This is how Apple and more recently Tesla do it. Tesla has its gigafactory in Shanghai for just two years and already it is manfacturing the majority of its cars in China! And it is also has a huge new market in China itself.

For other countries, like India, companies need to build out a suppliers network from scratch. But those suppliers usually do not have a local market so the end product company needs to provide the vast majority of business/funds for them to even survive. The component makers for Apple and Tesla in China already support a large number of Chinese companies too and there are many component makers for Apple and Tesla to chose from.

Any company trying to set up in another country without a Chinese base would be at a disadvantage to a company that has a China base.

So if you need to set up a plant elsewhere for geopolitical or tariff reasons, you create an assembly factory in another nation but keep your efficient supply chain in China. That is called the China Plus One strategy.

This China Plus One assembly move has been happening for many years now as Chinese salaries have gone way up.

Vietnam and ASEAN countries are the main beneficiaries since they are closest to the China supply chains. But now with the new US bans, even places like Mexico is becoming part of China Plus One.

Mexico has a similar China imports trajectory like Vietnam! Chinese exports to Mexico has doubled in past two years with US trade war!

It is very hard to remove the components supply chain from China unless a country has an internal market as big as China. Cheaper labor will not help, you need actual consumption to support those suppliers.

For Vietnam and Mexico, it is impossible for them to create this internal market. So the supplier in China will always have economy of scale advantages. Assembly of components from China for those places will remain as the best strategy for companies.

But India is big enough, theoretically, to provide an internal market for the component suppliers. But it needs to get wealthier faster! Right now, the comsumption rate for manufactured goods like cars, electronics and washing machines are many times higher in China.

Also because labor in China has gotten expensive (and scarce), components suppliers in China are more automated than anyone else in the world. Yes, Chinese parts are cheap not because of labor (Chinese salaries are five times India's on average) but robots on the production lines!

So India needs to get wealthier and get automated fast. Unfortunately, automation also creates less jobs for the masses

But first things first, India needs to compete with Vietnam and Mexico for the China Plus One assembly lines and then concentrate on building market and ecosystem for suppliers afterwards. Once the new supply chains are established, it will be harder for new countries to enter because companies have only so many billions to invest. The strategy is China Plus One. China Plus Two/Three/Four becomes prohibitively expensive.

 

[RoaringTigerHiddenDragon]

The key is getting the suppliers to move from China to India.
Simply moving assembly chains will not help India to gain economic superpower status.

It's much more easier to get Foxconn or Winstron but incredibly difficult and taxing to move the hundreds of suppliers that the apple supply chain has in China.

If it was so easy then China wouldn't have become the behemoth it is today. Only a few can achieve it and across many industries.

That’s the Chinese illusion. Wait and watch. At the end of the day, China only has 17% of Apple’s suppliers, in the 2nd spot, while India has 1.35%, in 8th spot. Also this trade deficit numbers are from Chinese customs, notorious for releasing fake numbers, unreliable tallies due to prevalence of massive corruption and diktats by CCP to ”show” volumes.

The reality is India imported less than $15 billion in high-value items from China: “The most-valued Chinese items that India imported were personal computers, which accounted for $5.34 billion in 2021-22, followed by ‘monolithic integrated circuits-digital’ ($4 billion), lithium-ion used in batteries ($1.1 billion), solar cells ($3 billion) and urea ($1.4 billion).”

The rest $90 billion+ were all low-value items imported only because of cheap costs over there possibly due to economies of scale.

This from anti India news channel The Wire.

Despite Frosty Relations, India's Trade With China Reaches Record Levels

The trade deficit crossed $100 billion for the first time. While Indian imports increased to an all-time high, exports to Beijing fell sharply compared to last year.

thewire.in

The main reason for the trade deficit is China’s restrictions on market access for Indian goods like pharmaceuticals. Here’s what Indian embassy officials have to say:

“
Officials say that while trade with China thrived on the availability of cheap Chinese goods to India, it has continuously resulted in the spiralling trade deficit India had with any other country.

"Our trade deficit concerns are two-pronged. One is the actual size of the deficit. Two is the fact that the imbalance has continuously been widening year after year," the Embassy brief said.

"The growth of trade deficit with China could be attributed to two factors: narrow basket of
of commodities, mostly primary, that we export to China and second, market access impediments for most of our agricultural products and the sectors where we are competitive in, such as pharmaceuticals, IT/ITES," it said.

Despite placating statements to address India's concerns, China has not taken any major steps to open up pharma and IT sectors to Indian exports despite widespread demand. “

Read more at:
https://economictimes.indiatimes.co...ofinterest&utm_medium=text&utm_campaign=cppst

Basically, China is majorly a cheap goods exporter to India. While these headline deficit numbers look large and are clickbait for news companies, the reality is no one cares as 90% of the imports are low-value manufactured goods, with ultra low margins. China is no Germany or Japan or the West which export most of the high value goods to India.
Plus: you are dealing with a sleaze ball, criminal government that won’t allow imports of Indian generics even during massive emergencies like Covid. There have been documentaries made in China where people in terminal stages of cancer are pleading for access to Indian cancer drugs. Yet the CCP let’s them die rather than provide market access. They also have not opened up to Indian IT/ITeS services. The criminal CCP posts a trade surplus at the cost of lives of their own citizens. This is something news articles hardly cover - how brutal the CCP is in showing off trade numbers and ranking lists, at deadly costs to its own citizens, animals, water sources, ecology and environment.
India through its PLI is already reducing the imports of high value manufacturing from China. So while the bots here will continue to boast about deficits, note that they are increasingly extremely low margin items which require the peasants to work in inhuman conditions.

