Explainer | Xi Jinping’s investment promise, Mastercard, visa-free entry: 7 things from China’s economy in November

President Xi Jinping pledged more measures to attract foreign investors to China after meeting with US counterpart Joe Biden in San Francisco
Premier Li Qiang took the helm at the Central Financial Commission, while China announced plans to allow travellers from selected countries visa-free entry for 15 days

China's economic recovery

Andrew Mullen

Published: 7:00am, 1 Dec 2023

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1. Xi Jinping pledges to ‘tear down’ foreign investment barriers after Biden meeting

After meeting US President Joe Biden in San Francisco, President Xi Jinping pledged more measures would be unveiled to attract foreign investors to China.

Xi told the Asia-Pacific Economic Cooperation CEO Summit that China would “strive to tear down the barriers”.

‘The next China is still China’: Xi pledges to tear down investment barriers

His address came as foreign firms continue to downsize their investments in China, and concerns rise about increasing scrutiny related to national security scrutiny.

In the third quarter, direct investment liabilities – a broad measure of foreign direct investment that includes foreign companies’ retained earnings in China – suffered a first quarterly deficit since records began in 1998.

2. Li Qiang promises to ‘intensify financial supervision’

Premier Li Qiang took the helm at the Central Financial Commission, a new organ of the Communist Party established to oversee the financial sector.

The commission was set up in March under the direct supervision of the party to tighten control over finance as part of a broad reshuffle of party and state institutions.

Chinese premier putting risk prevention first as head of new party finance body

The commission should “intensify financial supervision in a comprehensive way” and better coordinate different departments, Li said.

Meanwhile, Zhu Hexin was appointed party chief of the State Administration of Foreign Exchange, replacing central bank governor Pan Gongsheng.

And China’s lawmakers issued a rare warning about the asset quality at small and medium-sized financial institutions.

3. Exports fall, record deals as CIIE returns

China’s exports fell for a sixth consecutive month in October, dropping by 6.4 per cent from a year earlier to US$274.8 billion, data released in November showed.

Imports, meanwhile, grew by 3 per cent in October to US$218.3 billion, up from a 6.2 per cent decline in September.

Analysts said the fall in exports compared to a year ago was primarily due to price effects, while the improvement in imports appeared to have been broad-based, they added.

The China International Import Expo also took place over six days in November, with the value of deals signed hitting an all-time high of US$78.4 billion.

4. Food-price deflation drags down CPI, prompts ‘stagflation’ warnings

China’s consumer price index fell by 0.2 per cent in October from a year earlier, data released in November showed, with the main culprit a deepening of food price deflation.

‘Not too late’: outspoken economist Yu Yongding flags China’s stagflation risks

Meanwhile, the producer price index – which reflects the prices that factories charge wholesalers for products – fell by 2.6 per cent in October from a year earlier.

Yu Yongding, a former adviser to the central bank, also warned of a “stagflation” if China does not quickly adopt expansionary fiscal policies to spur domestic demand in the current economic slowdown.

5. China offers visa-free entry

China announced plans to allow travellers from France, Germany, Italy, the Netherlands, Spain and Malaysia to enjoy visa-free entry for 15 days.

The policy would start on December 1 and run until November 30 next year.

From 72 hours to 30 days: 5 visa-free ways to visit China by land, sea and air

In October and November, officials had also confirmed travellers from dozens of countries can again enter China through several other visa-free schemes.

6. China approves Mastercard in boon for expats, visitors

China approved an application from the Chinese joint venture of American payments firm Mastercard to conduct yuan clearing operations and issue yuan-denominated bank cards in a boost for expats and visitors.

Boon for expats, visitors as China approves Mastercard’s card clearing licence

“Foreigners working in China and executives and tourists on short visits will cheer the news more than Chinese consumers do, as the latter have grown so used to the duopoly of WeChat Pay and Alipay’s mobile, cardless payment services,” said Wang Pengbo, a researcher with market consultancy firm Botong.

7. China tightens rare earth, commodity controls

China asked exporters to report transactions of strategically important rare earth metals and oxide products.

Importers of crude oil, iron ore, copper ore concentrates and potash fertiliser were also asked to report orders and shipments.

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