Top News
China, US clash over Panama Canal at UN meeting
The US and China aired conflicting views on operation of the Panama Canal at a UN Security Council meeting this week. The US, which built the canal in 1904-14, said China's influence over port operations there could threaten global trade and US security. China rebutted the claim, saying it has always respected the permanent neutrality of the waterway connecting the Pacific and Atlantic oceans, and accused the US of trying to take it over. The meeting was chaired by Panama, which holds the council's presidency this month. Even before taking office in January, US President Donald Trump said the US should take back control of the canal.
Hong Kong-based CK Hutchison, which controls 90 percent of canal operator Panama Ports Co, has been in talks to sell those ports and 41 others around the world to a US-based consortium led by US-based BlackRock and Italian-based shipping conglomerate MSC for US$23 billion. CK Hutchison on July 28 announced it would include Chinese shipping giant Cosco as a stakeholder in the deal.
Bloomberg reported that the Panama Canal Authority is developing plans to enter operation of port terminals on either end of the waterway as part of a seven-year, US$8.5 billion capital spending program.
Ukraine remains firm on refusal to cede territory
Ukrainian President Volodymyr Zelensky doubled down on his refusal to cede any territory controlled by Russia in the eastern Donbas region in exchange for a ceasefire, warning that such concessions would act as a springboard for future attacks. US President Donald Trump and Russian counterpart Vladimir Putin will meet in Alaska on Friday to discuss a war that Trump wants to end. Zelensky isn't included in the summit. Trump said earlier that any peace deal would involve "some swapping of territories." Russian troops are continuing a summer offensive in the region.
Israel begins offensive on Gaza City
Israel stepped up air attacks on Gaza City as part of its newly unveiled plans to occupy the whole of the coastal enclave. The World Health Organization asked Israel to allow it to stock hospital medical supplies in Gaza in preparation for rising casualties. Israel has advised residents to leave the city, though where it is safe for them to go is problematical. Gaza's health ministry said 100 dead had been brought to hospitals in the past 24 hours, including 31 people killed while seeking food at distribution sites. It added that five more people died of malnutrition.
China-Brazil unity
Chinese President Xi Jinping told Brazilian President Luiz Inacio Lula da Silva on a phone call Tuesday that China is ready to work with Brazil to set an example of unity and self-reliance among major developing countries. Both are founding members of the BRICS group of nations, which have shown the staunchest opposition to the US trade war. Xi said China-Brazil ties are at their best in history and the two countries' development strategies align smoothly, Xi said.
Top Business
Woes mount for debt-laden China property developers
Shenzhen-based China South City has become the fifth Chinese property developer ordered into liquidation since the beginning of a real estate slump in 2020. The Hong Kong High Court appointed an administrator to take over the assets of the Hong Kong-listed company -- the biggest Chinese builder by assets to be wound up since China Evergrande Group. South City defaulted on two US-dollar bonds last year and announced a restructuring last year that failed to get support from creditors. At the end of last year, South City had debt liabilities totaling HK$30.2 billion (US$3.8 billion).
Separately, Guangzhou-based China Evergrande, once China's biggest developer by sales, will be delisted from Hong Kong's stock exchange on August 25. It owed US$300 billion to banks and bondholders when it was forced into court liquidation in January 2024 and then failed to produce a viable debt-restructuring plan.
Meanwhile, Dalian Wanda Group was been hit with a new enforcement of 2.4 billion yuan (US$330 million) by the Beijing Financial Court, lifting its total outstanding enforcements to more than 7.6 billion yuan. Property management arm Wanda Commercial Management reported 137.6 billion yuan in interest-bearing debt as of June 2024, with over 30 billion yuan due within a year. The group has sought to ease its liquidity crunch by selling nearly 50 Wanda Plazas this year.
China offers subsidies on consumer loans
China announced a new subsidy program to encourage more consumer spending. For the year commencing on September 1, consumer loans, excluding credit cards, will be eligible for an annual interest discount of 1 percentage point, capped at 50 percent of the loan's contract rate. The subsidies will apply only to the first only 50,000 yuan (US$7,000) of a loan. The subsidies cover areas of spending like cars, home renovation, household appliances, electronics, tourism and education. The central government will pay 90 percent of the cost of the program, with provincial governments paying the rest.
Beijing confirms extension of tariff truce
China confirmed extension of its 90-day tariff truce with the US, which scaled back ultra-high bilateral duties to allow for trade talks. Under the extension, Beijing will retain 10 percent tariffs on US imports through November 10. US President Donald Trump signed an executive order on Monday affirming the temporary suspension of all but 30 percent US tariffs on Chinese goods.
