This episode covers China’s top leadership new line-up; the resumption of all types of Chinese visas issuance; production and retail sales data in January and February; as well as producer and consumer prices and urban unemployment rate in February. From the Chamber side, join our events on the implications of the Two Sessions on 22nd March in Shanghai and 31st March in Beijing.
This episode covers China’s 2023 Lianghui (‘Two Sessions’), with comments from Jens Eskelund, vice president of the European Chamber; manufacturing and services activity in February; and imports and exports in January and February. From the Chamber side, the Tianjin Position Paper will launch and be available to download on 10th March.
MARIANN: the European Chamber’s weekly catchup about the Chinese business landscape.
RUI:China’s 2023 Lianghui, the annual sessions of the country’s national legislature and top political advisory body, opened on 4th March. During the Two Sessions, major policy priorities are outlined, legislation is ratified and key personnel changes within the government are confirmed.
MARIANN: China’s outgoing premier, Li Keqiang delivered the government’s annual work report on 5th March, reviewing the progress made on the government’s development plans from last year and setting out the key priorities for the coming year. The GDP target for 2023 was set at around 5 per cent, and his presentation emphasised economic recovery and stability for the year ahead. Premier Li reiterated China’s drive for self-reliance in some strategic areas, including science and technology, and pledged that the country would continue its transition to sustainable green development.
RUI: Commenting on the business community’s reception of the newly announced economic targets is Jens Eskelund, vice president of the European Chamber.
RUI: China’s manufacturing and services activity both continued to recover in February, with the pace of expansion exceeding expectations as business operations were getting back on track after a decrease in the number of COVID-infections across the country.
MARIANN: According to the National Bureau of Statistics, factory activity increased at the fastest pace recorded in almost eleven years, with 18 out of the 21 surveyed sectors registering expansion. While the largest expansion was seen among large enterprises, small and medium-sized companies registered the steepest rebounds last month, with their activity recovering to expansion territory after several months of decline. Services activity also continued to strengthen in February, with the rate of expansion the fastest recorded since March 2021.
RUI: China’s exports continued to drop in the first two months of 2023 amid weak global demand, and imports also fell sharply from the same period last year, according to data released by the Chinese customs authorities on 7th March.
MARIANN: In the January-February period, the value of exports shrank 6.8 per cent year-on-year in dollar terms, with the rate of decline easing from the previous two months. At the same time, the value of imports fell more than 10 per cent, which exceeded the rate of decline recorded in December. Data from the first two months of the year are usually combined to avoid any distortions caused by the Chinese New Year holiday, which always falls in this period. The official data also revealed that China’s trade with the European Union dropped 10 per cent in January-February, with exports from China to the EU shrinking more than twice as much as imports from the EU.
RUI: Tianjin is one of four cities in China with provincial status reporting directly to the central government. In the earlier years of 2000 it posted an annual GDP well above the national average. However, by 2021, the city fell out of the list of the top ten cities in terms of their contribution to GDP, a sign that it is falling short of its potential.
MARIANN: The European Chamber is launching the second edition of its Tianjin Position Paper on 10th March, which puts forward 20 constructive recommendations outlining how Tianjin can get its economic development back on track and further boost business confidence.
RUI: Join our event in Tianjin and download the Tianjin Position Paper from the Chamber’s website to find out more about how European companies operating in Tianjin see the situation on the ground, and what tangible steps they recommend the local government takes for the city to realise its potential.
MARIANN: Thanks for listening. Tune in again next week.
RUI: In the meantime, find useful links in the episode notes.
This episode covers the recently issued guidelines for establishing national standards in 2023, with comments from Chen Bolei, national chair of the Chamber’s Standards and Conformity Assessment Working Group; high-level visits from the European Union (EU) and several EU Member States to China in 2023; easing of inbound travel requirements; and consumption and urban employment drops in 2022. Join the event on 9th March on legislative developments in China’s export control regime and companies’ compliance management.
MARIANN: The document outlined that China should actively move towards adopting international standards and improve the compatibility of national and international standards. It advised that when submitting standardisation proposals at the national level, submissions should be done at the international level too, in order to advance the use of Chinese technology worldwide. The guidelines also included requirements aimed at accelerating the transformation of scientific and technological innovation achievements into standards. The document highlights the role of standards in China’s attempts to achieve scientific and technological self-reliance and urged for the advancement of standardisation for the creation, use, protection and management of intellectual property.
RUI: When asked about the guidelines, Chen Bolei, national chair of the Chamber’s Standards and Conformity Assessment Working Group expressed hope that they will help improve the consistency between Chinese and international standards, as they require a systematic analysis of international standards as a pre-condition for standardisation projects. He highlighted that the Chamber’s Standards and Conformity Working Group has been advocating for further harmonisation between international and domestic standards for several years.
