India’s Reliance Industries to divest Jio’s tower assets for $3.5 bln

BENGALURU, Dec 16 (Reuters) – India’s Reliance Industries Ltd on Monday said its unit had inked binding agreements with Brookfield Infrastructure Partners LP for an investment of 252.15 billion rupees($3.51 billion).

Reliance Industrial Investments and Holdings Ltd will sell its telecoms arm, Jio’s tower assets to Brookfield and its partners, the company, controlled by Asia’s richest man Mukesh Ambani, said here

$1 = 71.7700 Indian rupees
Reporting by Chandini Monnappa in Bengaluru; Editing by Rashmi
Aich

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Congress considers EV tax credit revamp to help Tesla, GM, and used EVs

Marie Sapirie of E&E’s Tax Notes group reports on some potential big developments for the US federal EV tax credit contained in a draft bill, the ‘‘Growing Renewable Energy and Efficiency Now Act of 2019’’ or ‘‘GREEN Act of 2019’’. The draft is being promoted by Congressman Mike Thompson (D-CA), a member of the powerful Ways & Means committee, which is the chief tax-writing committee in the US House of Representatives. That means this draft bill should be taken seriously. The bill is a potential huge win for Tesla and General Motors, for whom the existing credit has almost fully extinguished.

The current credit

Back in 2010, Congress passed a tax credit for electric vehicle buyers, making them eligible to get back $7,500 at tax time after buying a new EV (assuming they owed at least that much in federal income tax).

However the credit is structured so that once an automaker delivers 200,000 electric vehicles in the US, the credit phases out over the subsequent four quarters. Tesla hit that milestone first in Q3 2018, with GM right behind them in Q4 2018. As a result, Tesla buyers will lose access to the credit after December 31, 2019, and GM buyers after March 30, 2020. This means the tax credit now primarily benefits automakers late to the EV game, penalizing those who put forward EVs earlier.

The draft bill’s revised credit for new EVs (Sec. 401 of the bill, full draft here: PDF)

The current draft of the GREEN Act of 2019 would do the following to the current EV credit:

  • Raise the threshold from 200,000 EVs to 600,000 EVs;
  • The EVs Tesla and GM sold in 2019 that only qualified for reduced partial credits wouldn’t count towards the new 600,000 threshold;
  • Reduce the credit from the current $7,500 to $7,000;

New credit for used-EVs (Sec. 402 of the bill)

For the first time, there would be a federal tax credit of up to $2,500 for used-EVs. This used EV tax credit has many limitations:

  • the used EV is sold for less than $25,000;
  • the model year of the used EV has to be at least 2 years earlier than the year you buy it (e.g., you buy it in 2020, it can’t be a 2019 model);
  • it was previously used and registered in the USA by someone other than you;
  • the credit can’t exceed 30% of the sale price;
  • the credit is tied to your income. It gets reduced by $250 for each $1,000 (or fraction thereof) by which your adjusted gross income exceeds $30,000 (double for married tax payers filing a joint return);
  • you can only get the used-EV credit once every 3 years; and
  • the used EV credit expires December 31, 2024.

New credit for manufacturers of heavy-EVs (Sec. 403 of the bill)

The draft bill creates a manufacturer (not consumer) 10% investment tax credit for sales of zero emission heavy-vehicles. “Zero emission heavy vehicle” is defined as having a gross vehicle weight rating of at least 14,000 pounds, not powered or charged by an internal combustion engine, and is propelled solely by an electric motor which draws electricity from a battery or fuel cell.

Electrek’s Take

This is a very promising development. It seems untenable that the automakers who helped drive EV adoption in the 2010s (helping drive down battery prices) would be disadvantaged in the 2020s relative to the automakers who sat out the last decade.

I can’t even wrap my head around the consequences of a new, base Tesla Model 3, Y, or Cybertruck costing ~$33,000 after the credit refund. If economists are to be believed and we’re rational actors for the most part, this credit would be an atom-bomb explosion over the ICE landscape.

