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China Central Bank to Offer Cheap Loans to Support Developers’ Bonds

Julie Zhu and Engen Tham wrote . . . . . . . . .

China’s central bank will offer cheap loans to financial firms for buying bonds issued by property developers, four people with direct knowledge of the matter said, the strongest policy support yet for the crisis-hit sector.

The People’s Bank of China (PBOC) hopes the loans will boost market sentiment toward the heavily indebted property sector, which has lurched from crisis to crisis over the past year, and rescue a number of private developers, said the people, who asked not to be named as they were not authorised to speak to the media.

China has stepped up support in recent weeks for the property sector, a pillar accounting for a quarter of the world’s second-biggest economy. Many developers defaulted on their debt obligations and were forced to halt construction.

The country’s biggest banks this week pledged at least $162 billion in credit to developers.

The PBOC loans, through its relending facility, are expected to be at much lower than the benchmark interest rate and would be implemented in the coming weeks, giving financial institutions more incentive to invest in private developers’ onshore bonds, two sources said.

Terms such as the interest rate on the loans were not immediately known.

The PBOC is also drafting a “white list” of good-quality and systemically important developers that would receive wider support from Beijing to improve their balance sheets, two of the sources said.

The central bank did not immediately respond to a request for comment on the planned measures.

At least three private developers – including Longfor Group Holdings Ltd, Midea Real Estate Holding Ltd and Seazen Holdings – received the green light this month to raise a total of 50 billion yuan ($7 billion) in debt.

If there were not enough demand from investors for such new bonds, the PBOC would likely step in to provide liquidity via the relending facility for the rest of the issuance, said one of the four people and another source.

Hong Kong’s Hang Seng Mainland Properties Index was up as much as 4.7% on Friday, adding 1 percentage point after Reuters reported the PBOC moves. China’s top developer by sales, Country Garden, was up 10%, CIFI Holdings was up more than 5% and Longfor nearly 4%.


Relending is a targeted policy tool the PBOC typically uses to make low-cost loans to banks to support the slowing economy, as the central bank faces limited room to cut interest rates on concerns about capital flight.

The PBOC in recent months has used the relending facility to support sectors including transport, logistics and tech innovation that were hard hit by the COVID-19 pandemic or are favoured by long-term state policies.

Beijing’s aggressive support for the property sector marks a reversal from a crackdown begun in 2020 on speculators and indebted developers in a broad push to reduce financial risks.

As a result of the crackdown, though, property sales and prices fell, developers defaulted on bonds and suspended construction. The construction halts have angered homeowners who have threatened to stop mortgage payments.

The PBOC also plans to provide 100 billion yuan ($14 billion) in M&A financing facilities to state-owned asset managers mainly for their acquisitions of real estate projects from troubled developers, two sources said.

Chinese media reported on Monday the central bank planned to provide 200 billion yuan in interest-free relending loans to commercial banks through the end of March for housing completions.

Among other recent official support, China’s interbank bond market regulator said this month it would widen a programme to support about 250 billion yuan ($35 billion) of debt offerings by private firms.

Much of Beijing’s previous support targeted state-owned developers.

Yi Huiman, chairman of China’s securities regulator, said on Monday the country must implement plans to improve the balance sheets of “good quality” developers.

Fitch Ratings said on Thursday private Chinese developers face higher liquidity risk, in terms of debt structure with greater short-term maturity pressure, than state-owned peers as banks and other creditors are becoming reluctant to lend.

Source : Reuters

China’s Central Bank Urges Banks to Maintain Stable Property Financing

China’s financial regulators have asked banks to stabilize lending to property developers and construction firms, the latest effort by policymakers to turn around the real-estate crisis and bolster economic growth.

Authorities support the “reasonable” extension of existing real estate development loans and trust loans, according to a statement posted on the People’s Bank of China’s website after a Monday meeting with commercial banks. The gathering was jointly organized by the central bank and the banking regulator.

The regulators reiterated that the “reasonable” demand of home buyers for mortgages will be met. A key financing support program must be “used well” to help private property developers sell bonds, while legal protection and regulatory policy support for special loans aimed at ensuring housing-project delivery will be improved to promote the stable and healthy development of the market, the statement said.

The call is the latest in a slew of actions taken by the government to try to stop the more-than-yearlong slump in the real estate market that’s dragging down China’s economic growth and undermining local-government income. Bond defaults by cash-strapped developers have sent shockwaves across the financial markets, while delays in property-project delivery have driven homebuyers to stop mortgage payments in protest.

