China Business NOW

Hello! Welcome to this edition of CBN Perspective. I’m Stephanie Li.

Coffee shops are increasingly becoming the go-to spots for many Chinese consumers, either for informal business rendezvous, meeting friends, working or studying.  

The perfect choice, for many years, has always been Starbucks, for its middle-class vibe, open space, premium locations and better service.  

Recently, the US coffee chain is trying to leverage on this by launching free study spaces at some of its stores in China, with no charge for seating and no time limit. Starbucks China said at some of its stores in Guangdong province, it has introduced study rooms at its stores, hoping to provide a space for consumers in the hot summer. 

At those Starbucks outlets in Guangzhou and Shenzhen, the stores don't require consumers to purchase food and drinks, and the study space doesn't need to be booked in advance. The space also provides free power sockets and water.

This move appears as a generous sanctuary for students battling overcrowded libraries and chaotic homes. But beneath this lies a precisely calculated business strategy addressing slowing sales and intensifying market competition from local brands such as Luckin Coffee and Cotti. 

First, consider the challenging landscape brewing beneath the surface. Starbucks' China business reported a lukewarm performance for its 2024 financial year, with sales amounting to $2.96 billion, down 1.4% year-on-year. In the first financial quarter of 2025, Starbucks China achieved sales of $744 million, up 1% year-on-year, while same-store sales declined 6% last quarter, marking their fourth consecutive drop. Customer visits decreased by 6%, while average spending per transaction fell 8%.

The coffee giant is attempting to reverse its declining fortunes through scenario reconstruction, price reductions, and market penetration into lower-tier cities.

Last month, Starbucks reduced the prices of its non-coffee products, with the average price reduction for a large cup being around CNY5.

It is also accelerating the opening of new stores in lower-tier markets. As of March 2025, the total number of Starbucks stores in China reached 7,758, covering over 1,000 county-level markets, with 40% of new stores located in rural areas.

In contrast, Starbucks has closed nearly 20 flagship stores since 2024, with half of these closures concentrated in the densely populated regions of Jiangsu, Zhejiang, Shanghai, and Guangdong, indicating a trend of "closing in urban areas and opening in rural areas.”

These measures are making the once high-end coffee brand more accessible. In the increasingly competitive Chinese coffee market, "lowering its profile" may be Starbucks' strategy to stay competitive.

The company is exploring more "interest-driven" scenarios in the future to enhance the "third space" experience, which could include more study rooms or other community-focused initiatives.

Then enter the "StarStudy Room" concept: zero fees, no purchase requirements, unlimited time access—a dramatic pivot from their 2021 Shanghai trial of paid private pods.

So, could this shift towards a more community-oriented approach help Starbucks attract a wider range of customers and maintain its position in the market?

On the plus side, early data indicates 70% of studiers ultimately purchase items, typically high-margin products like iced drinks or pastries. This phenomenon stems from studying's inherent ability to manufacture demand. During intensive three-hour study sessions, plain water often loses its appeal against the allure of a perfectly crafted Cold Brew. By eliminating the psychological barrier of unpaid seating, Starbucks unlocks organic consumption—achieving sales without overt pressure.

Starbucks also provides more than seating—it delivers dignity. Removing the pressure of mandate purchases cultivates authentic loyalty, exemplified by a Guangzhou student's testimony: "I studied for six hours and bought two drinks—not from obligation, but because it felt equitable."

“Starbucks is looking for ways to create fun entry drink experiences for Gen Z consumers,” said Ms Jessica Gleeson, a former Starbucks China executive who now runs a Shanghai-based retail consultancy firm. “In-store activities both bring new customers to the cafes and create a relationship between Starbucks and the community. It is a simple, but effective tactic.”

However, significant operational challenges nevertheless persist. The most prominent remains ambient noise—most study zones lack physical separation from bustling cafe areas.

More importantly, operational expenditures, including electricity, Wi-Fi, enhanced cleaning and facilities repairs, will further complicate the "free" model. Should conversion rates decline, financial sustainability becomes precarious.

In China's hyper-competitive coffee landscape, space itself has become the core currency, an edge over the compact outlets of local coffee chains that only Starbucks is ready to offer. The coffee giant no longer primarily sells coffee, but the privilege of occupying spaces superior to dorms, offices, or commutes.

Fundamentally, "StarStudy Rooms" signal Starbucks' strategic evolution toward it “Third Space 2.0” strategy: transitioning from casual social venues to productivity-focused environments.

But Starbucks isn’t pioneering alone. McDonald’s is testing "Silent Breakfast Hours" devoid of music and promotions, while IKEA has also recently open its own version of study rooms. Simultaneously, tea giants like HeyTea captivate Gen Z with visually striking "third spaces."

This trend is clear: brick-and-mortar chains are ditching one-trick ponies—cafés, home stores, malls—and turning them into all-in-one spots for learning, hanging out, and shopping. The line between classic "third spaces" (like cafés) and "second spaces" (offices, schools) is fading fast, as offline spots shift from single-use to multi-purpose hubs, catering to demand for flexible, efficient, and cozy study nooks.

With fierce price wars and sluggish home goods sales, brands are using free study corners to juice idle space, keep customers longer, boost usage, and lure crowds with "extras" to subtly drive sales.

As the battle of “third space” is early on, the jury is still out on whether Starbucks China is able to get back on the game.

Hi everyone. I’m Stephanie LI.

Coming up on today’s program

Polysilicon and coking coal prices surge in China on supply-side reform hopes;

Chinese tech, auto companies move up ranks of Fortune 500 list.

Here’s what you need to know about China in the past 24 hours 

Prices of key Chinese bulk commodities such as polysilicon and coking coal, which are essential in solar panel and steel production, surged to new highs today amid investor expectations of government action to curb excessive competition, or “neijuan,” and accelerate the phase-out of outdated capacity.

Polysilicon futures on the Guangzhou Futures Exchange climbed 5.5 percent to CNY50,080 per ton, reaching the daily limit of 12 percent intraday and setting a new record since the contract’s launch last December. The contract has gained 53 percent so far this month.

Coking coal futures on the Dalian Commodity Exchange jumped 11 percent to CNY1,135.5 per ton, the highest level in four months, bringing this month’s increase to about 38 percent. Coke futures rose 3.8 percent to CNY1,707.5 per ton, up 22 percent in July.

Since the beginning of the month, China has reinforced its policy stance on confronting excessive industrial raw material output, following years of weak demand that have weighed on prices and profits.

The photovoltaic industry is facing challenges both internally and externally, and the stability of the supply chain has been compromised, Cao Renxian, chairman of the China Photovoltaic Industry Association, said at a seminar today. 

Cao, who is also the chairman of Chinese PV giant Sungrow Power Supply, suggested firmly rejecting bids below cost and resolutely curbing the chaotic phenomenon of vicious competition.

At a meeting on July 1, the Central Financial and Economic Affairs Commission emphasized the need to curb low-price, chaotic competition, improve product quality, and facilitate the orderly exit of outdated production capacity.

Echoing this directive, China's Ministry of Industry and Information Technology (MIIT) on July 3 held a symposium for manufacturing enterprises, focusing on accelerating the high-quality development of the photovoltaics industry, according to the Xinhua News Agency. 

Later on July 18, Xie Shaofeng, chief engineer at the MIIT, said work plans targeting 10 major sectors -- including steel, non-ferrous metals, petrochemicals, and building materials -- will soon be released to support industrial restructuring and eliminate outdated capacity.

