Companies
‘Strong, stable’ renminbi gains strength against the dollar
The central parity rate of the yuan against the US dollar strengthened on Monday after Yi Gang, vice-governor of the central bank, said on Sunday that the currency remained strong and stable in the global monetary system.
The People’s Bank of China set the central parity rate of the yuan versus the dollar at 6.9042, ticking up from the 6.9168 on Friday, after the currency slid to an eight-year-low against the dollar in the past week.
The jump came after Yi’s remarks on the yuan’s exchange rate on Sunday, when he fended off concerns over the strength of the yuan and future pressure for depreciation.
In an interview with Xinhua News Agency, Yi reaffirmed that the currency remained strong among major currencies.
Yi attributed the yuan’s recent depreciation to external factors, including sustained impact from Britain’s expected exit from the European Union, a likely interest hike in the near future in the United States and signs of improving US economic fundamentals.
“The yuan did not weaken much compared with other currencies in the emerging markets,” said Yi.
Since a more floating exchange rate system for the yuan was adopted in August last year, the market should observe the yuan’s fluctuation against a basket of currencies instead of focusing on its change against the dollar, according to Yi.
He did not see a long-term depreciation trend because, he said, the yuan has “strong and stable characteristics”. He noted that in the past five years, the yuan’s China Foreign Exchange Trade System index and its index against the Special Drawing Rights currency basket appreciated by 10.9 percent and 4.4 percent, respectively.
Yi’s comment eased some concerns amid market expectations of a short-term depreciation of the yuan, according to Zhao Xueqing, an economist with the International Research Institute of the Bank of China.
The downward pressure on the yuan, mainly driven by a strong dollar, may continue next year, but the yuan will…
China
Government subsidies don’t boost Chinese firms’ productivity
China’s industrial subsidies have caused considerable controversy both internationally and domestically. Trading partners have accused China of unfairly favouring its indigenous firms with subsidies, leaving foreign companies at a disadvantage in the race to lead the technologies of the future.
Governments around the world regularly spend an enormous amount of money subsidising businesses. But few spend like China. A 2022 report suggests that China spends 1.7–5 per cent of its GDP on industrial policies, more than most countries.
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Chinese Smartphone Manufacturer Lays Off 3,000 Employees Following Closure of Chip Design Division
OPPO, a major Chinese smartphone maker, announced the closure of its chip design company ZEKU Technology (ZEKU).
OPPO, a major Chinese smartphone maker, announced the closure of its chip design company ZEKU Technology (ZEKU).
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Company Owned by Chinese Billionaire Guilty of Paying $1 Million in Bribes to LA Councilman
A Los Angeles real estate firm owned by a Chinese billionaire is guilty of paying more than $1 million in bribes to a Los Angeles city councilman as part of a scheme that involved luxury cruises, high-rolling trips to casinos, and prostitution.
A Los Angeles real estate firm owned by a Chinese billionaire is guilty of paying more than $1 million in bribes to a Los Angeles city councilman as part of a scheme that involved luxury cruises, high-rolling trips to casinos, and prostitution.
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