CX Daily Mar. 24: What We Know So Far About the Crash of Flight MU5735
China’s securities regulator plans to break an audit deadlock with U.S. watchdogs
The investigation is proving difficult because of the severe damage to the plane, which left only scattered wreckage
Budgets /
In Depth: The growing difficulty of balancing China’s local government budgets
In 2021, the coal-rich northern province of Shaanxi raked in more revenue and spent less than its government projected.
Like Shaanxi, many other provincial-level regions had general public budget revenue that beat expectations last year. But such high growth is not likely to continue in 2022, especially taking into account how the Covid-19 lockdowns of 2020 affecged the economy and created a low comparison base.
Looking back at 2021, even as many provincial-level regions generated more revenues than projected, some lower-level governments struggled with budgetary constraints. A gloomier budget outlook this year could add to local woes and hurt their capacity to finance investments and repay debts.
Crash /
Caixin Explains: What we know so far about the crash of flight MU5735
Officials investigating China’s worst air disaster in more than a decade are trying to discover why a Boeing Co. 737-800 NG plane suddenly fell from the sky Monday and crashed on a mountainside in South China’s Guangxi Zhuang autonomous region.
There were no survivors among the 132 people on China Eastern flight MU5735. The investigation is proving difficult because of the severe damage to the plane, which left only scattered wreckage, an official at the Civil Aviation Administration of China (CAAC) said Tuesday at a briefing.
Voice recorder, passenger remains found from flight MU5753
FINANCE & ECONOMY
Audit /
China’s securities watchdog mulls move to break audit deadlock with U.S.
China’s top securities regulator may provide auditing firms with clear guidance that could help break a long-standing stalemate with U.S. watchdogs over access to the audit work papers of U.S.-traded Chinese companies.
The China Securities Regulatory Commission (CSRC) is mulling the issuance of a clear legal interpretation of the Securities Law that would tell auditing firms the conditions they need to meet before handing over such papers to the Public Company Accounting Oversight Board (PCAOB), the U.S. organization that oversees the audits of publicly traded companies, a source close to the CSRC said.
Covid-19 /
China vows more focused Covid testing to limit economic strain
China will no longer require citywide Covid-19 testing in most cases, marking a change to its epidemic control playbook as the country looks to implement faster and more targeted methods of tackling rising omicron outbreaks.
The world’s most populous nation is struggling to contain its worst outbreak in two years, mostly driven by the highly transmissible and harder-to-identify BA.2 subvariant of omicron, which is testing its “dynamic Zero-Covid" policy.
China needs better home-grown vaccines to beat omicron, expert says
Debt /
Baoneng Chairman Yao Zhenhua is not missing, despite court statement
Embattled conglomerate Baoneng Group Tuesday denied a court statement that the whereabouts of Chairman Yao Zhenhua were unknown and the court had to deliver several documents to him in the form of public statements.
Yao appeared in person Monday at the company’s auto factory in Shenzhen, Baoneng said through its social media WeChat account. It posted a picture of Yao at the factory.
BUSINESS & TECH
Evergrande faces more than $300 billion in liabilities and hundreds of unfinished projects.
Evergrande /
Evergrande unit discovers $2.1 billion in cash was seized by banks
China Evergrande Group’s property services unit is investigating how banks seized 13.4 billion yuan ($2.1 billion) of its deposits that were pledged as security for third-party guarantees.
Evergrande Property Services Group Ltd. said it made the discovery while preparing its annual report. Trading in shares of the company, its parent and Evergrande’s electric car unit has been suspended in Hong Kong since Monday pending the release of inside information. The companies also warned of delays in the release of audited financial results.
Drones /
DJI tells Ukraine it can’t disable drones used by Russian military
A big-name Chinese drone-maker found itself in an awkward position in war-torn Ukraine, where its consumer-facing products are said to be used by the Russian military.
In a tweet last week, Ukraine’s Vice Prime Minister Mykhailo Fedorov called on SZ DJI Technology Co. Ltd. to lend a hand in grounding its drones that “are helping Russia to kill the Ukrainians.”
ZTE /
ZTE shares jump as U.S. court ends probation for violating sanctions
Shares of ZTE Corp. jumped after a U.S. court ended probation imposed after the telecommunications equipment manufacturer’s 2017 guilty plea for violating sanctions, ending the criminal case against the Chinese company.
Its Shenzhen stock closed up by the daily limit of 10% Wednesday afternoon after trading was suspended in the morning before the release of the information. ZTE’s Hong Kong stock jumped 23.1%.
Quick hits /
Fosun luxury arm Lanvin plans New York SPAC debut
Chinese power giant swings billions into the red on surging coal prices
Tencent Music’s profit cut in half amid crackdown on monopolies, tax evasion
GALLERY
As Shenzhen eases curbs, Shanghai’s streets empty
Recommended newsletter for you /
China Green Bulletin Premium - Subscribe to join the Caixin green community and stay up to date with the most exclusive insights on ESG, energy and carbon. Sign up here.