As for the used EV credit, we’re big fans, but …. damn, that’s a lot of rules. Quebec’s very successful used-EV credit is much simpler.

Don’t make any big decisions on this news yet, however. This draft bill language still has to make it out of Ways & Means, a big hurdle, and then survive the Republican-controlled Senate, another massive hurdle. So color me skeptical for now.

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China’s textile B2B platform snags $300m from DST, Tiger Global, others

Baibu, a textile-focused business-to-business (B2B) service platform, has secured $300 million in a Series D round of financing led by DST Global and joined by CICC Capital, per a company statement. 

The company’s existing investors Source Code Capital, Tiger Global Management, Yunqi Partners, Chengwei Capital and Bull Capital Partners also participated in the round. China Renaissance served as financial advisor. 

The latest round comes a year after the company gathered $100 million in a Series C+ round from its existing investors.

Baibu, operated by Guangzhou Zhijing Information Technology Co., Ltd, is a supply chain service platform for the textile industry in China. Besides selling textiles and fabrics to businesses, it offers an ERP and inventory management system to help buyers locate and purchase materials.

Baibu claims its Series D financing is the largest so far in China’s textile industry.

Although China’s textile & clothing industry has suffered a setback due to rising labour costs, slowing overseas demand and the escalating US-China trade war, the country remains the world’s biggest textile producer and exporter.

The textile industry is aiming to increase its exports by about 7 per cent annually and boost the export value of fibre products to $400 billion by 2020, according to China National Textile and Apparel Council. The top textile companies in China include Jiangsu Hengli Group, Shanghaitex Holding, and Lu Thai Textile. 

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SG Digest: Keppel units ink real estate, waste management deals

Keppel Seghers, a wholly-owned subsidiary of Keppel Infrastructure, is acquiring an 18.18-per cent stake in Zerowaste Asia while another Keppel Corporation subsidiary, Keppel Land, is investing about $58 million in a joint venture that will develop an integrated township in Mumbai.

Keppel Land takes 49% stake in Mumbai integrated township JV for $58m

Keppel Land announced that it has entered into a joint venture with Indian developer Rustomjee Group to jointly develop an integrated township in Thane, within the Mumbai Metropolitan Region.

The company informed the Singapore Exchange that its wholly-owned subsidiary is acquiring a 49-per cent stake in Kapstone Constructions Private Limited, the joint venture company, at a consideration of about S$78.2 million ($57.7 million). The JV company will develop the 51.4-hectare Urbania integrated township.

The Urbania township, launched in 2006, has housed 2,700 residential units and the joint venture will develop an additional of about 7,400 homes and retail units with a total gross floor area of approximately five million square feet.

The JV is the first such collaboration between a Singaporean developer and an Indian developer for a township int he Mumbai Metropolitan Region, which is among India’s fastest-growing regions, Keppel said.

Keppel Seghers buys stake in Zerowaste Asia for $3.7m

Keppel Seghers, a wholly-owned subsidiary of Keppel Infrastructure that provides environmental solutions, has agreed to acquire an 18.18-per cent stake in Singapore-based waste and wastewater treatment provider Zerowaste Asia for S$5 million ($3.7 million).

In a disclosure to the Singapore Exchange, Keppel Seghers said Zerowaste Asia’s solutions will complement its portfolio of solutions by providing further treatment to extract heavy metals and pollutants from incineration fly and bottom ash, allowing the ash to be further reused instead of being landfilled.

Keppel Seghers said its waste-to-energy technology significantly reduces the volume of solid waste to be landfilled by up to 90 per cent, extending the lifespan of landfills and reducing greenhouse gases that are released in these areas. Zerowaste Asia’s proprietary technology, on the other hand, removes heavy metal and pollutants from waste and recycles detoxified waste into materials suitable for land reclamation and construction.

The investment comes at a time when environmental issues and the circularity of the economy are drawing increasing international attention, with many cities facing urbanisation challenges brought about by, among others, environmental risks, Keppel Seghers said.

