This episode contains segments on:
- China’s new guideline on green transition;
- Foreign trade data in July;
- Consumer and producer prices in July; and
- Rhodium Group & Atlantic Council’s China Pathfinder Q2 2024 update.
Also, listeners are invited to join the event to hear the impact of EU elections on EU-China relations and European business in China, on 22nd August online or in Shanghai.
Contact:
We’d love to hear your feedback. Contact us at website@europeanchamber.com.cn.
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Read more:
China’s new guideline on green transition
https://english.www.gov.cn/policies/latestreleases/202408/11/content_WS66b8a6f7c6d0868f4e8e9d80.html
China foreign trade data, July (GACC)
http://www.customs.gov.cn/customs/302249/zfxxgk/2799825/302274/302275/6031214/index.html
China price indexes, July (NBS)
https://www.stats.gov.cn/sj/sjjd/202408/t20240809_1955950.html
Rhodium Group & Atlantic Council: China Pathfinder: Q2 2024 Update
European Chamber event: 2024 EU Elections: Navigating the Impact of the EU Elections on EU-China Relations and Business in China
Transcript:
RUI: Hello and welcome to China ShortCuts,
MARIANN: the European Chamber’s weekly catchup on China’s business landscape.
RUI: This episode was recorded on 14th August 2024.
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RUI: On 11th August, the Central Committee of the Chinese Communist Party and the State Council jointly released a guideline with key targets for the country’s green transition.
MARIANN: The 33-point document repeated some of the country’s existing targets for its green energy transition. For instance, it stated that the proportion of non-fossil energy in total energy consumption will reach approximately 25 per cent by 2030. Among the newly added goals, the guideline noted that by the same year, the scale of the energy conservation and environmental protection industry will reach about 15 trillion yuan.
RUI: Commenting on the new guideline, the National Development and Reform Commission pointed to a key challenge that China is facing in its green transition: even though the installed capacity of renewable energy now accounts for more than half of the country’s total installed capacity, China still primarily relies on coal to produce electricity.
MARIANN: This is a significant problem for European companies operating in China, the majority of whom are pursuing carbon neutrality. The Chamber’s Business Confidence Survey found that Chinese reliance on coal is holding European companies back from both meeting their corporate pledges and contributing fully to China’s decarbonisation goals. More than 80 per cent of survey respondents reported that they are decarbonising their energy use as the primary means of achieving carbon neutrality, making access to green energy an imperative. At the same time, two fifths ranked limited access to renewable energy as the key challenge they face in their decarbonisation efforts.
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RUI: China’s customs authority released data on the country’s foreign trade in July. It showed that export growth slowed compared to the previous two months. The value of imports, however, grew at the fastest pace since April.
MARIANN: In dollar terms, China’s total value of exports rose 7 per cent year-on-year. Meanwhile, the total value of imports shot up sharply – from a 2.3 per cent decline in June to a 7.2 per cent increase in July. As a result, China’s trade surplus dropped by almost 15 billion dollars compared to June. Nevertheless, it remained relatively high at 84 billion dollars.
(MUSIC)
RUI: China’s price indexes in July alleviated some concerns over deflation trends, as consumer price inflation picked up speed and the drop in producer prices was relatively modest.
MARIANN: Data released by the statistics bureau on 9th August showed that consumer prices rose 0.5 per cent year-on-year. This was the most significant increase recorded in five months. The statistics bureau attributed this partly to the impact of extreme weather events, such as heatwaves and heavy rainfalls in several regions. At the same time, due to insufficient market demand, producer prices continued to fall in July, but with the pace of decline unchanged from June, when it slowed to 0.8 per cent, the most modest rate recorded since January 2023.
(MUSIC)
RUI: On 7th August, the Rhodium Group and the Atlantic Council released the latest update of their joint initiative, China Pathfinder. The report finds that in the second quarter of 2024, China’s economic system showed signs that it is moving further away from market economy norms.
MARIANN: The report highlights that macroeconomic data from the second quarter painted an overall picture of slowing growth. For the time being, retail sales and exports were the exceptions to this, but the report warns this could change, as consumer confidence remains low and other economies are stepping up trade protection amid concerns over China’s industrial overcapacity – an accusation the Chinese authorities reject. The report also warns of a growing divergence between official data and its communication on the one hand, and market reactions on the other.
(MUSIC)
RUI: At the beginning of June, the European Parliament held its once-every-five-year elections. European Commission President Ursula von der Leyen secured her mandate for a second term, and the appointment of the new commission is currently ongoing. The EU’s new leadership will have a significant influence on shaping and enacting new EU policies and legislation.
MARIANN: Over recent years, EU-China relations have deteriorated, driven by geopolitical tensions, trade policies and technological competition. This has resulted in the EU adopting a more assertive stance towards China, characterised by increased scrutiny on trade and technology exchanges.
RUI: Join us on 22nd August online or in person in Shanghai to find out how the 2024 EU election results might influence current EU-China dynamics and what the impact may be on European companies in China in terms of trade barriers, market access and investment conditions.
(MUSIC)
MARIANN: Thanks for listening, and don’t forget to tune in again next week.
RUI: In the meantime, please find useful links in the episode notes.