This week’s news and trends in China:
Borders Might Open if Vaccination Target Reached by Early 2022: China may open its borders after it vaccinates over 85% of its population by early 2022. China is allowing spectators into next February’s Winter Olympics, but not those from outside of Mainland China.
Michael Pettis on What Evergrande Means for China: The implosion of giant real estate group Evergrande continues. And nobody knows exactly how the losses will be distributed. In addition to the financial fallout, there’s also a macro angle. Real estate is extremely important to the Chinese economy for all kinds of reasons. The property sector comprises of 25-30% of China’s GDP, roughly twice of most other countries. Home ownership represents more than 80% of household wealth, more than twice of most other countries. Peking University Finance Professor and Senior Carnegie Fellow Michael Pettis speaks to Bloomberg about it. Here is the full transcript.
Foreign Companies’ Tailored Products Key to Chinese Consumers’ Hearts: L’Oreal is putting new effort behind technologies that can allow consumption to be more personal, whether in terms of retail or products. The company plans to launch five new brands and a personalized lipstick at CIIE.
44% of China’s Urban Young Women Don’t Plan to Marry, Survey Says: 44% of unmarried urban women aged 18-26 say they do not plan to marry, compared to nearly 25% of men. Marriage skeptics cited worries about both personal and financial costs. Asked for their reasons, 60.8% said “it is difficult to find the right person,” and 34.5% said they “feel that they do not have the time and energy to get married.” 46% said that “the financial cost of marriage is too high” and 56.2% claimed “the cost of having children is too high.”
Why Wall Street Backs China Despite Beijing’s Tighter Grip: “Is China investable?” asked J.P. Morgan, before answering, “We think so.” Goldman Sachs says “yes,” too.
Microsoft Shutting Down LinkedIn in China: Microsoft is shutting down its social network, LinkedIn, in China, saying having to comply with the Chinese state has become increasingly challenging. It comes after the career-networking site faced questions for blocking the profiles of some journalists. LinkedIn will launch a jobs-only version of the site, called InJobs, later this year, but this will not include a social feed or the ability to share or post articles. LinkedIn had been the only major Western social-media platform operating in China.
Alibaba Faces New Threat: an Evolving Chinese Shopper: Alibaba, already under regulatory scrutiny, is losing market share as consumers shift from targeted product searches to browsing and interaction. Alibaba remains the leading platform in online shopping, but its share of China’s retail e-commerce market has fallen to a projected 51% in 2021 from 78% in 2015. Total merchandise sales through WeChat mini-programs more than doubled in 2020 from 2019’s $123.5 billion.
British Haircare Brand ghd on How to Prepare for China’s Largest Shopping Festival 11.11: ghd starts to plan for 11-11 as early as June, July – straight after the 6.18 promotion, participating in many things which are a testbed for strategies. Tmall share a little bit more in terms of what’s to come from October to the early part of November, which provides direction for media activations.
Why China’s Falling in Love with Virtual Idols: Virtual idols are reliable assets with no political risks and undesirable behaviour. They could also hold the key to the country’s metaverse future. China currently has 400 million anime, comics and game (ACG) fans. At least 10 tech startups that specialise in virtual idol motion capture, image synthesis, AI action processing and image processing technologies have received early rounds of financing up to $5 million since mid-year 2020 with Alibaba, Tencent and ByteDance having all invested.
McDonald’s China Hops on NFT Madness by Rolling Out Big Mac Inspired Virtual Art: McDonald’s China will distribute 188 non-fungible tokens (NFTs) named “Big Mac Rubik’s Cube” to celebrate its 31st-anniversary of operating in China and the opening of its new headquarters in Shanghai. The NFTs will be given as gifts to lucky employees and customers. In June, Alibaba entered the realm of NFTs, selling out 16,000 limited-edition artworks in minutes on Alipay. McDonald’s plans to expand its business in China by opening 500 new restaurants per year by 2022.
One City’s Crack at Education Reform Leaves 15,000 Students Hunting for a School: On August 23, local authorities had told 101 private elementary and middle schools in Dancheng county in Henan province that they could no longer enrol new students. Around 15,000 first and seventh graders in the county have been left struggling to find spots in public schools. More than 500 private school teachers may lose their jobs as part of China’s plan to overhaul a compulsory education system.
Disney Meets Roadblocks to Releasing Movies in China: Over the past year or so, releases of three Disney movies designed for box-office appeal in China have been embroiled in political controversies, complicating a decade of unprecedented success in the market for the world’s largest entertainment company. Since the troubles that followed Mulan’s release last year, “Shang-Chi and the Legend of the Ten Rings,” the first Marvel Studios epic to feature a lead Asian superhero, has yet to secure a Chinese release weeks after its record-setting global premiere. The Marvel film “Eternals” release in China is uncertain after its Chinese director, the Oscar winner Chloé Zhao, was recently lambasted over comments she made about the country in 2013. The October releases “Dune” and “ James Bond: No Time to Die,” are among the few major recent Hollywood movies to have secured releases in China.
Prada Opened a “Vegetable Market” in Shanghai, and the Celebrities threw the Vegetables into the Trash After Checking In: Prada created a lot of online buzz by giving out branded bags and wrapping with vegetable purchases at a Shanghai wet market. Some of the celebs posing for selfies at the market were seen turfing the veges just to keep the Prada bag, which wasn’t well received online.
Home from Home: Mercedes-Benz Doubles Down on China: Mercedes-Benz will unveil a new China tech centre in Beijing this month and make China a ‘home away from home’. The company is also moving all of its designers in China to Shanghai. Mercedes’ sales in China jumped 12% last year to a record 774,000 despite the pandemic, streets ahead of its next two markets, Germany on 286,000 and the United States with 275,000.