Predictions for China 2021

I am making four predictions for China in 2021: Weakening of the RMB Weaker economic conditions Real deleveraging Pressure on local bonds. Capital inflows have been substantial, helping to reinforce the strength of the currency. Higher domestic Chinese interest rates, the rapid quelling of the virus, domestic Chinese stimulus, the relative weakness of western economies, […]

Evergrande and stress in China’s property market

Global Source Partners Evergrande and stress in China’s property market Andrew Collier | Sep 28, 2020 China’s property market has long been the weak link in the economy. It is the bubble that supports growth – including local consumption, fixed asset investment, and local government fiscal revenue. Although property sales remain healthy, the developers themselves […]

Ant’s IPO and the Chinese Economy

Global Source Partners Andrew Collier | Sep 14, 2020 Summary Ant Group’s proposed IPO, expected soon, raises the profile of China’s largest private online financial company. However, there are macroeconomic and political considerations that will affect the growth trajectory of both Ant and other private online financial firms. There are also competitive threats to Ant […]

Ant’s Aggressive Strategy

This is from a report originally written in March 19, 2018. Ant’s business clearly has changed but the analysis may still be useful. Ant’s Over-leveraged Funding Structure “Ant Financial has got just enough bullets to cause a small–scale financial crisis.” Economist with a State Owned Bank. l Growing Market Share. Ant Financial has quickly taken […]

China’s Inefficient Stimulus

Andrew Collier | Aug 14, 2020 China’s Inefficient Stimulus Prior to 2020, the largest contribution to growth of economic value add (with some fluctuation) has been the state sector. SOE value add bottomed out at -2.5% YoY in March 2020 but has since topped private value add at 4.9%. The rapid improvement in the state […]

Oil demand in China: a short-term bounce?

Global Source Partners Andrew Collier | Jul 24, 2020 China has clearly been one of the success stories in handling the coronavirus. The flattening of the curve was a reflection of the nature of the tightly controlled political system. The numbers may not be completely trustworthy but even at multiples the caseload is still much […]

China: Notes from Washington/Trade War

Global Source Partners China: Notes from Washington/Trade War Andrew Collier | Oct 17, 2019 Executive Summary I just returned from a three-day trip to Washington DC meeting local corporates, the Mansfield Foundation, CSIS, the State Department, and officials at the White House. Overall, the tone in Washington is decidedly negative. There is a growing consensus […]

Hong Kong’s Lost Role as a Financial Center – FT Op-Ed

Hong Kong’s not so special status as China’s financial centre Over time, Beijing will be perfectly happy to see it replaced by Shenzhen and Shanghai Financial Times . September 27, 2019 Andrew Collier Does China need Hong Kong as a financial centre? The People’s Daily certainly thinks so. In an editorial on September 16, the […]

What Can China Lose in Hong Kong

Global Source Partners What can China lose in Hong Kong? Andrew Collier | September 2019 Executive Summary How important is Hong Kong to China? What will happen — if and when the protests end — to the “special” relationship in the Jnancial sector between Hong Kong and the mainland? The argument is often made that […]

Renminbi retreat set to revive capital outflows pressure – Financial Times

15/08/2019 Renminbi retreat set to revive capital outflows pressure | Financial Times Chinese capital controls (See my comments…) Renminbi retreat set to revive capital outflows pressure Breach of key threshold sees currency and its regulator face challenges on many fronts Don Weinland in Beijing 9 HOURS AGO The renminbi’s fall through the closely watched and […]