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UPDATE 1-Hallmark reverses position on same-sex couple ads after public outcry

(Reuters) – The chief executive officer of Hallmark Cards apologized on Sunday night and said the company would reverse an earlier decision to pull television advertisements featuring same-sex couples from the wedding registry and planning website Zola.

FILE PHOTO: A rainbow flag flies above Market Street during the gay pride parade in San Francisco, California June 28, 2015. REUTERS/Elijah Nouvelage

In a statement, CEO Mike Perry said cable television’s Hallmark Channel “will be reaching out to Zola to reestablish our partnership and reinstate the commercials.”

Hallmark Channel faced a public outcry after it pulled the ads last week, under pressure from the conservative group One Million Moms.

The One Million Moms website said the group had “personally spoken with Crown Family Networks CEO Bill Abbott” who confirmed Hallmark pulled the commercial and said the advertisement aired in error. Crown Media Family Networks is the parent company of Hallmark Channel.

The decision to pull the ads prompted reactions from thousands of Twitter users as well as Democratic presidential contender Pete Buttigieg, comedian Ellen DeGeneres, California Governor Gavin Newsom and streaming company Netflix (NFLX.O).

On Saturday DeGeneres tweeted to her 79.1 million followers: “Isn’t it almost 2020? @hallmarkchannel, @billabbottHC… what are you thinking? Please explain. We’re all ears.”

The Netflix U.S. Twitter account tweeted: “Titles Featuring Lesbians Joyfully Existing And Also It’s Christmas Can We Just Let People Love Who They Love” above the titles and images from the Netflix film “Let It Snow” and sitcom “Merry Happy Whatever”, which feature lesbian characters.

Newsom tweeted a link to the ad, with the message “Same-sex marriage is the law of the land. There is no one way to love and be loved.”

Saturday Night Live also weighed in with a skit about a fictitious Hallmark Channel matchmaking show, which ended with comedian Aidy Bryant’s character saying: “This is Emily Cringle for Hallmark, reminding you to stay straight out there.”

The LGBTQ advocacy group GLAAD launched a boycott, and the #BoycottHallmarkChannel hashtag was featured in over 16,000 tweets as of Sunday afternoon.

On Dec. 2, Zola began airing six ads on Hallmark, four of which featured a lesbian couple. On Dec. 11 Crown Media notified Zola those four ads would no longer be airing, with the explanation that Crown Media is “not allowed to accept creatives that are deemed controversial.”

Zola then pulled its remaining ads from Hallmark, according to a Zola executive.

“The only difference between the commercials that were flagged and the ones that were approved was that the commercials that did not meet Hallmark’s standards included a lesbian couple kissing,” wrote Mike Chi, Zola’s chief marketing officer, in a statement prior to Hallmark’s reversal.

Reporting by Helen Coster; Editing by Chris Reese

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New Zealand holds minute of silence for volcano victims

WELLINGTON (Reuters) – New Zealanders across the country observed a minute of silence on Monday to honor the victims of last week’s fatal volcanic eruption, as police continued efforts to recover two bodies.

The official death toll from the surprise eruption on White Island, also known by its Maori name of Whakaari, stands at 16. Two people whose bodies are believed to be in the waters around the island are still officially listed as missing.

A further 26 people remain in hospitals in New Zealand and Australia, many in critical condition with severe burn injuries.

Prime Minister Jacinda Ardern led Monday’s minute of silence, standing alongside her ministers in Wellington’s distinctive “Beehive” parliament building.

“Those who have been lost are now forever linked to New Zealand, and we will hold them close,” Ardern posted on her official Instagram account.

The United States embassy in Wellington posted a photograph on Twitter of its staff, with heads bowed, before a U.S. flag flying at half-mast.

Recovery teams who retrieved six bodies from the island on Friday, have so far been unsuccessful in locating the final two bodies despite several hours of searching over the weekend.

New Zealand Police Commissioner Mike Bush said another aerial search would be conducted on Monday, to help naval divers form a plan for a further underwater search.

