China economy grows in 2020 as rebound from coronavirus gains

China economy grows in 2020 as rebound from coronavirus gains
China’s quick recovery brought it closer to matching the US in economic output. (AP)
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Updated 18 January 2021

China economy grows in 2020 as rebound from coronavirus gains

China economy grows in 2020 as rebound from coronavirus gains
  • Growth in the three months ending in December rose to 6.5 percent over a year earlier
  • China’s quick recovery brought it closer to matching the US in economic output

BEIJING: China eked out 2.3 percent economic growth in 2020, likely becoming the only major economy to expand as shops and factories reopened relatively early from a shutdown to fight the coronavirus while the United States, Japan and Europe struggled with rising infections.
Growth in the three months ending in December rose to 6.5 percent over a year earlier as consumers returned to shopping malls, restaurants and cinemas, official data showed Monday. That was up from the previous quarter’s 4.9 percent and stronger than many forecasters expected.
In early 2020, activity contracted by 6.8 percent in the first quarter as the ruling Communist Party took the then-unprecedented step of shutting down most of its economy to fight the virus. The following quarter, China became the first major country to grow again with a 3.2 percent expansion after the party declared victory over the virus in March and allowed factories, shops and offices to reopen.
Restaurants are filling up while cinemas and retailers struggle to lure customers back. Crowds are thin at shopping malls, where guards check visitors for signs of the disease’s tell-tale fever.
Domestic tourism is reviving, though authorities have urged the public to stay home during the Lunar New Year holiday in February, normally the busiest travel season, in response to a spate of new infections in some Chinese cities.
Exports have been boosted by demand for Chinese-made masks and other medical goods.
The growing momentum “reflected improving private consumption expenditure as well as buoyant net exports,” said Rajiv Biswas of IHS Markit in a report. He said China is likely to be the only major economy to grow in 2020 while developed countries and most major emerging markets were in recession.
The economy “recovered steadily” and “living standards were ensured forcefully,” the National Bureau of Statistics said in a statement. It said the ruling party’s development goals were “accomplished better than expectation” but gave no details.
2020 was China’s weakest growth in decades and below 1990’s 3.9 percent following the crackdown on the Tiananmen Square pro-democracy movement, which led to China’s international isolation.
Despite growth for the year, “it is too early to conclude that this is a full recovery,” said Iris Pang of ING in a report. “External demand has not yet fully recovered. This is a big hurdle.”
Exporters and high-tech manufacturers face uncertainty about how President-elect Joseph Biden will handle conflicts with Beijing over trade, technology and security. His predecessor, Donald Trump, hurt exporters by hiking tariffs on Chinese goods and manufacturers including telecom equipment giant Huawei by imposing curbs on access to US components and technology.
“We expect the newly elected US government will continue most of the current policies on China, at least for the first quarter,” Pang said.
The International Monetary Fund and private sector forecasters expect economic growth to rise further this year to above 8 percent.
China’s quick recovery brought it closer to matching the United States in economic output.
Total activity in 2020 was 102 trillion yuan ($15.6 trillion), according to the government. That is about 75 percent the size of the $20.8 trillion forecast by the IMF for the US economy, which is expected to shrink by 4.3 percent from 2019. The IMF estimates China will be about 90 percent of the size of the US economy by 2025, though with more than four times as many people average income will be lower.
Exports rose 3.6 percent last year despite the tariff war with Washington. Exporters took market share from foreign competitors that still faced anti-virus restrictions.
Retail spending contracted by 3.9 percent over 2019 but gained 4.6 percent in December over a year earlier as demand revived. Consumer spending recovered to above the previous year’s levels in the quarter ending in September.
Online sales of consumer goods rose 14.8 percent as millions of families who were ordered to stay home shifted to buying groceries and clothing on the Internet.
Factory output rose 2.8 percent over 2019. Activity accelerated toward the end of the year. Production rose 7.3 percent in December.
Despite travel controls imposed for some areas after new cases flared this month most of the country is unaffected.
Still, the government’s appeal to the public to avoid traditional Lunar New Year gatherings and travel might dent spending on tourism, gifts and restaurants.
Other activity might increase, however, if farms, factories and traders keep operating over the holiday, said Chaoping Zhu of JP Morgan Asset Management in a report.
“Unusually high growth rates in this quarter are likely to be seen,” said Zhu.


