CHINA LAUNCHES NATIONAL CAMPAIGN AGAINST DEFLATION
Xi Jinping's new national campaign against deflation includes stern lectures calling on employees to grow revenues and cut costs. "We cannot and dare not make losses," Zhang Xiong, a general manager at China's state-owned Sichuan 15th Construction Company, told his staff. Every project needs a plan to halt losses, he added. Over the past month, state-owned firms nationwide have held similar meetings with one message: stop losing money. Losses are a "red line," said the state-owned Gansu Power Investment Group on its social media account. But in the absence of national level reforms to boost consumption, a renewed wave of cost-cutting is likely to worsen deflation. "A stern talking to won't bring more contracts," says Xu Tianchen of the Economist Intelligence Unit. (Reuters, September 12, 2025)
BEIJING EXPORTS SURVEILLANCE SYSTEM TO THE SOLOMONS
China is exporting its surveillance model to the Solomon Islands, where Chinese police are piloting fingerprint and data collection. Chinese police are introducing residents to population management, household registration, community mapping, and the collection of finger and palm prints. They are visiting villages promoting the "Fengqiao" monitoring model, a grid system with each grid manager responsible for "monitoring blocks of households." The Royal Solomon Islands Police Force said the Fengqiao model would collect population data to improve security and "will be expanded to a larger area across the country in the future." "It is an infringement on individual rights that are protected by our Constitution and should have come through parliament, through our laws," opposition party politician Peter Kenilorea has stressed. (Taipei Times, September 13, 2025)
[EDITOR'S NOTE: Started under Mao Zedong in the 1960s to help communities mobilize against reactionary "class enemies," Fengqiao has been reinvigorated by Xi Jinping to ensure stability in local communities. China struck a security pact with the Solomon Islands in 2022 after anti-government riots there the preceding year. The protests were fueled in part by opposition to the Solomon Islands switching diplomatic ties from Taiwan to Beijing.]
U.S. BUSINESS CONFIDENCE IN CHINA HITS NEW LOWS
Political tensions, fierce domestic competition, and slow economic growth are sapping the confidence of U.S. businesses in China. According to the annual survey of the American Chamber of Commerce in Shanghai, only 45% of AmCham Shanghai's 254 members expect their revenue to grow in 2025 – the lowest percentage since the survey was introduced in 1999. Only 41% of U.S. firms were optimistic about their five-year China business outlook, a drop of six percent from last year. Only 12% of respondents ranked China as their firms' top investment destination, another record low, and 47% said they had redirected investment previously earmarked for China, mostly to Southeast Asia. (MSN, September 9, 2025)
RENTS ARE FALLING IN CHINA'S TOP-TIER CITIES
Rents for grade-A offices in Shenzhen, Shanghai, Guangzhou and Beijing have dropped between 20% and 40% since 2020, with those in Beijing declining the most. State-owned China Merchants Commercial REIT reported a 16% drop in net property income in the first half of the year, and is luring tenants with flexible leases and services including air conditioning, electric appliances, and charging EVs. At the end of June, Shenzhen had the highest vacancy rate (30.6%), followed by Shanghai (23.7%), Guangzhou (22.6%), and Beijing (19.6%). "We expect conditions to remain challenging in the near term, with landlords relying on incentives and flexible lease structures to retain tenants," said James MacDonald of Savills Research. (Business Times, September 8, 2025)
CHINA AIMS TO DOUBLE NEW ENERGY STORAGE CAPACITY BY 2027
China plans to nearly double its new energy storage capacity to 180 gigawatts by 2027 with the help of 250 billion yuan ($35 billion) in investment in the sector, The National Development and Reform Commission has announced. China's existing new energy storage capacity, which mostly consists of lithium-ion battery capacity, was 95 GW in June, compared to the U.S. which had 26 GW of utility-scale battery storage at the end of 2024. New energy storage refers to electrochemical, compressed air, flywheel and supercapacitor systems. (Bloomberg, September 11, 2025)