1. Xi declares victory over poverty
Xi Jinping kicked off Thursday’s Politburo Standing Committee with some good news (Xinhua):
- “Under the current standards, all rural poor people have been lifted out of poverty.”
- “Absolute poverty and localized poverty have been eliminated.”
- “A major victory has been achieved, earning the admiration of the world.”
Some context: Xi and his administration have spent much of the last decade working toward the goal of eradicating extreme poverty in China.
More context: In late November, the last nine counties in Guizhou province passed an independent assessment and were removed from the national list of impoverished areas (see November 24 Tip Sheet).
But don’t get all smug, now. There’s more work to be done.
Xi has previously noted that (Qiushi):
- “Eliminating poverty is not the end point, but the starting point of…a new struggle.”
The meeting’s read-out instructed officials to double down on this victory, by:
- Preventing backsliding into poverty through monitoring and ongoing assistance
- Linking poverty alleviation efforts to infrastructure projects, industrial development, regional rebalancing, and dual circulation agendas
- Expanding social services and public welfare programs
Get smart: Rural development is a top macroeconomic priority. It’s one of the last places where very rapid growth is possible.
2. Thank you for being a friend
On Wednesday, Premier Li Keqiang sat down with Russian Prime Minister Mikhail Mishustin for a virtual summit.
- Executive Vice Premier Han Zheng was also there.
Li opened by hailing Sino-Russian cooperation (MoFA):
- “China and Russia, each as the other’s largest neighbor, have been following a policy of good-neighborliness based on mutual respect with an eye to realizing mutual benefits and win-win results.”
- “[Improved ties are] indicated by closer bilateral trade, blooming development…cross-border e-commerce, [and the] steady advancement of major projects of strategic importance in energy and other sectors.”
And of course, Li couldn’t help but entice Mishustin with the promise of the China market:
- “Li…pointed out that China, as the largest developing country, is the most promising growth market.”
- “China is willing to share development opportunities, expand two-way opening-up, and enhance mutually beneficial cooperation.”
The two men then signed cooperation documents related to:
- Intellectual property
Get smart: At a time when China has alienated many of its neighbors, relations between Zhongnanhai and the Kremlin have been remarkably chummy.
Get smarter: China’s rhetoric on win-win cooperation is more than a talking point, and Beijing looks to have a willing partner in Moscow.
3. My life on the delist
Things are set to get a whole lot trickier for US-listed Chinese companies.
On Wednesday, the US House of Representatives passed the “Holding Foreign Companies Accountable Act.”
- US President Donald Trump is expected to sign the bill into law.
Some context: The bill, which passed the US Senate back in May, stipulates that any US-listed company that fails to comply with the US Public Accounting Oversight Board’s audits for three consecutive years will be delisted.
More context: The law applies to all firms regardless of national origin but is particularly problematic for (and targeted at) Chinese companies.
- That’s because Chinese authorities are extraordinarily reluctant to allow inspections of local accounting firms by foreign regulators, citing national security concerns.
The slow-burning threat of delisting has left US-listed Chinese companies looking for a backup plan (Reuters):
- “This year, a record number carried out secondary listings in Hong Kong with $19.1 billion raised in 12 transactions…compared to $14.8 billion in 2019.”
Foreign ministry spokesperson Hua Chunying slammed the bill’s passage:
- “This law severely weakens the trust global investors have in U.S. capital market, and will ultimately harm the international status of U.S. capital market.”
Get smart: In the long-term, a mass exodus of Chinese companies from US bourses may redound to China’s benefit.
The big question: Is this the opening verse in a longer saga of financial decoupling?
4. Han Zheng chairs symposium on housing development
On Thursday, Executive Vice Premier Han Zheng held a symposium at the Ministry of Housing and Urban-Rural Development (MoHURD) on housing development.
Han spelled out several priorities for the ministry, including:
- Improving the housing system and its supporting policies
- Focusing on affordable housing
- Strengthening the construction of a housing security system
Quick take: Han’s recommendations are mostly about continuing existing efforts.
Han said MoHURD should keep on trucking with:
- Further regulating the real estate market
- Continuously fine-tuning the country’s housing policy toolbox
- Implementing long-term regulatory measures and city-specific policies
He also touched on priorities related to housing development, including:
- Strengthening the top-level design of housing development for the 14th Five-Year Plan period
- Studying the housing market and housing security systems
- Expanding the supply of affordable rental housing
Get smart: ExpectHan’s symposium checklist to be translated into concrete policy documents in the coming months.
Get smarter: The government has long looked to increase the availability of affordable housing. This symposium is a reminder to the ministry that this is still very much a priority.
5. Hainan gets a new Party boss
The reshuffle of provincial Party secretaries continues.
Some context: Over the past two weeks, the Party secretaries of Jilin, Hunan, Guizhou, Yunnan, and Fujian all got switched out.
The latest: On Tuesday, it was announced that Shen Xiaoming would take over as Party secretary of Hainan.
More context: Shen is taking over from Liu Cigui, who is stepping down due to having reached retirement age.
A little about Shen:
- Shen has a PhD in Pediatrics.
- He spent the first two decades of his career at the intersection of healthcare and education, including serving as the dean of Jiaotong University’s medical school (2005-2006).
- Shen should be well acquainted with Executive Vice Premier Han Zheng, who served as Party chief of Shanghai when Shen was head of Shanghai’s Pudong district, between 2013-2016.
- In April 2015, Shen concurrently headed Shanghai’s Free Trade Zone (FTZ).
- Most recently, Shen served as Hainan governor beginning in April 2017.
Get smart: Shen is a renowned technocrat and young to boot. His career is bright if he does a good job in overseeing the development Hainan Free Trade Port, a major Xi Jinping initiative.
6. Prepping for the vaccine rollout
On Wednesday, Vice Premier and former head of the now-dissolved COVID-19 steering group Sun Chunlan and State Councilor Wang Yong hit the road.
The pair visited:
- The National Institutes for Food and Drug Control
- Sinovac Biotech
What these places have in common: They’re key players in the development, market approval, and production of China’s COVID-19 vaccines.
Sun called for more efforts to:
- Continue phase-III clinical trials for COVID-19 vaccines
- Approve vaccines based on internationally recognized standards
- Prepare for large-scale vaccine production
- Improve the vaccine tracing system
- Design vaccination plans for priority groups
- Educate the public on vaccine science
Sun is not getting everyone mobilized for no reason. On Friday, Wang Junzhi, deputy head of the national expert group on vaccine RD, said (Sohu):
- “Regarding [COVID-19] vaccines, there will be big news announced in the next one to two weeks.”
- “600 million inactivated vaccines will get approved for market access [by the end of 2020].”
The bottom line: Authorities know that continued economic recovery hinges on a quick and safe nationwide rollout of vaccines. No effort will be spared to make this happen.