China's money supply has been rising. Photo: iStock

China remains the largest local currency bond market in emerging East Asia, accounting for 76.6% of the total bond stock at the end of the first quarter of 2020, said the latest issue of  Asia Bond Monitor published by the Asian Development Bank (ADB).

The local currency bond market of China remains the largest in emerging East Asia at US$12.5 trillion at the end of the first quarter of 2020, representing 76.6% of the region’s total bond stock. This is 4.9% higher compared to China’s bond stock at the end of the fourth quarter of 2019 and 16.1% bigger compared to the same period last year, said the ADB.

Citing data from the report, the ADB said China’s corporate bond market grew 7.3% to reach $4.6 trillion in the first quarter of 2020 from the fourth quarter of last year after the Chinese government in March simplified the issuance process for listed corporate and enterprise bonds.

Government bonds increased 3.5% quarter-on-quarter to reach $7.9 trillion as local government bond issuance increased, the ADB said.

The ADB said the Hong Kong Special Administrative Region’s local currency bonds amounted to $291 billion after a 0.5% quarter-on-quarter contraction in the first quarter of 2020.

“The drop in local currency bonds outstanding stemmed from a 1.1% quarter-on-quarter contraction in government bonds and a tepid 0.2% quarter-on-quarter growth in the corporate bond segment,” the ADB added.

Government bonds outstanding in the Hong Kong SAR reached $151 billion at the end of March, while corporate bonds outstanding amounted to $140 billion over the same period.

Public-private partnership

China saw 316 new public-private partnership (PPP) projects registered in the first five months of the year. Some 110 of the projects were related to urban infrastructure, said the National Development and Reform Commission.

Sectors including agriculture, forestry, water conservation, social development, transport and environmental protection also reported new PPP projects in the period.
A total of 7,235 PPP projects have been registered with a national monitoring platform, the figures showed. PPPs act as collaborative investment models between government and private companies.

Chinese authorities have been exploring funding infrastructure and public works through PPP models in recent years, aiming to reduce local government debt and provide new opportunities to private capital.

Shenzhen’s outbound investment

Companies in Shenzhen in south China’s Guangdong Province invested $4.02 billion in foreign non-financial enterprises in the first five months of this year, up 61.78% year on year, according to the Shenzhen government’s commerce bureau.

The investment in 168 enterprises from 28 countries and regions covered wholesale and retail, manufacturing, leasing and other fields. During the period, Shenzhen’s companies made new investments in 38 enterprises and institutions from 13 countries and regions along the Belt and Road.

By the end of 2019, Shenzhen’s companies had set up 7,038 enterprises and institutions overseas in 141 countries and regions, with more than 100,000 overseas employees.

Automobile trading

China’s automobile imports and exports amounted to $8.33 billion in May, 10% down from April, or 36.9% down from the same period of last year, according to data provided Thursday by the China Association of Automobile Manufacturers.

Imports plunged 47.2% year on year to $3.78 billion last month, while exports decreased 24.6% from a year earlier to $4.55 billion.

In terms of exports, Shanghai Automotive Industry Corp, Chery Automobile Co and Changan Automobile Co were among the country’s top 10 car manufacturers during the first five months.

Company news

SoftBank Group founder Masayoshi Son announced Thursday he was leaving the board of Alibaba as Jack Ma, the charismatic co-founder of the Chinese e-commerce giant, also leaves SoftBank’s board.

Son made the unexpected move at SoftBank Group’s shareholders’ meeting after his company said last month Ma was leaving its board, effective June 25.

Son, an early Alibaba investor, characterized their parting as a vote of confidence in Ma’s successor as Alibaba chief executive, Daniel Zhang. Ma had been on SoftBank’s board for 13 years. Son had been on Alibaba’s board for about 15 years.

The story was written by Xu Jiangshan and first published at ATimesCN.com. It was translated by Nadeem Xu.

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