SwedCham China Insights for the Week of October 16 - October 20, 2023

Top news of the week:

China’s September consumer prices flat, factory deflation persists

October 16, 2023

China’s consumer prices were flat in September, while factory-gate prices shrank at a slower pace, indicating deflationary pressures persist in the economy. The consumer price index (CPI) was unchanged in September from a year earlier, data from the National Bureau of Statistics showed. The producer price index (PPI) fell 2.5% from a year earlier, the narrowest decline since March.

Putin arrives in Beijing to attend Belt and Road forum

October 17, 2023

Russian President Vladimir Putin arrived in Beijing on October 17 to attend the third Belt and Road Forum for International Cooperation, which is scheduled for October 17 and 18. This is Putin's second trip abroad since the International Criminal Court (ICC) in The Hague issued an arrest warrant for him in March.

World leaders laud China-proposed BRI at 3rd Belt and Road Forum

October 18, 2023

World leaders lauded the Belt and Road Initiative (BRI) at the opening ceremony of the third Belt and Road Forum for International Cooperation on October 18 in Beijing. President Xi Jinping delivered a keynote speech at the event and announced eight major steps China will take to support high-quality Belt and Road cooperation.

China’s Q3 economy grows faster than expected as recovery advances

October 19, 2023

China’s GDP expanded 5.2 percent year on year in the first three quarters of 2023 as the country’s growth steadily advances, official data showed. The growth in the first three quarters has laid a solid foundation for China to achieve its annual growth target of around 5 percent, said Sheng Laiyun, deputy head of the National Bureau of Statistics.

China put export curbs on graphite

October 20, 2023

China, the world’s top graphite producer, will require export permits for some graphite products from December 1 to protect the national economy, the commerce ministry said. Exporters need to apply for permits to ship two types of graphite, including high-purity, high-hardness and high intensity synthetic graphite material, and natural flake graphite and its products.

Insight of the week:

China kicked off a summit marking the 10^th anniversary of its Belt and Road Initiative (BRI) on October 17. Two dozen country leaders and more than a hundred delegations, largely from the Global South, came together for a packed schedule of forums and bilateral meetings revolving around China’s BRI – the global infrastructure drive that has cemented China’s place as a major international player since its launch a decade ago.

President Xi Jinping announced that China will take eight major steps to support the joint pursuit of high-quality Belt and Road cooperation with participating countries when delivering a keynote speech on October 18. The steps include: 1) building a multidimensional belt and road connectivity network, 2) supporting an open world economy, 3) carrying out practical cooperation to support high-quality Belt and Road construction, 4) promoting green development, 5) advancing scientific and technological innovation, 6) supporting people-to-people exchanges, 7) promoting integrity-based Belt and Road cooperation, and 8) strengthening institutional building for international Belt and Road cooperation. According to Xi, China will remove all restrictions on foreign investment access in the manufacturing sector and will launch the Global Artificial Intelligence Governance Initiative. To support Belt and Road projects, the China Development Bank and the Export-Import Bank of China, the country’s two policy lenders, will each set up a 350-billion-yuan (US$48.75 billion) financing window, and an additional 80 billion yuan will be injected into the Silk Road Fund, according to an official statement. At the forum that ended on October 18, US$97.2 billion worth of cooperation projects were signed.

Hailed by Xi as a “project of the century,” the BRI has emerged as a glaring symbol of China’s rise as a global power. But it has also been viewed with growing scepticism, especially in Western capitals where governments are wary of Beijing’s global ambitions. Beijing has been accused of straddling developing countries with crippling debt, while its sprawling projects have often faced concerns – and even protests – over their environmental costs, labour violations and corruption scandals. Xi is making the Belt and Road smaller and greener, moving away from big-ticket projects to high-tech ones. Besides, Xi and Putin had “in-depth” discussions on the Middle East conflict, state broadcaster CCTV reported without giving further details. It is worth mentioning that the Russian and Chinese leaders’ meeting in Beijing coincided with US President Joe Biden’s arrival in Israel, in a staunch show of support for the country.