Driven by these policy signals, the market anticipates new supply-side structural reform measures that could boost commodity futures prices following sharp earlier declines, market analysts said.

Vice-Premier He Lifeng will be in Sweden from Sunday to Tuesday to hold economic and trade talks with United States officials, as agreed upon by both sides, the Ministry of Commerce said on Wednesday. The two sides will fully leverage their economic and trade consultation mechanism and continue consultations on issues of mutual concern in the spirit of mutual respect, peaceful coexistence and win-win cooperation, the ministry added.

GBA express

Foreign trade of South China's Shenzhen reached CNY2.17 trillion in the first half of 2025, securing its position as the leading city on the Chinese mainland, according to Shenzhen Customs on Tuesday. Exports totaled CNY1.31 trillion, while imports amounted to CNY858.86 billion. 

Chief Executive of the Hong Kong Monetary Authority (HKMA) Eddie Yue Wai-man said on Wednesday that it is important to implement the Stablecoins Ordinance in a robust and sustainable manner. Yue said that given the merits of stablecoins as an emerging payment instrument and their gradual integration into the mainstream financial system as regulation takes shape, it is necessary to guard against undue speculation caused by market and public opinions. In light of shared international regulatory concerns, more stringent requirements will be imposed in respect of anti-money laundering to minimize the risks of stablecoins being used as a money laundering tool, Yue said. Hong Kong's Stablecoins Ordinance will come into effect on Aug 1.

Hong Kong’s Ryan Choi Chun-yin etched his name in fencing history, capturing the city’s first-ever gold at the 2025 FIE Senior Fencing World Championships in the men’s foil final. Choi is now the third Hong Kong fencer to reach the World Championship podium, joining bronze medalists Cheung Ka-long and Vivian Kong.

Industry and company news

Technology giants JD.com and Alibaba, and automakers BYD and Geely were among the Chinese companies that climbed corporate revenue rankings in the latest Fortune China 500 list. JD rose two rungs to 11th place; Alibaba, three to 18th; and Tencent, six to rank 32nd. PDD Holdings, Meituan and Xiaomi ranked in the top 100. Bilibili was the only Chinese Internet firm to debut on the list. In the auto industry, BYD rose to 27th from 40th place. Geely took 41st place, rising from 54th. Further down the list, Seres, the auto production partner of Huawei Technologies, rose to 169th place from 404th, and Li Auto climbed 13 places to rank at 171.

Alibaba deepened its presence in the artificial intelligence race as it announced on Wednesday the launch of an open-source AI coder, the Qwen3-Coder, an AI model designed for high-performance software development. The company also said that its model matched the performance of leading US models, including Anthropic's Claude and OpenAI's GPT-4, in certain areas.

WeChat Pay has allied with HarmonyOS 5 to offer a more convenient payment experience for Huawei phones with the OS, with users now able to pick WeChat Pay to complete transactions when buying digital goods or services like membership subscriptions, in-game items, and e-books.

Tesla may open its first Tesla Diner in China in Shanghai around the 2026 Chinese New Year, following the restaurant’s global debut in the US on Monday, with Chinese product prices potentially set at 70 percent of US prices, media reported today. The US EV maker has reserved a 3,000-sqm land plot next to its Shanghai plant for the restaurant.

Zero-tariff items will increase to 74 percent from 21 percent of goods coming into Hainan Province when the duty-free port expands independent customs operation island-wide in December, the National Development and Reform Commission announced. The port also announced a pilot project that will enable overseas investors to access financial products offered by local financial institutions.

Asia-Pacific highlights

Xpeng Motors’ Chairman He Xiaopeng announced today the Chinese EV startup’s first overseas smart factory in Indonesia has begun production. The first Indonesia-made X9 was delivered to a customer yesterday, marking a key step in Xpeng’s global localization strategy.

A tripartite intent deal worth USD1.75 billion was inked on Tuesday, which states that Shanghai-based Volant Aerotech shall provide Thailand's Pan Pacific Co Ltd with 500 units of electric vertical take-off and landing aircraft (eVTOL), with China National Aero-technology International Engineering Corp being responsible for the low-altitude infrastructure support. This will mark the largest international single order to date in China's passenger eVTOL sector.

China's General Administration of Customs on Tuesday issued a notice that allows corresponding wild aquatic products from New Zealand to export to China, with immediate effect. The announcement was made against the backdrop of the expanding trade ties between China and New Zealand.

The Asian Development Bank lowered its 2025 growth forecast for the Asia-Pacific region to 4.7 percent from 4.9 percent and trimmed its projection for next year to 4.6 percent, citing US tariffs and trade uncertainties. Southeast Asia is forecast to have the slowest growth, now projected at 4.2 percent this year and 4.3 percent in 2026.

Hi everyone. I’m Stephanie LI.

Coming up on today’s program

Global institutions have issued over CNY1 trillion of panda bonds, highlighting investor confidence in Chinese market;

Guangzhou sees surge in drone exports this year.

Here’s what you need to know about China in the past 24 hours 

As of Tuesday, the total issuance of panda bonds, or yuan-denominated bonds issued by foreign financial institutions in China, had exceeded CNY1 trillion, CCTV reported.

It underscores the strong confidence of internationally renowned issuers in the prospects of China’s long-term development, and their continued commitment to deepening their presence in the giant Chinese market.

Since the start of the year, several international development institutions have successively issued panda bonds. The Asian Infrastructure Investment Bank (AIIB) recently completed an issuance of two-year term panda bonds worth CNY2 billion in China’s interbank bond market, according to the report.

To date, panda bonds have been issued by more than 90 institutions, and renminbi-denominated international financing, including panda bonds, now ranks as the second largest bonds globally by volume.

In recent years, inspired by favorable policy and market conditions, the panda bond issuance market has seen continuous expansion. 

Launched in 2005 with modest issuance volumes and initially considered a trial innovation, it has now become a crucial strategy for foreign institutions seeking financing through China's bond market.

GBA express

Drone makers in Guangzhou exported more than 6,100 drones in the first five months, up 252 percent year-on-year, and achieved a record for the period, according to a statement released by the municipal commerce bureau. More than half of the drones delivered are for agricultural use, and most of the drones were exported to markets in Southeast Asia, South America and Central Asia. Liu Qing, director of the foreign trade management office of Guangzhou's municipal commerce bureau, attributed the surge of the city's drone exports to local drone enterprises' greater efforts in exploring the global market since the beginning of the year, leading to bigger brand influence and global market share.

E-commerce giant JD.com becomes a leading investor in three fast-rising robotics startups, positioning it at the center of China's industrial technology shift, alongside rivals like Alibaba and Baidu. Shenzhen-based LimX Dynamics said its full-size humanoid robot will enter commercial production in late 2025 for use in JD's retail and supply chain networks. Hangzhou's Spirit AI raised nearly CNY600 million in a round of financing, debuting its Moz1 robot powered by a vision-language-action model. EngineAI, also Shenzhen-based, secured almost CNY1 billion as it scales up production of its PM01 humanoid robot.

