1.US Approves equipment exports to S. Korean chip factories in China
The Biden administration has granted Samsung Electronics and SK Hynix permission to acquire the necessary equipment to maintain and grow their chip-making operations in China. This move provides these companies, the world’s largest memory makers, an indefinite waiver from the broader restrictions that previously prohibited the shipment of advanced chipmaking equipment to China. This decision is crucial for these Korean industry leaders to continue their operations in the world’s largest chip market.
South Korea’s presidential office confirmed this development, highlighting that the decision resolves a significant trade issue for Korean semiconductor firms. These companies are pivotal in the global semiconductor supply chain, contributing to 60.5% of the world’s memory output.
In 2022, the US had introduced a series of chip export restrictions, which raised concerns for Hynix about the potential closure or sale of a significant plant in China. Hynix operates major memory chip factories in China, which are vital for its global supply and are used in various products, including those for US companies like Apple.
Samsung Electronics and Hynix had previously received a one-year waiver to import the necessary equipment. However, there was uncertainty about the extension of this waiver. The recent decision by the US government removes this uncertainty, ensuring a stable supply chain for the global semiconductor industry.
2.Schumer meets with China’s Xi Jinping during visit to Beijing
A group of senators led by Senate Majority Leader Chuck Schumer, D.-N.Y., met with Chinese President Xi Jinping in Beijing on Monday, in a sign that Xi could hold a highly anticipated meeting with President Joe Biden later this fall.
The bipartisan group of six senators, which is also traveling to U.S. allies South Korea and Japan, is the first congressional delegation to China since 2019. They met with Xi at the Great Hall of the People in Beijing, according to state-run broadcaster CCTV.
Schumer described Xi as “engaged” during the meeting, which he said lasted much longer than expected at about 80 minutes.
During their meeting, Schumer said he was “disappointed” by what he described as China’s lack of “sympathy” for Israel after a surprise attack by fighters from the Palestinian militant group Hamas that was the deadliest incursion into Israeli territory in 50 years.
Asked about Schumer’s remarks on Monday, the Chinese Foreign Ministry said it was “deeply saddened” by the civilian casualties and called for a cease-fire and negotiations, while reiterating support for a two-state solution.
“China is a common friend of Israel and Palestine,” spokesperson Mao Ning said at a regular news briefing in Beijing. “We sincerely hope to see Palestine and Israel co-existing peacefully and sharing security and development.”
3.TikTok shop banned in Indonesia to protect offline business owners
Indonesia was one of the first countries where TikTok launched TikTok Shop back in 2021, betting on its 125 million users, the second-largest user base of TikTok worldwide.
Now, the country has become the first to block the feature. TikTok shut down its Shop apparatus in Indonesia on Wednesday after the country banned commerce on social media platforms to protect local business owners.
The Tiktok app itself is not banned, but people there could no longer buy or sell goods through TikTok or other social media platforms after the trade ministry issued new regulations last week. The rules, which essentially mandate the separation of e-commerce and social media, are meant to protect local merchants, prevent algorithms from dominating the market and stop the use of personal data for business purposes, the ministry said.
For months, Indonesian officials had expressed concern that TikTok Shop would threaten the country’s small businesses. During a visit to Jakarta a few months ago, TikTok’s chief executive, Shou Zi Chew, pledged to invest billions of dollars into the region over the coming years.
The ban is great news for offline retailers but a disaster for merchants on TikTok who contributed to 2.5 billion USD trade in 2022. After TikTok Shop closed in Indonesia on Wednesday, the government thanked the company in a statement for complying with its regulations, adding that TikTok and other platforms were welcome to pursue e-commerce separately from social media networks.
4.National Day ‘golden week’: 826 million trips made, overseas travel yet to regain momentum
During the holiday season from Sept 29th till Oct 6th, 826 million trips have been made in China according to the Ministry of Culture and Tourism, up 96.7% compared to 2022, and up 4% compared to 2019. The domestic tourism revenue reached CNY 753.4 billion, an increase of 162.34% compared to 2022, and up 2% compared to the same period in 2019. But per capita, dropped by 2.5% compared to 2019.
Outbound tourism is accelerating its recovery, with a total of 5.95 million people traveling abroad during the holiday, recovering to 85% of the same period in 2019. In contrast, during the Labors Day holiday in May, the total number of outbound tourists was 3.15 million, only recovering to 59% of the same period in 2019.
During the entire holiday many pictures full of traffic jams have surfaced on the internet…
5.Three months left for Chinese EV manufacturers to reach their own annual targets
Entering October, various automakers have successively disclosed their third-quarter sales data, hence the annual sales target completion rate has been available. On one hand, there is a clear differentiation in the completion rate of sales targets among automakers. On the other hand, when it comes to new energy vehicle sales, many automakers have a target completion rate of less than 50%. Based on the data disclosed by Tesla and BYD, the target completion rates of these two leading new energy vehicle manufacturers have both reached around 70%.
Tesla’s third-quarter deliveries amounted to 435,100 units, a year-on-year increase of 27%. This brought its cumulative deliveries for the first three quarters to 1.3241 million units. Tesla recently reaffirmed its annual delivery target of 1.8 million units, with a completion rate of 73.56% for the first three quarters.
Production and sales reports show that BYD’s cumulative passenger car sales for the first three quarters were 2.0702 million units, a year-on-year increase of 76.14%. BYD had previously announced an annual sales target of 3 million units, with a completion rate of 69.01%.
Among the leading EV brands, both NIO and Xiaopeng face significant pressure, with completion rates just over 40%.
For traditional automakers that have disclosed production and sales data, the overall completion rate is around 60%. Geely Auto performed well with a completion rate reaching 70%, but there was a clear differentiation in the completion rate of its EV sales.