Saudi PIF's developer to hand over Riyadh homes in 2022

Saudi PIF's developer to hand over Riyadh homes in 2022
Updated 27 February 2021

Saudi PIF's developer to hand over Riyadh homes in 2022

Saudi PIF's developer to hand over Riyadh homes in 2022
  • The Kingdom’s state-owned Public Investment Fund (PIF) launched Roshn as a real estate company last year
  • Roshn announced the signing of $930 million worth of construction contracts earlier this year

RIYADH: Roshn, Saudi Arabia’s national community developer, is planning to start off-plan sales at its flagship project in Riyadh later this year, with the handover of the first homes to tenants likely in early 2022, a senior executive said.

The Kingdom’s state-owned Public Investment Fund (PIF) launched Roshn as a real estate company last year. 

The developer’s master project in the Saudi capital will extend over an area of more than 20 million square meters and will include more than 30,000 homes. The project’s first phase involves 4,000 homes that will become available for sale by the middle of this year.

“In due course, we will be providing detailed information on how citizens can apply for a home, in addition to all available financing options,” Roshn’s Group CEO David Grover told Arab News.

“Our communities are entirely inclusive, with homes to suit all tastes and budgets. Our aim is to provide a modern, aspirational living experience while giving residents the freedom to interpret what this means to them in their own unique way. Our communities have been designed to inspire a strong sense of neighborly spirit and genuine connection between residents.”

Roshn announced the signing of $930 million worth of construction contracts earlier this year. Grover said the developer partnered with Rezaik Abdallah Al-Gedrawy & Co. as the main contractor for the first phase of the flagship development and have also awarded contracts to Posco E&C, AWJ International and Zuheir Ahmad Al Zahran and Company.

In relation to the timeline for their existing projects, Grover said: “Roshn’s customer experience center is expected to be ready in Q1 2021, while the handover process of homes will start in early 2022. Construction is planned to be completed by Q4 2023.”

With facilities such as mosques, schools, cafes, restaurants, healthcare, leisure and entertainment options, the community aims to cater to the needs of future residents and act as a self-contained “city within a city,” he added.

Roshn was launched in August 2020 by the PIF to deliver high-quality residential neighborhoods to Saudi nationals. The company is committed to supporting the Kingdom’s Vision 2030 goal of increasing the rate of homeownership in the country to 70 percent.

“Saudi Arabia is home to a number of world-class developers, and we are consistently looking to collaborate and partner with highly ambitious local firms to deliver on our mandate,” he said.

Despite the coronavirus (COVID-19) pandemic, Grover said Roshn has hit more than 90 percent of its 2020 business targets.

“Roshn will work closely with the mortgage industry to help meet the needs of each individual buyer’s personal circumstances and financial situation,” the CEO said of his immediate priorities for 2021.


Arab-Brazilian Chamber of Commerce to open Riyadh office

Arab-Brazilian Chamber of Commerce to open Riyadh office
Updated 27 February 2021

Arab-Brazilian Chamber of Commerce to open Riyadh office

Arab-Brazilian Chamber of Commerce to open Riyadh office
  • The ABCC said the new office would offer ‘enormous’ economic benefits to the Brazilian and Arab markets

RIYADH: The Arab-Brazilian Chamber of Commerce (ABCC) is to set up an international office in the Saudi capital of Riyadh to capitalise on trade between the two countries.

The move follows the success of ABCC’s first office in the region, which opened in Dubai two years ago. In addition to the Riyadh office, ABCC also plans to open an outpost in Egypt, it was announced last week.