So, stop bootlicking the CCP, and show some pride in your own country. Why don’t you move to Beijing and live there for a year and see what oppression and brutality is like? People in China live like zombies with no ethics or morals. Mercer index of living continues to rate Chinese cities including all the top ones as among the worst to live in the world, even today. Do not be taken in by the CCP’s charade of putting up a show. The biggest mistake the world did was letting china into the WTO without safeguards, thanks to American greed and sacrificing human rights of Chinese peasant. Remember cancer villages of China? That is what the genocidal CCP regime did to get to that trade surplus. Always remember that.

 

[RoaringTigerHiddenDragon]

The suppliers in China serve the home market first and then exports second. Western companies hook into this ecosystem. They do not have to build this out.

This makes their Chinese components supply chain very efficient and their final products more profitable. This is how Apple and more recently Tesla do it. Tesla has its gigafactory in Shanghai for just two years and already it is manfacturing the majority of its cars in China! And it is also has a huge new market in China itself.

For other countries, like India, companies need to build out a suppliers network from scratch. But those suppliers usually do not have a local market so the end product company needs to provide the vast majority of business/funds for them to even survive. The component makers for Apple and Tesla in China already support a large number of Chinese companies too and there are many component makers for Apple and Tesla to chose from.

Any company trying to set up in another country without a Chinese base would be at a disadvantage to a company that has a China base.

So if you need to set up a plant elsewhere for geopolitical or tariff reasons, you create an assembly factory in another nation but keep your efficient supply chain in China. That is called the China Plus One strategy.

This China Plus One assembly move has been happening for many years now as Chinese salaries have gone way up.

Vietnam and ASEAN countries are the main beneficiaries since they are closest to the China supply chains. But now with the new US bans, even places like Mexico is becoming part of China Plus One.

Mexico has a similar China imports trajectory like Vietnam! Chinese exports to Mexico has doubled in past two years with US trade war!
View attachment 189558

It is very hard to remove the components supply chain from China unless a country has an internal market as big as China. Cheaper labor will not help, you need actual consumption to support those suppliers.

For Vietnam and Mexico, it is impossible for them to create this internal market. So the supplier in China will always have economy of scale advantages. Assembly of components from China for those places will remain as the best strategy for companies.

But India is big enough, theoretically, to provide an internal market for the component suppliers. But it needs to get wealthier faster! Right now, the comsumption rate for manufactured goods like cars, electronics and washing machines are many times higher in China.

Also because labor in China has gotten expensive (and scarce), components suppliers in China are more automated than anyone else in the world. Yes, Chinese parts are cheap not because of labor (Chinese salaries are five times India's on average) but robots on the production lines!

So India needs to get wealthier and get automated fast. Unfortunately, automation also creates less jobs for the masses

But first things first, India needs to compete with Vietnam and Mexico for the China Plus One assembly lines and then concentrate on building market and ecosystem for suppliers.

“Wages have gone up.” Is that why 60% of Chinese earn less than $150 a month?
Nice propaganda bot. Won’t work.

 

[RoaringTigerHiddenDragon]

This is why Chinese semi conductor industry is toast.
”
The Biden Administration’s Four Semiconductor Policy Chokeholds
There are four interlocking elements of the new policy targeting different segments of the semiconductor value chain, and all elements must be understood simultaneously to grasp the scope of what the Biden administration plans on achieving. In short, the Biden administration is trying to (1) strangle the Chinese AI industry by choking off access to high-end AI chips; (2) block China from designing AI chips domestically by choking off China’s access to U.S.-made chip design software; (3) block China from manufacturing advanced chips by choking off access to U.S.-built semiconductor manufacturing equipment; and (4) block China from domestically producing semiconductor manufacturing equipment by choking off access to U.S.-built components.”

Choking off China’s Access to the Future of AI

In a transformation of U.S. export control policy, the Biden administration seeks to exploit U.S. dominance over “chokepoints” in the semiconductor supply chain to block China’s ambitions for Artificial Intelligence leadership and technological self-sufficiency.

www.csis.org

 

[RoaringTigerHiddenDragon]

Read this excellent article to understand why China can never be a supply chain power. Their contribution to high value supply chains is very, very low. They now have to spend hundreds of billions in R&D to get anywhere close to US technology, with no guarantees as to whether they will succeed. That is the big, risky R&D investments that the west did to get where it is.
Claiming dominance in low value, cheap manufacturing is all China can do. Once India gets to a significant share of this, the game is on.

The resilience myth: Fatal flaws in the push to secure chip supply chains

From China to the U.S. to Europe, semiconductor makers are being showered with subsidies, but to what effect?

asia.nikkei.com

 

[Varzone]

So, stop bootlicking the CCP, and show some pride in your own country. Why don’t you move to Beijing and live there for a year and see what oppression and brutality is like?

Why don't you relax a bit yourself and stop throwing around names.
I was talking from my pov, of course I don't know the 100% 360° scenario but from my own understanding.

The reality is somewhere in between but we have a long way to go. We've just started on production of electronic hardware and I'm not someone who starts screaming from the rooftops unless I achieve something first.

Its like preparing to be an certified professional and start acting like one before clearing any stage.

Also I'm talking from totally economic perspective, not human rights or legal. Obviously it gives China a advantage being a totalitarian regime.

 

[Varzone]

“Wages have gone up.” Is that why 60% of Chinese earn less than $150 a month?
Nice propaganda bot. Won’t work.

I don't know where you are quoting your figures from but from what I've heard wages have gone up. Now comparison to cost of living should be done in tandem to understand if the worker is better off now.