Economy

Hong Hao: China silences prominent market analyst as economic recession deepens

May 2, 2022
Callie Robertson
during the Weekend, Tencent (TCEHY) WeChat has frozen the public account of Hong Hao, managing director and head of research at BOCOM International, the investment banking arm of Bank of Communications, a state-owned bank and the fifth largest in China.

A notice posted on the WeChat account said, “All content has been blocked. User has been banned from using the account.” She added that the account “violated” government Internet rules, without elaborating. It also did not specify the job that led to the suspension.

Hong account on Weibo (WB), which had more than 3 million followers, was also removed. A CNN Business search of the account resulted in a message that the user “no longer exists”.

The Covid lockdowns have taken a heavy toll on the world’s second largest economy. The latest government survey data – released on Saturday – shows activity across manufacturing and services has fallen to the lowest level since February 2020.

Beijing’s policy of not spreading the coronavirus, along with a crackdown on big tech companies, declining real estate and risks related to the Russian war in Ukraine, have led to unprecedented capital flight by foreign investors in recent months. yuan recently It fell to its lowest level in 17 months.
Chinese leaders have given repeated reassurances in recent days about reforming the economy. President Xi Jinping on Tuesday called for action Infrastructure spending Spree to boost growth. The Politburo of the Communist Party promised on Friday Specific measures to support the Internet economy.

Hong and Bocom International did not respond to requests for comment on the social media comment. Weibo didn’t reply either.

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He is not the only one expressing growing concern about the health of China’s economy and markets.

Shan Weijian, founder and president of Hong Kong-based private equity firm PAG, recently criticized the government for its policies that have led to a “deep economic crisis”, according to the British newspaper The Guardian. financial times, citing comments he made at a meeting with brokers. PAG did not respond to a request for comment.
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Chinese regulators have stepped up their scrutiny of social media amid growing public discontent with the country’s Covid lockdowns.

in step to Reduce the anonymity of people onlineWeibo told users Thursday that it will start posting IP locations on their account pages and when they post comments, in an effort to combat “bad behaviour”.

Chinese tech giants have been cracking down on people making negative comments about the economy since last year. In October, Tencent suspended more than 1,400 WeChat accounts after the government cracked down on internet posts deemed harmful to the economy.

Tencent said The The accounts had made bearish calls about financial markets, “distorted” the interpretation of economic policies, or spread rumours. Among them was a public account run by Chen Guo, chief strategist at Shenzhen-based Essence Securities.

Likely to lead to social media ban?

It’s not entirely clear which of Hong Hao’s posts caused the recent ban.

The latest reports, posted on his WeChat public account, were titled: “Beware of Capital Flight” and “What Chinese ADRs Should Be Worried About.” ADRs are securities issued by Chinese companies listed in the United States.

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In those reports, Hong warned against dumping foreign investors in Chinese stocks, and drew attention to the sharpest inflow of capital since the epidemic began. He also blamed Chinese technology repression, rather than new US rules on listing foreign companies, for being behind Epic Sell-outs in Chinese Interactions (ADR) in March.

On another note on March 21, Hong also expected the Shanghai Composite Index to fall below 3,000 points.

Last Monday, Shanghai Composite dropped to less than 3000 For the first time in 21 months, a spike in Covid-19 cases in Beijing sparked fears that the Chinese capital could join Shanghai and other major cities in lockdown.

The Chinese stock market is the second worst performer in the world so far this year, after Russia, according to Refinitiv Icon.

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