SwedCham China Insights for May 22-May 26

Top news of the week:

Hong Kong exchange to launch HKD-RMB dual counter model in June

May 22, 2023

Hong Kong Exchanges and Clearing Limited (HKEX) announced that it will launch the Hong Kong Dollar (HKD)-Renminbi (RMB) Dual Counter Model and the Dual Counter Market Making Program in its securities market on June 19. This new model and program will further support the trading and settlement of RMB-denominated securities in Hong Kong, the HKEX said in an online statement.

China’ non-financial ODI up 26.6% in Jan-Apr

May 23, 2023

China’s non-financial outbound direct investment (ODI) rose 26.6 percent year-on-year to 289.29 billion yuan in the first four months of the year, official data showed. In US dollar terms, the ODI stood at $42.19 billion in the period, up 17.6 percent from a year earlier, according to the Ministry of Commerce.

Xi calls for advancement of all-round cooperation with Russia

May 24, 2023

President Xi Jinping met with Russian Prime Minister Mikhail Mishustin on May 24 in Beijing, with the two sides vowing to level up all-round pragmatic cooperation. Xi said the two sides should continue to tap potential, further upgrade the level of economic, trade and investment cooperation, improve the institutional mechanism of bilateral cooperation, and consolidate and expand cooperation in energy and connectivity.

Vice Premier: China ready to work with intl community to promote global trade, investment

May 25, 2023

Chinese Vice Premier He Lifeng said that China is ready to work with the international community to strengthen communication and exchanges, promote trade and stimulate growth drivers for investment cooperation. He made the remarks while addressing the opening ceremony of the Global Trade and Investment Promotion Summit of 2023.

2023 Zhongguancun Forum opens in Beijing

May 26, 2023

The 2023 Zhongguancun Forum, featuring frontier science and innovation achievement, including artificial intelligence, quantum science, brain computer interface, kicked off in Beijing on May 25. President Xi Jinping urged further boosting science and technology and building Zhongguancun into a world-leading science and technology hub in a congratulatory letter to this forum.

Insight of the week:

China’s Commerce Minister Wang Wentao met with US Commerce Secretary Gina Raimondo in Washington on May 25 while Wang was attending the 2023 APEC Ministers Responsible for Trade Meeting, according to the ministry. Their meeting in Washington was the first US-China cabinet-level exchange for months, after a string of trade and national security irritants derailed plans for re-engagement between the world’s two largest economics. The two sides had frank, professional and constructive exchanges of views on China-US economic and trade relations and issues of mutual concern, the ministry said. The Chinese side expressed key concerns over US economic and trade policies towards China, semiconductor policy, export controls and foreign investment review. Both sides agreed to establish and maintain open communication channels, with Raimondo’s office saying that would help “responsibly manage the relationship”.

The rising tensions between China and US have brought serious challenges to the semiconductor industry. The US government released a ban in shipments to China of certain semiconductor chips made anywhere in the world with US equipment in 2022 and expanded it chip controls to Macau in January 2023. Subsequently, Japan and the Netherlands joined the US in imposing chip controls in China. Recently, Japan unveiled details of its updated list of regulated exports, including 23 types of chip-making equipment. China firmly opposes Japan’s export control, claiming that it is an abuse of export control measures and has gravely deviated from free trade and international trade rules. The observer considered that this meeting might be a good sign for China-US relations and might help ease the tensions between the two parties.