MarketLine Blog

Posts tagged to China

US and China trade talks: Emphasis on steel and tariffs is misguided

MarketLine

The danger of current US policy towards Chinese steel is that damaging tariffs will be imposed. Many observers describe such a policy as the nuclear option because the ability of other countries to impose harmful tariffs on US goods will be just as strong. Troublingly, tariffs would do little to solve the actual problem of dumping on the international market. A policy with many similarities was attempted in 2002 but resulted in a public climb down by the then President Bush after severe job losses were incurred. Tariffs are not… Read more

Behind the Digital Iron Curtain: Rise of Chinese Silicon Valley

MarketLine

After a long period of rapid, double digit growth, the Chinese economy entered a more sustainable phase of development, based on innovation and consumption. Given the large population of 1.3 billion in China, the explosive growth of smartphone users, e-commerce, and online content consumption and creation led to a digital revolution in almost all industries and business sectors. While the Chinese Communist Party is trying to match its social control in the real world with the virtual world, which becomes more and more restrictive, the country’s internet is thriving and… Read more

China’s OBOR project: Threatening the Singaporean transportation sector

MarketLine

Singapore’s location at the southern tip of the Strait of Malacca has allowed the country to position itself as one of the world’s major transportation hubs. Through this Strait travels practically all trade between the Indian and Pacific Oceans, and therefore trade going in and out of countries such as Japan and China will more likely than not pass through Singapore, especially if headed towards Europe, the Middle East and Africa. To emphasize its importance, almost half of all Chinese oil imports pass through Singapore, and the figure is even… Read more

Toshiba NAND business sale: Suitable sale is becoming increasingly difficult to achieve

MarketLine

A major problem Toshiba has with the sale of the NAND business is the company as a whole is in such a bad financial condition, potential buyers are in a very strong negotiating position. Toshiba has already sold off other profitable parts of the business in order to cover costs resulting from an accounting scandal in which profits were overstated. Now the second largest NAND business in the world is up for sale, prospective buyers are aware that the Japanese technology giant desperately needs a deal, and soon. Downward pressure… Read more

South Korea and China: WTO complaint must be resolved swiftly and amicably

MarketLine

In July 2016, American and South Korean military officials agreed to deploy the Terminal High Altitude Area Defense (THAAD) missile defense system in South Korea. China was unimpressed, seeing the move as an act of aggression and intimidation by the US close to its borders, as well as citing concerns that it could interfere with the efficacy of its own military capabilities. On March 20, 2017, South Korea complained to the WTO that China’s unease with the THAAD situation has caused it to retaliate economically, although it was keen to… Read more

Chinese Foreign Direct Investment Liberalization

MarketLine

Reducing the number of markets foreign investors are prevented from entering – down to 62 from 93 – marks a useful step in the right direction and should encourage investment into China, reducing the gap to the outflow. Investors should become more comfortable with China given the proposed new rules, but there is much to be done and reasons for pessimism. The proposals appear to be hobbled by caution and need to go much further to create a lasting impact. More worryingly, the problems that the changes aim to tackle… Read more

COMAC C919 Airliner lands

MarketLine

When the COMAC C919 launched, comparisons were immediately made with the failed Bombardier effort to break the Boeing/Airbus duopoly. Bombardier failed for several reasons, chiefly because it was unable to gain the required customer base needed to gain traction in the airline industry. This does not apply to COMAC: the company has a ready-made market of state controlled airlines, colossal state backing and provides fantastic opportunities for foreign companies. These factors will aid the company to make serious inroads into the Chinese domestic airline market, providing the impetus for future… Read more

Belinda Wong appointed CEO of Starbucks China as part of growth plan

MarketLine

A focus on China and on increasing store openings in the country has been part of the Starbucks strategy since the company felt the negative impact of recession. Prior to 2008, Starbucks had been growing rapidly in terms of store openings, revenues, and operating profit. However, this all changed as the recession hit and the company struggled to cope. As many countries around the globe fell into recession, the impact on Starbucks was strongly felt. This led to a shift in resources to growth in international markets. It was felt… Read more

China’s banking industry: BIS scaremongering unwarranted but warning signs must be heeded

MarketLine

China’s economic growth has been slowing for a while now and while it remains healthy, there are concerns over the state of the country’s banking industry. Non-performing loan (NPL) rates have been increasing, with some of the country’s biggest banks seeing a surge in that particular metric. Bank of China and ICBC saw noticeable increases in their NPL rates during 2015, necessitating greater allowances for credit losses, while Agricultural Bank saw something of a surge from 1.54% to 2.39%, with the retail and wholesale industry the main cause for concern…. Read more

