China Direct

Stop Press - Update for UK Nationals Seeking to Return to China 10.06.20

Update for UK Nationals Seeking to Return to China 10 June 2020

The information below has been compiled through a coordinated effort between the British chambers of commerce in China, the UK Government in China and the China-Britain Business Council.  Please note that details and guidance are likely to continue to evolve over time and that all available sources should be consulted for the latest information.  We continue to work on this issue for the benefit of our members and the wider British community in China. We will strive to provide additional notifications as required to reflect any further significant changes to the situation.

Process for Arranging Return to China Please note the latest advice from the Foreign & Commonwealth Office on travelling to China: https://www.gov.uk/foreign-travel-advice/china

Please be aware: all stages of the process outlined below are owned and managed by the Chinese government at both national and local levels. Local implementation may differ and there are unlikely to be opportunities for UK Government and partners to influence individual applications. The information outlined below is based on information provided to us by the Chinese authorities in Beijing, Shanghai, and Guangdong, and is our best understanding of the process and information given at that time. Please note that we are making enquiries about the possibility of returning to other localities. Criteria for which category of businesses are allowed to return foreign national staff also differ by jurisdiction and continue to evolve in line with local economic and epidemic control requirements. The process is new and therefore relatively untested. As the situation is uncertain and evolving, there is no guarantee that applications will be accepted as described.   ·    An application does not guarantee that permission to return will be granted - due to a series of necessary approvals and conditions as mentioned above. ·    The possibility to rejoin family members has not so far been tested and cannot be guaranteed. ·    These processes constitute local provincial policies to return foreign workers, and therefore may differ from the advertised “fast-track” process. For more information or if you have specific questions pertinent to your case, you will need to contact the Chinese authorities.

Who can apply: 1.  UK nationals - with existing employment visa and a valid residence permit in Beijing, Shanghai or Guangdong - who need to return to working and living in China, and whose return can be justified by their employer as ‘urgent’ or ‘essential’. 2.  Immediate family members of the above mentioned UK nationals (with a valid residence permit) who wish to accompany them on their return. 3.  Possibly - and in exceptional cases - family members (of UK nationals still in China) with a valid residence permit who were displaced to third countries due to the effects of COVID-19, and who now wish to return to China to reunite with their families.

How to apply: 1.  In the first instance, the employer (company/school) of potential applicants will need to approach their local district Foreign Affairs Office (FAO 区外事办) or district Epidemic Control Office (区疫情防空办 - for Guangdong) to request permission to return home to their district.  2.  Applications approved at the district level will then be referred to the Foreign Affairs Office of the relevant Municipal People’s Government（市外事办）or Provincial People’s Government (省外事办) for their review and further approval. 3.  If agreed, Municipal/Provincial FAO will then issue a visa invitation letter, copied to the Ministry of Foreign Affairs and Chinese Embassy in London. The individual employee should use this to arrange an appointment the Chinese Embassy, where – subject to the Embassy’s final approval - they will be able to obtain a new, one off, time limited, single-entry visa to travel. 4.  Upon successful entry into China using the new single-entry visa, returnees will be able to stay for a maximum 180 days. The employer will be required to liaise with district FAO and Epidemic Control Offices to ensure relevant quarantine procedures and pandemic movement regulations are followed. 5.  During the 180 day period, individuals with previous long-term residence permits or visas that had been temporarily frozen will need to go to their local PSB immigration office to re-activate their frozen permit. The local PSB office will have ultimate decision making authority on whether or not to grant each individual request to remain on a long term basis.

What to expect from the process: All applicants will be required to: ·    Allow approximately three weeks to complete the application process. ·    Ensure that they are able to identify a suitable commercial flight to return within the ‘use before date’ specified on the single entry visa, or risk having to reapply. ·    Potentially be expected to arrange for a nucleic acid test (NAT) in the UK within 48 hours of departure. ·    On arrival in China, undergo screening by customs officials before disembarking the plane. ·    Immediately after disembarking, take a nucleic acid test (NAT) test at the airport. ·    After completing the test, be met at the airport with representatives of the district of the company that made the original application on their behalf. ·    Subsequently be taken to a designated facility to wait for the results of the nucleic acid test - which can take up to 24 hours. ·    Assuming that the test is negative, to then quarantine for 14 days in a centrally supervised facility (designated hotel – for which the cost will be borne by the company or individual) before being able to return to home and work. In Beijing, after the 14 days you will need to complete an additional 7 days quarantine at home.

