Mon. Jun 17th, 2024

The China Brief this week discusses the impending liquidation of the China Evergrande Group, the announcement of a new national security law in Hong Kong, and the ongoing purge within the Chinese defense sector. The troubled property giant, China Evergrande Group, was ordered into liquidation by a Hong Kong court on Monday, signaling a final blow to the firm and its investors. However, with the majority of its assets held in mainland China, the process may be delayed by Chinese courts and the upcoming Spring Festival holiday. The real estate crisis will not only impact urban property owners but also the migrant laborers building these properties, as many may face job insecurity following the holiday. The broader property crisis in China has been exacerbated by the COVID-19 pandemic and government inaction, leading to abandoned and unfinished projects scattered across the country. Additionally, the government’s control over information and finance may lead to a lack of investor and consumer confidence, despite efforts to prevent market collapse.

Hong Kong’s leadership is preparing a new national security law to further crackdown on dissent and broaden the definitions of state secrets and sedition, reflecting the rhetoric of mainland China. The ongoing purge within the Chinese military has targeted senior rocket researcher Wang Xiaojun, indicating government scrutiny over corruption within the Chinese People’s Liberation Army (PLA).

Asia Genesis Asset Management, a hedge fund based in Singapore, announced its closure due to significant losses from failed bets on Chinese and Japanese stocks, mirroring the trend of overestimating the Chinese economy among financial institutions. Finally, YouTube star MrBeast is attempting to break into the Chinese market, facing challenges due to the strict and constantly shifting rules of Chinese streaming platforms and government scrutiny of foreign content producers.

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