Industry and company news

A total of 16 centrally administered state-owned enterprises (SOEs) have pledged their support for the development of Southwest China's Xizang autonomous region, with 75 investment deals worth CNY317.5 billion concluded. The agreements, covering energy, power and telecommunications infrastructure and other sectors, were signed on Sunday at a conference focusing on SOEs' contribution to the region's high-quality development. Since 2021, China's SOEs have invested CNY145.8 billion in more than 8,800 projects in Xizang, generating CNY276.7 billion in business revenue, according to data unveiled at the conference.

Chinese car giant BYD confirmed today that its premium brand Yangwang will enter the European market, media reported. Launched in China two years ago, Yangwang aims to compete with luxury car brands such as Bentley, Porsche, and Ferrari.

JD.Com has opened its first self-operated physical restaurant that offers only food delivery and pick-up services, with no dine-in option. 7Fresh Kitchen, located on the ground floor of a building in Beijing’s Dongcheng central district, received 800 orders on opening day yesterday, according to media reports.

Cotti Coffee's super factory in the Chinese coffee chain's global supply chain base in Ma'anshan, China's Anhui province, broke ground yesterday, media reported. The factory, with a building area of around 340,000 sqm, has an annual production capacity of 4 billion cups.

China's electricity use in June grew 5.4 percent from a year earlier to 867 billion kilowatt hours, according to the National Energy Administration. Consumption rose 4.9 percent in primary production and 10.8 percent in households. In the first half, electricity use was up 3.7 percent to 4.84 trillion kilowatt-hours. The figures reflect both continued recovery in China's economy and modest growth in manufacturing.

Asia-Pacific highlights

The number of new users in Thailand on Taobao has increased nearly 60 percent since the Chinese e-commerce platform launched a Thai version over a month ago, media reports today. The Thai language version of Taobao features an AI translation service developed based on Alibaba's LLM TongyiQianwen.

Chinese new-style tea brand ChaPanda has entered Singapore to further speed up its coverage in Southeast Asia, opening two stores in the SCAPE and Northpoint shopping malls, media reported yesterday. The SCAPE shop saw long queues on the first day, with an average waiting time of over 2 hours.

Argentina on Monday announced a loosening of visa requirements for Chinese citizens. Under the new policy, effective Tuesday, Chinese nationals with US visas will not need Argentine visas to enter the country for tourism or business. The move comes after China in May announced a trial policy that unilaterally grants visa-free entry to citizens of Brazil, Argentina, Chile, Peru and Uruguay.

As the Belt and Road Initiative (BRI) marks its 11th anniversary, China-Malaysia cooperation has entered a new phase of multi-dimensional and deeply integrated engagement, spanning infrastructure, the digital economy and green transformation — with vast potential ahead, Loh Wee Keng, chairman of the Malaysian Chamber of Commerce and Industry in China (MayCham China), told Chinese media during the 2025 China International Supply Chain Expo (CISCE) in Beijing. One of the most iconic achievements of China-Malaysia cooperation under the BRI, Loh said, is the "Two Countries, Twin Parks" model — the Malaysia-China Kuantan Industrial Park and the China-Malaysia Qinzhou Industrial Park, which has been operating for over a decade. Loh also highlighted that the flagship BRI project jointly built by Malaysia and China, the East Coast Rail Link, is now in its final phase of construction and is expected to become operational by late 2026 or early 2027. Loh expressed hope that more large-scale infrastructure projects would be successfully launched and implemented in Malaysia in the coming years.

Hi everyone. I’m Stephanie LI.

Coming up on today’s program

China sets up new central SOE to oversee the CNY1.2 trillion Yarlung Zangbo hydropower project;

Guangdong posts record import and export volumes in H1.

Here’s what you need to know about China in the past 24 hours 

China has founded a new central state-owned enterprise that will be responsible for building and operating the CNY1.2 trillion Yarlung Zangbo hydropower project in China's western Xizang Autonomous Region, according to Xinhua News Agency.

China Yajiang Group was established on Saturday at a ceremony held in Beijing, becoming China’s 99th central SOE. It is 22nd on the central SOE list on the website of the State-Owned Assets Supervision and Administration Commission, right before China Energy Investment and after China Three Gorges, reflecting its important status in the energy sector.

The Yarlung Zangbo hydropower project, which was approved by the central government last December, has officially begun construction in Nyingchi, Xinhua reported. It will consist of five cascade hydropower stations and primarily deliver electricity for external consumption, while also addressing local demand in Xizang.

The project will take full advantage of the abundant water resources of the Yarlung Zangbo River and drive the development of surrounding new energy resources, creating a clean energy hub that integrates hydropower, wind, and solar power.

This is a major initiative in China's efforts toward green and low-carbon energy transformation and plays a crucial role in advancing the country's carbon peak and carbon neutrality goals and addressing global climate change, Xinhua noted.

Upon completion, the project will greatly enhance local infrastructure in terms of electricity, water conservancy, and transportation, strengthening development connections between Xizang and other regions and bringing greater satisfaction, happiness, and security to people of all ethnic groups in Xizang.

Chinese A-share market jumped on Monday, with the benchmark Shanghai Composite rising 0.72 percent to reach another yearly high. The infrastructure sector gained the most across the board, with dozens of stocks including PowerChina, Xizang Tianlu, and Poly Union hitting daily trading limit. 

As agreed between China and the European Union, President of the European Council Antonio Costa and President of the European Commission Ursula von der Leyen will visit China on July 24, spokesperson from the Chinese Foreign Ministry announced on Monday. The spokesperson said that Chinese Premier Li Qiang and the two EU leaders will jointly chair the 25th China-EU Summit.

GBA express

Guangdong's import and export volumes for the first half of 2025 hit historic highs, setting new records for the period. Total trade reached CNY4.55 trillion, up 4 percent year-on-year, surpassing the national growth rate by 1.1 percentage points. Exports totaled  CNY2.89 trillion, rising 1.1 percent year-on-year, while imports surged 9.5 percent to CNY1.66 trillion. Since the third quarter of 2023, Guangdong has maintained positive growth for eight consecutive quarters. During the period, Guangdong had 130,000 foreign trade enterprises engaged in actual import and export activities, an increase of over 9,000 from the previous year. Of these, around 110,000 were private enterprises, making up 84 percent of the total, with their trade volume exceeding 60 percent of the province's overall figures.

Hong Kong’s stock market benchmark has again climbed to its highest level in more than three years, buoyed by market optimism. The Hang Seng Index surged past the 25,000-point mark in morning trading on Monday, hitting 25,010 points -- a record high since February 2022, before ending at 24,994 points.

Xiaomi's HQ building in China's southern tech hub Shenzhen went into use on Friday, becoming the Chinese tech giant's fourth regional office after those in Beijing, Wuhan, and Nanjing. Its largest Mi Store, covering an area of over 1,591 sqm, also opened near the building.

Shenzhen-based UBTech Robotics said it has developed a humanoid robot called Walker S2 that can change its own batteries, creating a robot that can function 24/7 without human intervention. The company released a video showing the robot in an industrial setting, detaching a depleted power pack, popping it into a charger and installing a fresh one – all in three minutes.

Industry and company news

China's State Administration for Market Regulation recently summoned three major food delivery platform operators -- Ele.me, Meituan, and JD.Com -- urging them to participate in competition rationally. This was the second round of regulatory discussions with the three since May. The three have been engaged in a fierce price war that cost them an estimated CNY25 billion in consumer discounts and merchant subsidies in the second quarter alone, according to investment bank Goldman Sachs.

