August trade data is in for Guangdong, and it is not looking too shabby. According to official numbers reported by Nanfang Daily, exports remained in positive territory at +1.23% YoY, and even picked up from the low growth point seen in July of +0.5%. Imports were still weak, but the pace of the drop, at -8.4%, was an improvement on July’s -12.7%.
We had been intuitively expecting worse, given the China macro data released last week showing industrial production had slowed sharply in August. We still don’t have that data for Guangdong, so we cannot make comparisons yet. Moreover, in issuing these trade numbers, it seems like Guangdong has jumped the gun on the custodians of the national accounts, because China’s trade data for August isn’t out yet.
Continue reading Guangdong trade holds steady
It seems only fitting that the neighbourhood of Shenzhen once renowned for knockoffs of IT gadgets is today the first to switch over to 5G.
Huaqiangbei, which has cleaned up its piracy act in recent years, is still a must-visit place in Shenzhen for anyone wanting to see what a Chinese electronics market looks like. The place is insanely packed and carries every piece of equipment that could remotely be called electronic. Now, it is the country’s first “city block” to be fully 5G-operational, which allows it to host demonstrations of all sorts of new, high-bandwidth applications.
According to the Shenzhen Daily News, the three major telco operators have set up the main base stations in the area and are now laying indoor sub-base stations inside the major malls and shops. These include SEG, Huaqiang, Gome, Suning, Shundian, Maoye and others.
Already working are some outdoor applications around the market’s main areas, while an indoor “experience pavilion” is under way. Some of these include: VR-based interactive games, 360-degree 8K panoramic VR live broadcast, remote driving, VR-based cloud games, remote ultrasound diagnosis, 3D vision screening, AR industrial inspection, AI face recognition.
We will get across their soon and shoot a video of it. Stay tuned.
As Hong Kong counts down apprehensively to the October 1 National Day holidays, attention is focusing on how the government might address the underlying causes of the protests. As we wrote recently, CE Carrie Lam’s “Four Actions” are a decent game plan. But time is running out for specifics to be researched and decided ahead of the Policy Address at the end of October. The government cannot properly canvas public opinion by then. It is going to have to draft some measures on the fly, based on a less-than-perfect consultation mechanism.
Continue reading Fresh perspectives on the HK crisis
One-upmanship between Guangzhou and Shenzhen over AI-driven subway technology is continuing to provide reporters with fun material. Last week, Guangzhou opened two “Smart Stations” on its Metro, powered by AI algorithms. This week it is Shenzhen’s turn to promote the rollout of automated customer service kiosks and announce the entire Metro Line 11 now has “brush-face” gates.
The new customer service kiosks allow riders to register their faces for purchasing tickets, topping up their Metro cards, and other services. Initially, only those who get to ride the line for free can use them to register for “face-brushing”, but they will be upgraded soon for paid ticketing. In the meantime, everyone can use the kiosks for performing a variety of other transactions.
Continue reading Shenzhen Metro Line goes ‘all-brush’
UOB in Zhongshan: Singapore’s UOB Bank sees the potential in Zhongshan, becoming the first international bank to open a branch in the city. Read more.
Financial Rankings: Even without a convertible currency, Shenzhen has climbed into the global rankings as a finance center, making 9th place on a list compiled by a UK-based think tank and a … Shenzhen-based institute. Read more.
Songshan Lake, the high-tech zone in Dongguan, is going upscale. Already the home of the Huawei R&D headquarters known as Ox Horn, which has a collection of European-style buildings and its own mini-railway, the district has been in need of a major commercial complex. It is getting one around the Songshan Lake North railway station, courtesy of China Resources Group, which makes its first foray into Dongguan with a large, mixed use project, Wan Xiang Hui.
The project broke ground yesterday, Dongguan Daily reports. It is expected to be finished in three years, boasting offices, shops, hotels and apartments, covering an area of 44,100 sqm, with a total construction area of about 350,000 sqm. It consists of a podium with five floors above and one below ground, plus two towers at 240 meters and 130 meters high, respectively.
The station is a major future transport hub, with the Guangzhou-Huizhou Intercity Railway passing through, as well as Dongguan’s metro Lines 3 and 5, all of which are still under construction.
