1.China cuts electricity prices to support struggling manufacturers
Two of China’s largest power distributors will cut electricity rates for most of their business customers by an average of 5%, in Beijing’s latest move to assist manufacturers struggling under restrictions and other limitations aimed at controlling the Covid-19 outbreak, reported Caixin.
The new cuts are effective from Feb. 1 and will run through June 30, according to a notice issue late Saturday by the National Development and Reform Commission (NDRC), China’s state planner. While the policy will apply to most commercial enterprises, regardless of size, it excludes the most power-intensive users. The NDRC’s latest assistance plan applies to State Grid Corp. of China, the nation’s largest electricity distributor, and China Southern Power Grid, a major provider in the nation’s affluent south. State Grid estimated the 5% reduction would save its customers a total of RMB 36.4 billion ($5.2 billion), while Southern Power said its customers would save RMB 7.4 billion.
2.China bans trade, consumption of wild animals due to coronavirus
China’s top legislature said it will immediately ban the trade and consumption of wild animals, in a fast-track decision it says will allow the country to win the battle against the coronavirus outbreak, reported Reuters.
The announcement, made late on Monday comes after an initial suspension of the trade and consumption of wildlife in January.
“There has been a growing concern among people over the consumption of wild animals and the hidden dangers it brings to public health security since the novel coronavirus disease (COVID-19) outbreak,” said Zhang Tiewei, a spokesman for the top legislature’s Legislative Affairs Commission.
The decision, made by the National People’s Congress, stipulates the illegal consumption and trade of wildlife will be “severely punished” as will be hunting, trading or transporting wild animals for the purpose of consumption.
3. PBOC steps up lending support for companies fighting virus
China’s central bank expanded companies’ access to cheap loans Monday from six major state-owned lenders through a special relending program in a move to bolster businesses struck by the deadly coronavirus, reported Caixin.
The People’s Bank of China told the country’s biggest banks to provide low-interest loans to selected companies shortlisted by 10 provincial and municipal governments, using a RMB 300 billion ($42.6 billion) special relending fund set up Feb. 7 to support companies involved in fighting the Covid-19 epidemic.
The order means more companies are now eligible to get low-interest loans from the country’s biggest banks — the Industrial and Commercial Bank of China, Agricultural Bank of China, Bank of China, China Construction Bank, Bank of Communications and the Postal Savings Bank — under the special relending project, according to a notice from the People’s Bank of China.
Previously, only companies on a national list picked by the National Development and Reform Commission and the Ministry of Industry and Information Technology could access the cheap funding from the state lenders.
4.Chinese carmakers accelerate drive into India
Chinese carmakers are accelerating their entry into India to counter falling demand at home with a new market where mass car ownership is in its infancy, reported the Financial Times.
Manufacturers such as Great Wall Motor and FAW Haima this month launched their first vehicles for the Indian market. SAIC Motor has been selling MG cars there since 2019. BYD, which makes electric buses in the country, has announced plans to launch electric vans too.
“They have been planning their India entry strategy” for years, said Puneet Gupta, an analyst at IHS Markit. “Finally we’re now seeing a lot of action.”
The push comes as China’s car market shrinks — vehicle sales fell 8% in 2019. While India fared worse with a 13% drop in sales, analysts expect a recovery and that its growth rate will overtake China.
5.China’s CMC Capital raises over $950 million in its biggest private equity fund
Chinese private equity fund CMC Capital Group said it raised over $950 million in its biggest private equity fund to date, bolstering its ability to cut deals in the world’s second-largest economy, reported Reuters.
CMC Capital Partners III, the firm’s third dollar-denominated fund, surpassed its original target size after securing commitments from global investors, the firm said in a statement on Tuesday. It initially targeted about $800 million, said a media representative of the fund.
Its investors, known as limited partners (LPs), included pension funds, sovereign wealth funds, insurers, endowments and family offices across North America, Europe, the Middle East, and Asia Pacific, it added, without naming any of them.
Like the previous dollar funds, the latest fund will continue to invest in innovative growth companies with a China angle across sectors, including media and entertainment, technology and consumer, it added.
