Weblog with daily updates of the news on a frugal, fair and beautiful China, from the perspective of internet entrepreneur, new media advisor and president of the China Speakers Bureau Fons Tuinstra
The US failed to stamp out the coronavirus, unlike China, says Harry Broadman, a former senior US trade official to the Sydney Morning Herald. And since South Korea and New Zealand also dealt with COVID-19 efficiency, it is not China’s authoritarian regime that made the difference, he adds.
The Sydney Morning Herald:
“Obviously, the US government bungled it,” said Harry Broadman, a former senior US trade official and managing director with Berkeley Research Group. The singular authority of China’s Communist Party helped Beijing enforce contact tracing and lockdowns, Broadman said. But other democracies, including New Zealand and South Korea, stamped out the virus as China did.
The real difference between the US and China was that Washington “has been arguing over stimulus issues on Capitol Hill and it’s still far too little and too late”, said Broadman, who has served under both Republican and Democratic presidents. “That has created more and more uncertainty on the part of business.”
The world never saw so much reaction of wealth as during 2020, says Rupert Hoogewerf, chief researcher of the Hurun China Rich List, despite the coronavirus crisis triggered off by COVID-19. Even seasoned rich-researcher Hoogewerf is amazed by the number of billionaires China created over the past months, he tells Devdiscourse, citing the newly released Hurun China Rich List 2020.
Devdiscourse:
Ant is expected to create more mega-rich through what is likely to be the world’s biggest IPO, as it plans to raise an estimated $35 billion through a dual listing in Shanghai and Hong Kong. The combined wealth of those on the Hurun China list – with an individual wealth cut-off of 2 billion yuan ($299.14 million) – totaled $4 trillion, more than the annual gross domestic product (GDP) of Germany, according to Rupert Hoogewerf, the Hurun Report’s chairman.
China is minting new billionaires at a record pace despite an economy bruised by the coronavirus pandemic, thanks to booming share prices and a spate of new stock listings, according to a list released on Tuesday. The Hurun China Rich List 2020 also highlights China’s accelerated shift away from traditional sectors like manufacturing and real estate, towards e-commerce, fintech and other new economy industries.
Jack Ma, founder of Alibaba, retained the top spot for the third year in a row, with his personal wealth jumping 45% to $58.8 billion partly due to the impending mega-listing of fintech giant Ant Group . Ant is expected to create more mega-rich through what is likely to be the world’s biggest IPO, as it plans to raise an estimated $35 billion through a dual listing in Shanghai and Hong Kong.
The combined wealth of those on the Hurun China list – with an individual wealth cut-off of 2 billion yuan ($299.14 million) – totaled $4 trillion, more than the annual gross domestic product (GDP) of Germany, according to Rupert Hoogewerf, the Hurun Report’s chairman. More wealth was created this year than in the previous five years combined, with China’s rich-listers adding $1.5 trillion, roughly half the size of Britain’s GDP.
Booming stock markets and a flurry of new listings have created five new dollar billionaires in China a week for the past year, Hoogewerf said in a statement. “The world has never seen this much wealth created in just one year. China’s entrepreneurs have done much better than expected. Despite Covid-19 they have risen to record levels.”
According to a separate estimate by PwC and UBS, only billionaires in the United States possessed greater combined wealth than those in mainland China. China has accelerated capital market reforms to aid a virus-hit economy, accelerate economic restructuring and fund a “tech war” with the United States.
That opinion turned on Fang Fang shows the artificial nature of China’s consensus. Not all public opinion is manipulated, but it’s often warped in a way that makes the culture wars of the United States appear mild. In open societies, conflicts come up like pus in a wound, whereas in China they fester below the surface. Over the past few weeks my social media feed has been filled with completely delusional views of how the pandemic has progressed in the West, with many (I would say most) Chinese believing that it has been an unadulterated debacle in rich countries, while the Chinese state has kept its people safe. Differing opinions are pilloried, and obtaining basic facts is hard. Not for the first time, I’ve felt that my Chinese friends are living in a parallel universe where certain basic assumptions about the world are turned on their head.
