Our more attentive readers will have noticed a streak of creativity running through developments in the news this week. Yes, The Wall Street Journal ran a piece today on Chinese inventions that will provide all the cocktail fodder you need for an evening out, whether in the former French Concession or the hutongs of Gulou. But you do not need to be an entrepreneur to innovate.
Xi Jinping for one found new ways to put the squeeze on SOEs, calling for tighter regulation of their Brobdingnagian budgets. The Ministry of Health no doubt hopes to spur domestic innovation by pushing local medical tech at the expense of global giants. Amazon of all companies finally maybe found an actual use for the FTZ in Shanghai, hoping to funnel foreign bags and books into China, though no telling which ones will be allowed in: Tight-fisted business owners are likely to petition Customs to block copies of a new study commissioned by Hong Kong’s government that recommends a new salary tax to fund a pension for elderly residents.
Even Bank of China broke new ground by announcing plans to raise RMB30.7 billion for a buffer against bad loans. And in far Xinjiang, China National Petroleum Corp. announced it was looking for new partners to explore untapped gas fields in the region provided, of course, those partners have RMB10 billion on hand and are backed by the right local government organs.
But one can fail creatively as well, of course, and exemplars abounded these past five days: The first corporate bond default in China charted new ground, as a meeting this week failed to address investor concerns. State plane maker Avic saw its prospects nosedive after failing in the first half of the year to finish nine of the 10 planes it planned to deliver. The accomplishments of state-backed airlines in customer frustration and flight cancellation no doubt helped prompt the three biggest in the fleet to issue profit warnings. And foreign automakers from Mercedes to Mitsubishi found themselves subject to creative new interpretations of the term “monopoly.”
So don’t let the latest PMI data get you down, as it did Asian markets and the Australian dollar. Creativity is on the rise in China, and we daresay creative ideas will spread faster than ever now that Apple is storing user data in the country – an example of how the business practises of local firms are catching on among MNCs.