The facilities, which aim to bolster trade relations between major Arab markets and Brazil, will assist companies looking to partner Brazilian firms, and vice versa.

ABCC President Rubens Hannun said that the development would give members a competitive edge and offer “enormous” economic benefits to the Brazilian and Arab markets.

“It will bolster trade activities among relevant parties as we remain committed to deliver solutions through our offices in the Arab world, including cost-effective procedures and faster import-export processes. It is a milestone in our ongoing efforts to reinforce trade ties between Brazil and the Arab countries,” he said.

While Brazilian food and beverage exports to the Arab region were down 8.7 percent year-on-year in 2020, the region accounts for $6.19 billion worth of produce and is Brazil’s second largest purchasing market after Asia, according to figures published last week by the Brazilian Food Industry Association (ABIA). Saudi Arabia is ranked the ABIA’s sixth largest market, with the UAE eighth.

“There’s a major focus on Asia and the Arab countries, where we have decades-long partnerships and there’s a very fruitful, complementary economy, and we still have many opportunities to tap into,” ABIA board chair Grazielle Parenti said during a press conference, according to a report by the Brazil-Arab News Agency.

For more than 68 years, the Arab-Brazilian Chamber of Commerce has been working to connect the Brazilian and Arab peoples to promote economic, social and cultural development, playing a pivotal role in developing the relationship between the two countries over the years.


KSA sees rising demand for PC devices

KSA sees rising demand for PC devices
Updated 27 February 2021

KSA sees rising demand for PC devices

KSA sees rising demand for PC devices
  • Virtual school and working remote during pandemic is driving market, analysts say

RIYADH: The personal computing devices (PCD) market, which is made up of desktops, notebooks, workstations and tablets, recorded strong growth in Saudi Arabia and the Middle East in the final quarter of 2020, according to a new industry report.

“The Saudi Arabian market experienced an overall 7.1 percent growth in shipments of PCs and notebooks in Q4 2020,” said Isaac Ngatia, a senior research analyst at the American research firm International Data Corporation (IDC) 

“This was driven by continued demand for computing devices mainly for homeschooling.”

In the PC market, the consumer segment grew by 9 percent quarter-on-quarter, while the commercial segment grew 3.9 percent, he added.

The Kingdom's Ministry of Education emphasized the need for digital platforms so students could attend class virtually during the pandemic. Each child and teacher now needs their own device, while previously they may have been able to share with a fellow colleague or student.

Ngatia said there was a strong demand for notebooks. They feature a better user experience for learning purposes compared to tablets, which saw sales decline by 6 percent quarter-on-quarter.

“Demand for PC devices remained strong across the Middle East and Africa (MEA) region, with end-users still requiring these devices to work remotely or study from home,” said Fouad Charakla, the IDC's senior research manager for client devices in the Middle East, Turkey, and Africa.

Turkey, which is by far the region's largest single PCD market, experienced the highest growth year on year, almost doubling in shipments, Charakla said. The market's recovery from the slowdown in consumer demand seen in Q4 2019 was the primary driver of growth in Turkey. 

“A massive education deal totaling more than 150,000 tablets was also delivered to the country, which further accelerated the market's growth,” he added.

Each of the region's other large markets, including Saudi Arabia, South Africa, and the UAE, all experienced year-on-year growth as well, with strong demand witnessed in both the commercial and consumer segments. 

“On the flip side, sharp declines were recorded in Egypt and Kenya, primarily because these markets had witnessed massive education deals in Q4 2019 that were not repeated in Q4 2020,” Charakla said.

In the PC segment, Lenovo posted strong year-on-year growth that pushed it to the top of the MEA’s PC market for the first time. HP experienced a sharp decline but still finished second. Dell remained almost flat year on year to remain in third place.