This is mirrored in so many facets of daily life that it is hard to list them all. Talk to most Chinese about minority areas in the country, such as Tibet and Xinjiang, and they will have almost no understanding of international concepts such as self-determination. Bring up Hong Kong and most people will angrily denounce pro-democracy protesters there as dupes and traitors. The disconnect is sometimes so strong that it’s easy to lose heart. Many people in the West have done so, leading to a sense that engagement with China has been a failure, and that confrontation is now the only alternative.
But people like Fang Fang still exist and show that China isn’t a monolith. I would argue that collectively they present a real challenge to the government—not in the classic civil society sense of people who are likely to organize opposition; the party, as Mattingly argues, is too savvy to allow such opposition to form, and officials are much better at stifling dissent than they were a couple of decades ago. Instead, Fang Fang represents a significant group of people in China who see clearly the flawed nature of their state and who are willing to express these reservations in the most direct way they know.
Consider her analysis of how local officials hid the pandemic early on. While the party-led media blamed a few local officials for not responding quickly enough to the virus, Fang Fang saw Wuhan’s problems as systemic. Without competition that might result from elections or some sort of participatory political system, China’s system leads to disaster; empty talk about political correctness without seeking truth from facts also leads to disaster; prohibiting people from speaking the truth and the media from reporting the truth leads to disaster; and now we are tasting the fruits of these disasters, one by one.
This sort of analysis is not shared by most Chinese people. For them, the party’s message is still dominant and they largely believe that it did a good job, especially compared to the mess in supposedly advanced countries. But many others do understand the party’s highly flawed nature. Their views, their books, their underground documentary movies, and their artwork—all of this is producing an unofficial history of China, a counterhistory written at the grassroots.
As the century progresses, this alternative history will stay alive, like a virus biding its time. And when the conditions are right, when Chinese people wonder why China pursued a development-at-all-costs strategy that made it vulnerable to climate change in the first place, or why local officials bungle so many crises, their suppressed views will emerge.
COVID-19 has changed life for sales professionals, says marketing guru Ashley Dudarenok. The early coronavirus crisis in China has accelerated online retail with live streaming at its core and will do so also as the rest of the world comes out of the corona crisis.
China is one of few countries recovering from the coronavirus crisis, after an initial dip. Most foreign brands are still lacking a strategy to deal with the upsurge in China’s retail, says marketing expert Ashley Dudarenok at InsideRetail.Asia.
Inside Retail Asia:
Author and speaker Ashley Galina Dudarenok, who will lead a masterclass on Chinese retail trends in November, says China has experienced one of the world’s fastest recoveries from the pandemic, even after having the world’s first large outbreak of the disease.
“For the first time in eight months, there’s a positive retail sales report showing 0.5-per-cent year-on-year retail growth in China, and 15.8-per-cent growth in online retail sales of physical goods,” Dudarenok told Inside Retail Asia.
She says Chinese consumers are already confident about an economic recovery next year, with 43 per cent of Chinese consumers optimistic about it occurring in the second quarter.
“This, along with growth in e-commerce, will bring new business opportunities for foreign brands in Mainland China.”
Live-streaming services is expected to be a standout sector of online retailing next year and the following one, with sales expected to reach US$28.57 billion as younger consumers embrace the concept.
She expects millennials, who are getting older and building their income levels, will increase their consumption to US$2.6 trillion next year.
Financial analyst Sara Hsu looks at China’s post-corona recovery, which looks encouraging, although the good news is spread unevenly along the services sector, the smaller companies, and some regions, she tells at the state broadcaster CGTN.
China has become an easy scapegoat for the COVID-19 pandemic, while now it is in better shape than most other countries in the world, says super-investor Jim Rogers from Singapore. “Blaming foreigners is a normal habit during crises,” he adds.
Journalist and academic Ian Johnson reviews a documentary of artist Ai Weiwei with hidden footage of the coronavirus crisis in Wuhan for Plataformamedia. “The public needs to understand that this film is about China,” Weiwei said in a telephone interview with Ian Johnson. “Yes, it is about the coronavirus lockdown, but it is an effort to reflect what ordinary Chinese have experienced.”