In a possible sign of willingness to shift away from the previous tightening stance on the real estate sector, PBOC Governor Yi Gang emphasized Monday that the industry is critical for the economy. “The property sector is linked to many upstream and downstream industries, and its healthy operating cycle is significant for the economy,” Yi said at a financial forum in Beijing.

Meanwhile, the PBOC is planning to provide 200 billion yuan ($28 billion) in interest-free relending loans to commercial banks through the end of March, 2023, in a move to support them to provide matching funds for stalled property projects, China Business News reported, citing the central bank’s meeting with commercial banks on Monday.

Adding to the positive messages sent by the authorities, Yi Huiman, chairman of the China Securities Regulatory Commission, said at the same event that his agency will support property developers’ reasonable bond financing needs and support mergers and acquisitions in the sector.

Support Package

The main points from Monday’s meeting are similar to a 16-point package authorities rolled out earlier this month to help embattled developers, who have at least $292 billion of onshore and offshore borrowing maturing through the end of next year. The push followed regulators’ orders for banks to dole out hundreds of billions of yuan in financing for developers in the remainder of this year.

The remarks by Yi Gang are “a rare recognition of the property sector’s irreplaceable significance” by a top financial official, according to Lu Ting, chief China economist at Nomura Holdings Inc. in Hong Kong. The government’s recent supportive policies “demonstrate that Beijing is willing to reverse most of its financial-tightening measures,” he added.

At the meeting on Monday, the PBOC and the China Banking and Insurance Regulatory Commission also urged banks to expand medium- and long-term lending to help policy bank financing drive effective investment. Credit demand from manufacturers and service providers should be supported via the special relending loan program for equipment upgrading, the regulators added.

Yi said at the forum that the outstanding size of the relending programs targeting sectors such as technology innovation, transport and logistics and equipment upgrading is about 3 trillion yuan ($419 billion), adding they will be ended after policy goals are reached.

Stocks Down

A Bloomberg gauge of Chinese developers’ stocks ended the day 2% lower, after sinking as much as 4% in the morning. The Shanghai Stock Exchange Property Index closed 0.5% lower after earlier being down 2.7%.

PBOC Deputy Governor Pan Gongsheng and CBIRC Vice Chairman Xiao Yuanqi made comments at the Monday meeting, which was attended by heads of institutions including the major state-owned banks, joint stock lenders, and the branches of the central bank and the banking regulator, according to the statement.

Source : BNN Bloomberg

Charts: Both U.S. Manufacturing and Services PMI Dropped Below 50 in November 2022

Source : Bloomberg and Nikkei

Charts: U.S. New Homes Sales Unexpectedly Rose in October 2022

Median Prices Jumped to All-time High

Source : Bloomberg


国家发展和改革委员会主任 何立峰 . . . . . . . . .










(五)网络安全保障和数字经济治理水平持续提升。在全国人大的指导推动下,加快健全法律法规体系,强化网络安全机制、手段、能力建设,完善数字经济治理体系,提升网络风险防范能力,推动数字经济健康发展。一是法律和政策制度体系逐步健全。相继颁布实施《网络安全法》《电子商务法》《数据安全法》《个人信息保护法》,修改《反垄断法》,制定新就业形态劳动者权益保障政策。中央全面深化改革委员会第二十六次会议审议通过了《关于构建数据基础制度 更好发挥数据要素作用的意见》,初步构建了数据基础制度体系的“四梁八柱”。二是网络安全防护能力持续增强。建立网络安全监测预警和信息通报工作机制,持续加强网络安全态势感知、监测预警和应急处置能力。完善关键信息基础设施安全保护、数据安全保护和网络安全审查等制度,健全国家网络安全标准体系,完善数据安全和个人信息保护认证体系,确保国家网络安全、数据和个人隐私安全。基本建成国家、省、企业三级联动的工业互联网安全技术监测服务体系。三是数字经济治理能力持续提升。建立数字经济部际联席会议等跨部门协调机制,强化部门间协同监管。提升税收征管、银行保险业监管、通关监管、国资监管、数字经济监测和知识产权保护、反垄断、反不正当竞争、网络交易监管等领域的信息化水平,推动“智慧监管”。有序推进金融科技创新监管工具试点、资本市场金融科技创新试点、网络市场监管与服务示范区等工作,探索新型监管机制。




















Source : 中国人大

‘No Tears Left’: Hong Kong Property Agents Resort to Desperate Ads

Olivia Tam and Shawna Kwan wrote . . . . . . . . .

Property agents in Hong Kong are resorting to increasingly wry advertising slogans to attract potential buyers during the city’s worst housing slump in years.

