China probably isn’t the place you think of when you want to buy a world class wine, but maybe it should be soon. Ao Yun is a new label from the global wine and alcohol giant Moët Hennessy which found some abandoned vines at the foothills of the Himalayas about a decade ago. The started to produce a limited-edition Cabernet Sauvignon that they named Ao Yun, which means “Above the Clouds.” The bottles are coming to the States and cost a bit more than $300. And they are actually getting some good reviews! It’s worth checking into and watching this Chinese company.
Standard Chartered has a finance arm called Pembroke and together with Sichuan Development Holding, they are launching a join venture in Sichuan. This will allow them a foothold in the market where airlines will be spending $1tn on aircraft in the coming 20 years. Chinese money is expected to fund over a third of the $261bn aircraft leasing market by 2022.
Learn more about the Pembroke/Sichuan join venture and their plans.
China is launching five pilot zones to try to promote “green finance.” These zones include Guangdong, Guizhou, Jiangxi, Zhejiang and Xinjiang. Financial institutions in these areas will have incentives to provide credit and special funds for environmentally friendly industries. The programs will also focus on green insurance and on having banks explore new financing mechanisms that include emissions trading and water use permits.
China is currently in their fourth year of a “war on pollution” to try to reverse the damage that has been done with more than three decades of economic growth. The provinces, however, are having a hard time finding the money that is necessary to clean up their areas and to switch to cleaner types of energy.
Germany has made it clear that they welcome Chinese investments, after HNA Group, a Chinese conglomerate, raised its stake in Deutsche Bank.Beijing is encourages its corporate sector to expand overseas and the HNA investment reflects this broader Chinese push into financial services.
As BaFin President Felix Hufeld said on Tuesday,
“We believe it is fundamentally positive that capital is being invested in German banks. This of course includes foreign capital and of course Chinese capital. There is no black list of countries that are not allowed to invest with us. In this regard, this is a welcome development.”
Read all the details here and learn more.
JD.com, the large Chinese online retailer, has announced that they are spinning off their finance business for $2.1 billion. The new group will be called JD Finance and will help to start a rival to Ant Financial which is owned by Alibaba.
Chinese businesses are finding a new avenue for success with payment services and other online products that cater to their emerging digital savvy middle class.
As The New York Times explains,
“Along with its core payment platform for consumers and companies, JD Finance is venturing into credit scoring and loans. It has teamed up with China UnionPay, the state-backed financial company, to work on online payments, credit cards and rural financing programs. The spinoff will allow JD Finance to move more aggressively. A separate payments business, with only Chinese investors, can apply for certain financial licenses, enabling JD Finance to offer products that invest in securities and mutual funds.”
Move over America and make room for China. That’s the latest we are hearing about “fintech” or financial technlogy, as China has become the global investment leader in this area. This is according to Citigroup’s latest report. In the first ninth months of last year, China accounted for more than 50% of all fintech investments around the world. They also more than doubled their worldwide share of this investment category.
Researches are attributing this change to what they are calling “Chinese dragons.” This is a term for upstarts in Asia like Ant Financial, JD Finance, Lu.com and others.
Learn much more about these changes and the factors involved in them.
So this is interesting. If Snapchat is banned in China, then why is Snapchat hiring there? Apparently, Snapchat’s parent company, Snap Inc., is opening a technology office in Shenzhen to focus on Spectacles. This is their camera-equipped sunglasses that enable the user of the sunglasses to send pictures to their Snapchat accounts.
This new office employs about 20 people already and its focus is on research and development. Now, the US startup is looking for engineers to join their “first core team in China” as the recruitment ad says. They identified that their ideal candidates would have experience working for one of China’s big technology firms: Alibaba (BABA, Tech30), Baidu (BIDU, Tech30) and Tencent (TCEHY).
Another very appealing incentive is that the Shenzhen employees could also have the opportunity to transfer to Snap’s US team.
The G20 Summit was held this year in Hangzhou, China on September 4-5 and one of the major topics might surprise many. Green finance was on the agenda for the first time. Prior to the Summit, a G20 Green Finance Study Group that was co-chaired by China and the UK and had more than 80 people involved issued a report. They identified the major challenges to green finance and laid out key options to consider.
As described on one website, “Green finance, generally defined, is the act of setting up market and policy tools for the financing of public and private sustainable investments. The main goals for green finance in China are to increase return on green investments and decrease the return on polluting investments. In this way, green finance can help restructure China’s market towards a more sustainable economy, and reduce pollution and greenhouse gas emissions.”
Learn more about Green Finance and about the steps that were taken at the G20 Summit.
Prime Minister John Key met with Chinese business people at a networking event in Beijing recently alongside Alibaba billionaire Jack Ma. Key is leading a delegate trade mission which includes 40 people. It is focused on upgrading their ties to New Zealand and its free trade agreement with China.
China and New Zealand signed a memorandum of understanding which will allow New Zealand small businesses more access to sell their products on Alibaba. Ma is hoping to introduce products from New Zealand to China. As he said, while talking to the media after the signing,
“I think your total population is 4.5 million, and we’ve got 1.4 billion people. So the market is huge … and I think our cities are already demanding a quantity that will scare you guys. So this is something that we would love to do; not only buy from New Zealand, we should learn from New Zealand how to protect the environment and then continue to do that.”
During the course of the six day trip that Key was on, he saw the signing of three agreements just on the first day. These included the Alibaba announcement and “an extension to communications provider Huawaei’s sponsorship of the Wellington Phoenix and an agreement for production company Natural History New Zealand to produce documentaries and children’s programmes for China Central Television.”
China’s Cabinet has just created a new department to coordinate financial and economic affairs as a goal of restoring investor confidence in the government’s regulation of markets. The move has not been publically announced yet, but was reported to Bloomberg Business by an insider. Agricultural Bank of China VP Li Zhenjiang was nominated as the deputy director who will be responsible for the daily operations and he has just taken the post.
The move shows an understanding by Communist Party leaders that the current structure needs to be redone as a reflection of China’s markets and their economic slowdown. The Shanghai Composite Index has decreased more than 17% since late December.
Learn more about these plans and pay attention to their implementation in the weeks ahead.