Ian Johnson:
In January of this year, the Chinese city of Wuhan became the first in the world to enter a lockdown to combat the coronavirus pandemic. This crucial period remains in many ways a mystery. Few images have escaped the censors’ control.
A new film by Chinese artist and activist Ai Weiwei has come to help fill some of this missing story. Although he is now living in Europe, Weiwei, working remotely, has directed dozens of volunteers in China to create “Coronation”, a portrait of the draconian lockdown imposed on Wuhan – of a country capable of mobilizing enormous resources, at a very high human cost.
“The public needs to understand that this film is about China,” Weiwei said in a telephone interview. “Yes, it is about the coronavirus lockdown, but it is an effort to reflect what ordinary Chinese have experienced.”
Despite its initial mistakes, China has managed to control the pandemic better than many other countries, having had 4,700 deaths, compared with more than 177,000 in the United States. The Communist Party has done everything it can to suppress expressions of sadness or revolt, but its efforts still have broad public support.
China’s food shipping was already far ahead of competitors in the US, but making a profit is still not possible, says marketing veteran Ashley Dudarenok to 90xtra, although the restaurants are griping about the percentages the shippers ask. And the COVID-19 crisis did not improve relations between retailers and shippers.
90xtra:
Ashley Dudarenok, co-writer of “New Retail Born in China Going Global,” notes how most Chinese shipping workers use maneuverable and mild e-bikes, though their Western counterparts generate cars extensive distances and incur steep labor, parking, and refueling costs. She also says Ele.me motorists are pressured by rigid evaluate systems, which penalize them RMB 200 Chinese renminbi (RMB) per weak assessment and RMB 1200 for every complaint. Another incentive: Meituan’s Supply Time Coverage alternative that charges end users simply RMB 1 ($.14), and refunds portions of service fees for any late orders…
Dudarenok, in the meantime, details out that “franchisees, HR businesses, and other third get-togethers involved in the system are in the middle. The agent on your own can even account for 25 % of Meituan’s supply profit.” Her conclusion: “Meituan’s deliveries are not sufficient to make finishes meet. It has been at a reduction for 5 many years, and it has only been successful in 2019.”
Those figures did not increase all through the pandemic, even with some restaurateurs grousing about substantial expenses. In its place, Meituan’s 1st quarter earnings announcement in depth a 12 months-in excess of-year revenue drop from RMB 19.2 billion to RMB 16.8 billion, citing offer and demand from customers difficulties (having said that, Dudarenok factors out “after the resumption of function in March and April, the volume of supply orders… has returned to practically 80 percent of the orders in advance of the outbreak” very first started).
Having a strong digital strategy has put Burberry ahead of luxury competitors even before the coronavirus crisis hit the purchasing behavior of China's consumers, says Shanghai-based business analyst Shaun Reinto the BBC.
The BBC:
Retail analysts praised Burberry for the hybrid store which combines online shopping with traditional bricks-and-mortar retailing. "Burberry has been savvy and ahead of the curve in understanding the importance of social media and e-commerce in targeting Chinese consumers," said Shaun Rein, founder of the China Market Research Group. "Too many luxury brands focus on bricks and mortar and the in-store experience only while Chinese want to shop online." Luxury brands have been selling strongly in China as residents can't travel overseas on expensive foreign shopping sprees due to coronavirus travel restrictions.
Already before COVID-19, American and Chinese internet giants fought for dominance in the booming market for food and grocery delivery, and the coronavirus crisis has caused another boom in the market, says William Bao Bean, managing director of global venture capital firm SOSV in Shanghai in Marketplace. Having dominance in their home market helps the Chinese players.
Marketplace:
William Bao Bean
“Ordering groceries online is much more advanced in China than the U.S., and when I say ‘advanced,’ it’s market penetration. I’d say more than double the amount of groceries are ordered in China for delivery versus the U.S.,” said William Bao Bean, with the global venture capital firm SOSV in Shanghai.
According to iResearch, the customers it surveyed used grocery delivery services one to two times a week in 2019...