Frequently Asked Questions 1.  Are all UK nationals who need to return to working/living in China able to apply or just those who work in certain industries? We understand that this route is designed for those with existing employment visa and a valid residence permit in Beijing, Shanghai or Guangdong, that are deemed business critical to their respective companies. Applications will be judged by the Chinese government on the basis of each individual application. 2.  What if my visa/resident permit expired during the time I was out of China and when the border controls began? Your employer will need to contact the local FAO in the first instance for guidance on local requirements. Some of the material needed for the application will need to be prepared before you depart from the UK. After you enter China, your employer will be able to help you to apply for a work permit and then get a resident permit from the PSB (police). If the work permit is close to expiring but still valid, the local FAO will allow your employer to renew it online on your behalf before you physically return to China. 3.   If my family member is already in China and I also have a residency permit, why will I only be allowed back in in exceptional circumstances? We understand that this service is designed for and focussed on those that are deemed business critical to their respective companies – rather than on reconnecting families. Therefore we think it likely that applications through this route based on family circumstances will only be successful in exceptional circumstances. 4.   Why do I have to go through my employer rather than be able to apply for this on my own? As mentioned, we understand that this route is designed for those that are deemed business critical to their respective companies. Therefore the focus and onus is on those companies to make necessary arrangements through this route. 5.  What if I am self-employed through my own WFOE? Application should be submitted by the employer/company (though the FAO may give priority to bigger companies.) 6.   Do I have to get a COVID test done in the UK before applying for this? Our understanding is that applications under this service may require individuals to take a COVID-19 test in the UK at the discretion of the Chinese Embassy, and you should be prepared to make necessary arrangements if requested. 7.  If approved by the Chinese embassy, how long will the one-off, single entry, time-limited visa be valid for? We understand from conversations with district FAOs that recent applicants have been issued a single entry visa that requires them to arrive in China within thirty days of the application being approved. On arrival in China, we understand that the single entry visa remains valid for 180 days, during which time individuals with previous long-term residence permits or visas that had been temporarily frozen will need to go to their local PSB immigration office to re-activate their frozen permit. The local PSB office will have ultimate decision making authority on whether or not to grant each individual request to remain on a long term basis. 8.   What if I cannot get a flight in time before the approved visa expires? We understand that you would be able to apply again. 9.  What if my application gets rejected? We understand that you would be able to apply again, if you wish. 10.                 Given the lack of commercial flights available, will the British Embassy/Consulates be organising charter flights from the UK to China to support Brits in returning? If not, why not? Her Majesty’s Government currently has no plans to arrange charter flights for businesspeople to return to China. The British Chamber of Commerce in China and the China-Britain Business Council are in touch with the business community to scope the demand for this and to explore possible solutions.

PWC update on China’s Lianghui or Two Sessions meeting

 

 

CBI member, Price Waterhouse Coopers has released an insight report documenting the events at last week’s LiangHui or ‘Two Sessions’ meeting, which took place in Beijing from March 3^rd – 15^th.

Titled, ‘What are the Business Implications from China’s Two Sessions?’ PWC’s report sets out the following as key takeaways:

• China will speed up the all-round opening-up of the economy by improving the business environment, particular in terms of rule of law and opening up more areas to foreign investment.
• China will continue to fight three major battles against significant risks, poverty and pollution.
• Supply-side structural reform still plays a vital role in economic development.
• Manufacturing and consumption will benefit from tax cuts for the manufacturing sector and individual tax deductions. Other takeaways include, the fact that the Chinese government has set the major economic targets for 2019 including: GDP growth of 6% to 6.5%, creating 11 million new urban jobs, and maintaining the surveyed employment rate at around 5.5%. PWC’s ‘standout sector’ are the financial services institutions active in the China market, who have made significant progress covering, securities, insurance and providing credit ratings. PWC accounts that foreign investment in China’s bond market has increased by nearly 600 million Renminbi in 2018, and the total amount has now reached about 1.8 billion Yuan.  
• Please follow the link to find the complete report.

PWC launches latest China macro-economic and policy updates

CBI member, PWC has released its latest edition of China Economic Quarterly, which includes PWC’s latest analysis of China’s major economic indicators for Q4 2018. China’s GDP growth rate in Q4 was 6.4%, which PWC marked as ‘lower than expected’, before qualifying the statistic as ‘reasonable’ when examined in the context of China achieving 6.6% GDP over the whole year.

