After a lengthy crackdown on shadow banking, this risky financial tool seems to be back in grace as China’s economy is slowing down. It is the pragmatic way China’s financial authorities deal with the economy, financial analyst Sara Hsu says. Shadow banking will be allowed, as long as it works, she writes in China Focus.
Category Archives: government
The official trade war between the US and China seems to be entering its end game. But that does not mean the hostilities will end. Making sense out of what the world’s first and second-largest economies will do will only be slightly easier. A few speakers at our office might be able to help you out.
China is trying to pacify Islam by force, but is achieving the opposite of the stability it wants to secure, says Ian Johnson, author of The Souls of China, to Foreign Policy. “By using more force to increase stability, the government is achieving the opposite effect.”
China is overhauling its now 30-years old regulations for cosmetics, a fast-growing industry of now 260 billion Renminbi (euro 34 billion). The new rules remove some of the red tape, says lawyer Mark Schaub, but also gives the authorities more leverage over the industry, he writes at the China Law Insight.
The reform of the income tax in China will drive many expats out of the country as it will kick in by 2021, as foreign and local taxpayers will fall under the same taxation rules, says financial expert Paul Gillis on his weblog. Especially the equal treatment for housing and education costs will become too costly for expats, or their companies.
Some analysts see in the new Foreign Investment Law a way for China to placate the US, but China veteran Mark Schaub sees here no quick fix triggered off by the trade war. It is the first new foreign investment law since the Berlin Wall came down, he says to the BBC News Service.
China brought the newly adopted foreign investment law with some fanfare, but political analyst Victor Shih does not expect the law will be a game changer, as some hope, he tells at the Deutsche Welle. A level playing field for foreign and domestic companies in China might be far away.
For years the business community feared China’s central government would kill the so-called VIE’s (variable-interest entity). The tool to circumvent the country’s strict ownership regulations was never endorsed by the government but has also never been in serious trouble, tells China veteran and lawyer Mark Schaub to Bloomberg. The ban even did not show up in the draft foreign investment law, last week.
The new foreign investment law is no longer mentioning the ban on VIE’s like an earlier edition did in 2015. The tool to circumvent Chinese regulations by channeling investments through…
Women in China might be regaining some tracking in the economy, they are still lacking political leverage and earn on average less than men, says author Zhang Lijia at Wion. “According to Zhang, if China wants to improve the lives of women, it will first need to accord them equal status in society and politics.”