Latest news with #DingShuang
South China Morning Post
3 days ago
- Business
- South China Morning Post
AI might be answer to China's labour woes, but could also fuel deflation, report says
While the rise of artificial intelligence (AI) is set to mitigate an expected shortage of labour in China in the long run, market observers differ on its impact on deflationary pressures in the near term. Advertisement The wider adoption of AI in China could exacerbate 'China's prevailing deflationary pressures' by disrupting an already-weak employment market, as the labour displacement effects of the technology might dominate in the short term, Morgan Stanley analysts said in a research report published last month. 'In China, the AI-induced labour market disruption could potentially prove more acute, given that the economy has a weak starting point of high youth unemployment problems and deflation,' they said. With AI potentially taking over 'junior-level cognitive work', companies might be encouraged to spend more on adopting the technology, with reduced hiring 'leading to more severe wage growth deceleration', the report said. But Ding Shuang, chief Greater China economist at Standard Chartered, said AI would not be a driving force of deflationary pressure in China as the main causes were overcapacity in some industries and sluggish domestic demand. Advertisement 'To combat deflationary pressure, China should curb overinvestment and excessive competition, but not hesitate to develop AI for fear of deflation, as AI is a strategically important industry,' Ding said.
South China Morning Post
19-05-2025
- Business
- South China Morning Post
China's economic resilience muffles speculations over imminent fiscal stimulus
Beijing may be less likely to enact aggressive fiscal stimulus measures in the coming quarter, analysts said, as April's macroeconomic data has proven China's economic resilience against US tariff headwinds. Major investment banks have already raised their growth outlook for the world's second-largest economy after a 90-day tariff truce with the United States and a supportive policy package announced by China's central bank this month. 'The economic growth slowed in April compared with the first quarter, but not by much,' said Ding Shuang, chief Greater China economist at Standard Chartered Bank. China's industrial output grew by 6.1 per cent from a year earlier in April, marking a slight deceleration from 6.5 per cent recorded in the first quarter, the National Bureau of Statistics said on Monday. However, the reading was higher than the 5.21 per cent growth forecast polled by financial data provider Wind. China's retail sales increased by 5.1 per cent during the same period, up from 4.6 per cent in the first quarter, while overall fixed-asset investment rose by 4 per cent in the first four months of 2025 – compared with a rise of 4.2 per cent for the period from January to March. The country's exports beat market expectations in April, growing by 8.1 per cent, year on year, to US$315.69 billion – despite the impact of tariffs from the US.
South China Morning Post
14-02-2025
- Business
- South China Morning Post
With DeepSeek, China's economic growth suddenly seems tied to AI
While artificial intelligence (AI) start-up DeepSeek surprised the world with its latest low-cost reasoning model – dubbed R1 – the revelation reignited overseas interest in Chinese tech and capital market investments while raising expectations that a subsequent surge in AI-fuelled productivity will serve to elevate the national economy. Advertisement From analysts to economists, many point to its commercialisation and potential applications in domestic industries. And they have noted how China's rapid tech progress has defied mounting curbs from Washington, thereby instilling confidence that Beijing will manage to shrug off market concerns stemming from a property crisis, demographic upheavals, and a debt-fuelled growth model to eventually overtake the United States as the world's No 1 economy. 'This could ignite a wave of innovation and accelerate the pace of AI development, which is important for enhancing total factor productivity,' said Ding Shuang, chief Greater China economist at Standard Chartered. Just like how it has lowered the barrier to entry in the AI field, DeepSeek could catalyse the emergence of low-cost solutions, he said. Advertisement 'While China's demographic dividend is diminishing, technological innovation holds the key to boosting labour productivity, which will remain critical for sustaining the country's medium- to high-speed economic growth.'
South China Morning Post
13-02-2025
- Business
- South China Morning Post
Ready, set, DeepSeek: how China's economic growth suddenly became tied to AI
While artificial intelligence (AI) start-up DeepSeek surprised the world with its latest low-cost reasoning model – dubbed R1 – the revelation reignited overseas interest in Chinese tech and capital market investments while raising expectations that a subsequent surge in AI-fuelled productivity will serve to elevate the national economy. From analysts to economists, many point to its commercialisation and potential applications in domestic industries. And they have noted how China's rapid tech progress has defied mounting curbs from Washington, thereby instilling confidence that Beijing will manage to shrug off market concerns stemming from a property crisis, demographic upheavals, and a debt-fuelled growth model to eventually overtake the United States as the world's No 1 economy. 'This could ignite a wave of innovation and accelerate the pace of AI development, which is important for enhancing total factor productivity,' said Ding Shuang, chief Greater China economist at Standard Chartered. Just like how it has lowered the barrier to entry in the AI field, DeepSeek could catalyse the emergence of low-cost solutions, he said. 'While China's demographic dividend is diminishing, technological innovation holds the key to boosting labour productivity, which will remain critical for sustaining the country's medium- to high-speed economic growth.' Indeed, China has arrived at a crossroads of economic development.
South China Morning Post
05-02-2025
- Business
- South China Morning Post
China keeps yuan stable against US dollar: what it means for the trade war
China's central bank set a stronger-than expected fixing rate for the yuan against the US dollar on Wednesday, signalling that China does not plan to offset the impact of US tariffs by allowing its currency to weaken. The People's Bank of China set the fixing rate for the yuan at 7.1693 per US dollar on Wednesday, compared with the 7.1698 rate it set in late January. The fixing rate – also known as the midpoint rate – plays a crucial role in determining the onshore yuan's exchange rate, as the PBOC only allows trading to rise or fall up to 2 per cent above or below its set rate each day. Many analysts had expected the PBOC to set a lower rate for the yuan this year, as a weakening of the Chinese currency would mitigate the impact of US tariffs on Chinese exporters. The US government raised duties on Chinese imports by 10 per cent on Tuesday. 'Today's fixing rate was set stronger than market expectations. This sends a signal that China is unlikely to counter the impact of tariffs through yuan depreciation,' said Ding Shuang, chief Greater China economist at Standard Chartered Bank. 'The trade negotiation between China and the US hasn't started. Setting a strong fixing rate could contribute to a good negotiation atmosphere, as the US does not want the yuan to depreciate sharply either.'
