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☆ Back From the Brink, Chinese Developer Resumes Buying Land
▼ + stars: | 2023-04-26 | by ( Rebecca Feng | Cao Li | ) www.wsj.com time to read: 1 min

A Country Garden residential development in Shanghai. Photo: Qilai Shen/Bloomberg NewsHONG KONG— Country Garden Holdings Co., one of China’s largest real-estate developers, bought residential land in a local government auction for the first time since December 2021, signaling confidence in its liquidity and a recovering housing market. The company, which used to be an aggressive acquirer of land, had been hit by a sharp slowdown in China’s property sector last year. Its sales of new apartments slumped, and prices of its dollar bonds slid to below 10 cents on the dollar in November, as investors worried that Country Garden could default on its debt like dozens of other developers.

☆ Chinese Consumers’ Lack of Confidence Is Causing a Rush of Mortgage Prepayments
▼ + stars: | 2023-04-07 | by ( Cao Li | ) www.wsj.com time to read: 1 min

Policies encouraging home sales were rolled out last year. HONG KONG—When banks in China cut interest rates last year to boost lending and help the country’s slumping housing market, they set off an unintended wave of home-loan prepayments. Since last summer, homeowners in the world’s second-largest economy have been paying down their mortgages at a much faster pace than in years past, a trend that is weighing on banks’ profitability. The behavior is somewhat counterintuitive because mortgage prepayments typically pick up when interest rates are rising—as opposed to falling—when people want to avoid incurring higher future interest costs.

The city of Zhengzhou in China has seen its fiscal revenue drop and total debt grow in recent years. As China tries to turn the page on one of its worst stretches of growth since the 1970s, its economy is being weighed down by the colossal debts of its local governments, which swelled during the pandemic and are starting to come to a head. Xi Jinping ’s zero-Covid campaign saddled cities with billions of dollars in unplanned expenditures for mass testing and lockdowns. The Chinese leader’s crackdown on excessive property-market leverage led to a sharp drop in land sales, depriving cities of one of their biggest revenue sources.

☆ Chinese Developer Is Preparing to Buy Land Again After Painful Slowdown
▼ + stars: | 2023-02-24 | by ( Rebecca Feng | Cao Li | ) www.wsj.com time to read: 1 min

Chinese property developer Country Garden Holdings Co. is planning to buy residential land in local government auctions for the first time in more than a year, a further sign that the downturn in the country’s housing market is easing. The company, one of the largest real-estate developers in China by contracted sales, was hit by a widespread slump in the sector last year that was marked by home sales declines, falling prices and a wave of international bond defaults among its peers.

☆ After Painful Slowdown, a Big Chinese Developer Is Preparing to Buy Land Again
▼ + stars: | 2023-02-24 | by ( Rebecca Feng | Cao Li | ) www.wsj.com time to read: 1 min

☆ China’s State-Owned Property Developers Shun Private-Sector Deals
▼ + stars: | 2023-02-20 | by ( Rebecca Feng | Cao Li | ) www.wsj.com time to read: 1 min

The property-market slowdown has hit state-owned developers, though not as hard as their private-sector counterparts. When China’s private real-estate developers started sliding into distress more than a year ago, the government encouraged state-owned property companies to step in and take over their ailing peers’ projects and assets. That call has gone largely unheeded—a big reason why the country’s housing market remains in the doldrums.

☆ China’s State-Owned Firms Are Sitting Out the Property Rescue
▼ + stars: | 2023-02-20 | by ( Rebecca Feng | Cao Li | ) www.wsj.com time to read: 1 min

☆ Evergrande Probe Finds Management Missteps and Convoluted Financing Arrangements
▼ + stars: | 2023-02-16 | by ( Cao Li | Rebecca Feng | ) www.wsj.com time to read: 1 min

China Evergrande Group’s weak controls and poor management decisions were to blame for a funding arrangement that ultimately led banks to seize $2 billion of deposits held by a subsidiary, an independent investigation found. The property giant used deposits from six units of Evergrande Property Services Group Ltd., a separate Hong Kong-listed company, to borrow money between late December 2020 and early August 2021, when the developer was in need of capital. It was part of a complicated financing arrangement that involved dozens of third-party companies and loans from multiple banks.