New Zealand’s Prime Minister Jacinda Ardern and fellow politicians observe a minute of silence, to mark one week since the deadly eruption of White Island, in Wellington, New Zealand, December 16, 2019, in this still image taken from video. TVNZ via REUTERS TV

“We will continue the operation for as long as we have a chance of recovering those bodies,” Bush told Radio New Zealand.

The volcano, a popular destination for day-trippers, erupted last Monday, spewing ash, steam and gases over the island. The 47 people on the island when it erupted included 24 Australian citizens and four permanent residents, as well as others from the U.S., Germany, China, the U.K. and Malaysia.

CRUISE PASSENGERS ARRIVE HOME

Many of dead and injured were Australians on a day tour to White Island from a Royal Caribbean Cruises’ ship that launched its tour of New Zealand’s famed sounds or fjords, lakes and volcanoes earlier this month from Sydney.

The 16-deck Ovation of the Seas docked back in Sydney on Monday, with some passengers disembarking in tears as they were reunited with family members.

“So happy to be home,” Australian tourist Jo Anne Anderson told the Sydney Morning Herald newspaper. “There are dead people, people who went on a trip of a lifetime, and they haven’t come home. It is dreadful.”

Australian Foreign Minister Marise Payne is expected to arrive in New Zealand later on Monday for a meeting with Ardern to express Australia’s thanks to emergency and medical crews.

Legal experts said last week they expected to see lawsuits filed in the U.S. courts by injured passengers and families of those who died. There has been growing criticism that tourists were allowed on the island at all, given the risks of an active volcano.

New Zealand’s Prime Minister Jacinda Ardern observes a minute of silence, to mark one week since the deadly eruption of White Island, in Wellington, New Zealand, December 16, 2019, in this still image taken from video. TVNZ/via REUTERS TV

Royal Caribbean Cruises Ltd’s potential liability for the deadly excursion could hinge on whether the eruption was an unforeseeable “act of God,” maritime lawyers told Reuters.

A spokeswoman for the company declined to comment on criticisms from some passengers about the excursion and the cruise line’s handling of the aftermath of the tragedy.

“We will to continue to provide ongoing support and services to them and their families during this difficult time,” the spokeswoman said in an emailed statement.

Reporting by Praveen Menon in Wellington, additional reporting by Colin Packham in Sydney; editing by Jane Wardell

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UPDATE 1-China’s Nov industrial output, retail sales beat expectations

BEIJING (Reuters) – China’s industrial output and retail sales growth accelerated more than expected in November, suggesting resilience in the economy as Beijing seeks to prop up domestic demand amid the trade war with the United States.

FILE PHOTO: Workers direct a crane lifting ductile iron pipes for export at a port in Lianyungang, Jiangsu province, China June 30, 2019. REUTERS/Stringer

Industrial production rose 6.2% year-on-year in November, data from the National Bureau of Statistics showed on Monday, beating the median forecast of 5.0% growth in a Reuters poll and quickening from 4.7% in October. It was also the fastest year-on-year growth in five months.

Factory indicators for November have shown surprising improvement in manufacturing, suggesting government support measures are helping domestic demand, even as exports and producer prices shrank.

Japanese construction machinery maker Komatsu Ltd (6301.T) said its machine usage hours in China rose for the first time in eight months in November, echoing trends seen in two manufacturing surveys.

The United States and China on Friday cooled their trade war, announcing a “Phase one” agreement that reduces some U.S. tariffs in exchange for what U.S. officials said would be a big jump in Chinese purchases of American farm products and other goods.

U.S. Trade Representative Robert Lighthizer on Sunday described the U.S.-China trade agreement as a “totally done” deal, notwithstanding some details.

However, despite recent glimmers or hope, analysts expect growth to slow further next year, with the government likely to set economic target at around 6% due to heightened uncertainties of global trade and more domestic headwinds that are set to weigh on growth.

Fixed asset investment showed no signs of improvement, after growing 5.2% from January-November, in line with a 5.2% rise in the first 10 months, which was the weakest pace in decades.