These differences matter, given that U.S. grocery and food apps are now competing against Chinese giants for customers in Latin America and India. This is a global food fight.
“When you look at India, they’re definitely going more towards the China model,” said Bao Bean, the venture capitalist in Shanghai. “Whereas the U.S., the big-box format, with large parking lots and everybody driving a car, you’re simply not going to see that in Southeast Asia and South Asia.”
He said Amazon is not doing as well in India compared to Chinese tech firms, and Chinese money is backing Indian startups. A report by the MacroPolo think tank found that Chinese apps overtook U.S. apps in 2019.
Domestic travel in China might be recovering after being hit by the COVID-19 crisis, but international travel might never be the same, says marketing analyst Ashley Dudarenok at Technode. People will likely never travel the same way internationally again, she adds.
Ashley Dudarenok:
On June 11, after 56 days of no local transmissions and as control measures began to loosen, Beijing had another outbreak. As a result, the city locked down again, and lots of flights were canceled. A similar situation occurred in Jilin not long ago. The local government blocked travel to and from the city since May 13th. However, these incidents haven’t affected people’s willingness to travel.
According to Fliggy, travel was up during the Dragon Boat Festival in June with the overall number of tourists returning to 60% of last year’s numbers. Beijing, Tianjin, and Hebei have returned to (in Chinese) about 40% of last year’s levels.
So China’s tourism industry is gradually recovering despite strong Covid measures. With policy support from local governments and creative promotion, domestic tourism will spring back soon. However, international tourism will take longer and people will likely never travel the same way internationally again.
Airbnb co-founder Brian Chesky has said that he believes travel will never be the same. He foresees people in the West limiting their travel to a 200 mile range from home, heading to nature spots and small centres. He believes the days of visiting big destinations like London, Rome, and Paris—and posing for photos in front of famous landmarks—is over.
Some of these trends are already playing out in China as destinations like Huzhou’s Giraffe Hotel, which mimics a safari experience in Africa, with real giraffes roaming the grounds, pop up. It brings to mind a former time in China, when famous foreign sites were created within its borders for travellers who would never have the chance to see them in real life.
The chance will come again, but fewer will want to take it up than before Covid-19 entered our lives.
If China is on your strategic agenda, 2020 is the best time to enter this tough market, says marketing guru Ashley Dudarenok at her video blog. It is never going to be cheaper and more strategic if you are planning anyway to enter the China market.
While the jury is still out on the economic effects of the coronavirus crisis, the majority of the wealthy ended off better since the COVID-19 hit the world, says Hurun rich list founder Rupert Hoogewerfin the Business Standard. "The two biggest ‘winners’ from the Hurun Top 100 of Covid-19 were online retailers Jeff Bezos of Amazon and Colin Huang Zheng of Chinese low-end ‘social shopping’ giant Pinduoduo," says Hoogewerf.
The Business Standard:
Amazon Inc boss Jeff Bezos, Reliance Industries chairman Mukesh Ambani and Dr Cyrus Poonawalla of Pune-based Serum Institute of India saw their wealth increasing during the coronavirus pandemic, says research done by a Chinese group.
Hurun Research's 'Wealth Impact 4mths after Covid-19 Outbreak' tracks the wealth changes of the world’s most successful entrepreneurs in the four months ending May 31. It is a follow-up on the 'Wealth Impact 2mths after Covid-19 Outbreak' looking into wealth changes in the two months ending 31 March 2020 and the Hurun Global Rich List 2020, which had a wealth cut-off of 31 January 2020.
As many as 60 per cent of the entrepreneurs on Hurun Global Rich List Top 100 had their wealth rise or stay the same in the four months since the outbreak. As many as 40 per cent entrepreneurs saw their wealth reducing. “Whilst the first two months of the outbreak saw a massive wealth wipeout of the Hurun Global Top 100, the second two months saw a V-shaped recovery for two-thirds of the Hurun Global Top 100, reminding us that it is dangerous to bet against the world’s best wealth creators,” said Rupert Hoogewerf, Hurun Report chairman and chief researcher.