Other key statistics identified by PWC include:

• China’s total GDP increased by USD$1.4 trillion last year, which is almost the same economic size as Australia – the world’s 14^th largest economy
• Total retail sales of consumer goods went up by 9.0% y/y to 38.10 trillion RMB in 2018
• Profits of foreign owned industrial enterprises only increased by 1.9% in 2018, but profits of SOEs and private companies went up by 12.6% and 11.9%
• Imports and exports were better than expected. Total imports and exports reached 30.1 trillion RMB, increasing by 9.9% over 2017 and amounting to 1/3 of China’s GDP in 2018These statistics corroborate a view shared by many foreign companies in China - that China is making a lot of money, and there is a lot of money to be made in China, but foreign companies are being unfairly collected as big fish in a little pond, and are unable to take advantage of the full extent of China’s economic development because market access barriers which offer Chinese companies and SOEs preferential treatment remain in place.
• PWC’s China Economic Quarterly also includes a series of longer articles, discussing whether China will decide developing high-quality manufacturing and further opening the market should become actionable priorities for 2019? Or whether to continue prioritising infrastructure investment over the course of the year and turning to unconventional industries – such as sports – to re-balance the economy after slower GDP growth during 2018.

China Outlook 2018 - KPMG Report - Future opportunities & BRI

 

Dear Members and partners,

Please find information relating to CBI member KPMG's recent China Outlook 2018 Report below.

The interactive dialogue covered future investment opportunities in China and with China (including across the Belt and Road Initiative (BRI)) alongside expert analysis of the economic transformation and industrial upgrading during the period of China’s 13th Five-Year Plan and beyond.

All of which can be studied in detail within the China Outlook 2018 report, with a summary of the key messages available on KPMG's website.

With our thanks to CBI member KPMG for sharing this important report.

EUCCC Business Confidence Survey 2018 Launched in Beijing and Shanghai

 

On 20^th June, the European Business in China Business Confidence Survey 2018 was launched in Beijing and Shanghai to media and members.

The survey reveals that doing business became more challenging over the past year due to longstanding regulatory barriers, market access restrictions and unequal treatment. New challenges are also on the horizon. European companies must now compete with Chinese firms that are more innovative than ever before. Yet they have remained resilient, delivering strong financial results for the second year running.

Please read English press release and Chinese press release.

China's Lianghui in 1 minute summary

Dear CBI members and partners,Kindly find a short one minute summary of the key takeaways from the recently concluded Lianghui.

Download CPW No. 174

China Direct would like to thank Trey McArver, Co-Founder of Trivium/China, for kindly sharing this useful update.

China's revolutionary government overhaul - the new era

Xi Jinping emerged from the 19th Party Congress with a mandate to push China into a ‘new era’. To support this agenda, the Party has proposed a scheme to retool the machinery of government.

Passed at the NPC 17 March, it is the most ambitious restructuring in decades, creating seven new ministries and adjusting the structure of nearly every national agency.

It will change how government works with the Party, the market and the outside world. It could deliver streamlined governance, but risks enormous growing pains as the system copes with a disruptive change. This report explains each of the 26 changes to state structure included in the reform document: what’s changing, why and what to expect.

Liu He 刘鹤 Politburo member describes the plan as a ‘revolutionary’ reform that will touch every part of the state. It attempts to overcome endemic problems of policy implementation by creating cradle-to-grave accountability for policy goals, entrusting new, specialised ministries with singular missions.

Leaders have warned for years that ‘vested interests’ and inefficiency pose an existential threat to the Party-state. The roots of these problems were planted in the Mao era: ministries were created to meet production targets in ‘sectors’ 行业 of a planned economy.

But the biggest worry is no longer production, and those sectors are a bad fit for contemporary policy.

Former finance minister Lou Jiwei 楼继伟 joked ‘frogs in the river are governed by the Ministry of Agriculture (MoA); frogs on the shore are governed by the State Forestry Administration’.

As it attempts to pivot toward meeting what Xi calls the ‘ever-growing needs of the Chinese people’, the Party needs a government fit to regulate a demand-driven economy. The new integrated system addresses the question of oversight and accountability and designs new, purpose-built agencies.

China Direct would like to thank China Policy for sharing this wide-ranging Report with our readers.