The combined valuation of the 372 unicorn companies in China has exceeded USD1.2 trillion as of the end of last year, highlighting the vibrant vitality of the country's new quality productive forces. The integrated circuit sector led for the fourth straight year with 56 unicorns worth USD161.8 billion, Xinhua News Agency reported, citing the GEI China Unicorn Enterprise Research Report 2025 released at the China Shenzhen Unicorn Enterprise Conference. Commercial aerospace was the fastest-growing field, with the number of firms surging 150 percent, while frontier tech companies accounted for 70 percent of the total.

Chinese robotics startup Unitree began pre-listing tutoring, with Citic Securities as its IPO adviser, a regulatory filing showed. Founder and CEO Wang Xingxing holds around 35 percent of the firm, it added.

The total length of China's operating high-speed rail tracks has expanded 10,000 km from 2021 to 2024. Total operational length of railway lines reached 162,000 km in the period, Minister of Transport Liu Wei said at a press conference on Monday.

From January to June, China’s national online retail sales expanded by 8.5 percent, with 15 categories of home appliances and digital products covered by the government’s trade-in programs rising 12.7 percent and online services consumption growing 14.6 percent year-on-year, according to data released by the Ministry of Commerce on Monday.

Asia-Pacific highlights

Japanese Prime Minister Shigeru Ishiba's ruling coalition lost control of the upper house in an election on Sunday, further weakening Ishiba's grip on power even as he vowed to remain party leader, citing a looming tariff deadline with the United States. The Japanese yen showed firmness on Monday despite the result. Japanese government bonds plunged last week, sending yields on 30-year debt to an all-time high, while the yen slid to multi-month lows against the U.S. dollar and the euro.

China has doubled cross-border passenger train services between Kunming in Yunnan Province, and the Laos capital Vientiane on the China-Laos Railway starting Friday, with departures now available from both Kunming Railway Station and Kunming South Station, according to China Railway Kunming Group.

South China's Guangxi has taken a noteworthy step by launching the AI "super league," which is set to run until November. Particularly intriguing is the introduction of a mechanism that allows for cross-border teams, a move expected to enhance China's international collaboration in AI, especially with ASEAN countries. The AI "super league" reportedly encompasses three events: an innovation competition focused on the application of AI in real-world industrial scenarios, a contest designed to tackle critical bottlenecks, and an event dedicated to discovering latent AI talent within the general public.

Hello! Welcome to this edition of CBN Perspective. I’m Stephanie Li.

After a long era of peace, smoke now rose across the country, and a “war” mostly affecting the cities had broken out, again. In a scramble to capture and retain both customers and delivery riders, the country’s three biggest delivery platforms have gone into “war mode.”

China’s leading delivery platforms—Meituan, Taobao Flash Sale, and JD Delivery—have reignited a fierce price war, with aggressive discounts and giveaways making headlines.

A quick scroll through these platforms reveals shockingly low prices. On Taobao, once-premium offerings from brands like Nayuki are now available for CNY7 a cup which originally priced at CNY20 or above.  

These steep discounts have proven irresistible. This morning, I had a 15oz iced cold-brew coffee in sparkling water for CNY2.6, delivered to my office in downtown Shenzhen, in less than 30 minutes after I placed the order, which, ironically, costs even less than the minimum fare for the Shenzhen Metro (CNY3).  

Over the past weekend on China’s social media, the hashtag “free milk tea” topped trending charts. JD offered 100,000 discounted crayfish sets nightly, while Meituan and Taobao continued their “Super Saturday” campaigns to attract users.

The numbers are simply staggering. Meituan's subsidy amount last Saturday (July 12) was CNY300 million to CNY400 million, while that of Taobao Flash Sale exceeded CNY1.2 billion. In the past two weeks, the daily subsidy amount of Taobao Flash Sale on weekdays has been around CNY400 million.

The delivery war, ignited by JD’s entry into the food delivery sector, has triggered unprecedented user traffic. Daily order volumes reportedly exceeded 100 million, and many consumers took to social media to describe scenes at tea shops—some waiting over 30 minutes for a drink, with crowds of delivery riders gathering outside stores late into the night.

Meituan’s instant retail daily orders hit record 150 million at 11.36 p.m. on July 12. Taobao Flash Sale and Ele.me platforms processed over 40 million orders in a single day on May 26, with tea and coffee accounting for a quarter of that volume—about 10 million orders.

JD.com and Alibaba have reportedly poured over 80 billion yuan into subsidies since April, accounting for roughly 20 percent of China’s total outbound direct investment in the first half of the year.  

While platforms are footing most of the bill, caterers are also affected, with many of them having to accept razor-thin profits, break-even sales and even losses on some orders.

The surge in orders is coinciding with shrinking profits and a lot of businesses are starting to worry about what happens when the subsidies end as customers are now used to rock-bottom prices.

For instance, a drink normally priced at CNY19 had a CNY6.40 subsidy from the caterer and a CNY9.60 discount from the platform. The platform’s CNY9.60 subsidy goes to the food provider together with the CNY3 paid by the customer, but after the delivery fee and platform commissions are deducted, the caterer is left with just CNY5.99.

That’s barely enough to cover the cost of the cup, lid and thermal sleeve, which comes to around CNY1.10 and CNY1.30 per serving. “After joining the subsidy war, it is clear that the profit per cup is shrinking. We are probably losing some money on around one or two out of every 10 orders,” said a franchise manager.

Although subsidies can drive up the number of orders, the profit per drink per store has tumbled from previous levels, a coffee chain executive said. Although customers benefit, some brands are seeing their revenue squeezed. Most consumers are price-driven, so firms worry that once the discounts end, sales will slump.

For most brands, a prolonged price war brings no long-term benefits, said a consumer industry analyst. A short-term surge in orders masks the danger of shrinking profits, and smaller businesses will feel the pain first.

Consumers, for now, cheer the windfalls. Who wouldn’t love a cheap meal delivered to their door? But history repeats itself: every subsidy spree in China’s tech sector has been followed by inevitable price hikes once the dust settles. There’s no such thing as a free lunch, and the bill will eventually come due.

The price war has clearly spirals into a self-destructive rat race. The focus on boosting milk tea orders over proper meals, the erosion of profit margins across the board, and the strain on riders and merchants all point to a system teetering on the edge.

A commentary on The People's Daily pointed out that this kind of low-level competition is not a sustainable development model for the industry. It may bring short-term prosperity, but in the long run, it will undermine the innovation ability of enterprises and the healthy development of the entire ecosystem.

When customers lured by rock bottom prices leaves restaurants bleeding cash, staff exhausted, and dine-in services crippled, it’s time to pivot: true progress lies in competing on innovation, not subsidies. The world is watching, and what it sees now is a sector trapped in a race to the bottom.

Hi everyone. I’m Stephanie LI.

Coming up on today’s program

Nvidia’s Jensen Huang praises Chinese tech as he attends CISCE for the first time;

China records 38 million border crossings by foreign nationals in H1 2025.

Here’s what you need to know about China in the past 24 hours 

Jensen Huang, Founder & CEO of Nvidia, delivered a speech at the opening ceremony of the third China International Supply Chain Expo (CISCE) that kicked off on Wednesday in Beijing, which gathered more than 600 exhibitors from over 70 countries and regions.

Huang praised China's tech companies and vast market potential, expressing optimism about the country's advances in AI, robotics and smart manufacturing, as well as China's growing role in global innovation.

