5% GDP growth looks baked in.
Tech
Huawei is building a $1.66 billion Shanghai R&D center to develop lithography machines to make logic chips on 14nm/16nm FinFET and more advanced processes. ASML controls well over 90% of the lithography tools market, so Huawei-developed machines will have to be at least 28nm or 14nm/16nm-capable.
China is now three years behind TSMC, Japan’s IC analytical lab: “The area of SMIC’s 7-nm mass-produced chip is 118.4 sq. mm., while TSMC’s 5-nm chip is 107.8. The two chips have similar performance levels”. The gap between SMIC and the world’s most advanced chips is now 3 years.
Nvidia’s best AI chips are 40% cheaper to rent in China than in the US, a sign that the advanced processors are easily reaching the Chinese market despite Washington’s export restrictions: $6/hour vs. $10/hour for the same setup.
China spent more on chipmaking equipment than South Korea, Taiwan, and the U.S. combined: $25 billion in the first half of the year.
Huawei’s new $2,800 trifold phone attracted 3 million personal orders in its first three days on sale, for revenue of $8.4 billion.
De Beers leaves the lab-grown diamond jewelry business as China arrives. In central China, the nexus of the country’s diamond industry, new technologies caused a boom in synthetic diamond production; now, with prices falling through the floor, companies are wondering what’s next.
China will launch its Tianwen-3 mission to Mars in 2028, two years earlier than previously planned, which would see Martian samples returned to Earth by July 2031, handing China the lead in the race for Mars and becoming the global leader in space exploration.
China’s low latitude long range ionospheric radar (LARID) detected plasma bubbles over both the Pyramids and over Midway Islands, almost simultaneously. Equatorial plasma bubbles are electron-depleted regions that can be hundreds of kilometers in diameter and play havoc with GPS positioning and satellite communications. China is the first country to detect plasma bubbles on radar.
China’s reusable test spacecraft, launched, Dec 2023, returned to its scheduled landing site on Friday after 268 days of in-orbit operation, demonstrating the growing maturity of China’s reusable spacecraft technologies.
A jellyfish-inspired luminous artificial spider silk for surgical sutures has a maximum breaking stress of 1,017 MPa and maintains luminosity after 60 hours of UV exposure. It helps surgeons ensure a safe and complete suture.
Tsinghua can train optical neural networks without GPUs. The new FFM learning method allows the optical system to learn and adjust itself in real-time, much like a self-driving car continuously adapting to road conditions. This on-site learning approach eliminates the need for complex simulations and allows the system to account for its own unique quirks and imperfections.
Finance
Dilma Rousseff: “By promoting transactions in local currencies, we facilitate investment growth, help governments and the private sector overcome the cash flow mismatch between projects and financing, provide greater predictability and reduce the costs associated with currency hedging”.
Digital RMB volumes to the end of June hit $988 billion, up from $932 billion at the end of May, or $56 billion/ month. The digital RMB is also used for high value corporate transactions, including cross border.
The Asian Infrastructure Investment Bank (AIIB) issued its first digitally native note (DNN) on Euroclear’s Digital Financial Market Infrastructure (D-FMI). The initiative was supported by BMO Capital Markets as dealer and Citi, serving as dealer as well as the issuing and paying agent on the transaction.
The US dollar’s hegemony ends January 1, folks:
Economy
Hilton opens its 700th hotel, to add 100 more p.a. across the country.
BYD sold a record 373,083 vehicles in August, with strong growth in overseas markets.
Imports and exports to Africa are 1.19 trillion yuan, YTD, up 5.5%. China imported $3.5 billion of agricultural products from Africa, an increase of 7.2%
Export of ships, automobiles, wind turbines grew 45%, 36% and 253% respectively,
January-June freight revenue reached a whopping 484.1 billion yuan, an increase of 4.7% YoY.
China rail completed a record 2.1 billion passenger trips in H1, up 18% YoY.
Electricity consumption, a proxy for GDP, suggests that China’s economy is twice as big as America’s:
Combined revenues of the top four sportswear brands – Anta, Li-Ning, Xtep, and 361 – grew in H1 to $8.3 billion. Anta’s revenue, $5 billion, was up 14% YoY, with net profit of $1.4 billion, for 13.6% growth.
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Xizang (Tibet) Rural per capita disposable was 6,711 yuan ($3,000 PPP) in H1, up 8.4% YoY, the second highest growth rate in the country. Agricultural and livestock product processing rose 21%.
Global goods trade in 2023 fell 1.1%, though global GDP expanded by a trend-consistent 3.2%, a normalization after the world economies’ extraordinary 2021-22 rebound post-pandemic.
China’s international trade in goods and services hit $600 billion in July, up 12% YoY, leaving a surplus of $41 billion.
“China’s rapid development in industrial robot automation is extraordinary,” says the IFR, “The operational stock surpassed 1.5 million two years ago, making China the only country with such a large industrial robot stock. The installation of 290,258 units in 2022 alone represents 52% of the global market.”
220,000 industrial robots installed in H1, up 5.4%, more than half of the global total. America installed 7,123 robots in H1, down 9.7% YoY.
China makes 98% of the world’s gallium, a byproduct of aluminum production. Gallium nitride semiconductors are used in next-gen radar systems, high-speed power charging, 5G base stations, and consumer electronics. Export restrictions cut gallium exports in half, doubling overseas prices.
Russia will supply Mongolia (pop. 3.5 million), with discounted fuel and lubricants and a huge gas pipeline to China through Mongolia will fill the country’s coffers for decades.
872 million passenger rail trips during this year’s summer travel rush, up 6.2% YoY.
China has more internet users than the US, EU, Japan, Korea and Australia have citizens combined.
Chinese solar panel exports to Pakistan and South Africa surged because they fixed the energy crises those countries were experiencing. You can connect solar panels to the grid or build distributed projects MUCH faster than any other form of energy. In a continent where 44% of people don’t have access to electricity, the flexibility of distributed solar is welcome.
Huawei launches Egypt’s first public cloud service in Cairo, will pump $430 million into North Africa and unveil an Arabic language LLM and train local talents in applying LLMs to real world applications.
Hong Kong overtook Switzerland as a safe haven for overseas assets–after Switzerland froze Russian assets at America’s request.
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