CX Daily: Sanctions on Russia Sound Alarm for Chinese Banks

Mar 09, 2022 09:07 AM

Sanctions /

Sanctions on Russia sound alarm for Chinese banks

As China’s banks find themselves walking a tightrope amid the deepening economic warfare between Russia and the West, those with international exposure need to take extra care to ensure they avoid being hit by the fallout from U.S. and European sanctions, analysts say.

The U.S. and its allies have imposed sweeping financial sanctions on Russia following its attack on Ukraine, including freezing the assets of its central bank and removing seven Russian banks from SWIFT.

While Chinese institutions are technically able to continue engaging with sanctioned Russian entities under domestic law, the move has prompted a number of Chinese financial institutions to assess their business dealings in Russia and evaluate the risks and their potential exposure as they await further guidelines from their head offices, people familiar with the matter told Caixin.

Paxlovid /

China Meheco confirms Pfizer talks on selling Paxlovid in China

China Meheco Corp. is in talks on commercializing Pfizer’s new Covid-19 pill in China, but the discussions are still at an early stage, the state-owned pharmaceutical company said Monday.

Boosted by speculation that China Meheco might become Pfizer’s partner for marketing Paxlovid in China, the company’s Shanghai-traded shares surged by the daily limit of 10% during four consecutive sessions since last Wednesday.

FINANCE & ECONOMY

Chinese Premier Li Keqiang. Photo: gov.cn

Fund /

Caixin Explains: Why China’s creating a financial security fund

In the government work report delivered Saturday, Chinese Premier Li Keqiang announced plans to set up a financial security fund, a device that several developed economies have adopted to deal with troubled systemically important financial institutions.

“A fund for ensuring financial stability will be established, and market- and law-based ways will be used to defuse risks and potential dangers,” Li said in the annual report. “All these efforts will ensure that no systemic risks arise.”

The fund is Beijing’s latest attempt to ensure financial stability and to prevent risks from indebted “too big to fail” institutions from overflowing into the rest of the financial system or broader economy. Here are the key things to know about why this fund is important and how it will function.

Inflation /

China plans to manage inflationary impact of surging energy prices

Rising global crude and natural gas prices resulting from Russia’s invasion of Ukraine will drive up China’s costs for importing energy, but the overall impact is controllable, a senior Chinese official said Monday.

China’s annual target for the rise in the consumer price index (CPI) of around 3% is achievable despite the higher energy costs because of a highly resilient economy, large market space and abundant policy toolbox, said Hu Zucai, deputy head of the National Development and Reform Commission (NDRC), at a press briefing.

Investment /

More wealthy women are getting into Asia’s financial markets, survey shows

More women of means from Hong Kong, Singapore and the Chinese mainland have been playing the markets since the start of the Covid-19 pandemic, a new survey shows.

The number of woman investors with at least $120,000 in liquid financial assets in the Asian markets grew 14% from January 2019 to the end of last year, according to a survey report that HSBC Holdings PLC released Monday ahead of International Women’s Day. The results were based on a poll of 378,000 HSBC customers.

Covid-19 /

China’s new Covid wave ratchets up pressure on local authorities

A new wave of local Covid-19 outbreaks has hit the country as 505 cases were recorded in the Chinese mainland Monday, following 526 local cases Sunday, which was the mainland’s highest daily tally since March 2020.

The latest 175 confirmed infections were found in 16 provincial-level regions, representing a broader range than the previous day, according to the National Health Commission. The 330 other cases were asymptomatic.

Quick hits /

Opinion: What to expect from efforts to stabilize China’s economy

Opinion: Why India’s population could surpass China’s in next three years

BUSINESS & TECH

A man refills a vehicle at a gas station in Nanjing, East China's Jiangsu province, on March 3. Photo: VCG

Oil /

China’s oil prices go through the roof as Ukraine crisis hits home

Refined oil prices in China soared to near 10-year highs after international crude prices went through the roof in the wake of the Russia-Ukraine conflict.

On March 7, the real-time wholesale price of gasoline reached 10,306 yuan ($1,630) per ton on average, a 30% surge from Jan. 1, while diesel jumped 15.5% to 8,657 yuan per ton, figures from energy market information provider 315i.com showed. Both of the prices touched a 10-year high.

It comes after the gasoline supply price exceeded a previous peak in March 2012, when Chinese regulators raised it to 9,180 yuan per ton, and raised the price of diesel to 8,330 yuan per ton, according to historical data recorded by East Money Information Co. Ltd.

Nickel tops $100,000 as big short tests 145-year-old exchange

TikTok /

TikTok restricts Russian services after ‘fake news’ law targets war criticism

TikTok will restrict some of its services in Russia after new legislation criminalized the publication of what the Kremlin deems to be “false” information about its assault on Ukraine.

In a series of tweets Monday, the ByteDance-owned video-sharing sensation said users in Russia will no longer be able to livestream or upload new content as the company reviews the implications of the law. Its in-app messaging service will remain available, it said.

Quick hits /

Luckin escapes liquidation after striking debt restructuring deal

Crisis-mired China Evergrande hits electric vehicle roadblock

Tech Insider /

TikTok’s Russian restrictions, battery fire concerns

GALLERY

Women’s resilience and misery in Ukraine