Huang took off his signature leather jacket, appeared in traditional Chinese attire, and delivered part of his speech in Chinese. He said it was his first time delivering a speech in Chinese and praised China's open-source efforts in the AI sector. 

China's open-source AI serves as a catalyst for global progress, giving every country and industry a chance to join the AI revolution, Huang said.

During his speech, the CEO mentioned 11 Chinese tech companies -- Tencent, NetEase, MiHoYo, Game Science, ByteDance, DeepSeek, Alibaba, Meituan, MiniMax, Baidu, and Xiaomi.

The comments came as the senior executive paid his third visit to China this year, highlighting the importance of the Chinese market to Nvidia, which has become the first company in the world with a market cap of USD”4 trillion. 

For the future development of AI, Huang said that the next wave of AI is relying on systems that understand the physical world, reason and perform tasks. Within a decade, factories will be powered by software and AI, orchestrating teams of robots, working alongside people, building smart products that are also driven by AI.

When asked for his views on the progress made by China's tech giant Huawei, Huang said anyone who discounts Huawei and anyone who discounts China's manufacturing capability is deeply naive.” Huang recognized the Shenzhen-based firm as "a formidable technology company" with deep excellence in semiconductors and networking infrastructure.

Analyzing China's broader AI landscape, Huang outlined a three-tier ecosystem driving progress — foundational infrastructure including chips and systems; rapidly evolving AI models such as Alibaba's Qwen and Moonshot's Kimi; and hyper-competitive application development.

During a media briefing, Huang spoke with particular enthusiasm about China's electric vehicle (EV) sector, calling them "incredible," and said he would love to buy a Xiaomi car. He said the unavailability of Chinese EVs in the US market is “our misfortune, not yours.” The executive was seen in a photo taken earlier in Beijing with Xiaomi CEO Lei Jun and a Xiaomi SU7.

On Tuesday, Huang told a group of journalists that the company will resume the sales of its H20 AI chips to China. Following this announcement, Nvidia's shares surged over 4 percent.

Huang revisited this topic at the media briefing on Wednesday. "I hope to get more advanced chips into China than H20. And the reason is that technology is always moving on."

GBA express

The Hong Kong arm of the Chinese mainland's second-largest fund firm China Asset Management on Thursday rolled out the world's first renminbi-denominated tokenized money fund, after rising demand for similar products based on US dollar funds. The company also launched a tokenized US dollar money market fund, calling it the first such offering in Asia. The fund firm in February rolled out a similar product based on the Hong Kong dollar.

China's Ministry of Finance on Wednesday issued CNY6 billion of government bonds in the Macao SAR. This is the first such issuance following the interconnection of bond market infrastructure between the Hong Kong and Macao SARs.

Industry and company news

China's silver economy has seen robust growth in the first half of this year, with related industries recording significant revenue increases, data released Wednesday by the State Taxation Administration showed. Notably, sales revenues for elderly travel services, sports and health services, and cultural entertainment activities increased by 26.2 percent, 23.9 percent, and 20.7 percent, respectively.

Midea yesterday reached an agreement with the Confederation of African Football to become an official sponsor of the Africa Cup of Nations 2025. The Chinese home appliance giant plans to invest additional USD50 million in Egypt early next year. Its plants there are expected to come on stream next month.

Despite the continued recovery of the civil aviation industry, China’s three biggest state-owned airlines expect losses in the first half of the year, while their private competitors forecast to have expanded profits. Air China’s net loss likely narrowed 21 percent to 39 percent to between CNY1.7 billion and CNY2.2 billion in H1, and China Eastern Airlines expects losses of CNY1.2 billion to CNY1.6 billion, shrinking up to 57 percent in the period. Meanwhile, China Southern Airlines projected its net loss to have widened 43 percent to 9 percent to between CNY1.3 billion and CNY1.8 billion. Regarding private airlines, China Express Airlines said it expects a net profit of CNY220 million to CNY290 million, and Hainan Airlines Holding will likely turn a loss into a net profit of CNY45 million to CNY65 million.

Asia-Pacific highlights

China processed 38.05 million border crossings by foreign nationals in the first half of 2025, a 30 percent year-on-year increase, according to the National Immigration Administration on Wednesday. Of these trips, foreign nationals made 13.64 million entries to China visa-free, a year-on-year increase of 54 percent, as the country continues to expand visa-free entry policy. China introduced and implemented a visa-free policy for tour groups from ASEAN countries entering Xishuangbanna in Yunnan Province in H1. Indonesia was newly added to the list of countries eligible for China's 240-hour visa-free transit policy.

China's Ministry of Commerce and Australia's Department of Foreign Affairs and Trade have signed a memorandum of understanding on the implementation and review of the China-Australia Free Trade Agreement (ChAFTA), according to the ministry on Wednesday. The MoU was signed during Australian Prime Minister Anthony Albanese's week-long visit to China, which marks a pivotal step in advancing the steadily improving relationship between the two countries, Xinhua reported.

Thailand's TCP Group, owner of the Red Bull brand, is increasing its investment in China, its top executive said during the China International Supply Chain Expo on Wednesday. "Investing in China is investing in long-term certainty. From infrastructure to policy transparency, China offers a level of systematic support that gives foreign enterprises confidence to expand and grow," said Saravoot Yoovidhya, CEO of TCP Group. Its latest moves include establishing a regional headquarters in Beijing and constructing new manufacturing bases in Sichuan and Guangxi.

Autocraft from the UAE signed an MoU with the Chinese electric vertical takeoff and landing (eVTOL) maker Shanghai TCab Technology on Wednesday on purchasing 350 E20 eVTOL aircraft worth USD1 billion, China's largest single intent order for eVTOLs to date.

Baidu is teaming up with Uber Technologies to deploy thousands of its Apollo Go driverless taxis on the ride-hailing provider's app outside the Chinese mainland and the United States. The new service is expected to launch in Asia and the Middle East by the end of this year.

Saudi Arabia’s Diriyah said yesterday that China Harbour Engineering won the USD1.5 billion contract to build the Diriyah Arena block near Riyadh. The project includes a multi-purpose indoor arena, three mixed-use office buildings, and a parking facility.

Hi everyone. I’m Stephanie LI.

Coming up on today’s program

China's H1 GDP expands 5.3%, demonstrating resilience amid complex global environment;

Jenson Huang said in Beijing that Nvidia's H20 chips are cleared for sales to Chinese market.

Here’s what you need to know about China in the past 24 hours 

China's GDP grew by 5.3 percent year-on-year in the first half of 2025 to CNY 66.05 trillion, showcasing a steady economic rebound backed by supportive macroeconomic policies, the National Bureau of Statistics said on Tuesday. 

In the second quarter, the economy rose by 5.2 percent in comparison to a year earlier after a 5.4 percent growth in the first quarter of the year.  

China's value-added industrial output, a gauge of activity in the manufacturing, mining and utilities sectors, grew by 6.8 percent in June from a year earlier after a 5.8 percent rise in May. In the first half of the year, value-added industrial output grew by 6.4 percent compared to the same period last year. 

Retail sales, a key measurement of consumer spending, grew by 4.8 percent year-on-year in June, down from the 6.4 percent growth in May. In the first half of the year, retail sales rose by 5 percent compared to the same period last year. 

