China Digest

Economics and policy from China’s newspapers

Thursday April 13, 2017

Regulator turns up the heat on banks

The China Banking Regulatory Commission called for improved monitoring and issued guidelines on 26 policy items, the third set of guidance released in the past week and the sixth over the past month, Economic Information Daily reported.

Fourfold jump in local, global IPOs

In the first three months of the year, 147 companies made their debut on stock exchanges at home and abroad, a fourfold increase from a year earlier. The size of the IPOs was about half the average for 2016 at 530 million yuan (US$77 million), Securities Daily reported.

Tighter rules see placements slump

New rules introduced mid-February drove a 77% drop in private placements, with 42 companies raising a total of 61.3 billion yuan (US$ 8.9 billion) this year as of April 10. Companies are expected to bridge the funding gap by selling convertible bonds, Economic Information Daily reported.

China Eco Watch Chart 0413-1

Housebuilders turn to overseas funding

Residential property developers raised 30.2 billion yuan selling overseas debt securities in March after regulators squeezed sources of funding to drive speculators from the overheated residential property market, Securities Daily reported. Only three homebuilders opted to raise money through domestic IPOs in the first three months of the year, raising 6.7 billion yuan, compared with the 42.9 billion yuan raised by 10 companies a year earlier.

Xiongan New Area stocks suspended

More than 10 so-called Xiongan New Area concept stocks — companies that investors bet stand to benefit from the central government’s new development project — have been suspended and are under investigation after rising by their 10% daily limit for six consecutive trading days, Shanghai Securities Journal said.

Companies’ lack of pricing power poses problem

The inability of companies to pass on the rising cost of raw materials, as seen in the discrepancy between headline consumer inflation and the PPI data released yesterday, is an issue that deserves attention, said China Center for International Economic Exchanges economist Xu Hongcai, who also urged speedy reform of energy prices.

Coals trucks may soon become history

Tianjin port will not accept coal deliveries by lorry from the end of April, Caixin said. A directive from the environment ministry will bar diesel trucks from transporting coal into all ports in the city, Hebei province and the Bohai Sea area by the end of September in a bid to improve air quality.

ChemChina-Syngenta deal: green light or not?

The Ministry of Commerce is reviewing the proposed acquisition of Syngenta by ChemChina after receiving a competition complaint, Caixin reported, in an apparent contradiction of a statement on the Chinese company’s website that the deal had been approved.

China to become a service-industry stronghold, CASS says

Services should make up 72% of the economy by 2030, from 51.6% now, the Chinese Academy of Social Sciences said, with between three and five global players in the sector by 2050.

Shanghai seeks to take heat out of land auctions

Shanghai will test a new land-sale system to prevent irrational bidding at open auctions. If more than three potential buyers pass the government’s pre-screening process, the lot will be put out to tender.

Beijing opens second batch of housing to migrants

Beijing city government will provide 1,000 additional public housing units for migrant workers who don’t hold a hukou — or local residency permit — after receiving 10 applications for each of the 400 apartments in the first batch last week, CCTV reported.