CPI (Consumer Price Index) for August 2024
In August 2024, China’s consumer price index (CPI) rose 0.6% y-on-y. Among them, urban areas rose 0.6% and rural areas rose 0.8%. Food prices rose 2.8% and non-food prices rose 0.2%. Consumer goods prices rose 0.7% and service prices rose 0.5%. From January to August, the national CPI rose 0.2% y-on-y.
Key Metrics:
- CPI rose 0.6% y-on-y in August, with food and tobacco prices up 2.1% and non-food prices up 0.2%.
- Pork prices increased 16.1%, contributing about 0.21 percentage points to CPI growth.
- Fresh vegetable prices rose 21.8%, contributing about 0.44 percentage points to CPI growth.
- Prices for other major categories had mixed changes, with clothing, education and medical care rising, while transportation and communication fell.
m-o-m Changes
On a m-o-m basis, the CPI rose 0.4% in August. Food and tobacco prices rose 2.2%, while non-food prices fell 0.3%. Consumer goods prices rose 0.7% and service prices fell 0.1%. Fresh vegetable prices rose 18.1% m-o-m, contributing about 0.38 percentage points to CPI growth. Pork prices increased 7.3%, contributing about 0.10 percentage points.
Prices for other major categories were mostly down, with transportation and communication, household goods and services, and other goods and services falling.
Data Source: https://www.stats.gov.cn/sj/zxfb/202409/t20240909_1956311.html
Removal of Restrictions on Foreign Investment in Manufacturing
- China has fully released foreign investment restrictions in the manufacturing sector, allowing equal treatment for domestic and foreign capital.
- This move demonstrates China’s firm commitment to expanding high-level opening-up and optimizing the foreign investment structure.
Piloting Openness in the Medical Field
- China is piloting expanded openness in the medical field, allowing foreign-invested enterprises to engage in the development and application of human stem cells, gene diagnosis and treatment technologies in certain free trade zones.
- Foreign-invested hospitals (excluding traditional Chinese medicine and acquisitions of public hospitals) will be allowed in nine cities and the entire Hainan Island.
Optimizing the Business Environment
- China will continue to optimize the business environment for foreign investment, fully implement the Foreign Investment Law and its regulations, and ensure fair policy for foreign-invested enterprises in areas such as qualification licensing, standard setting, and government procurement.
- The relevant departments will strengthen policy publicity and actively serve foreign-invested enterprises with investment intentions.
As China’s opening-up continues to deepen, we hope foreign businesses seize the opportunities presented by the expanding market and optimized operation environment. Stay tuned for further developments and their implications for your operations.
Data Source: https://news.cctv.com/2024/09/09/ARTIXJAVQS7Dwv0qXuzKmH7i240909.shtml
China Initiates Investigations in Response to Canada’s Trade Restrictions
On September 3, a spokesperson from China’s Ministry of Commerce (MOFCOM) addressed inquiries regarding Canada’s recent trade restrictions against China.
Background on Canada’s Measures
A reporter questioned the Ministry about the Canadian government’s announcement to impose tariffs on electric vehicles (EVs), as well as steel and aluminum products imported from China. Specifically, Canada plans to implement a 100% surtax on all Chinese-made EVs effective October 1, 2024, and a 25% surtax on imports of steel and aluminum starting October 15, 2024.
China’s Response
In response, China will initiate an anti-discrimination investigation into Canada’s tariff increases on these products. This marks the first anti-discrimination investigation conducted by China and globally. The Ministry emphasized that these actions are in accordance with China’s Foreign Trade Law, which allows for countermeasures against countries imposing discriminatory practices.
Concerns Over Canadian Rapeseed Imports
Additionally, the Ministry highlighted significant growth in Canadian rapeseed exports to China, which reached $3.47 billion in 2023—a 170% increase in volume compared to the previous year. However, this surge has been accompanied by declining prices, raising concerns of potential dumping practices. Consequently, China will also launch an anti-dumping investigation into Canadian rapeseed imports, as well as certain chemical products, based on applications from domestic industries.
Statements from Officials
The China’s spokesperson expressed strong dissatisfaction with Canada’s unilateral measures, labeling them as discriminatory and contrary to fair trade principles. Liang Ming, a researcher with the Chinese Academy of International Trade and Economic Cooperation, criticized Canada’s actions as a blatant form of trade protectionism that violates World Trade Organization (WTO) rules. China’s Ministry of Commerce reiterated its commitment to safeguarding the legitimate rights and interests of Chinese companies and indicated that all necessary measures would be taken in response to Canada’s actions. The Ministry also plans to appeal to the WTO’s dispute settlement mechanism regarding these trade practices.