“Born in the Wrong Time,” “No Tears Left to Cry,” “The Cut Is Deep, The Love Is Real” — these are just some of the catch lines being used on home listing ads, underscoring the desperation of agents and owners. On one level it’s worked: Social-media sites are now flooded with these over-the-top descriptions. But sellers are still finding it hard to offload properties.

Rising interest rates are weighing on a property market that has already been battered by a population exodus and Covid curbs. Hong Kong’s one-month rate, known as Hibor, has increased to the highest level since 2008 due to the city’s currency peg with the greenback. Expensive borrowing costs coupled with an economic contraction have made would-be buyers cautious.

The number of unsold new homes in Hong Kong increased to the highest in more than 15 years in the third quarter. Even the city’s powerful developers may need to offer discounts to sell vacant units, according to Bloomberg Intelligence.

Ada Chan, a 42-year-old HR manager, recently had to stomach a loss of HK$5.4 million ($690,000) to sell her three-bedroom apartment near the University of Hong Kong for HK$13.3 million. She said it was her biggest loss on property investments. Even with multiple price cuts, it took Chan more than a year and a half to find a buyer for the 500-square-foot (46-square-meter) flat.

Prices of used homes have declined 11% since the beginning of the year. Goldman Sachs Group Inc. is expecting values to plummet 30% through 2023 from last year’s levels.

“I’m not optimistic about the long-term development of Hong Kong,” said Chan. “This is no longer a place where investing in real estate can get you high returns.”

Source : Bloomberg

New Japanese Chipmaker Rapidus Joins Development and Investment Race

Yuki Yamaguchi wrote . . . . . . . . .

New Japanese chip production company Rapidus is facing daunting challenges as it tries to catch up with Asian rivals in the technology development and investment race, leaving a shaky outlook for the country as it attempts to revive its once-thriving industry.

Created by Toyota Motor, Sony Group and six other major Japanese companies with a total investment of ¥7.3 billion ($52 million), the next-generation semiconductor venture plans to mass-produce chips with state-of-the-art 2-nanometer technology in Japan in 2027. Such advanced chips can be used for 5G communications, quantum computing, data centers, self-driving vehicles and digital smart cities.

SoftBank and NTT are also among the participants in the project, along with Kioxia, Denso, NEC and MUFG Bank.

The Ministry of Economy, Trade and Industry will provide ¥70 billion in subsidies as part of its semiconductor strategy compiled last year.

The government sees domestic chip production as critical to its economic security, as dependence on major supplier Taiwan poses geopolitical risks amid rising tensions between the United States and China over the self-ruled island. A potential crisis in the region could lead to Japan losing access to semiconductor supplies.

Rapidus focuses on foundry operations representing a group of private-sector entities, while the government-backed Leading-edge Semiconductor Technology Center will serve as a research and development hub in cooperation with the United States.

This latest effort follows the country’s failure to keep up in the investment race over the miniaturization of semiconductors that resulted in a yearslong development hiatus in the 2010s.

Taiwan Semiconductor Manufacturing, a world leader in chipmaking, plans to mass-produce 2-nanometer chips in 2025, while Samsung Electronics succeeded in mass production of 3-nanometer semiconductors in June. In contrast, the latest technology in Japan can only produce 40-nanometer chips.

Analysts are skeptical about the immediate success of the new company amid stiff global competition. The state financial support of ¥70 billion, compared with the much larger assistance of $52.7 billion set out by the U.S. government, raises questions about how committed the Japanese government is to reviving the chip industry. The European Union and the private sector will also offer assistance of €43 billion ($45 billion).

Hideki Yasuda, a senior analyst at Toyo Securities, said the ¥70 billion is “not enough at all” for the new company to be competitive in the global market.

“Around ¥1 trillion of annual investment is necessary for the chip industry,” Yasuda said. “It’s hard to force private companies to bear such a cost. So the question is whether the Japanese government is prepared to do that.”

Rapidus Chairman Tetsuro Higashi said at a news conference last Friday he believes the industry ministry is aware that long-term financial support is necessary and hopes more support will be provided to help his company build a chip plant.

The government’s financial aid should at least match the amounts offered by other countries for Japanese companies to stay competitive, Mitsuhiro Osawa, senior analyst at Ichiyoshi Research Institute, said.

Japanese chip manufacturers were once dominant players, taking half the global share in the late 1980s. But they came under pressure when frictions over trade with the United States led to export restrictions that allowed South Korean and Taiwanese chipmakers to make deeper inroads.

Spending by Asian rivals outpaced that of flagging Japanese companies in an industry where the development and mass production of cutting-edge products determines competitive advantage.

Japan has striven to rejuvenate its semiconductor sector through government initiatives over the past decades. In 2006, Toshiba, Hitachi and Renesas Technology set up a planning company for a government-backed joint foundry, but the project fell apart six months later.