RUI: In a recent, exclusive interview with Global Times, Fu Cong, head of the Chinese mission to the EU said that the EU and China are expected to resume frequent high-level mutual visits in the near future.
MARIANN: The ambassador said that preparations are already underway for European Commission President Ursula von der Leyen and European Council President Charles Michel’s visit to China to take place in the first half of 2023. A number of high-level visits from EU members states are also expected to take place in the year ahead. French President Emmanuel Macron said he would visit China in early April, while Italian Prime Minister Giorgia Meloni accepted an invitation for a visit from Chinese President Xi Jinping when they met at the G20 summit last November.
RUI: Resuming face-to-face exchanges at all levels is an important step towards rebuilding trust that was eroded during China’s almost three-year-long isolation. While China is yet to restart issuing tourist visas and further optimising inbound business travel for foreign nationals, recent announcements by some of China’s diplomatic missions overseas provide some scope for optimism.
MARIANN: According to notices released by the Chinese Embassies in a handful of countries, including Hungary and New Zealand, starting from 1st March, passengers travelling to China will no longer be required to present a PCR test result, but instead can use antigen tests to report their health status to China’s customs authorities. The notice also highlighted that airlines will no longer check passengers’ test results for boarding. However, inbound travellers will still be tested upon arrival in China and, if infected, will be subjected to home quarantine or medical treatment depending on their condition.
RUI: On 28th February, the National Bureau of Statistics released a report about national and economic development in 2022. The data showed unusual drops in consumption and urban employment.
MARIANN: As strict COVID-control measures brought grave challenges to business operations for the most part of 2022, China’s cities shed more than 8 million jobs from the previous year. At the same time, the annual growth of per capita disposable income slowed significantly from 2021. As unpredictable pandemic controls created uncertainty about financial security in China’s households, per capita spending also shrank in 2022, with retail sales of consumer goods and catering revenue both declining compared to the previous year, according to the official dataset.
RUI: On 30th December 2022, the Ministry of Commerce, the Ministry of Science and Technology, and several other relevant authorities jointly announced a series of amendments to the Catalogue of China’s Prohibited and Restricted Technology Export.
MARIANN: These amendments proposed that certain raw materials or technologies—namely rare earths, integrated circuits, photovoltaic silicon wafers, electronic devices and laser radar—be included in the scope of export prohibition or restriction.
MARIANN: Join us on 9th March to find out what new regulations can be expected as a result, and what adjustments companies will need to make to ensure compliance.
RUI: Thanks for listening. Tune in again next week.
MARIANN: In the meantime, find useful links in the episode notes.
This episode covers a survey on the performance of small and medium-sized enterprises (SMEs) in January, with comments from Liam Jia, team lead at the EU SME Centre; the phasing out of restrictions on travellers from China to European Union Member States; and foreign direct investment in January. Join the event on 28th February on the protection of women’s rights in the workplace.
This episode covers social insurance compliance issues faced by some European companies, with comments from Jeanette Yu, chair of the Chamber’s Human Resources Working Group; the China Pathfinder 2022 report; producer and consumer prices in January; and the Guangzhou government’s economic support measures. Join the event on China’s Transition through COVID and its Economic Recovery on 20th January in Beijing or online.
This episode covers the easing of travel to the mainland from Hong Kong and Macao; the share of China’s private sector in the country’s top 100 largest listed firms; projected growth of China’s renewable power installations; and China’s five-year growth projection. From the Chamber side, the fifth edition of the Shanghai Position Paper will launch on 14th February.
This episode covers data on foreign direct investment in China in 2022, the State Council’s emphasis on expanding consumption in 2023, China’s manufacturing and services activity in January, and the International Monetary Fund’s global economic growth forecasts. On the Chamber side, the Business Confidence Survey 2023 opened on 30th January for members to give their input on China’s business sentiment.
This episode covers China’s gross domestic product (GDP) growth rate, producer and consumer prices, import and export data in December and the year 2022; and Guangdong Province’s 2023 GDP target, with comments from Klaus Zenkel, chair of the Chamber’s South China Chapter. From the Chamber side, the January/February 2022 issue of EURObiz on stability is available to download.
This episode covers the resumption of international travel with comments from Tammy Qiu, vice chair of the European Chamber’s Aviation and Aerospace Working Group; border reopening between the Mainland and Hong Kong; and Caixin’s data on business activity in December. From the Chamber side, on 9th January, a delegation kicked off its first in-person European Tour in Brussels after three years of the pandemic.
This episode covers China’s easing of its pandemic control measures; manufacturing and services activity data in December; and Rhodium Group’s prediction of China’s 2022 gross domestic product growth rate and 2023’s growth prospects. Join the Chamber’s national webinar on 9th January on US export controls and their impact on businesses.