☆ Chinese Consumers Hoard Cash After Confidence Takes a Hit
▼ + stars: | 2023-02-08 | by ( Cao Li | ) www.wsj.com time to read: 1 min

Beijing is trying to kick-start economic growth after lifting its stringent Covid-19 restrictions. One challenge: Chinese citizens borrowed less and saved more last year and it isn’t clear how long it will take to return to freer-spending ways. Individuals in China took out the equivalent of $564 billion in new loans in 2022, down more than half from a year earlier, marking the lowest total since 2014 according to government data. The big drop was largely due to a decline in home sales, which translated into lower demand for new mortgages. Everyday consumer spending also took a hit during lockdowns that affected many Chinese cities, reducing the need for short-term borrowing.

☆ China’s Property Bust Compounds Economic Pain
▼ + stars: | 2023-01-19 | by ( Rebecca Feng | Cao Li | ) www.wsj.com time to read: 1 min

Home prices in China have been declining sequentially on average across 70 major cities that the government tracks. HONG KONG—China’s housing market flipped from being a growth driver to an economic drag in 2022, with sales slumping, prices falling and widespread job losses. The prognosis for this year isn’t much better, compounding Beijing’s efforts to get its economy back on firmer footing. Sales of new residential properties in the country tumbled 28% last year to the equivalent of $1.7 trillion in value terms, a five-year low. By floor area, they dropped to their lowest level in nearly a decade, after a wave of real-estate developer debt defaults, delays in construction of unfinished apartments and Covid-19 lockdowns dampened consumer confidence.

CHONGQING, China—A month after scrapping most of its zero-Covid restrictions, China is experiencing all at once what many other nations have been navigating for three years. Infections have skyrocketed, medical facilities are stretched to their limits and the elderly and infirm are dying, although official government numbers are seen by public-health experts as vastly underestimating Covid-related deaths.

☆ Undercounted Deaths Cloud China’s Zero-Covid Exit
▼ + stars: | 2022-12-21 | by ( Liyan Qi | Cao Li | ) www.wsj.com time to read: 1 min

China has reported just a handful of Covid-19 deaths as a wave of Omicron infections has swept the country’s biggest cities, stoking suspicion among public-health experts and relatives of deceased patients that the government isn’t accurately accounting for the impact of the virus. Despite widespread reports of soaring infections, crowded hospitals and overwhelmed crematoria, Chinese health authorities had by Tuesday reported only seven Covid-related deaths since the country abruptly eased many of its pandemic-control measures more than two weeks ago. Two deaths were reported in Beijing on Monday and five the following day.

☆ China Plans Covid Vaccination Drive for the Elderly in Bid to Ease Pandemic Controls
▼ + stars: | 2022-12-01 | by ( Raffaele Huang | Cao Li | ) www.wsj.com time to read: 1 min

HONG KONG—China is planning a Covid-19 vaccination campaign for the elderly in December and January, part of its effort to be able to ease its zero-Covid policy, public-health officials familiar with the plan said, as outbreaks hit records and protests denouncing rigid pandemic controls spread. China aims to inoculate 90% of people aged 80 and above with at least one shot by the end of January, said the officials, who work at local branches of the Chinese Center for Disease Control and Prevention and received instructions from Beijing. That rate is currently at 77%, according to government data.

☆ China Clamps Down on Protesters Against Zero-Covid Policies
▼ + stars: | 2022-11-28 | by ( Cao Li | Elaine Yu | ) www.wsj.com time to read: 1 min

Chinese authorities tightened controls in reaction to rare nationwide protests against the country’s zero-tolerance approach to Covid, dispatching phalanxes of police to prevent fresh gatherings as state media reiterated support for leader Xi Jinping ’s stringent pandemic strategy. The demonstrations exploded in several large cities, including Beijing and Shanghai, during the weekend. They followed a deadly fire on Friday in Urumqi, capital of the remote region of Xinjiang, which officials said killed 10 people. Some residents suggested that pandemic restrictions contributed to a delay in putting out the fire.