Private sector fixed-asset investment, which accounts for 60% of the country’s total investment, grew 4.5% in January-November.

China will keep economic policies stable while making them more effective in 2020 to help achieve its annual growth target, a top economics meeting said last week.

Betty Wang, senior China economist at ANZ, said policymakers are likely to rely on a combination of tools to maintain growth next year, rather than any single policy option.

Wang said in a note to clients on Friday accommodative policy was likely to be conducted in a less aggressive manner than what markets expect.

China’s economic growth cooled to 6.0% in the third quarter, a near 30-year low, but policymakers have been more cautious about growth boosting measures than in past downturns.

Retail sales rose 8.0% year-on-year in November, compared with an expected 7.6%, buoyed by the November Singles Day shopping extravaganza.

Reporting by Kevin Yao and Stella Qiu; Editing by Sam Holmes

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SoftBank’s China strategy wobbles as key bets disappoint

HONG KONG/BEIJING (Reuters) – For SoftBank Group Corp (9984.T), financial technology firm OneConnect’s IPO should have been a vindication of an aggressive China investing strategy.

FILE PHOTO: Japan’s SoftBank Group Corp Chief Executive Masayoshi Son attends a news conference in Tokyo, Japan, November 5, 2018. REUTERS/Kim Kyung-Hoon

Instead, embarrassed bankers had to slash the offering size and cut its price as investors baulked at a business model seen too reliant on majority owner Ping An Insurance (601318.SS). The IPO valued OneConnect at $3.7 billion, about half its worth last year when SoftBank’s Vision Fund invested $100 million, and its stock finished flat in its debut on Friday.

OneConnect Financial Technology (OCFT.N) is just one of many China bets placed by the Japanese investment giant or its massive Vision fund which have run into trouble. That’s added to global woes for SoftBank CEO Masayoshi Son, under fire for bad judgement and insufficient due diligence, exemplified by U.S. office-space startup WeWork’s disastrous IPO attempt and subsequent bailout.

In ZhongAn Online P&C Insurance Co Ltd’s (6060.HK) 2017 IPO, for example, SoftBank ploughed in $550 million as a cornerstone investor. But the deal was seen by some investors as way overvalued and now trades at about half its IPO price.

Its unlisted portfolio has also had problems. The Vision Fund in February invested $1.5 billion in Guazi.com, valuing the second-hand car dealing platform at more than $9 billion.

But a $500 million funding round for Guazi.com in the first half of the year failed to get off the ground, people with knowledge of the fundraising said.

The people, who were not authorised to speak to media and declined to be identified, said potential investors thought it was too pricey and were put off by its lack of profits in a sector where sales have been declining.

Guazi.com said in a statement that talks for new funds were advanced, investors included the Vision Fund and other top international investment institutions and that it expected to be profitable in the fourth quarter.

In fairness to SoftBank, many China IPOs have stumbled, hurt by a sharp slowdown in economic growth and trade tensions with the United States.

But investors and some bankers looking at China-related deals say SoftBank’s involvement, once a sign of promising prospects, was now viewed as a red flag that a company was likely overvalued.

“SoftBank has become a signal that the market has peaked,” said one person involved in the OneConnect IPO.

SoftBank declined to comment on its investments in Chinese companies for this article.

OTHER PROBLEMS

Other big bets like TikTok owner ByteDance and artificial intelligence firm Sensetime are threatened by the fallout from the U.S.-China trade conflict. The Vision Fund has invested roughly $1 billion in both, sources have said.

ByteDance is entangled in a U.S. national security review over how it handles U.S. customer data.

Sensetime in October was added to the U.S. “entity list” which bars it from buying U.S. components without U.S. government approval, over its alleged involvement in human rights abuses in China’s Xinjiang.

Sensetime has countered it abides by all relevant laws of jurisdictions in which its operates and that it has been actively developing an AI code of ethics.

