MNI China Daily Summary: Thursday, November 29

     EXCLUSIVE: China's yuan will come under renewed selling pressure and likely

break above 7 against the U.S. dollar if Saturday's summit meeting between

presidents Xi Jinping and Donald Trump fails to to ease the ongoing trade

dispute, an official government advisor told MNI Tuesday. "If (the U.S. and

China) do not show willingness for further negotiation, or the G20 fails to

accept the leading role of the WTO-dominated multilateral framework in the

global trading system, it is not impossible that the yuan would break the 7

level against the dollar," Xu Hongcai, chief economist at the China Centre for

International Economic Exchange, a Chinese government think tank, told MNI. (See

full story: https://www.marketnews.com/node/1840063)

     EXCLUSIVE: China could make concessions to the U.S. to lower the

temperature in their trade dispute, including further opening its markets to

foreign companies, but will not budge on demands relating to World Trade

Organisation rules covering subsidies for state enterprises and China's status

as a developing economy, two sources close to the Chinese government told MNI

ahead of the G20 summit. Recent public statements by Chinese officials offer

some "meat" to the U.S., which is trying to push China towards freer markets and

has criticised the World Trade Organisation for failing to check Beijing's

subsidies for state-owned enterprises, said one source, who asked not to be

named due to the sensitivity of the issue. U.S. President Donald Trump has also

said it is unfair that China continues to draw benefit from its WTO status as a

developing country. (See full story: https://www.marketnews.com/node/1840087)

     LIQUIDITY: The People's Bank of China (PBOC) skipped open market operations

(OMOs) for plans to make 18 amendments to regulations on foreign banks in China,

further clarifying the rules governing them, Economic Information Daily reported

on Thursday. Foreign banks with approval to run derivatives trading units from

their China head offices will likely be given clearance to expand to other

branches after consultation with local bank regulators, the Daily reported,

citing a revised draft of the plans. (Link to the story: https://bit.ly/2P64enf)

     TOP NEWS: Officials from both China and the U.S continue to work

constructively ahead of upcoming G20 Summit in Argentina, looking for an outcome

acceptable to both sides, Gao Feng, a spokesman for the Ministry of Commerce

said Thursday. Feng gave no indications as to how much progress China and the

U.S. have made towards resolving the trade spat ahead of the much-anticipated

meeting between Chinese President Xi Jinping and his U.S. counterpart Donald

Trump on the summit sidelines. Instead of directly responding to President

Trump's recent warning of again raising tariffs, Gao said that the essence of

Sino-U.S. economic and trade cooperation was in seeking mutual benefits.

     Following Wednesday's executive meeting, China's State Council has decided

to launch a nationwide assessment of the business environment, benchmarking

against international standards, and pledging to optimize the environment so as

to attract further foreign investment, 21st Century Business Herald reported.

There are a list of concerns that need fully addressing, including market

access, tax and fee reductions, legal safeguards, government-business relations,

and fair competition, the newspaper said citing Feng Qiaobin, professor at the

Department of Economics in the Chinese Academy of Governance. (Link to the

story: https://bit.ly/2TSzbii)

     As year end approaches, local governments are rushing to kick start major

projects in order to meet annual targets. A batch of key projects with a total

investment of over CNY100 billion yuan got underway recently, Shanghai

Securities News reported on Thursday. In November, Bengbu city in Anhui

province, Qingdao city in Shandong province, and Changde city in Hunan province

started infrastructure projects worth CNY65.78 billion, CNY20 billion and

CNY10.97 billion respectively, the News reported. Transportation projects have

been a highlight for local governments promoting investment in Q4, the News

said. (Link to the story: https://bit.ly/2BDSgh7)

--MNI London Bureau; tel: +44 203-586-2225; email: les.commons@marketnews.com

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