In the January-June period, fixed-asset investment, a gauge of expenditures on items including infrastructure, property, machinery and equipment, grew by 2.8 percent compared with a year earlier. 

The surveyed urban jobless rate came in at 5 percent in June, flat with the previous reading, according to the NBS. 

Generally speaking, with the more proactive and effective macro policies taking effects in the first half of the year, the national economy maintained steady growth with good momentum, showcasing strong resilience and vitality, said Sheng Laiyun, deputy head of the NBS. 

However, the official warned of pressures from mounting external uncertainties and insufficient domestic demand, saying the foundation for sustained recovery is yet to be consolidated. 

In the next step, the NBS that China will cope with external uncertainties with high-quality development, and make more efforts to promote the sustainable, stable and healthy development of the economy. 

The decline in the prices of commercial residential homes in China's 70 major cities continues to ease in June, official data showed on Tuesday. New home prices dropped 1.4 percent from a year earlier in the four first-tier cities, slowed from the 1.7 percent decline in May, according to the NBS. Notably, Shanghai recorded a 6 percent year-on-year increase in new home prices last month. Second- and third-tier cities saw new home prices fall by 3 percent and 4.6 percent year on year in June, with the declines narrowing by 0.5 and 0.3 percentage points, respectively. 

GBA express

Bond sales in Hong Kong dollars surged in the second quarter as issuers rushed to raise funds after currency interventions in the city drove down short-term borrowing costs to nearly zero. Hong Kong dollar bond issuance jumped to a record HK$1.28 trillion in the April to June period, according to Bloomberg data. The bond sales were up about 20 percent from the previous quarter.

Industry and company news

Nvidia CEO Jensen Huang said the US government has granted export permits of its H20 chips to China and will begin the shipment soon, China's state broadcaster CCTV reported. Huang made the remarks in Beijing, as he is set to attend the opening ceremony of the 3rd China International Supply Chain Expo (CISCE) in Beijing on Wednesday and participate in relevant activities at the invitation of the China Council for the Promotion of International Trade (CCPIT), CCTV reported on Tuesday. This is Huang's third visit to China in 2025. Another Chinese media reported Monday that Huang appeared in two photos with Lei Jun, chairman of Chinese tech giant Xiaomi, taken in Beijing. One of the image captured the pair standing beside a Xiaomi SU7, flashing thumbs-up at the camera.

China's finance ministry yesterday issued two batches of ultra-long special treasury bonds worth CNY123 billion. A total of CNY1.3 trillion such bonds -- CNY800 billion for key projects, CNY300 billion for trade-in schemes, and CNY200 billion for equipment updates -- are expected to be issued this year.

CATL's unit has inked a deal with online ride-hailing service provider T3 Mobility to jointly advance a Robotaxi business using the Chinese battery giant's Bedrock skateboard chassis platform, with the firm also providing EV tech solutions, including battery swaps for T3.

Xpeng Aeroht, the flying car arm of Chinese NEV startup Xpeng Motors, announced today it has completed a USD250 million Series B round. The funds will support ongoing R&D and speed up mass production of its modular flying car, the “Land Aircraft Carrier.”

Starbucks China said yesterday it partnered with China Eastern Airlines to launch a joint membership plan for nearly 200 million combined members. The pair will also collaborate on Yunnan coffee, cultural tourism, and sustainable development initiatives.

Asia-Pacific highlights

New Zealand on Monday launched a strategy to become a leading destination for international students, aiming to double the sector's economic contribution to NZD7.2 billion by 2034. The plan includes enhanced work rights for student visa holders, streamlined visa processes and targeted global promotion. Last year the average international student spent NZD45,000, according to the Education Ministry.

Australian Prime Minister Anthony Albanese's weeklong official visit to China reflects the close economic ties between the two countries and offers opportunities for greater cooperation in emerging sectors amid global challenges, according to Australian academic analysis. Professor James Laurenceson, director of the Australia-China Relations Institute at the University of Technology Sydney, told Chinese media that at a time of rising geopolitical tensions globally, Australia-China relations take on greater significance. "Businesses engaged in the Australia-China economic corridor report that they have benefited from the stabilization in Australia-China relations since 2022," he said. Climate change and the clean energy transition is another area that will expectedly get a lot of coverage given the two countries' shared interests in that space, Laurenceson added.

Hi everyone. I’m Stephanie LI.

Coming up on today’s program

China's foreign trade of goods rose 2.9% in 2025 H1 to CNY21.79 trillion;

Australian PM's China visit aims to boost cooperation amid global challenges.

Here’s what you need to know about China in the past 24 hours 

China's imports and exports of goods in yuan-denominated terms rose to reach CNY21.79 trillion, driven by the country's strenuous efforts to optimize foreign trade structure and stabilize economic growth. 

Foreign trade growth in the second quarter rose significantly by 4.5 percent year-on-year, 3.2 percentage points higher than the figure seen in the first quarter, which marks the 9th quarter in which quarterly foreign trade exceeding CNY10 trillion, according to the data released by the General Administration of Customs (GAC) on Monday.

During the first six months of 2025, China's exports rose 7.2 percent year-on-year to reach CNY13 trillion, while imports fell 2.7 percent to reach CNY8.79 trillion, the data showed.

Currently, certain countries violate international trade norms by imposing unreasonable tariffs, causing severe challenges to global economic development. However, an increasingly diversified foreign trade market, innovative and high-quality products manufactured in China, and the adaptive foreign trade entities give China the confidence and ability to cope with global challenges, Wang Lingjun, deputy director of the GAC, said at press conference on Monday.

In terms of the trading partners, trade with Belt and Road Initiative (BRI) partner countries rose 4.7 percent to reach CNY11.29 trillion, with its proportion in China's total foreign trade rising by 0.9 percentage points to 51.8 percent. 

Trade with ASEAN rose up by 9.6 percent to reach CNY3.67 trillion, while trade with the EU, South Korea, and Japan witnessed positive growth respectively.

During the period, China's export growth drivers strengthened and gained new momentum, according to the GAC. In the first half, exports of electro-mechanical products increased by 9.5 percent, taking up 60 percent of the country's total exports.

Meanwhile, as the world's second largest consumer market, with the continuous supportive policies including the equipment upgrade and consumer trade-in programs, China's imports turned to positive growth in the second quarter. 

Import growth of petrochemical, textile and other machinery and equipment reached double digits, while key parts such as electronic components grew rapidly, and imports of vital raw materials such as crude oil and metal ore increased in volume.

In the second half of the year, it is expected that exports will likely maintain growth, driven by broader opening-up policies, improved corporate competitiveness, and expanded market diversification. Imports will benefit from domestic demand expansion policies, experts noted.

GBA express

IMF ex-Deputy Managing Director Zhu Min, Unitree Robotics founder Wang Xingxing, and BrainCo CEO Han Bicheng participated in their first lunch meeting of the Hong Kong Chief Executive's Council of Advisers last week. The 34-member advising council set up in 2023 provides advice on strategic issues in their respective fields.

South Korean financial institutions traded over HK$1.5 trillion on Hong Kong’s stock market in the first five months of this year — 2.8 times last year’s total — reflecting strong confidence in local investment opportunities, according to the city’s financial secretary. Since last September, the strong performance of Hong Kong’s financial markets and vibrant IPO fundraising activities have attracted the attention of the South Korean financial sector, Paul Chan Mo-po said in his Sunday blog.

