Model of Evergrande real estate development in Shenyang [Sina]
Economy
Founded in 1996 with few employees and benefitting from the 2000s real estate boom, developer Evergrande earned US $78.4 billion last year
The company specializes in middle-class real estate with low production costs; founder Xu Jiayin was the richest Chinese person in 2017 (US $45 billion) and joined the country’s top advisory body (CCPPC)
With over US $300 billion in debt, construction giant Evergrande risks bankruptcy, facing protests from creditors for months
Due to the new state policy to limit high indebtedness of construction companies since last year, about half of the company’s 800+ projects are on-hold; Chinese government is expected to intervene
Backed by government funding, China leads the US in many high-tech sectors – particularly hardware – but lags behind in software
Chinese companies dominate sales of smartphones (58% 2021, US 15%), solar panels (67% 2020, US 1%), commercial drones (80% of US market 2020 Q1, US 4%), and telecoms equipment (36% of 2021 revenue, US 9%) but still lag in semiconductors (4% of 2020 sales, US 47%)
Geopolitics
Australia, US, and UK announce new military alliance (AUKUS) and agreement to supply nuclear submarines to Oceanian country
Although not explicitly mentioned, China is the target of the “security pact” that signals a regional “arms race”, causing Indonesian president Joko Widodo to cancel scheduled visit to Canberra; Australia cancels submarine contract with France in “backstabbing” move
Iran becomes a full member of the Shanghai Cooperation Organization (SCO) at the 20th anniversary summit in Dushanbe, Tajikistan
After 16 years of observer status, Iran joins China, Russia, Pakistan, India and other Central Asian members; stabilizing Afghanistan – an observer state – is SCO’s priority as the joint declaration calls for “a more representative, democratic, just, and multipolar world”
Beijing orders Chinese mining companies that broke laws in DR Congo to leave, as Kinshasa reviews infrastructure-for-minerals deals
Wu Peng, senior diplomat for the region, said companies will be punished by the Chinese government, while IMF gives DRC pressure to “clean up” foreign deals to get access its US $1.5 billion credit line
Agriculture and Environment
At the UN General Assembly, President Xi pledges China will stop building coal plants abroad and support developing countries in low-carbon energy projects
China is the world’s largest coal producer and public financier but funds only 13% of total coal power capacity (2013-19) overseas; 44 international coal plants (US $50 billion) could be impacted
China’s leading coal producers join green energy trading pilot to boost renewables and achieve carbon emission goals
The program allows CO2 emitters to directly buy green energy, thereby offsetting emissions and financing high-cost renewables sector; this should see 20-30 billion kWh of green energy traded next year
People’s Life and Culture
Chinese version of TikTok limits app use for children under 14 years-old to 40 minutes/day
Douyin announcement comes amid government measures to discourage minors from spending too much time online and recommends providers “implement time management tools, feature restrictions, and purchase restrictions for underage users”
China commemorates 90th anniversary of the September 18 Incident, that began the 14-year-long war against Japanese aggression (1931-45)
During the 1931 “Mukden Incident”, the train station explosion in northeastern Shenyang was used as pretext for full-scale Japanese invasion; activities were organized and sirens wailed in cities nation-wide to remember the 35 million Chinese casualties of that war
September 18 Incident [Li Min/China Daily]
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