Monthly Roundup - January 2021

Each month we bring you updates and commentary on Chinese tech and the Chinese digital economy from around the web. Subscribe to stay updated with the latest each month alongside all our other content.

McKinsey released a report on reskilling China's work-force for a digitalised, post-industrial economy. It highlights how the growing market for services requires a work-force better suited for skilled labour, especially among rural-urban migrants. The report emphasises the role of four key levers in boosting skill development including digital technologies (such as online learning platforms), collaborations with the private sector, better vocational pathways and incentives such as subsidised training.

The Chinese Ministry of Industry and Information published draft regulation (in Chinese) to allow autonomous vehicles on public highways, citing how testing is already permitted in countries like the United Kingdom.

Shenzhen held their third lottery issuing digital renminbi to consumers which they can spend at more than 10,000 vendors. The city was chosen to trial the centrally-controlled digital currency developed by the People's Bank of China.

Tesla-rival Nio announced a new autonomous sedan complete with LIDAR, cameras and ultrasonic sensors. It will be priced in the range of RMB 378,000 to RMB 506,000 ( $58,360 to $78,130) which positions it slightly above Tesla's Chinese-manufactured Model Y offering, designed to compete against premium car manufacturers such as BMW.

According to Reuters, leading drone-manufacturer DJI is reportedly putting together a team to develop technology for self-driving cars such as Lidar sensors, building on its experience with autonomous UAVS.

Video-sharing application Kuai Shou has reportedly been given approval for a $5 billion listing on the Hong Kong Stock Exchange, with a target valuation of close to $50 billion according to Bloomberg News. Tencent has a 21.6% stake in the app, which is also backed by Sequoia Capital China.

Chinese AI startup Megvii has announced plans to go public on Shanghai's Star Market after multiple previous unsuccessful attempts to list in Hong Kong. The plans will see it selling equity in the form of Chinese depositary receipts (CDRs).

Official GDP data showed that China's economy grew faster in the fourth quarter of 2020 than before the Coronavirus pandemic, making China the only major economy to see GDP growth in 2020. The figures reported a 6.5% expansion in Q4 of 2020, with GDP growing by 2.3% in 2020 overall.

The reappearance of Alibaba founder Jack Ma resulted in a brief rally in its stock price, before falling again with the release of a draft of proposed new anti-monopoly rules by the People's Bank of China. The regulations could impact Alipay's payment service by allowing the State Administration of Market Regulation to break up “non-bank payment companies” with a more than 50% market share.

Tiktok's Chinese equivalent Douyin has launched its own digital payments functionality called Douyin Pay. The move could allow Douyin to directly process e-commerce payments, rather than relying on WeChat or Alipay which control 90% of the Chinese digital payments market.

KPMG China has released a report (Chinese) of its top 50 leading fintech companies in 2020, with categories including insurance, payments and wealth management. Names on the list include the Fintech arm of e-commerce giant JD.com, Robo wealth advisor platform Aqumon and Tencent's WeBank.

The Diplomat discussed the influence of China's global venture capital funding, which already represents 40% of global VC investments. It notes the increase in Chinese VC interest in Southeast Asia, such as Indonesia's growing e-commerce sector.

Finally, think-tank Macro Polo released analysis reflecting on the rise of technologies such as Blockchain, Artificial Intelligence and Quantum Computing by tracking mentions of the technologies in China's largest newspaper 'People's Daily' between 2011 and 2020. It found that mentions of blockchain in the publication increased by 700% between 2017 and 2020.

Check back next month for a roundup of the latest developments in Chinese technology and the digital economy.