Uber & Didi Chuxing: Uber gives app in China

MarketLine

Uber’s once seemingly irresistible march to world domination has suffered a setback as it agreed to merge its business operations in China with local competitor Didi Chuxing. Uber had been employing the practices that served it well elsewhere, by engaging in subsidizing of rides and drivers’ income to gain market share. However, in China a domestic ride sharing incumbent made from the merger of Didi and Kuadi in February 2015 (later renamed Didi Chuxing) could match Uber’s financial power, as it drew backing from Chinese internet companies and Apple. The… Read more

Self-driving to the future

MarketLine

The line between the auto and tech industries is rapidly blurring, with the pursuit of autonomous driving and a shift from car ownership towards car sharing and ride sharing. China is widely viewed as the next frontier for growth and many market players are looking to establish a foothold in this country, which requires significant investment. To keep up with changing market trends, most major auto makers are investing in their own driverless-car technology, which is less costly if done in cooperation with high-tech companies, like Google or Apple. The… Read more

Jaguar Land Rover: Five years of successive growth under Tata’s leadership

MarketLine

Jaguar Land Rover has now reached five consecutive years of growth in 2015, which has been achieved under Tata Motors ownership and investment. This success has emboldened the company to invest in itself and Jaguar land Rover now produces its own engines, has plants in Brazil and China and has brought the Jaguar range right up to date, making the company one of the most important and successful prestige car companies and one of the most recognizable British manufacturers. The company has managed to do this on the back of… Read more

Rise in non-performing loans potential time bomb for China’s swollen banks

MarketLine

As measured by total assets, four of the ten largest banks in the world are now headquartered in China. As the Chinese economy has swelled, so too have the balance sheets of its largest banks. This has spurred great growth in operating incomes and net profit as demand for credit has soared. However, there are signs that the curse of non-performing loans (NPLs) that wreaked such havoc with the West’s banking system could potentially strike China, a ticking time bomb if left unaddressed, with several economic sectors posing a significant… Read more

Population growth, industrialization, and increased food consumption have affected China’s food security

MarketLine

Food security has been a significant driver behind a number of acquisitions in recent years. As industrialization and population growth have occurred, arable land and water sources have been affected, and this presents problems for the future of the country’s food security. What’s more, the Chinese population is consuming more food per capita than it has in the past, further squeezing the country’s resources. China’s arable land has decreased According to the World Bank, China feeds nearly 20% of the world’s population with less than 10% of the world’s arable… Read more

Agriculture takes center stage again in PRCs 2015 policy portfolio

MarketLine

China once again placed agricultural reform at the top of its policy agenda in its latest No.1 Central Document, released in February. The No.1 Document is released annually and outlines key policy priorities for the year ahead. For the twelfth year running, agricultural reform has taken center stage. The reason for this is simple: as one official puts it, “China has to feed about one fifth of world’s population from less than 10 percent of the arable land.” There are two key issues facing Chinese agriculture. The first is productivity…. Read more

The New Cars Market in 2015

MarketLine

In the international spectrum China will remain the main driver for a global growth in the sales of new passenger cars. The forecast for automotive industry is still optimistic despite the slowdown in the major European markets, such as France and Italy. The second place on the podium is occupied by, dethroned a few years ago, the USA. Americans bought 7.7m of new passenger cars in 2014. In order to maintain a sustainable growth, manufacturers will have to look for new customers in rural areas of developing countries like China… Read more

Consumer Electronics – Industry Analysis

MarketLine

Introduction The global consumer electronics market contracted from 2011 to 2013 and has performed poorly in recent years in most regions throughout the world with the exception of some. In general, consumer electronics are deemed as a non-essential item and is sacrificed at the cost of more essential items in times of austerity. However, the market has had some form of redemption from a strong performance from countries within emerging markets such as China and India leading the way. With the economy turning the corner, the consumer electronics market will… Read more

Market unimpressed by Peugeot Citroen recovery plan

MarketLine

The French auto group Peugeot Citroen gave little comfort to investors despite presenting a global recovery strategy aimed at building a money-making culture within the business. Having made net losses of €7.2 billion ($10.0 billion) in the last two years, the group released a strategic plan titled “Back in the Race”, and emphasized ambitions to grow in China and South-East Asia. Traders were less than impressed with the changes however which they saw as too little too late and this was reflected in PSA Peugeot Citroen share price which ended… Read more

Chinese Banks Are Growing Their Footprints Overseas

  The Chinese banking sector has grown strongly in recent years, with the likes of Bank of China and Agricultural Bank of China both expanding their operations to become leading players in the Asia-Pacific market. Having now established themselves domestically, these banks are now looking to branch out and open representative offices overseas. In fact, if Chinese banks go on to become major forces internationally, 2012 may come to be seen as something of a watershed year for the country’s financial services industry as it has so far seen a… Read more