12/29/2020 Financial News: Trump bolsters order barring U.S. investment in CCP military-controlled firms

Image source: https://www.secretchina.com/

1.Trump bolsters order barring U.S. investment in CCP military-controlled firms
The Trump administration on Dec. 28 strengthened an executive order barring U.S. investor from buying securities of alleged CCP military-controlled companies, following disagreement among U.S. agencies about how tough to make the directive.

The Treasury department was seeking to exclude CCP companies’ subsidiaries from the scope of the White House directive. The guidance released on the day specifies that the prohibitions apply to “any subsidiary of a Communist Chinese military company, after such subsidiary is publicly listed by Treasury.” It added that the agency “intends to list” publicly traded entities that are 50% or more owned by a CCP military company or controlled by one. Currently the list contains 35 companies, including oil company CNOOC Ltd and CCP’s top chipmaker, Semiconductor Manufacturing International.

2.Online education company Xuebajun went bankrupt
At the end of 2020, another online education company Xuebajun went bankrupt. A xuebajun educational administration director said in a circle of friends that he was informed on the afternoon of December 26 that part of xuebajun had been acquired, which was equivalent to bankruptcy, and all teachers and course planners had been dismissed.

Xuebajun asked employees to return their mobile phones to the company to prevent staff from continuing to contact parents and students. According to the chat records provided by a parent, the course consultant was still urging her to renew the fee one day before the bankruptcy. Due to the high amount of tuition, there are many parents who have chosen to pay in installments and are unaware that they’ve signed a training loan agreement with a 3rd party financial platform introduced by Xuebajun.

3.Donald Trump signs laws to further US support to Taiwan, Tibet
President Trump on Dec. 27 signed “Taiwan Assurance Act of 2020” and “Tibetan Policy and Support Act of 2020”. As per the Tibetan act, the US will open a US consulate in Lhasa, Tibet and Washington will assist non-governmental organizations in support of Tibetan communities. Taiwan has also lauded the US move, with its presidential office calling Washington an “important ally” for sharing values of “freedom and democracy”. Chinese Foreign Ministry spokesman Zhao Lijian said Beijing was “resolutely” opposes both acts.

4.Communist China tries to overcome the core technology of advanced chips
The Central Economic Work Conference was held in Beijing from December 16th to 18th. The main task is solving a batch of “stuck neck problems” as soon as possible, especially advanced chips. On Dec 28, Communist China’s National Development and Reform Commission and the Ministry of Commerce rolled out the 2020 edition of the Catalogue of Encouraged Industries for Foreign Investment (FIE). To encourage chip R&D and production, foreign Investors can enjoy the tariff exemption policy for imported self-use equipment within the total investment; For FIEs in encouraged industries in the western regions of Communist China, the Corporate income tax can be reduced by 15%; land can be preferentially supplied for encouraged foreign-funded projects with intensive land use.
Comment: The decoupling between Communist China and the United States is accelerating. The CCP can no longer steal core technologies. In addition, the domestic economy and people’s livelihood are deteriorating, and foreign capital has fled. Which foreign entities would be investing in this kind of business environment?

5.The CCP expect to increase coal imports
The national development and Reform Commission will appropriately increase coal imports according to the supply and demand situation. According to data, since December, national electricity generation and consumption have increased by about 11% year-on-year, and the growth rate has increased by 6% over the same period last year. The power consumption of 20 provincial power grids increased by double digits, and the cumulative load of 15 provincial power grids hit a new high for 137 times.

By 【Financial Team -Tracy】

Disclaimer: This article only represents the author’s view. Gnews is not responsible for any legal risks.

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