Under heavy blockade sanctions by the United States and other Western countries, there are signs that the CCP is mobilizing troops and preparing food, and comments suggest that Xi Jinping is trying to return to the lock-up route to prepare for war. At the same time, foreign investment has accelerated to withdraw from China, and China’s largest manufacturing center enterprise has had to lay off staff and reduce wages this year. Foreign investment accelerated to withdraw from the mainland, and 5 foreign companies decided to turn to invest in Indonesia. China is entering an era of depression in all industries, and the automotive industry is more serious, entering a moment of life and death. Nowadays, a large number of second-hand houses are listed in all parts of China, and even the real estate market is stalling.
Contrasting strongly with China’s economic tragedy is that, despite the intensified semiconductor competition in various countries, Taiwan’s strong industry is calling for its output value to double in 2030.
In addition, China freezes thousands of updates to Apple’s App Store! The US National Security issued a major report: The expansion of American multinational companies in China is detrimental to US technological superiority, Apollo commentator Wang Duran commented.
Food crisis! China is mobilizing troops to prepare food, returning to the era of Mao’s preparations to fight against hunger?
The Chengdu Municipal Agriculture and Rural Bureau of Sichuan Province recently issued a document requesting investigation and reporting on the restoration of rice cultivation in the city’s orchards and tree plantations in order to respond to the possible food crisis.
According to a document issued by the Chengdu Agriculture and Rural Bureau, in order to encourage villagers to evacuate the fruit trees for ploughing and replanting rice, they promised to give the fruit tree planters a compensation of 3,000 yuan per mu for recultivating rice.
Local farmers said that Chengdu’s orchards and flowering trees were once very developed. Even now, the benefits of planting fruit trees and landscape seedlings are far more than several or even tens of times more than that of growing grain. Planting staple foods with extremely poor benefits means that the country’s food reserves are very fragile.
Mr. Fang, a grassroots official in Xiaogan City, Hubei Province, also told Free Asia reporters that they also requested villagers to mobilize land and promised a subsidy of 150 yuan for each staple food of one acre of land. But he revealed that because of the serious input and income deficits of farming, many people would prefer to waste land even with a small amount of compensation.
Mr. Chen from Chongqing also said that now US grain cannot be imported, plus the grains in the last few grain stores have been grains, and all of them are sand. All are national reserves. Two directors of grain depots committed suicide last month. Despite the apparent tension, the actual crisis is still very serious. At the beginning and end of this month (June), the Politburo Standing Committee was completely closed. Originally, it was opened twice a month.
At the same time, Mr. Chen pointed out that on the one hand, the authorities tried to push the replanting of staple food at a huge cost, on the other hand, they made a high-profile troop deployment to the Northwest Plateau, put the reserve into the direct control of the Military Commission, and even high-profile propaganda and development of militia organizations to show off the force. People are worried that the routine of preparing for war and preparing for wasteland decades ago is repeating itself.
Worrying happened! A large number of second-hand housing listings across China
In the past year, the number of second-hand housing listings in Beijing has increased very quickly. According to the data of intermediaries, in March 2019, there were only more than 55,000 listings in Beijing second-hand housing. By August 2019, this number had risen to 8. 10,000, which became 90,000 in December. It fell back slightly in January this year, but came back in May. Although the second-hand housing transactions driven by the school district’s housing policy have blown up, the number of listed houses has not decreased but has increased. It is more than 92,000 sets.
Beijing’s second-hand housing is now extremely down payment, according to regional guide price loans, so basically the same as the full amount. It seems that housing prices have not fallen this year in Beijing, but in fact, you only know when you want to sell, which is basically 10-20% lower than your psychological expectations.
Secondly, Hangzhou, everyone thinks that the property market in Hangzhou is very hot, and new house transactions are often snapped up, but in January 2019, Hangzhou’s second-hand housing has only 65,000 suites, and now it is already 120,000 units. In a year and a half, almost Doubled. However, the turnover in Hangzhou has not improved. And according to the latest data, in the first half of 2020, Hangzhou was the first to sell land, surpassing 150 billion yuan, that is to say, Hangzhou is constantly increasing land supply, new houses are constantly entering the market, and there are more and more second-hand houses.
