Business
Calls for Scrutiny of US-Listed Chinese Companies Will Benefit Investors
Commentary
When Chinese beverage brand Luckin Coffee admitted to fraud—wiping out $8.3 billion of value from U.S. investors’ pocketbooks—the scandal highlighted the risks of investing in Chinese companies.
In an interview with Fox Business Network last week, President Donald Trump said his administration is “looking at” Chinese companies such as Luckin that are listed on U.S. exchanges yet don’t always follow U.S. disclosure and accounting guidelines.
Investing bears risks. And investors understand that companies from emerging markets (such as China) bear an even higher risk–reward ratio, due to the less mature economy and less developed markets of their local countries.
But that’s not all with Chinese companies. There are additional risks that investors may not be aware of. While being listed on U.S. stock exchanges, Chinese companies such as Luckin aren’t held to the same accounting and disclosure standards as U.S. companies listed on those same exchanges.
There were 172 Chinese companies listed on U.S. exchanges that were valued at more than $1 trillion as of September last year, according to an annual report issued by the U.S.-China Economic and Security Review Commission.
They’re not on a level playing field with U.S. companies.
The U.S. stock market is home to companies from a multitude of industries, geographies, and financial positions. Investors’ ability to determine the fair price of a company’s stock is vital to the healthy functioning of the market. A level playing field and the integrity of market participants is paramount. That’s why the Trump administration’s investigations into Chinese companies should be a welcome development for investors.
Loopholes
As a starting point, Chinese companies should be bound by the same set of rules and guidelines as other companies listed on U.S. exchanges. But due to certain loopholes that U.S.-listed Chinese companies have exploited, they have more lax requirements compared to their American counterparts.
All U.S. companies are audited, and their auditors are professionally licensed…
Business
China Limits Apple Operations as BYD Manufacturing Moves to India and Southeast Asia Amid Trade Frictions | International Business News – The Times of India
China is restricting the export of high-tech manufacturing equipment and personnel to India and Southeast Asia, aiming to maintain domestic production amid potential US tariffs, impacting companies like Foxconn and BYD.
China Curbs on High-Tech Manufacturing
China is intensifying restrictions on the movement of employees and specialized equipment essential for high-tech manufacturing in India and Southeast Asia. This measure aims to prevent companies from relocating production due to potential tariffs under the incoming US administration. Beijing has urged local governments to restrict technology transfers and export of manufacturing tools as part of this strategy.
Impact on Foxconn and Apple’s Strategy
Foxconn, Apple’s primary assembly partner, is facing challenges in sending staff and receiving equipment in India, which could impact production. Despite these hurdles, current manufacturing operations remain unaffected. The Chinese government insists it treats all nations equally while reinforcing its domestic production to mitigate job losses and retain foreign investments.
Broader Implications for India
Additionally, these restrictions affect electric vehicle and solar panel manufacturers in India, notably BYD and Waaree Energies. Although the measures are not explicitly targeting India, they complicate the business landscape. As foreign companies seek alternatives to China, these developments are likely to reshape manufacturing strategies amidst ongoing geopolitical tensions.
Business
EFIS Maroc and China Eastern Airlines Set to Launch Service Between Morocco and China
China Eastern Airlines and EFIS Maroc will launch three weekly flights between Casablanca and Shanghai via Marseille starting January 19, 2025, enhancing cargo logistics for Morocco-China trade, particularly in the automotive sector.
New Flight Route Launch
China Eastern Airlines has partnered with EFIS Maroc to introduce three weekly flights between Casablanca (CMN) and Shanghai (PVG) via Marseille (MRS). This service is set to commence on January 19, 2025, operating on Tuesdays, Fridays, and Sundays, using Boeing 787-900 aircraft with a capacity of 18 tonnes for cargo.
Supporting the Automotive Industry
The service aims to enhance logistical support for the automotive sector, facilitating the secure and timely transport of high-value components between Morocco and China. This new route will not only strengthen local supply chains but also promote economic growth and trade relations between Africa and Asia.
Innovative Cargo Solutions
Jean Ceccaldi, CEO of ECS Group, emphasized that this collaboration marks a significant achievement for EFIS Maroc. Leveraging advanced digital tools like Squair for customs optimization and CargoAi for booking, EFIS Maroc will enhance operational efficiency, ensuring a superior cargo management solution tailored for China Eastern Airlines.
Source : EFIS Maroc and China Eastern Airlines to launch Morocco-China service
Business
China Considers Selling TikTok US Operations to Musk as a Viable Option – Bloomberg
China is considering the sale of TikTok’s U.S. operations to Elon Musk as a potential option, according to a report by Bloomberg.
Potential Sale of TikTok to Elon Musk
Reports suggest that China is considering the sale of TikTok’s U.S. operations to Elon Musk as a viable option. This development follows ongoing scrutiny over the app’s data privacy practices and its links to the Chinese government. Officials believe that a sale could alleviate international concerns and preserve the platform’s presence in the U.S. market.
Strategic Implications
The potential transaction raises numerous strategic implications, not only for TikTok but also for Musk’s other ventures. If Musk were to acquire TikTok, it could enhance his digital footprint and provide new avenues for advertising and user engagement. Conversely, it could pose challenges in managing regulatory compliance and addressing data security issues.
Regulatory Hurdles Ahead
Despite the intriguing prospect of a sale, significant regulatory hurdles remain. Any acquisition would require approval from U.S. authorities, who continue to assess the risks associated with foreign ownership of tech companies. The outcome of these discussions could have widespread ramifications for both TikTok and the broader social media landscape.
Source : China Weighs Sale of TikTok US to Musk as a Possible Option – Bloomberg
- China Limits Apple Operations as BYD Manufacturing Moves to India and Southeast Asia Amid Trade Frictions | International Business News – The Times of India
- China’s GDP Grows 5% in 2024: Key Insights and Main Factors
- Can science be both open and secure? Nations grapple with tightening research security as China’s dominance grows
- China Lures Indonesia to Ease Its Position on the South China Sea
- EFIS Maroc and China Eastern Airlines Set to Launch Service Between Morocco and China
- China Considers Selling TikTok US Operations to Musk as a Viable Option – Bloomberg
