China policy round-up: Covid-19 cases surge overseas, regulators roll out more supportive measures, China tightens rule on wild animal trading
In this round-up, the growth of novel coronavirus (Covid-19) infections outside China outpaced that reported by the country, Chinese regulators announced more loosening policies and the trade of wild animals for consumption is banned in the Mainland.
The number of new Covid-19 cases reported outside China exceeded the number of new cases in China for the first time since the first identified case on December 8, 2019, according to the World Health Organisation.
The update published on Wednesday by the WHO showed that, for the 24 hours before 10am central European time on Tuesday, there were 459 new cases outside China, compared to 412 from China. Noticeably, there were less than 10 cases reported in the Mainland from provinces excluding Hubei, the epicentre.
According to the Thursday update, 746 new cases were reported outside China and 439 within. Infections have now been confirmed in 46 countries.
Despite calls from media and politicians for a pandemic to be declared, the WHO’s director general Tedros Adhanom Ghebreyesus resisted. He said on Wednesday that such a declaration requires a “careful and clear-minded analysis of the facts”. He added that “every scenario is still on the table” and “all countries must prepare for a potential pandemic”.
China permanently banned the trade of wild animals for consumption, according to a Monday evening announcement by the standing committee of the National People’s Congress. That said, the decision did not ban the trade of wild animals for fur, medicine or research.
Antoinette Sayeh could become the deputy managing director of the International Monetary Fund (IMF) starting March 16, subject to board approval. Kristalina Georgieva, who proposed the appointment, has been serving as the managing director of the IMF since October 2019, a position held for over eight years by the current president of the European Central Bank, Christine Lagarde.
The State Administration of Foreign Exchange (Safe) reiterated its stand on supporting foreign exchange and cross-border trades during the coronavirus outbreak.
Safe will ensure smooth processing of foreign currency deals that are related to epidemic control and the resumption of production.
The People’s Bank of China (PBoC) has increased by Rmb500bn a quota for commercial banks to on-lend funds they borrow from the central bank to small businesses, which will enjoy a discounted interest rate on their loans.
The so-called ‘re-lending and re-discount’ quota is designed to ensure these businesses don’t pay an interest rate of more than 1.6%, the central bank said in a Wednesday videophone conference. The previous quota was Rmb300bn.
The quota was launched on February 1, part of an effort to combat the impact of the coronavirus on the domestic market.
Chinese banking institutions had provided over Rmb953.5bn of credit support for the fight against the virus outbreak by Wednesday, according to Xiao Yuanqi, the China Banking and Insurance Regulatory Commission’s chief risk officer.
Speaking at a State Council press conference on Thursday, Xiao reiterated Chinese regulators’ encouragement for banking institutions to give temporary extensions on loan repayments.
The loans must be from borrowers that were impacted by Covid-19 and due between January 25 and June 30. The extended deadline should not be later than June 30, but exceptions can be made when it comes to companies severely impacted, he added.
The National Development and Reform Commission reduced domestic natural gas prices to off-season levels, half a month ahead of schedule. The city-gate gas price will be lowered for non-residential sectors and gas suppliers. Natural gas prices are regulated by the Chinese government who usually makes the seasonal adjustment sometime in mid-March or the beginning of April.
“Regardless of the magnitude of retailed gas price cuts, we believe that the dollar margin impact could be limited for gas distributors since the instant pass-through mechanism is in practice,” Jamie Wang, an equity research analyst at Nomura, wrote in Monday note. “PetroChina, as a state-owned enterprise, should bear the brunt of the early city-gate price cut, in our view.”
Liu Xin, a former vice-head of department at CSRC’s international cooperation division, was found guilty of abusing his role at the CSRC to achieve personal gains.
Liu used his position at the CSRC to secure pre-IPO shares of at least two mainland companies listed on the Hong Kong Stock Exchange – Hunan Nonferrous Metals Corp and China Molybdenum – and then sell them to make a profit, according to the Beijing municipal court. The activity happened between 2006 and 2007.
Liu also accepted Rmb1.96m worth of bribes, according to the court. Liu was sentenced to three years in jail and fined Rmb200,000.
Foreign ministry spokesperson Hua Chunying has defended China’s decision to expel three Wall Street Journal reporters from the country after the newspaper published an opinion piece earlier this month entitled 'China is the Real Sick Man of Asia'.
It is just the latest example of tensions between China and the US. In a Wednesday update on the ministry’s website, Hua called US Secretary of State Mike Pompeo's comments supportive of the Journal “inappropriate” and said the newspaper’s mistakes were “serious”.
The Journal must be “held accountable”, and the US “unreasonably offended and provoked China first” before China defended itself, Hua said. He said it was not “unacceptable” for the US to threaten to retaliate against Chinese news organisations in the country.