Top News
Europe-Iran talks make no progress toward peace
British, French and German foreign ministers held talks with Iranian Foreign Minister Abbas Araghchi on Friday in Geneva but made no headway in finding a path to peace in the weeklong Iran-Israel war. Araghchi told reporters after the talks that his country will consider resumption of diplomacy only if Israel stops its attacks on Iran. He said Israel must be held accountable for "crimes committed" and repeated that his nation's nuclear program is for peaceful purposes.
The talks came amid a "window for diplomacy" created when President Donald Trump delayed for two weeks a decision whether the US will join Israel in bombing Iran. The US and Iran were in talks on Iran's nuclear program when Israel launched its surprise attacks on Irani nuclear facilities.
Trump dismissed Europe's ability to help broker a ceasefire. "Iran doesn't want to speak to Europe. They want to speak to us," he said, adding that it's unlikely he would press Israel to scale back its attacks as a precondition for further negotiations.
French Foreign Minister Jean-Noël Barrot summed up Friday's talks by saying, "There can be no definitive solution to the Iran nuclear problem through military means. Military operations can delay it, but they cannot eliminate it."
New Zealand prime minister hails China trade relations
Chinese President Xi Jinping and New Zealand Prime Minister Christopher Luxon, who is on his first official visit to China, stressed the importance of cultural ties and bilateral trade. Luxon, who is leading a delegation that includes representatives from New Zealand's agricultural, health, education and tourism sectors, called China a "global economic powerhouse" that buys 20 percent of New Zealand exports. Bilateral trade last year totaled almost US$23 billion.
New Zealand announced it is simplifying procedures and lowering costs for Chinese travelers transiting its airports. Beginning in November, visitors will be able to obtain an electronic "travel authority" that can be processed in 24 hours and costs as little as NZ$17 (US$10). A new China Eastern Airlines "southern link" route from China to South America via Auckland is due to open by the end of the year.
Top Business
Tesla to build mega energy storage facility in Shanghai
Electric carmaker Tesla signed a 4 billion yuan (US$557 million) deal with the Shanghai government and Kangfu International Leasing to build a grid-scale energy storage plant in the city, Yicai Global reported. Elon Musk's company, in a post on Chinese social media platform Weibo, said the project will be the largest of its kind in China when completed. The project will use Tesla megapack batteries. The US-based company began production of the batteries at a manufacturing site in Shanghai in February.
Rare-earth export licensing speeds up
China is accelerating its review of export licenses for rare earth minerals and industrial magnets, the Ministry of Commerce said. Some Western automakers complained last month that a shortage of the critical industrial elements was causing them to curtail production. China dominates the world in rare-earth mining. The elements are used in a range of production, including vehicles, smartphones and other consumer electronics.
AtomIC Technology 2D chips
Chinese startup AtomIC Technology has launched the country's first engineering validation line for two-dimensional semiconductor-based integrated circuits in Shanghai, signaling a key step toward commercializing next-generation chip technologies. The facility aims to bridge the gap between lab breakthroughs and large-scale application of ultra-thin materials.
AtomIC, backed by Fudan University, is also developing its own 2D chips and recently unveiled a 32-bit RISC-V processor built entirely from 2D materials like molybdenum di-sulfide. After securing tens of millions of yuan in funding, the company plans to achieve mass production of low-power 2D chips by 2029.
Cross-border payment bridge launched
China's mainland and Hong Kong will be linked by a new digital payment system dubbed "Payment Connect." Starting this weekend, the system will combine the mainland's Internet Banking Payment System with the city's Faster Payment System, allowing quicker, safer financial transactions between residents and businesses on both sides of the border. "This is a milestone in deepening financial cooperation," said Pan Gongsheng, governor of the People's Bank of China, at the launch ceremony. "It improves cross-border efficiency and enhances Hong Kong's international financial standing." Hong Kong Monetary Authority chief Eddie Yue hailed the system as a secure, convenient tool for residents and institutions alike.
China-South Asia Expo opens
The 9th China-South Asia Expo opened in the southwestern city of Kunming, attracting business people from more than 70 countries and 2,500 companies. The event is aimed at strengthening economic and trade ties with the region, which had import-export volume of US$200 billion with China last year.
