The Standing Committee of the National People’s Congress (NPCSC) revised China’s tax law on Aug. 31. At a glance, the revision seemed to be helpful. Individual taxpayers saw their annual tax-free threshold raised from 3,500 yuan per month to 5,000 yuan per month (60,000 yuan per year). However, in an overhaul of its income tax …
On July 24, China’s Ministry of Finance (MoF) released economic data for state-owned enterprises (SOEs) for the first half of 2018. In the statement accompanying the data, the MoF declared that SOEs performed well in H1 2018, and that “both solvency and profitability had improved over the same period last year.” On July 27, China’s …
Read moreRisk Watch: China’s State-owned Enterprise Debt Financing ‘Ponzi Scheme’
According to China’s National Bureau of Statistics (NBS) data released on July 27, the country’s industrial firms’ (“industrial enterprises above designated size”) profits grew 17.2 percent from the previous year. We compared the 2018 figures with that from 2017, and found that China’s industrial firms’ profits actually fell 6.8 percent. The statistics bureau’s official explanation …
Read moreRisk Watch: China’s Industrial Firms’ Profits Fell, Not Grew, in H1 2018
Caijing Magazine’s 16th issue of 2018 (published on July 9) featured a cover page with a man hauling a piggy bank atop a cracking iceberg. The headline read: “The Worries of Local Debt Hanging High Overhead.” The cover page article likened China’s local government implicit debt to an iceberg, with a small portion publicly visible …
Read moreRisk Watch: China’s Local Debt ‘Iceberg’ Emits ‘Cracking Sounds’
On July 6, the United States imposed 25 percent tariffs on $34 billion worth of Chinese goods. China hit back with tariffs on a similar scale on the same day. News reports say that another $16 billion of U.S. tariffs targeting products under China’s “Made in China 2025” program would go into effect two weeks …
China’s National Development and Reform Commission and the Ministry of Commerce jointly released a shortened negative list of industries where foreign industries are restricted or banned on June 28. The new list reduces the number of sectors restricted to foreigners from 63 to 48, and will go into effect on July 28. The sectors where …
Read moreRisk Watch: Can China’s New Negative List Help Defuse Trade Dispute with America?
Data published by China’s National Bureau of Statistics (NBS) indicates that industrial profits in the period of January to May 2018 rose by 16.5 percent from the previous year. Western media outlets described the industrial profits as “steady” and “solid.” We checked the NBS figures with those of the year before, and found that industrial …
Read moreRisk Watch: China’s Industrial Profits Fell, Not Rose, Between January to May
According to Chinese economic data for May provided by the National Bureau of Statistics (NBS), China’s total retail sales of consumer goods, investments in national urban fixed assets, and aggregate financing to the real economy all showed downward growth trends. Also, the NBS data for total retail sales of consumer goods appears to be false. …
Read moreRisk Watch: Official Data Shows China’s Economy Worsened in May
According to state media reports on June 15, China has started to collect information in a unified nationwide property database. China’s Ministry of Natural Resources said that there are 3,001 property registration stations in 335 cities and 2,853 counties serving over 300,000 enterprises and individuals on average per day. The backdrop: In 2007, a unified …
On June 6, the People’s Bank of China (PBoC) loaned 463 billion yuan ($72.43 billion) to financial institutions through its 1-year medium-term lending facility (MLF) at an interest rate of 3.3 percent. After rolling over 259.5 billion yuan of loans maturing in June, the central bank would add a net 203.5 billion yuan of liquidity. …
Read moreRisk Watch: China Central Bank MLF Injection Lowers RMB Creditworthiness