In tablet sales, Samsung is in the top spot, once again backed by a large-scale education delivery, this time in Turkey. Lenovo more than doubled its tablet shipments to place second, while Huawei also experienced growth to rank third.


Saudi Arabia offers Europe ‘green’ hydrogen by pipeline

Saudi Arabia offers Europe ‘green’ hydrogen by pipeline
Updated 27 February 2021

Saudi Arabia offers Europe ‘green’ hydrogen by pipeline

Saudi Arabia offers Europe ‘green’ hydrogen by pipeline
  • Hydrogen is regarded by many experts as the clean energy of the future
  • The need to fight global emissions is key to the “circular carbon economy” championed by Saudi Arabia as a way to achieve climate change goals

DUBAI: Saudi Arabia is offering to transport “green” hydrogen by pipeline to Europe in the next stage of the Kingdom’s strategy to combat climate change.

“If Europe would like to buy more hydrogen, Saudi green hydrogen, we would be more than happy, and even, if the economics allow for it, even piping it all the way to somewhere in Europe,” Saudi Energy Minister Prince Abdul Aziz bin Salman said.

He also hinted at major developments to come in solar energy production. “I believe in the next month or so we’ll dazzle the world with how cheaply we can get our solar electricity,” he said.

Prince Abdul Aziz was speaking at a virtual meeting of the International Energy Forum and the European Union hosted in Riyadh, at which he added detail to the Kingdom’s strategy to control harmful greenhouse gas emissions.

 

 

Hydrogen is regarded by many experts as the clean energy of the future. Green hydrogen is produced using solar energy, and is a major feature of the energy equation at the planned NEOM megacity. In another form, “blue ammonia” is a byproduct of the oil refining process that Saudi Aramco has already produced and exported to Japan.

The need to fight global emissions is key to the “circular carbon economy” championed by Saudi Arabia as a way to achieve climate change goals, and was endorsed by G20 leaders last year under the Saudi presidency.

Prince Abdul Aziz appealed for “flexibility” by other countries in the debate over how best to mitigate climate change.

 

 

“The goal is to be flexible and mindful of the participants and their priorities,” he said.

Some countries, especially in Europe, have said they would like to move away more quickly from hydrocarbon fuels. Saudi Arabia, the world’s biggest oil exporter, believes this is the wrong approach.

To address climate change, Prince Abdul Aziz said, “you need to bring everybody on board and you need to be mindful of their priorities and you need to be mindful of how much (energy resources] they are endowed with.

“But I can guarantee you that we’re opening hands, hearts and minds to work with everybody and bring solutions to move forward and work with these ambitions, but with a difference — we are not bragging about it, not talking about it, we are executing these things and providing people with examples.

“Trust us, but more important, collaborate with us in universal solutions.”


NYSE begins move to delist Chinese state oil producer CNOOC

NYSE begins move to delist Chinese state oil producer CNOOC
Updated 27 February 2021

NYSE begins move to delist Chinese state oil producer CNOOC

NYSE begins move to delist Chinese state oil producer CNOOC
  • The Trump administration had last year moved against certain Chinese companies that Washington said were owned or controlled by the Chinese military in an effort to ramp up pressure on Beijing

The New York Stock Exchange on Friday decided to begin formal delisting of Chinese state oil giant CNOOC Ltd. based on an update to an executive order signed by former US President Donald Trump in November last year.
Prohibitions on CNOOC will take effect on March 9, 60 days after the company was added to the list that prohibits US investments, according to a guidance issued by the Treasury Department on Jan. 27.
However, the exchange did not disclose a target date for the completion of the delisting.
The Trump administration had last year moved against certain Chinese companies that Washington said were owned or controlled by the Chinese military in an effort to ramp up pressure on Beijing.
The NYSE said CNOOC has the right to appeal the delisting decision. The exchange will include any appeal it receives in its application to the US Securities and Exchange Commission, which will be submitted on completion of all procedures.
CNOOC could not be immediately reached for comment.