Elpida Memory, established through the merger of chip operations at Hitachi, NEC and Mitsubishi Electric, filed for bankruptcy protection in 2012 despite government aid of ¥30 billion.

Rapidus President Atsuyoshi Koike, a former engineer in Hitachi’s chip division and former president at the Japan unit of Western Digital, says he has learned lessons from the past.

“In the past, Japan tried to seek solutions only in a closed world,” Koike told reporters last Friday. “We will collaborate with people and companies worldwide, including raw material companies and chipmaking equipment makers.”

Rapidus is looking for more partners, including from overseas. The company, for example, is in talks with IBM over technology cooperation on 2-nanometer chips.

The technological vacuum of the past decade has allowed talented personnel to be recruited by rivals out of the country. Rapidus may find it difficult to look for skilled engineers and plant workers anytime soon in Japan, Masahiko Ishino, chief analyst at Tokai Tokyo Research Institute, said.

Japanese companies trying to catch up with global competitors are “like a high school student, who did not study at all in school, trying to get into the University of Tokyo,” Ichiyoshi Research’s Osawa said, referring to the most prestigious institution of higher education in Japan.

“The bar is extremely high” for Rapidus, which has no prior experience in mass-producing state-of-the-art semiconductors, to make 2-nanometer chips, Toyo Securities’ Yasuda said.

Source : Japan Times

Read more at 経済産業省

次世代半導体の設計・製造基盤確立に向けて . . . . .

Vertiport Testbed for European Urban Air Mobility Testing Inaugurated in Paris

Groupe ADP, Skyports and Volocopter commissioned Europe’s first fully integrated vertiport terminal for the urban air mobility (UAM) industry at the Groupe ADP, RATP Group and Choose Paris Region-run Re.Invent Air Mobility testbed at Pontoise-Cormeilles airfield. The launch of the terminal represents the start of a new era for urban air mobility, as the facility allows advanced testing of critical technology and passenger processes.

Urban air mobility is a new form of sustainable aviation with a multitude of use cases that will provide regions and cities with an alternative form of transport for people and goods. Introducing a new form of mobility successfully requires industry-wide collaboration and the support of regulators and government bodies. The UAM ecosystem includes manufacturers of electric vertical takeoff and landing aircraft (eVTOL), physical and digital infrastructure providers, regulators, technology supply chain, cities, governments, the public, and many others. The fully integrated testbed at Pontoise-Cormeilles enables a variety of stakeholders to test technologies and procedures in diverse configurations in a real-life environment. The opportunity to test on a live airfield is both invaluable and essential to the development of the entire industry.

The testbed at Pontoise-Cormeilles, designed by Skyports in collaboration with Groupe ADP, is aircraft agnostic and offers the entire ecosystem the chance to test and develop their technologies. Most importantly, it facilitates collaboration between the key ecosystem partners, including technology pioneers, regulators and local partners such as the French Civil Aviation Authority (DGAC), suppliers and airlines. It will enable the testing of:

  • Vehicle integration, ground movement procedures, and charging procedures
  • Flight scheduling, situational awareness, and information exchange
  • Passenger journey through the terminal, including security and check-in processes, biometric technologies (provided by SITA), passenger dwell time, and aircraft boarding.

The launch event provided an opportunity to demonstrate the end-to-end passenger journey, from arrival at the vertiport terminal to aircraft boarding. A model of the VoloCity, which is being developed as Volocopter’s first certified aircraft for commercial services, was featured at the launch in addition to a crewed test flight of the 2X model – the only aircraft currently authorised by DGAC for eVTOL test flights in France. The series of demonstrations by Skyports and Volocopter also featured displays of flight monitoring capabilities and digital operating systems, including Skyports’ vertiport operating systems and the VoloIQ.

The Re.Invent Air Mobility testbed at Pontoise-Cormeilles airfield is now the most extensive technology-enabled test site for UAM in Europe. The innovation consortium is formed by Groupe ADP, Choose Paris Region, and RATP Group, and made up of 30 ecosystem partners. It has propelled France to the forefront of UAM development. The consortium focuses on a wide range of topics to facilitate the development of the industry, including vehicle development, vertiport infrastructure, airspace integration and public acceptance.

Source : Volocopter

Watch video at You Tube ( 9:07 minutes) . . . .

Infographic: China’s Dominance in the Solar Panel Supply Chain

See large image . . . . . .

Source : Visual Capitalist

Charts: U.S. Container Freight Volume Is Shrinking in September 2022

Confirming the slackening of merchandise trade and downturn in the business cycle.

See more charts . . . . .