Residents will likely especially appreciate the Wan Xiang Hui Square, which will feature a wide variety of modern dining and entertainment options. Songshan Lake is a beautiful area, but it does get a bit dull at night.
Of all the places in the Greater Bay Area, Nansha probably has the grandest ambitions. Once little more than a site of large deposits of alluvial sand, at the mouth of the Pearl River, today Nansha is being spoken of as the one true “core” of the Greater Bay’s development plan. Finance, technology, scientific research, and shipping are all being clustered here with a view to building a New Area that can propel the next stage of the region’s – and the country’s – growth.
To say it has come a long way from humble beginnings would be an understatement. Nansha only became a district of the provincial capital, Guangzhou, in 2005, when it was separated from the larger Panyu District. Back then, it was known for not much more than being the source of the sand that laid the foundations – literally – of Hong Kong’s real-estate boom in the post-war period. But already, its potential was being measured due to its location on the southernmost tip of Guangzhou. The country was embarking on a wave of experimentation after joining the WTO a few years before, and it was designating national-level New Areas around the country to launch experiments in economic reform. Nansha was the sixth of these, tapped for future stardom in 2012. (read our explainer of what a New Area is.)
Continue reading Nansha: From sand to fintech
Alipay in Macau: Alipay has launched a version of its service for Macau residents. Local users can bind their Macau bank accounts to it and pay each other as well as local merchants. Read more.
Clean Shenzhen: The city has retained its clean-air ranking, running in third place between Haikou (Hainan) and Lhasa (Tibet). Read more.
Dongguan going digital: Huawei has won a contract to help the Dongguan government “go digital”. It is worth RMB 2.7 billion. Read more.
The GBA gets a major boost at the end of this month, when the north-south Intercity Railway opens between Shenzhen, Dongguan and Guangzhou, as we reported recently. But in five years’ time, the much bigger infrastructure project of the main east-west high-speed railway connection will open. This has been confirmed by provincial authorities. The Shenzhen-Jiangmen section of the Shenmao Railway has been given the official green light to begin construction by the end of the year, with completion set for late 2024.
It cannot be emphasized enough how this railway connection will change the economic structure of the GBA. Running from Shenzhen’s under-construction Xili Station, one of the city’s four major railway hubs, it will run across (and under) the mouth of the Pearl River, linking the manufacturing powerhouses of Shenzhen and Dongguan on the east with Nansha (in the middle) and Zhongshan and Jiangmen in the west.
The Shenzhen-Nansha section will chug along at a sedate 200km/h, while the Nansha-Jiangmen section will allow speeds of up to 250km/h. There will only be seven main stations along the route, which means express trains can get across the Bay more quickly at certain times of the day.
The line will essentially make Zhongshan and Jiangmen outer neighborhoods of Shenzhen. And it will boost Nansha, being right in the middle, as a central hub as it strives to build a new center of gravity for the entire Bay (more on this tomorrow in our Nansha overview).
Read more (in Chinese).
Hong Kong remains China’s key gateway for foreign investment despite the protests, according to the latest data from Beijing. As SCMP reports, China received US$62.9 billion in foreign direct investment via Hong Kong in the first eight months of this year, accounting for 70 per cent of total inflows. The rise was even sharper once the monthly number for August was calculated: US$7.53 billion, up 29.2% from the same month last year.
It’s hard to blame or credit these flows on anything Hong Kong is doing, as Investment decisions into China are often months, if not years, in the planning. Still, the numbers might bring some comfort at a time when the tourism pillar of the economy is crumbling.
According to this SCMP report, Causeway Bay is struggling, with one in ten shops standing empty and thousands of staff facing job losses. We think a very painful withdrawal experience lies ahead as the city is forced off the drug that it has been hooked on since 2003. Mainland tourists have other options, including Macau, and once mainland tariffs on imported goods start being completely repealed, they will likely have little reason to come back – even if the protests somehow start to subside.
Across the city, the hotel industry is reeling. But landlords appear to be doing what they do best: forcing management companies to let go of staff while they figure out the best way to reconvert the buildings into office space. And they are in the meantime looking to move their real-estate projects as fast as possible before prices start to fall off a cliff as the government strong-arms them into offering below-market discounts.
Hong Kong needs a big, new vision for its future.