So far in 2022, there have been 25 trading days in which the Hang Seng Index gained or lost more than 3%. Hong Kong entered a bull market earlier this month—at least according to one common definition. The city’s benchmark Hang Seng Index surged 25% in the first half of November, clearing the 20% hurdle that is traditionally used to define a bull market. The sharp run-up from its trough on Oct. 31—when the index touched its lowest level since April 2009—was fueled by signs that China is starting to shift away from its strict zero-Covid policy that has hamstrung the world’s second-largest economy. Moves by the Chinese government to ease pressure on its limping property sector also gave investors reason for optimism.

☆ To Boost Land Sales, Local Chinese Governments Set Up New Companies to Buy Plots
▼ + stars: | 2022-11-17 | by ( Rebecca Feng | Cao Li | ) www.wsj.com time to read: 1 min

China’s slumping housing market has made selling land increasingly difficult for local governments across the country, leading some to find creative ways to avoid massive revenue shortfalls. Local governments’ total land-related income in the first nine months of 2022 was down nearly 30% from a year earlier, data from the Ministry of Finance shows, mostly because of a big drop in land sales. After six consecutive years of annual growth, they fell 36% in the first 10 months of 2022, according to official data compiled by Wind.

For much of the past year, China’s economy has been reeling under Xi Jinping’s dual campaigns to rein in soaring property prices and to stamp out any traces of Covid-19 within the country’s borders. Now, as he moves to loosen pandemic restrictions, China’s leader, Mr. Xi, is signaling a reversal of his real-estate crackdown, too, a tacit acknowledgment of the economic pain and public frustration that the two policies have engendered.

☆ China Evergrande’s Debt-Crisis Fallout: Losses, Layoffs and More Defaults
▼ + stars: | 2022-10-13 | by ( Cao Li | Rebecca Feng | ) www.wsj.com time to read: 1 min

When China Evergrande Group began struggling under a mountain of debt last year, it quietly set off a chain reaction across the country. Chinese authorities prevented a disorderly collapse of the real-estate colossus, but Evergrande’s distress has spread across China’s housing market and many related industries. The situation has worsened this year into what is now a full-blown property downturn that has become a major drag on China’s economy.

☆ China Jails Gang Members Over Attack on Women
▼ + stars: | 2022-09-23 | by ( Cao Li | Liyan Qi | ) www.wsj.com time to read: 1 min

HONG KONG—A court in China handed down hefty sentences to members of a gang who carried out a brutal attack on several women in a restaurant three months ago that shocked the country with its violence and reignited debate on gender inequality. Seven members were found guilty of taking part in the assault, and together with 21 others of committing a string of serious offenses over the past decade, according to a social-media post by the Guangyang district court in China’s northern Hebei province. They received jail sentences of between six months and 24 years, it said.

☆ China Meets With Boeing, Raising Hopes for 737 MAX Flight Resumption
▼ + stars: | 2022-09-20 | by ( Rachel Liang | Cao Li | ) www.wsj.com time to read: 1 min

Boeing 737 MAX jets operated by China Southern Airlines were grounded in 2019 after two fatal crashes. China’s air safety regulators have met with Boeing to discuss the company’s 737 MAX, a move that the regulator’s official media outlet said signaled the jetliner could soon return to Chinese skies after more than three years. The Civil Aviation Administration of China held an evaluation meeting last week with Boeing’s U.S. and China teams to review the training protocols for pilots, the CAAC News, a news outlet run by the regulator, said Tuesday.

☆ Fatal Bus Crash Underscores Costs of China’s Covid Measures
▼ + stars: | 2022-09-19 | by ( Cao Li | ) www.wsj.com time to read: 1 min

An aerial photo of a Covid community-testing center in the Wudang district of Guiyang, the capital of Guizhou province in southwest China. HONG KONG—A fatal bus crash in southwestern China that killed 27 people being transferred to a quarantine facility has reignited public anger about the toll of strict anti-Covid measures meant to protect the Chinese public. The bus overturned on a highway in the early hours Sunday in the southwestern province of Guizhou while carrying passengers to a quarantine facility, state-backed media outlets including the Beijing News reported. The accident killed 27 people and injured 20 others, according to local police. A social-media account managed by China’s Ministry of Transport said the accident occurred around 2:40 a.m. before the post was deleted.

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