Another week and another bunch of headlines out of or related to China. China winds are blowing in the global economy, Asia tensions and technology just to name a few. Here are 5 things that caught my eye this week:
- China stops buying coal from North Korea.
- China has become Germany’s top trading partner.
- South China Sea problem just won’t go away
- The Bird Flu is still here and appears to be getting stronger
- China winds blow strong in technology…solar and nuclear
No Coal
Early this week China announced that it will stop buying coal from North Korea. This is part of an effort to put pressure on North Korea to rein in their nuclear program and support UN sanctions. But it also comes on the heels of a ballistic missile firing and the assassination of the half-brother of Kim Jung Un, North Korea’s leader.
What was not widely reported was that according to the Economist, the half-brother, was residing on Chinese territory in Macau. Macau is a Chinese “Special Administrative Region”. It is just across the bay from Hong Kong.
Germany’s Top Trading Partner
China winds are blowing into Europe as it becomes Germany’s top trading partner. This move leapfrogged the United States and France, with the U.S. dropping to third. This statistic counts both the imports from China and the exports to China, from Germany.
In terms of countries who are the biggest customers of German exports, it is United States, France and the UK. The strengthening of the relationship between China and Germany comes at a time when there is heightened concern about where international trade is going.
South China Sea
China continues to build and develop islands in the disputed areas of the South China Sea. China believes that this is their territory. This territory is actually claimed by at least 5 other countries and I believe includes international territory as well. The South China Sea is one of the most heavily traveled bodies of water in the world and holds significant oil reserves.
This last week it became known that China winds were getting stronger here with the possible installation of missile defense systems on the man-made “Great Wall of Sand” as these artificial islands have been called. China has been building these islands for the past 2-3 years. The United States recently moved an aircraft carrier into the South China Sea as a show of force.
Bird Flu
China is dealing with the bird flu and it is spreading more rapidly over the last several months. This virus is called H7N9 and started infecting people in 2013. Over a 3 year period from 2013 to mid-2016 798 cases occurred with 40% of the people dying.
This winter alone there have been an additional 424 cases and it’s spreading. These statistics come from an article on NewScientist.com The main concern of course is that something like this gets out of control and turns into a pandemic.
Solar and Nuclear
Everyone is probably well aware of the pollution problems in Beijing and other major industrial areas of China. As a result China is making an effort to increase its use of non-carbon based energy. I came across two articles related to solar and nuclear that appeared this week.
The first one was about the world’s largest solar farm which covers 10 square miles and has 4 million solar panels. It has the capacity to produce 850 megawatts. Impressive, but it won’t be the largest for long. There are plans for China to build a solar plant that will produce 2000 megawatts. That’s “big league”.
And when it comes to nuclear power plants, the United States has China beat but for how long? According to a Bloomberg article, China has 20 nuclear plants under construction with another 176 either planned or proposed.
Market Video
In my post and video on Wednesday I talked about Weibo and a couple of other Chinese stocks. In this short market update I include a review of Baidu (BIDU) and Ctrip.com (CTRP). Both had earnings out last week but with different results.