For more information please contact: Ekaterina Kuroedova: ekaterina.kuroedova@policycn.com

Download China Policy-A revolutionary overhaul

China National People's Congress 2018 - A Summary

 

Dear CBI members and partners,

Please find attached a useful summary of China's National People's Congress which concluded earlier this week.

Download CPW No. 173

Our grateful thanks to China Politics Weekly for sharing this issue.

(CNPC image above courtesy of www.scmp.com)

 

China set to launch an 'unhackable' internet communication

Dear CBI Members & Partners,

China Direct thought that you would find these developments of particular interest in relation to China's recently announced Cyber Security Law and recent developments to create an Internet infrastructure separate from the current global World Wide Web.

Related web link is here.

 

China Financial Headlines - Q2 GDP, Wanda, Coal & Stocks

A short summary of several key financial and regulatory headlines...

China Direct would like to thank Noah Shaw, the CBI's Beijing based Policy Analyst, for preparing this note.

 China Q2 GDP growth beats expectations

China's gross domestic product rose 6.9% in the second quarter, faster-than-expected, setting the country on course to comfortably meet its 2017 growth target and giving policymakers room to tackle big economic challenges ahead of key leadership changes later this year, according to Reuters. The boost to growth was in part driven by firmer exports and production, in particular steel, which could heighten trade tensions as the United States and China begin economic talks this week. Economic data from the second quarter has prompted a number of analysts to upgrade their GDP forecasts for China for 2017, although some moderation in growth is expected later this year as policymakers' efforts to rein in property and debt risks weigh on activity. Citi raised its 2017 annual GDP projection to 6.8% on-year from 6.6% previously.

 

China warns banks against lending to Wanda

Chinese banks have been warned by regulators against lending to Dalian Wanda as the serial acquirer comes under official scrutiny following a half-decade overseas dealmaking binge. Regulators instructed banks to restrict exposure to the property-to-movies conglomerate in a meeting on June 20, according to notes of the meeting that were seen by the Financial Times. A person familiar with the discussions between banks and regulators vis-a-vis Wanda said six Wanda deals were discussed. The document cites two of the deals by name, giving strict instructions to banks not to finance them, accept their assets as collateral, list them in China or inject them into Wanda's China-listed companies. Wanda was also told not to inject any of its own assets into the six acquisitions or sell them to other Chinese buyers.  Overall the meeting appeared to highlight official anxiety about Wanda's financial situation. The unlisted parent, which does not publish information about its liabilities, made virtually all of Wanda's foreign acquisitions.

 

Coal and steel still large and in charge

“Rebalancing with Chinese characteristics,” Christopher Balding, a professor at Peking University’s HSBC Business School in Shenzhen, declared upon hearing the news that China’s steel output had hit a record high in June. In doing so, he referred to two things: current president Xi Jinping’s years-long policy goal of “rebalancing” the economy away from heavy industry and toward services, and former leader Deng Xiaoping’s famous maxim about “socialism with Chinese characteristics,” a phrase that is often used derisively but refers to the government’s vision of China as a country with a balance of public sector control and private sector competitiveness. Xi’s rebalancing act has not reduced the role of government-subsidized heavy industry and manufacturing: Quartz reports that record coal and steel output — a side of China’s economy that is both polluting and disproportionately state-owned — is largely responsible for recent economic growth trends. According to Bloomberg, a “factory rebound” led to these numbers, all of which slimly surpassed survey expectations by less than 0.5 percent, except for industrial output, which rose 1.1 percent above expectations:

• GDP up 6.9 percent in the second quarter from a year earlier
• Industrial output up 7.6 percent in June from a year earlier
• Fixed-asset investment up 8.6 percent in the first half of this year
• Retail sales up 11 percent from a year earlier in June

 

Chinese stocks plummet after financial planning meeting

On Saturday, July 15, China’s senior leaders concluded the National Financial Work Conference which takes place every five years, with what Keith Bradsher in the New York Times calls (paywall) “modest” results: “The biggest accomplishment of the conference appeared to be an announcement that a commission would be established under the auspices of the cabinet,” known in China as the State Council.  When trading in Chinese stocks resumed on Monday, the South China Morning Post reports that “more than 2,800 stocks fell across Chinese markets…with nearly 500 dropping by their daily limit of 10 per cent.” The SCMP attributes the sell-off to “fears that the financial sector will face a prolonged period of increased scrutiny” after the National Financial Work Conference.