Economy & Markets
China central bank leaves rates intact
The People's Bank of China left benchmark interest rates unchanged for June, signaling confidence in economic stability amid global trade tensions. The central bank's decision leaves the one-year loan prime rate at 3 percent and the five-year rate at 3.5 percent. The one-year rate is a reference point for corporate and consumer loans; the five-year rate guides mortgage lending.
Japan rice prices soar, inflation climbs
Japanese prices of rice, a staple of the national diet, doubled in May from a year earlier, the largest increase in more than 50 years. Prices in both April and May rose at rates above 90 percent. The government has been releasing rice from emergency stockpiles to mitigate prices. Part of the soaring rice price is attributed to a severe heatwave in 2024 that reduced the annual rice harvest.
Core inflation, which excludes volatile items such as fuel and fresh food, but not raw rice, rose 3.3 percent in May, up from 3 percent in April and at its highest level since January 2023. Headline inflation was little changed at 3.5 percent but exceeded the Bank of Japan's 2 percent inflation target for the 38th consecutive month.
Harbinger of weaker US economy
The US Conference Board's Leading Economic Index, a measure of future economic activity, fell 0.1 percent in May, with its sixth straight month of decline triggering a recession signal. The drop reflected consumer pessimism, weak new manufacturing orders and sagging building-permit applications.
Shanghai tourist-market boost
Shanghai's tourism market is getting a boost with the unveiling of a new platform combining information on food, transport, attractions and shopping into one user-friendly site for international visitors. The English-language Easy Go service will operate on Alibaba's Alipay app. It amalgamates 30 commonly used apps and tools. Shanghai, a major gateway for foreign tourism in China, benefits from the central government's new visa-free entry policies and rebates on value-added tax offered on goods purchased during stays.
Deep Dive
Hong Kong unveils new investment channel to recapture its prominent in global finance
For Chinese high-growth industries, the Technology Enterprises Channel is a windfall born from timing, turmoil and tectonic changes in global capital flows.
(click headline to read the full article)
Corporate
Disney, Shanghai studio to produce animation series
Walt Disney China and Shanghai Animation Film Studio have teamed up to produce a four-part series entitled "Zootopia: Day and Night," which will feature Chinese traditional art animation techniques, such as stop-motion, ink-wash and paper-cut images. The show will be screened on Chinese social media and video platforms in November.
Pop Mart faces selloff
Shares of Pop Mart, the world's most valuable toymaker, fell 8.8 percent in the last two days of trading in Hong Kong, wiping nearly HK$31 billion (US$3.9 billion) off market value. The slide follows the first online presale of Pop Mart's latest version of its coveted Labubu dolls, denting scalpers' profits by offering fans direct access to the soft toys. Resale of Labubu 3.0 blind boxes have halved in price and are now fetching 650-800 yuan. Pop Mart's new sales strategy has caused a flood of orders from delighted consumers, with revenue across all distribution channels expected to exceed 5 billion yuan. While this may benefit long-term brand loyalty, investors fear pressure on profit margins and collectible value.
JD to move into tourism services
Chinese e-commerce giant JD.com is planning to expand with supply-chain services for the hotel and restaurant market, according to an open letter to potential clients. JD founder Richard Liu said the services will cut costs for clients by two-thirds. The foray into the tourism sector comes as JD seeks new business models to overcome slower growth in core activities in competitive markets like fast-food delivery.
Zhongman wins Algerian contract
Shanghai-based oilfield services provider Zhongman Petroleum & Natural Gas said it secured exploration and development rights to Algeria's Zerafa II natural gas block under a production-sharing agreement. The value of the investment wasn't disclosed. The privately owned company said the project will strengthen its control over upstream gas resources. Zhongman shares in Shanghai rose 7.12 percent on the news, but retreated 5 percent on Friday.
Fangda snaps up Hainan land
Fangda Group was a big winner as the city of Sanya in China's southern Hainan Province sold four land parcels in a single day for a record 4.4 billion yuan (US$612 million). Fangda, the largest shareholder in Hainan Airlines, bought two prime sites on Haitang Bay for nearly 3 billion yuan. Fangda's business portfolio also includes investments in steel, pharmaceuticals and commercial building. Hainan's economy has been booming on tourism and the province's status as a free-trade port.