A batch of 24 domestically built 2,000-meter-class ultra-deepwater suction anchors was shipped from Zhuhai, Guangdong Province, to Brazil, marking China's deepest-capacity offshore oil and gas equipment overseas delivery and underscoring the growing recognition of Chinese deep-sea technology in mainstream global markets, according to China National Offshore Oil Corp (CNOOC) on Sunday.

Industry and company news

China issued CNY12.92 trillion of new yuan-denominated loans during the first half of the year, according to data from the central bank. Lending to households rose by CNY1.17 trillion, while corporate borrowing accounted for CNY11.57 trillion of the total.

Nearly 60 percent of sovereign wealth funds plan to increase asset allocations in China over the next five years, especially in the tech industry, according to a survey by Invesco. Funds flow into the country's innovation-driven sectors with the "strategic urgency they once directed toward Silicon Valley."

Nio's share surged 10.8 percent as of lunch break in Hong Kong today after the Chinese EV startup priced the Onvo L90, its upcoming full-size e-SUV under its sub-brand, below CNY300,000, beating market expectations. 

Geely's sales jumped 30 percent to 1.9 million vehicles in the first half of the year from a year earlier, with over half of them being NEVs, up 73 percent in the period, the Chinese auto giant said today.

Meituan’s instant retail daily orders hit record 150 million at 11.36 p.m. on July 12, the Chinese on-demand services giant said, adding that, taking a July weekend as an example, delivery riders’ daily income rose 111 percent, and the platform’s daily order volume jumped 33 percent from a month earlier.

The Shanghai branch of the State-Owned Assets Supervision and Administration Commission held a meeting with local officials to discuss how stablecoins and blockchain technology may have a part to play in cross-border trading. He Qing, director of the city regulator, cited the need for more sensitivity toward emerging technologies like digital currencies, backed by proper research.

A Chinese-built, driverless maglev train that can reach speeds of 600 kilometers an hour or more, comparable with a jetliner, was showcased at the 17th Modern Railways exhibition in Beijing, giving a glimpse of a future that could slash rail travel between Shanghai and Beijing to just 2.5 hours from 5.5 hours. The prototype fastest train in the world, still under testing, is being developed by China Railway Rolling Stock Corp.

Asia-Pacific highlights

The prime minister of Australia began a six-day official visit to China on Saturday. Anthony Albanese said the visit will focus on strengthening trade and tourism ties. In a short video filmed on Shanghai's Bund, he said "engaging with China is in our interest to build a stable and secure region.” In addition to high-level meetings in Beijing, Albanese's visit includes stops in Shanghai, where he arrived on Saturday, and Chengdu, the capital of Southwest China's Sichuan province. His trip covers key sectors such as business, investment, tourism and other major sectors to build on Australia's strong economic and trade links with China, according to a statement from his office. China is ready to promote the comprehensive strategic partnership with Australia through a more proactive approach, Chinese Foreign Minister Wang Yi said on Friday.

Chinese Foreign Minister Wang Yi on Saturday said China and ASEAN countries have demonstrated a strong desire to support each other, unite and cooperate, and jointly meet challenges against the backdrop of rampant unilateralism and protectionism, during his attendance of the ASEAN Plus foreign ministers' meetings in Malaysia. Wang said the meetings confirmed the completion of negotiations on version 3.0 of the China-ASEAN Free Trade Area and agreed to submit it for approval and signing at the leaders' meeting in October, and both sides agreed on the action plan for the comprehensive strategic partnership for the next five years, setting out over 40 goals of all-round cooperation in various fields. China and ASEAN also welcomed the completion of the third reading of the draft text of the Code of Conduct in the South China Sea (COC), he added.

Australian miner BHP said it has signed an MoU with Chinese battery giant CATL to explore battery development for mining gear and locomotives, such as rapid charging infrastructure, seeking energy storage systems and battery recycling options for its mining applications.

Hello! Welcome to this edition of CBN Perspective. I’m Stephanie Li.

For most kids, summer vacation is probably one of the happiest time in a year. If you’re still making traveling plans, the newly-launched LEGOLAND in east China might just be the place to go, especially if you’re looking for “happiness.”

The resort in Shanghai, currently the largest LEGOLAND globally and the first in China, offers a new amusement option for Chinese citizens and foreigners visiting this metropolis.

The opening of LEGOLAND Shanghai Resort on Saturday coincides with the beginning of the summer vacation, which is a tourism and consumption high season, especially for students.

Case in point: a day before the resort officially opened on July 5, its mini-program crashed under overwhelming traffic. The glitch highlighted just how high the appetite is for the “happiness business” in one of the world’s fastest-growing markets for entertainment.

This goes beyond nostalgia and family fun. From ongoing expansions at Shanghai Disney Resort to the opening of LEGOLAND Shanghai and the development of new IP-led attractions, China’s so-called "happiness economy" is emerging as a key focus for both domestic and international investors.

Marking its ninth anniversary this June, Shanghai Disney Resort exemplifies the trend through ongoing expansion. It unveiled plans for its first Marvel-themed attraction and is building a third themed hotel, as well as major upgrades to its Tomorrowland and Adventure Isle themed areas. Hong Kong Disneyland will also enlarge its Marvel zone and introduce new Pixar-themed entertainment.

Universal Beijing Resort is preparing for its second phase of development. Construction at LEGOLAND Shenzhen is also speeding up. The world's largest Peppa Pig outdoor park is scheduled to open in Shanghai in 2027, while the Harry Potter Studio Tour in Shanghai is expected to open in the same year.

Domestic players are rising quickly too. Fantawild launched nine parks in just eight months last year. Pop Mart is redesigning two-thirds of its City Park in Beijing and preparing for the second phase next year.

Nationwide, more than 50 new theme parks are in development or set to launch this year, spanning diverse themes from cinema and gaming to winter entertainment, marine worlds, forests and water-based attractions.

As of October 2024, there were 385 theme parks operating on the Chinese mainland, with 87 classified as large or super-sized – each occupying over 600 mu (40 hectares) or backed by investments exceeding 1.5 billion yuan.

According to data from China Insights Consultancy, the country’s amusement park sector reached nearly 60 billion yuan in 2023 and is projected to surpass 110 billion yuan by 2028. This growth is underpinned by urbanization, rising disposable income, and evolving consumer expectations for leisure experiences.

However, the market penetration of theme parks in China was just 27 percent as of September 2023, far below the 68 percent average seen in developed countries. This significant disparity points to enormous room for growth.

Over the next five years, China's theme park industry is projected to expand at a compound annual growth rate of 7.2 percent, with many cities aiming to turn these attractions into iconic local landmarks.

"China offers an excellent business environment," said Siegfried Boerst, managing director of LEGOLAND Resorts in China. "LEGOLAND Shanghai has a series of world's first to fulfill the growing demand. All this will help boost the regional economy, create job opportunities and enhance Shanghai's competitiveness in the international tourism market.”

As China is thriving to shift to a consumption-driven economy, the cultural and tourism industries are becoming important growth drivers.

Earlier this year, the Chinese government made it one of its major priorities to boost consumption and stimulate domestic demand across the board. It urged more efforts to foster new forms of cultural business and vigorously develop the tourism industry.