The Canadian Minister of Agriculture and Agri-Food, MacAulay, expressed deep concern over China’s announcement and emphasized that the Canadian government will always support the agriculture sector in pursuing market access for their high-quality products. He reiterated the government’s commitment to ensuring fair market access for exporters, farmers, and producers. He will continue to monitor the situation closely and engage with provincial, territorial, and industry stakeholders. He also reaffirmed his support for canola producers, one of Canada’s most valuable agricultural exports and a significant contributor to the Canadian economy.
We will continue paying attention to this event.
Mooncake Market Update: Affordable Prices and Evolving Consumer Preferences
As the Mid-Autumn Festival approaches, the China Bakery & Sugar Products Industry Association has released key information that highlights the current state of the industry.
Affordable Pricing and Shifting Consumer Preferences
One of the most notable trends is the more affordable price level of mainstream mooncake gift boxes this year. The consumption is most concentrated in the price range of CNY 70 to CNY 220, compared to last year’s range of CNY 80 to CNY 280, indicating a significant drop in the overall price level.This shift in pricing can be attributed to several factors, including the earlier timing of the Mid-Autumn Festival this year, the compressed sales cycle, and heightened market competition. As a result, both corporate customers and retail consumers are focusing on cost-effective mooncakes, leading to a decline in the sales of high-priced gift boxes.
Production and Sales Forecast
The association estimates that this year’s mooncake production will reach 300,000 tons, with sales of around CNY 20 billion, representing a flat or slightly lower y-on-y performance. In comparison, mooncake production in 2023 was at 320,000 tons, with sales reaching CNY 22 billion.
Regulatory Changes and Packaging Guidelines
In May 2022, China’s National Development and Reform Commission (NDRC) and four other departments jointly issued a notice on limiting high-priced mooncakes. This notice imposed important regulations on packaged mooncakes with a unit price of more than CNY 500, including restrictions on the number of packaging layers and the cost of packaging materials.
Evolving Flavor Profiles and Market Participants
As consumer preferences shift towards healthier and more beneficial products, major supermarkets like Freshippo and Sam’s are focusing on developing innovative flavors that cater to this demand. Starbucks, the renowned coffee chain, has also entered the mooncake sales sector, offering a diverse range of flavors such as chocolate coffee, strawberry cheese, creamy pine nut, and apple grapefruit.We hope this update provides valuable insights into the current state of the mooncake market in China. As the industry continues to evolve, it will be exciting to see how brands and retailers adapt to meet the changing needs and preferences of consumers.
Elon Musk Embraces the Monkey King: Praises “Black Myth: Wukong” with AI-Generated Poster
In a surprising move, Elon Musk, the renowned entrepreneur, recently took to social media to express his admiration for the Chinese game “Black Myth: Wukong”. Musk shared an AI-generated poster featuring his own face seamlessly blended with the game’s protagonist, the Destined One. This humorous and creative post has garnered an astounding 52 million views, showcasing the game’s widespread appeal.
The comment section was flooded with netizens expressing their love for the iconic character Wukong, as well as sharing their knowledge of the classic Chinese novel “Journey to the West”. Many users noted the striking similarities between Musk and Wukong, such as their extraordinary abilities and their stories of overcoming adversity to achieve greatness.
The success of “Black Myth: Wukong” has not only captured the attention of Musk but has also resonated with gamers worldwide. According to data from VideoGameInsights, the game has consistently topped sales charts, with sales reaching an impressive 17.8 million copies as of September 4th, a 3 million increase from the previous week. When including confirmed sales from the Wegame and PS5 platforms, the total sales could easily surpass 20 million copies.
Moreover, the game’s popularity has transcended borders, with 80.7% of players hailing from China and a steady increase in overseas players, rising from 18.6% to 19.3% in just nine days. This success not only showcases the technical prowess and creative talents of China’s gaming industry but also highlights the global appeal of traditional Chinese culture.
As “Black Myth: Wukong” continues to captivate audiences, it is poised to become one of the most successful AAA titles of the year, setting new records in video game sales. Musk’s endorsement and the game’s overwhelming popularity serve as a testament to the growing influence and recognition of Chinese gaming on the global stage.
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