Capital Flight from China Worse Than Thought - January 20, 2016

Media Report

January 20 , 2016

Financial Times：Capital Flight from China Worse Than Thought
Financial Times reports that the flow of capital out of China and other emerging markets was significantly worse than previously thought in 2015, according to new estimates. In a report released on Wednesday the Washington-based Institute of International Finance said outflows increased as overseas investors pulled out of emerging markets and Chinese companies scrambled to pay off overseas loans in the final three months of the year amid a weakening renminbi. Emerging markets saw an estimated $735bn in net capital outflows last year with all but $59bn of that coming from China. In October, the global finance industry group had predicted 2015 would see net outflows from emerging markets of $540bn, the first since 1988. The latest grim data comes amid growing concerns about faltering growth in China and other major emerging economies that has led some to start calling the end of a charmed era for emerging markets. They also highlight the continuing opacity of many of those markets and the difficulty of measuring the extent of capital flight out of places like China that impose strict controls on the movement of money.
The New York Times：U.S. Weighs Tighter Sanctions on North Korea if China Fails to Act
The New York Times reports: "The United States and its allies will bolster sanctions and go on the defensive against North Korea in ways that China may not like if Beijing fails to lend greater support to efforts to curb the North's nuclear ambitions, a top American diplomat said here on Wednesday....China, while condemning the North Korean nuclear test, has suggested that it is the Americans, not the Chinese, who are largely to blame for the North's pursuit of nuclear weapons....Since the latest North Korean test, some analysts and newspaper editorials in South Korea have accused the United States of 'outsourcing' the North Korean issue to China and not doing enough itself....In its first statement since the nuclear test, North Korea's Foreign Ministry reiterated on Friday that it would settle American concerns about its nuclear weapons only if Washington first signed a peace treaty to end its 'hostile policy' toward the North, which it described as 'the root cause of all problems.'"
Reuters：China shares slip as oil slides, outweighing stimulus hopes
Reuters reports: "China's volatile stock markets fell more than 1 percent on Wednesday, though mounting chatter about imminent policy stimulus provided some support against the backdrop of a fresh slide in oil prices, which hit stock markets across the globe. Asian and European stocks were down sharply as U.S. crude sank beneath $28 a barrel for the first time since 2003, hammering energy stocks and boosting safe havens. [MKTS/GLOB]....Late on Tuesday, the central bank announced it would inject more than 600 billion yuan ($91 billion) into the banking system to help ease a liquidity squeeze expected before the long Lunar New Year in early February....China's woes combined with the slump in commodities to prompt the International Monetary Fund to cut its global growth forecasts again on Tuesday. It warned the world's second-largest economy would see growth of only 6.3 percent in 2016."

Calendar

2016-01-19 Xi Asserts China's Middle East Role as Iran Sanctions Lifted
2016-01-18 China GDP Growth Slowest Since 1990
2016-01-17 China's economic turmoil sends ripples of anxiety across G20
2016-01-15 Ousted Communist Official’s Brother Is Living in United States, China Says
2016-01-14 China Stocks Rebound From Lowest Since Rout as Smallcaps Rally
2016-01-13 South Korea Presses China for More Aggressive Action on the North
2016-01-12 Wanda goes to Hollywood: China tycoon's firm buys film studio Legendary for $3.5 billion
2016-01-11 China stocks start new week with 5.3% drop
2016-01-10 China claims it has a ‘stable and healthy’ financial system
2016-01-08 Asian Markets Stabilize as China Stocks Rise

News

The New York Times U.S. Weighs Tighter Sanctions on North Korea if China Fails to Act
Reuters China shares slip as oil slides, outweighing stimulus hopes
TIME Swedish Activist Shown 'Confessing' on Chinese State Television
The Wall Street Journal Saudi Arabia and Iran Tussle Over Exports to China
The New York Times Asian Stocks Down After US Turbulence, Weak China Growth
The New York Times Treatment of Foreigners in China a 'Worrying Trend,' E.U. Envoy Says
The Washington Post Vietnam demands that China remove oil rig
The New York Times Peter Dahlin, Detained Swedish Rights Worker, Said to Confess in China
The Washington Post China's Taiwan office deputy head under investigation

Commentary

Reuters China's online arms race shows no sign of cooling
Foreign Policy Will the 'One China' Policy Survive the New Taiwan?
The Wall Street Journal: China Real Time Smog, Censorship, Antiforeign Sentiment: U.S. Firms' China Woes
Slate Magazine China's Sluggish Economy Is Dragging the World Down With It
The Wall Street Journal: China Real Time As Labor Unrest Looms, China Vows to Target Deadbeat Employers
Foreign Policy Davos Diary: Money is Rushing Out of Emerging Markets. Blame China.
The New York Times 'Star Wars: The Force Awakens' Receives a Cool Reception in China