"The two biggest ‘winners’ from the Hurun Top 100 of Covid-19 were online retailers Jeff Bezos of Amazon and Colin Huang Zheng of Chinese low-end ‘social shopping’ giant Pinduoduo, who added Rs 1.51 trillion (20 billion US$) and Rs 1.35 trillion (18 billion US$) to their fortunes, pretty much all the gains coming in the past two months,” said Hoogewerf.
Another big winner was Eric Yuan Zheng, 50, of popular video conferencing app Zoom, who saw his wealth triple from Rs 34,000 crore in January to Rs 98,200 crore today, propelling him up from 555th in the world four months ago to knocking on the door of the world’s Top 100 today."
Premier Li Keqiang caused some rippled over the past few weeks by pushing street vendors as a way to save the economy and generate employment in the post-corona era. Some big cities disagreed, as they have tried to get rid of those vendors and political economist Shirley Ze Yu also disagrees with the street vendor policies, she writes in the South China Morning Post.
Shirley Ze Yu:
The “street vendor economy”, the latest economic policy from Premier Li Keqiang, has spread across China’s city streets in the past two weeks. It may seem alluring at first, but it’s far from a prescription for economic prosperity. A street vendor economy cannot save China.
During his visit to Yantai, Shandong province, on May 31, Li said: “Street vendors and small shops are important sources of employment. This is the ordinary people’s way of living. Just like those advanced and hi-tech industries, they are vital to the economy.”
Shanghai quickly announced a month-long festival promoting street nightlife. By June 4, at least 27 cities had enacted policies promoting street vendors.
Street vending has long been considered at odds with metropolitan modernity in China. For the past decade, city patrols and street vendors have engaged in a cat-and-mouse game on China’s streets, occasionally ending in brutality...
In an event too orchestrated to be accidental, a group of mayors from Hubei province held a wave of social media live streams in April. The mayors went on popular social media apps such as Douyin – China’s TikTok – to promote local produce, accompanied by their accents and on-camera unease.
They were quickly overshadowed last month when Gree Electric Appliances chairwoman Dong Mingzhu sold 310 million yuan (US$43.7 million) of goods during a three-hour stream on Kuaishou. Viya Huang, a streamer who was virtually unknown to the world before 2017 but now enjoys a celebrity status in China on a par with Kim Kardashian in the West, sold a rocket launch service for 40 million yuan on an April stream that attracted more than 19 million viewers.
Once China has experienced the power of a digital economy, how can it travel back in time and return to a more labour-intensive, less productive output narrative?
SpaceX recently made history by sending astronauts to space on an American rocket again. Solemn salutes were made on Chinese social media to the spirit of innovation. While the United States celebrated the revival of its space economy, China celebrated the revival of its street economy. No country becomes a leading nation by adding flocks of vendors to its city streets.
Government policy intervention can create emotional exuberance on the streets.
China’s leaders know a street vendor economy won’t save the country this time. They are simply soothing the public while stalling to also gaze at the stars.
Shaun Rein, founder of the China Market Research Group, believes a major challenge will be the growing strength of China's online movie sector, which is hugely competitive with platforms such as Iqiyi, Youkou and Tencent Video.
He said subscriptions were cheap at around $2 a month for a basic package, while movie tickets often sell for $20.
"Chinese players are just so cheap, often because they are subsidised as they are owned by giant internet players like Alibaba, Baidu or Tencent," he said.
"Aside from fears over catching Covid-19, consumers won't go back to cinemas anytime soon as the digital offerings are too good and cheap,"
He also predicted more pain for cinemas if film companies start to launch direct-to-digital offerings and charge higher prices for online movie releases on a pay-as-you-go basic on top of subscription rates. "I expect the cinema sector to face a massive bloodbath and many will go out of business," he added.
China veteran Kaiser Kuo discusses the future of relations between China and the US, as disaster is luring, while cooperation is needed more than ever considering the problems of the coronavirus and climate change. On racism in the US, at the Oxford Political Review. Kaiser Kuo is a speaker at the China Speakers Bureau. Do you need him at your meeting or conference? Do get in touch or fill in our speakers' request form. Are you looking for more political experts on the China Speakers Bureau? Do check out this list.