Economy & Markets
China lifts some export controls on US companies
China's commerce ministry announced on Tuesday that it is easing export controls on some US companies, adhering to a consensus agreement reached in trade talks with the US last month in Stockholm. The Ministry of Commerce added 28 US companies to the export-control list in April, prohibiting exports to them of so-called "dual-use items," or goods, software or technology that can be used for both civilian and military applications. Under the latest steps, restrictions on 12 of the companies have been lifted, while 16 will remain on the list for an additional 90 days.
The ministry also announced some adjustments to its "unreliable entity list." China initially added 17 US companies to the list in April, prohibiting them from engaging in import-export activities with China and from making new investments within the country.
US inflation remains tame
US consumer prices in July rose 0.2 percent, slowing from a 0.3 percent rise in June. Excluding volatile items like food and energy, core CPI increased 0.3 percent. The tame inflation figures spurred anticipation of a rate cut next month by the Federal Reserve, which has been awaiting evidence of how Trump administration tariffs are affecting domestic prices.
Separately, President Donald Trump advised Goldman Sachs to hire new economists after the investment bank published an economic research report warning that the tariffs will mean higher prices for US consumers.
Australia cuts rates, lowers growth outlook
Australia's central bank cut its main cash rate by a quarter point to a two-year low of 3.60 percent, citing a slowdown in inflation and a looser labor market. It was the third rate cut this year. The Reserve Bank also trimmed its growth target for 2025 to 1.7 percent from 2.1 percent.
Corporate
Pony.ai quarterly loss widens, revenue surges
US-listed autonomous driving startup Pony.ai widened its net loss in the second quarter to US$53 million from US$31 million a year earlier. Revenue jumped 76 percent to US$21 million on surging demand for its robotaxi services. Operating expenses increased 75 percent to US$64.7 million. Its shares fell 3.5 percent in New York.
The company, which is backed by Toyota, raised US$260 million from its public listing on the Nasdaq last November. In the second quarter, it began mass production and road testing of its seventh-generation robotaxi, expanding its fleet to over 500 vehicles. The company has launched Shanghai's first fully driverless robotaxi service, making it the only Chinese company with autonomous-driving operations in four cities. It said it is on track to meet its target of 1,000 robotaxis in operation by year's end.
Kweichow Moutai reports 8.9 percent profit growth
Chinese liquor maker Kweichow Moutai reported profit in the first half rose 8.9 percent to 45.4 billion yuan (US$6.3 billion) on a revenue increase of 9.2 percent to 91 billion yuan. Bloomberg said it was the company's worst six-month earnings growth since at least 2016, as domestic consumer demand for its premium liquors abated and government edits against wasteful practices ate into banquet spending. Overseas sales, however, surged 31 percent to 2.8 billion yuan, indicating a faster pace in its going-global strategy.
CATL introduces low-cost battery repair service
Contemporary Amperex Technology (CATL), the world's biggest maker of electric vehicle batteries, has rolled out a repair service for its batteries using cell-to-pack technology to reduce expenses for car owners and seek a new growth driver, Yicai reported. Replacing a battery typically costs around 100,000 yuan (US$14,000), while the new repair costs can be as low as 10,000 yuan.
Ikea parent invests in Shanghai recycling firm
Ingka Group, parent of Swedish retail giant Ikea, has invested in Shanghai-based Re-Mall Environmental Protection New Material, a Chinese recycler of consumer packaging waste.
China is one of the largest plastic markets in the world and has taken a leading role in finding recycling solutions. Re-Mall produces premium recycled polypropylene used in consumer goods. Ingka, which operates 39 Ikea stores and 10 shopping malls under the Livat brand on the Chinese mainland, said the investment is a commitment to tackle the global waste problem.
Property developer to expand into technology
Beijing-based property developer Vantone Neo Development Group said that it plans to diversify its business by spending 854 million yuan (US$118 million) to purchase a 63 percent stake in Sudo Information Technology, which produces high-speed interconnect chips for artificial intelligence servers.
Sandwich chain Subway eyes 10-fold increase in outlets
US-based sandwich chain Subway said it ultimately plans to open 10,000 outlets in China, as it celebrated the launch of its 1,000th store. The company entered the mainland in 1995. Its previous goal was to open 4,000 outlets. Subway called the China market one of endless opportunities.
Airbus Helicopters delivers aircraft for energy industry use
Airbus Helicopters said it has delivered the first H160 medium-utility helicopter to Shanghai Jet Airways Technology, marking the model's entry into service in China. The aircraft will be mainly used to ferry personnel to offshore oil and gas platforms, and wind farms.