TWS: Feb. 8, 2021

Graph of the Week | Economics

Shenzhen: The City with a Whole Lotta Green Behind That Green

Curious about what to expect from our whitepaper?

Working with Policybot, we analyzed Pearl River Delta policies at the city level, using keywords to identify industries receiving strong governmental support. From there, Policybot brought this data to life with stunning visualizations, and we made sense of these findings with in-depth analysis.

Among the 90 PRD-related policy documents from Shenzhen, we found that city officials have their sights set on green development and energy, with related keywords appearing in 34% and 20% of policies, respectively.

  1. Green Development: Shenzhen is known as a pacesetter in China for its dominance in electric vehicles tech. Between 2016 and 2019, Shenzhen’s streets saw 60,000 new electric trucks, or more than 35% of the city’s total truck freight capacity. Meanwhile, in June 2017, the city replaced its entire fleet of public buses with electric counterparts.
  2. Energy: While China has made considerable leaps in the renewables space, green energy power generation still lags the enormous energy demand of China’s population. As Shenzhen continues to grow its ~20 million population, the city is grappling with how to shift from using traditional sources of energy such as coal, to cleaner alternatives like wind and solar.

Bottom line: Development and integration of the Pearl River Delta region is one of the largest domestic undertakings yet. Learn more about the future direction of Shenzhen and check out breakdowns like this for the other cities in the Pearl River Delta region in our whitepaper.


Finance | Markets

It Smells Like Teen Spirit Across the Globe

There’s nothing like a lil’ angsty anti-establishment spirit to bring people together.

GameStop’s pilgrimage to the moon struck a universal chord last week. While Redditors took to the stork market in the US, Chinese investors hummed along to the tune of revolution as they piled onto the volatile stock from overseas.

When GME soared more than 400%, Robinhood and other trading platforms gained infamy after halting trading amid extreme price swings. Up Fintech and Futu Holdings, Chinese e-trading platforms that help Chinese investors invest overseas, echoed the decision of the hero-turned-villain Robinhood as they restricted users from trading the beleaguered stock. They then resumed trading shortly after Chinese investors began singing criticisms in solidarity with Redditors over the platforms’ ill-timed restrictions.

Bottom line: US and Chinese markets are near inverses of each other. Nearly 60% of capital in US markets comes from institutions and 40% from households, while nearly 67% comes from households and 33% from institutions in China. Though both markets march to the beats of different drummers, the plight of the small investor versus the big institution still harmonizes with all those who listen along – particularly among Chinese investors who suffer from frequent market manipulation at the hands of institutions.


Industry | Technology

Another One Bites the (Moon) Dust

The world is running out of chips—at least the kind needed to power the 21st-century’s digital gold: bitcoin.

China accounts for more than 60% of global bitcoin production. Because mining operations consume so much computing power, an entire economy has sprung up around the specialized equipment used within the industry.

Yet, as bitcoin’s value moons, some Chinese miners are stumbling in their quest for the digital gold. Chinese cryptocurrency mining behemoth Bitmain, which produces specialized equipment for cryptocurrency mining, has been unable to keep up with a worldwide spike in demand for its products amid a global chip shortage. A resulting price hike has short-circuited many smaller mining groups, while deeper-pocketed organizations struggle to get their hands on the goods needed to sustain operations.

Bottom line: Chinese miners were some of the earliest to get in the game. But, as the world catches up and the tech used by industry competitors gets leaner, meaner, and greener, China’s underdeveloped chip producing capabilities is claiming yet another victim. While other countries dig in deeper, Chinese miners are being forcibly exited from the digital currency mine.


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Markets | Industry

There and Back Again: A Chinese Space Industry Tale

3…2…1…BLAST OFF! That’s the sound of Chinese private rocket firm, iSpace, counting down for its IPO.

Beijing-based iSpace will launch on China’s science and tech-focused exchange for smaller companies, the STAR Board. The startup turned heads as the first private Chinese firm to launch a satellite into space and is now working on a new technology that could propel the company into the stratosphere of success. Much like SpaceX launches, this new rocket would be able to absorb landing impact, making it reusable for multiple flights.

China’s foray into space is decades in the making but kicked into hyper-drive after Beijing opened the industry up to private investment in 2014. Since then, around 20 firms have joined the race and taken the industry to new heights.

Bottom line: With multiple companies—both private and state-owned—jetting towards reusable rocket technology, China has been popping on the radar as a quickly advancing competitor within the space industry. Though iSpace’s most recent launch was a flop, a successful mission would mark a turning point for the burgeoning industry by allowing for more frequent launches and cheaper space exploration – not to mention shoot iSpace stock straight to the moon.


Industry | Technology

Chinese Tech Giants Showdown Over Community Group Buying

China’s hottest tech trend in 2020 was collective online grocery shopping, also known as “community group buying.” This contact-free model for digital grocery retail took off during the pandemic as a convenient way to procure daily necessities in lockdown. Doubling in value over the course of the year, community group buying has all of China’s e-commerce giants, including tech companies outside the e-commerce space, aggressively pursuing a share of the pie.

Full Article

Further Reading

China Business Newsletter

TWS: Aug. 2, 2021

China Business Newsletter

TWS: July 26, 2021

China Business Newsletter

TWS: July 19, 2021

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