The rent in Hangzhou has fallen for three consecutive months. There are a lot of vacancies now, and many of them have not yet been rented out. The average rent level in Hangzhou is probably less than 60 yuan per square meter, which is 30% lower than the northbound, but the income is about 10% worse, so it is clear that Hangzhou has already Oversupply is over.
The number of listings in Nanjing has increased from 38,000 units at the beginning of 2019 to 92,000 units now, which is the same level as Beijing; Chongqing is even more excessive. At the beginning of 2019, it was 48,000 units, and it is now 160,000 units; Tianjin is from 50,000 units This increased to 130,000 units; Guangzhou’s 40,000 units rose to nearly 70,000 units; Suzhou’s 24,000 units rose to 88,000 units, and many friends said that Shenyang didn’t understand why the Northeast population continued to flow out and the economy bottomed out every year. Can housing prices continue to rise?
Most of the prices of new homes are now upside down with the prices of second-hand homes, which triggered the selling of second-hand homes. On the one hand, everyone thinks that buying a new house is an arbitrage opportunity. On the other hand, second-hand home holders are also willing to sell their hands. The house is going to be new, so the second-hand house is under pressure. In fact, this kind of arbitrage transaction has occurred. The return of value has begun. As more and more sell-offs are made, the price of second-hand houses will inevitably move closer to the price of new houses, thereby narrowing the price difference. At that time, if the new house wants to promote again, it has to continue to cut prices. Then it will continue to lower the price of second-hand housing.
In the past three years, except for a few cities, they have basically lost money. Even if prices haven’t fallen, or even increased a bit, it’s far from enough for your capital cost. Now it is basically impossible to take out without losing money. If you wait any longer, there will be more and more new houses and second-hand houses. In a cycle of 2 years, the new houses will be converted into second-hand houses after 2 years.
The situation is grim! China’s largest manufacturing center enterprise layoffs and pay cuts this year
Financial media Bloomberg reported that Standard Chartered’s survey of more than 190 manufacturing companies in Guangdong, Hong Kong and Macau showed that this year’s wages are expected to decline by an average of 0.2%, and the total number of employees will be reduced by 2.8%. This commonly known as the “Great Bay Area” relies on exports, while China’s exports fell by nearly 8% in the first five months of this year.
This is the first time that the Standard Chartered survey has witnessed a drop in wages in the 11 years since it was launched. 60% of the companies surveyed said they expected a pay cut this year. However, even if labor costs are expected to decline and the tension in the job market will be eased, companies are still considering transferring some of their production capacity overseas.
43% of the companies surveyed said that due to the continued tension between China and the United States and the crisis, they will more actively consider shifting production.
Foreign investment quickly withdrew 5 foreign companies transferred to Indonesia
The survey shows that Vietnam is still the most popular destination for companies considering shifting production, followed by Cambodia, Myanmar, Bangladesh and Thailand. Although ASEAN countries are benefiting from increased foreign investment, most of the companies interviewed also highlighted the problems in these countries, such as lack of local capital, low productivity, and rapidly rising labor costs.
Indonesian President Joko Widodo announced on June 30 that seven foreign businessmen have decided to relocate production capacity to Indonesia, five of which are moved from the mainland, and another 17 foreign companies have the intention to invest in Indonesia.
The Jakarta Post reported on the same day that the Indonesian Investment and Manpower Bureau (BKPM) estimated that the investment of seven foreign investors in Indonesia totaled approximately US$850 million and brought 30,000 job opportunities.
U.S. multinational corporations heavy report released
The U.S.-China Economic and Security Review Commission issued a report on Wednesday that pointed out that U.S. companies’ business in China shifts from manufacturing to R&D and other high-value activities, which may threaten U.S. industrial competitiveness and long-term technological leadership, and may “inadvertently” increase China’s Risks of industrial policy and military development goals.
At present, American companies have 1.7 million employees in China, which is six times that of 2000. In addition to seeing the market potential of China’s middle-class population increase, American companies are also taking advantage of China’s cheap labor, economies of scale, and local government preferential policies to serve other regional markets.
The report points out that American multinational companies rely on China as a sales and global manufacturing hub, which may increase the risk of dependence on China for US national security-related industries.
Apollo commentator Wang Duran commented that after the report came out, the White House would take measures to improve the situation, because it involves the country’s national capital. The White House will formulate a new national strategy and then implement it.