Mutually Beneficial

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Mutually Beneficial

Solar panels installed on farmland in Leqing, east China’s Zhejiang Province.

Electricity generated will go to the national grid in late August while crops are grown underneath the panels—a combination of power generation and farming.

PMI Data

The manufacturing sector posted a slight drop in July due to the effects of the flood season and weak demand, according to official data released on August 1.

The purchasing managers’ index (PMI) came in at 49.9, slightly lower than June’s 50, according to the National Bureau of Statistics (NBS) and the China Federation of Logistics and Purchasing.

NBS statistician Zhao Qinghe said that floods that hit much of the country during July disrupted manufacturing activities and transportation.

In addition, slowing market demand and weak investment sentiment in the private sector contributed to the contraction in the manufacturing sector, he added.

The sub-index measuring production stood at 52.1, 0.4 percentage points lower than a month ago.

The sub-index for new orders settled at 50.4, 0.1 percentage point lower than the previous month, declining for the fourth month in a row.

While the manufacturing sector slowed, the service sector expanded faster in July.

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NBS data showed that the index for services grew 0.2 percentage points to 53.9, its highest level this year.

China-Britain FTA

China is willing to take on an open attitude as it works with the British Government to conduct a feasibility study for a bilateral free trade agreement (FTA), the Ministry of Commerce (MOFCOM) said on August 2.

Shen Danyang, a spokesman for the ministry, said that as Britain is a major global economy, China will respect its wishes if it wants to launch FTA talks.

British Chancellor of the Exchequer Philip Hammond said recently that his country has already started preparing for the launch of FTA talks with China.

Trade in goods between China and the EU amounted to $564.85 billion in 2015, while that between China and Britain reached $78.54 billion, data from the General Administration of Customs of China showed.

China and the EU have already started negotiations on a bilateral investment treaty, which is expected to give easier market access to EU companies looking to enter the Chinese market. Both sides wish to conclude talks by the end of this year.

China has already signed an FTA with two non-EU members—Iceland and Switzerland. China and Norway are in talks to reach a free trade deal as well.

Because China has not signed a single deal with an EU member, the British Government is currently studying the details of the China-New Zealand FTA, as well as considering which Chinese products would have a large impact on Britain’s national security, according to information posted on the China FTA Network, a website administered by MOFCOM.

Tourism Boom

The tourism industry raked in 2.25 trillion yuan ($346 billion) in revenue in the first half of the year, up 12.4 percent year on year, official statistics showed on August 1.

Domestic tourists made 2.24 billion trips in the same period, an increase of 10.5 percent from a year ago. Inbound and outbound trips edged up 4.1 percent year on year to 127 million, the China National Tourism Administration (NTA) said.

Tourism has become a strong engine for economic growth. The sector contributed 10.8 percent to the country’s GDP last year and created a job increase of 10.2 percent, according to NTA data.

China’s spending in the tourism sector is likely to triple by 2020 to 3 trillion yuan ($450 billion), said NTA head Li Jinzao during the First World Conference on Tourism for Development in May.

China invested more than 1 trillion yuan ($150 billion) in the tourism sector last year, an increase of 42 percent from one year before, according to Li.

New Regulation

E-commerce giant Alibaba Group Holding Ltd. has ceased sales of medicines on its Tmall platform as the government tightens control over the nascent e-pharmacy industry.

Tmall, the business-to-consum-er site of Alibaba, said in a statement that it will “adjust its business model based on new regulatory requirements in order to provide better service to customers.”

The change in regulation, effective on August 1, put an end to the experiment in selling pharmaceutical products directly to consumers via online third-party platforms. The ban also applies to other websites such as Yhd.com.

Bank Listed

The yuan-denominated A-share market saw the first initial public offering of a regional commercial bank on August 2—the Bank of Jiangsu. It was the first of such to occur in China since the global financial crisis in 2008.

It is also the first listing of bank shares in six years.

Some of the bank’s 1.1 billion shares became tradable on the Shanghai Stock Exchange, bringing in an expansion of more than 7 billion yuan ($1.05 billion) to its capital base, according to the bank’s prospectus.

The stock, opening at 6.27 yuan ($0.95), was off to a 44-percent surge to finish at 9.03 yuan ($1.36), during which trading was temporarily halted by the Shanghai Stock Exchange.

Founded in 2007, the Bank of Jiangsu had total assets worth 1.29 trillion yuan ($194.6 billion) after three years of cumulative growth of 70 percent by the end of last year, making it the country’s third-largest municipal commercial bank.

Regional banks have been vying to go public in recent years as they seek to raise funds to improve their capital adequacy ratios and reach the required supplementary capital level due to rising bad loans.

E-commerce Education

Online-to-offline (O2O) giant Meituan & Dazhongdianping has announced a plan to set up a college to train e-commerce personnel.

The college, named Internet Plus University (IPU), is the first of its kind in the e-commerce sector to focus on developing business models, technology and skills to promote China’s Internet Plus strategy.

It will integrate the company’s training departments to establish several schools to train internal staff and business partners on upgrading e-commerce, the company said on July 30.

E-commerce platforms should not only focus on marketing and transactions, but also expand to other upstream services, according to Wang Xing, CEO of the company, noting that the essence of the Internet Plus strategy is focused on improving efficiency and reducing costs across all sectors by integrating the Internet with more industries.

Formed by the merger of group-buying platform Meituan. com and review service Dianping. com in October 2015, Meituan & Dazhongdianping offers a range of O2O services, from food delivery to movie ticket sales.

Urbanization Trend

Sponsored by the China Center for Urban Development, the China Smart City Annual Forum 2016 was held in Beijing on July 29, based on the theme of innovation, coordination, openness, ecological awareness and sharing.

Rapid progress has been made in urbanization, and the urban population is expected to rise from the current 760 million to 900 million as of 2030, said Li Tie, Director General of the China Wisdom Cities Industry Alliance. He believes that urban construction will generate huge demand, and that the development of smart cities will encompass urbanization efforts, the Internet and the Internet of Things.

Li’s view was echoed by Zhang Wang, Deputy Director of the Internationalization Development Department of the Office of the Cyberspace Administration of China. Besides meeting people’s demand, Zhang suggested that the development of smart cities should be driven by both advanced technology and innovative mechanisms. He also said that different methods should be applied to different cities, and a high level of attention needs to be paid to cybersecurity.

According to statistics from the Blue Book of Cities in China, during the 12th Five-Year Plan (2011-15) period, the urbanization rate in China went up by 5 percentage points and reached 56.1 percent. By the end of 2015, there had been over 500 smart city pilots in China, creating 248 billion yuan ($37.41 billion) of investment in information technology.

Auto Show

Visitors look at cars on display at the 19th Harbin International Auto Show, which kicked off in Harbin, Heilongjiang Province, on August 1.

A total of 466 domestic and foreign automakers showcased their latest car models and technologies at the event.

Setting Out

Ships sail off to fish in Zhoushan, east China’s Zhejiang Province, on August 1, after a two-month fishing ban in parts of the East China Sea ends.