Welcome to China Business News, NEO’s weekly roundup of top business developments as reported by news outlets in China and the region.
This week’s highlights:
- Around 26 Chinese cities have adjusted their interest rate for first home loans in an attempt to rekindle people’s enthusiasm for buying real estate, after the Chinese government announced a new policy of dynamic adjustment in January this year. The People’s Bank of China and the China Banking Regulatory Commission announced that cities where new residential housing prices have been falling for three consecutive months will be allowed to maintain lower interest rates for first home loans, which account for 3.8% of the market. China’s real estate market took a big hit last year, marked by a sharp decline in housing prices and sales as well as defaults by developers. At present, weak demand still remains a key constraint to the Chinese economy’s full recovery. (The First Financial)
- The Caixin BBD China New Economy Index (NEI) declined in January 2023, dragged down by poor performance across all three indicators – spanning labour, capital and technology inputs. The data jointly released by the Caixin Intelligence Centre and the firm Chengdu Business Big Data earlier this week showed that the NEI stood at 28.3% in January, down 1.4% from the previous month. According to the report, after the outbreak of the COVID-19 pandemic in early 2020, the NEI saw several months of continuous growth but has been on a downward trend since mid-2020. From 2021 to date, the NEI has been fluctuating within a range of around 30%. (Caixin)
- BYD, a Chinese manufacturing conglomerate, reported strong year-on-year growth in new-energy vehicle sales – ranking first in the world in that regard – which effectively alleviated the cost pressure from rising raw materials prices. BYD’s sales figures disclosed in early January 2023 showed that its annual production and sales in 2022 accounted for almost 1.9 million units, up 209% year-on-year. Plug-in hybrid products remained the fastest-growing segment, with the company reporting annual sales of 95,000 units, an increase of almost 250% year-on-year. BYD’s sales of plug-in hybrid products also surpassed those of pure electric products for the first time, accounting for 51% of its passenger vehicle sales. (Caixin)