Yet as over 50 new parks debut nationwide this year, the race shifts from expansion to differentiation. Disney’s IP-driven success has spurred Chinese theme park operators to blend top IPs with experiential consumption, aiming to boost sustainability. Recent moves underscore this shift: Universal Beijing’s 2023 Honor of Kings events and Pop Mart’s 2023 immersive IP venue.

IP construction relies on continued content innovation. In China, parks revitalize existing IPs by combining traditional culture with adventure. Mianyang’s Fantawild Oriental Heritage and Zigong’s Fantawild Dinosaur Kingdom weave myths, history, and Sichuan’s ancient Shu culture, highlighting Chinese heritage’s draw.

Teaming up with global IPs is another path to follow. Haichang Ocean Park’s use of Ultraman and One Piece enriches its offerings, striking a chord with diverse crowds.

Amid the cultural-tourism blend, theme parks are doubling down on cultural elements—backed by policies pushing deeper integration to meet demand for quality experiences.

Operators now understand that viable, market-ready IPs are key to steady revenue and longevity. Yet a critical hurdle persists: turning cultural motifs into profitable IPs while spreading Chinese culture globally.

As IP awareness grows, nailing the balance of authenticity, innovation, and profitability will determine if China’s parks can mirror Disney’s success—turning cultural depth into lasting “happiness economy” powerhouses.

Hi everyone. I’m Stephanie LI.

Coming up on today’s program

Over 40 internet giants rush to apply for issuance as Hong Kong’s stablecoin legislation takes effect soon;

English-language version of Ne Zha 2 starring Michelle Yeoh is hitting overseas theaters in August.

Here’s what you need to know about China in the past 24 hours 

Chinese mainland internet heavyweights have accelerated steps to apply for stablecoin licenses in Hong Kong as the city's Stablecoins Ordinance will come into effect on August 1.

This, industry experts said, is a significant step that will lower cross-border transaction costs and improve the efficiency of international payments.

Christopher Hui, secretary for Financial Services and the Treasury of the Hong Kong SAR government, said the authorities aim to issue stablecoin licenses this year, although the number will likely remain in the "single digits".

Nevertheless, more than 40 companies are preparing to submit their applications. They are mostly leading internet companies, large financial institutions and payment processors.

A stablecoin is a form of cryptocurrency that is pegged to fiat currencies or other real-world assets at a designated exchange rate to maintain a stable value. The Legislative Council of the HKSAR passed the Stablecoins Bill in late May, formulating a licensing regime for fiat-referenced stablecoin issuers in Hong Kong.

Liu Qiangdong, chairman of Chinese mainland e-commerce giant JD, said the company hopes to apply for stablecoin licenses in major currency countries worldwide to cut cross-border payment costs by 90 percent and enable settlements to be completed within 10 seconds.

The company is preparing to apply for a stablecoin license in Hong Kong through its local arm. JD Coinlink Technology Hong Kong entered the Hong Kong Monetary Authority's stablecoin sandbox in 2024. The project is testing tokens pegged to the Hong Kong dollar and other major currencies.

Ant International, the overseas arm of financial technology giant Ant Group, has confirmed that it plans to apply for an issuer license of fiat-referenced stablecoins in Hong Kong.

The company has said previously that it is accelerating investments and expanding banking partnerships in global treasury innovations, to transform its cutting-edge AI, blockchain and stablecoin technologies into reliable, large-scale real-world applications.

Stablecoins can serve as efficient and low-cost settlement tools, improving the efficiency of cash flow and reducing the risk of exchange rate fluctuations, analysts said. 

However, experts warned that applying for such licenses poses challenges for companies as they need to meet strict regulatory requirements for capital and operations, and pool a large amount of resources in establishing a compliance system. 

GBA express

Hong Kong's world-leading streak of IPOs continued on Wednesday as five Chinese mainland companies that raised a combined HK$10.4 billion from initial share offers ended their first trading day above their issue prices. Shares in chip designer Fortior Technology led gainers, surging 16 percent from their initial share price of HK$120.50. Apple supplier Lens Technology gained 9.13 percent; robot maker Geekplus Technology was up 5.36 percent; Dazhong Dental Medical increased 3.5 percent; and Xunzhong Communication closed 0.2 percent above its initial share price.

Guangzhou-based autonomous driving firm Pony.ai has formed a partnership with the Dubai transit authority to begin robotaxi services. The first vehicles will begin road testing this year, with full operations expected to start in 2026. 

Industry and company news

The English dub version of Chinese animation blockbuster Ne Zha 2 will be released in the United States, Canada, Australia, and New Zealand later next month, with Oscar-winner Michelle Yeoh starring in a lead voice role. US film studio A24 and Chinese movie platform CMC Pictures will co-distribute the English-language version of Ne Zha 2, which will hit cinemas on Aug. 22.

China's auto production and sales logged double-digit increases in the first half of the year, data from the China Association of Automobile Manufacturers showed on Thursday. The country's auto output totaled 15.62 million units during the period, up 12.5 percent from a year ago, while auto sales rose 11.4 percent to 15.65 million units. In particular, new energy vehicle production surged 41.4 percent year on year to nearly 6.97 million units in the first six months, with sales up by 40.3 percent year on year to about 6.94 million units.

Huawei Digital Power penned a deal with Saudi Electricity and National Grid Saudi Arabia to jointly create a power grid simulation platform based on Real-Time Digital Simulation to research how to efficiently apply new energies to the power grid, the digital power products provider under Chinese tech giant Huawei announced today.

China has achieved significant breakthroughs in mineral exploration in the first half of 2025, with 38 new mineral deposits discovered and exploration investment in non-oil and gas minerals continuing to grow, the Ministry of Natural Resources announced on Thursday. 

China will release a global AI open-source cooperation initiative in collaboration with some organizations at this year's WAIC2025, Du Guangda, deputy director of the MIIT's tech department, said today. The 2025 World Artificial Intelligence Conference will kick off in Shanghai from July 26 to 28, with 800 domestic and international companies participating. About 3,000 cutting-edge exhibits, including LLMs, AI terminal products, and robots, will be exhibited at the event.

Enterprises and social organizations that hire jobless individuals aged 16-24 and pay their pensions and insurances for three months will receive a one-time cash bonus of up to CNY1,500, effective now until the end of the year, according to a new measure aiming to stir up employment released by the State Council yesterday.

Starbucks has received about 30 offers for potential stakes in its China business, valuing the mainland operations at up to US$10 billion, media reported. Among interested investors are Asian equity firms Centurium Capital and Hillhouse Capital, and US-based KKR, the report said, adding that Starbucks may retain a 30 percent stake.

Asia-Pacific highlights

The logistics branch of China Southern Airlines has officially opened the Guangzhou-Auckland-Sydney international cargo flight route recently. This is the first scheduled all-cargo flight from Chinese mainland to New Zealand by a Chinese mainland-based carrier.

China continues to expand its visa-free "circle of friends," as the mutual visa exemption agreement between China and Micronesia is set to take effect on July 25. China and the western Pacific islands country will mutually waive visa requirements for their citizens for a visit of up to 30 days.

China Development Bank has signed a CNY2.1 billion loan agreement with the Development Bank of Southern Africa, the Chinese bank said on Wednesday. The deal, inked during the BRICS Interbank Cooperation Mechanism annual meeting in Brazil on Tuesday, will channel funding toward projects in sectors such as infrastructure, energy, information and communications, water, sanitation, and manufacturing, the bank said.