Ride-hailing company Didi Chuxing, one of SoftBank’s biggest China bets with $11.8 billion invested, appeared to have a bright future after U.S. rival Uber (UBER.N) traded its China business for a stake in Didi.

But the rape and a murder of a Didi passenger by her driver has dented the company’s image, and its IPO timetable remains unclear after Uber valuations slid.

The Vision Fund opened a China office this year led by former Silver Lake managing director Eric Chen. Two sources familiar with the operation told Reuters that the pace of hiring for the China team has been slow, though SoftBank says the team has grown a lot since March to include about 20 investment professionals.

One source said Chen had scaled back the size of the deals he was looking at, now focusing on investments of around $50 million compared to those of $200 million-$300 million.

SoftBank declined to comment.

It’s all a far cry from just two years ago, when SoftBank and the Vision Fund were ramping up. Son had made a killing with an early investment in Alibaba (BABA.N) – a stake now worth $140 billion – and the China tech business was booming.

Then, Son’s penchant for splashy checks to help startups grow fast and quickly vanquish rivals was in full force – as evidenced by a meeting with Chinese online medical platform Ping An Good Doctor (1833.HK) in late 2017 to discuss pre-IPO fundraising.

“How much do you want to raise in the pre-IPO round and via IPO? “ Son asked Good Doctor’s CEO Wang Tao, according to sources.

Wang told him it would be $300 million and $1 billion respectively.

“How about I give you $1 billion and you drop the listing plans?” Son said.

Wang later decided not to take him up on the $1 billion, receiving instead $400 million from the Vision Fund in a pre-IPO round before listing in Hong Kong last year.

In contrast to some of SoftBank’s other China investments, its stock has made progress after a rocky start, however, climbing and mostly staying above its IPO price since October.

(This story refiles to correct SoftBank Group Corp, not SoftBank Group Inc in paragraph one)

Reporting by Kane Wu and Julie Zhu in Hong Kong and Yang Yingzhi in Beijing; Additional reporting by Sam Nussey in Tokyo and Clare Jim in Hong Kong; Writing by Kane Wu; Editing by Jonathan Weber and Edwina Gibbs

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China’s November industrial output, retail sales beat expectations

BEIJING (Reuters) – China’s industrial output and retail sales growth accelerated more than expected in November, suggesting resilience in the economy as Beijing seeks to prop up domestic demand amid the trade war with the United States.

FILE PHOTO: Workers direct a crane lifting ductile iron pipes for export at a port in Lianyungang, Jiangsu province, China June 30, 2019. REUTERS/Stringer

Industrial production rose 6.2% year-on-year in November, data from the National Bureau of Statistics showed on Monday, beating the median forecast of 5.0% growth in a Reuters poll and quickening from 4.7% in October. It was also the fastest year-on-year growth in five months.

Factory indicators for November have shown surprising improvement in manufacturing, suggesting government support measures are helping domestic demand, even as exports and producer prices shrank.

Japanese construction machinery maker Komatsu Ltd (6301.T) said its machine usage hours in China rose for the first time in eight months in November, echoing trends seen in two manufacturing surveys.

The United States and China on Friday cooled their trade war, announcing a “Phase one” agreement that reduces some U.S. tariffs in exchange for what U.S. officials said would be a big jump in Chinese purchases of American farm products and other goods.

U.S. Trade Representative Robert Lighthizer on Sunday described the U.S.-China trade agreement as a “totally done” deal, notwithstanding some details.

However, despite recent glimmers or hope, analysts expect growth to slow further next year, with the government likely to set economic target at around 6% due to heightened uncertainties of global trade and more domestic headwinds that are set to weigh on growth.

Fixed asset investment showed no signs of improvement, after growing 5.2% from January-November, in line with a 5.2% rise in the first 10 months, which was the weakest pace in decades.

Private sector fixed-asset investment, which accounts for 60% of the country’s total investment, grew 4.5% in January-November.

China will keep economic policies stable while making them more effective in 2020 to help achieve its annual growth target, a top economics meeting said last week.

Betty Wang, senior China economist at ANZ, said policymakers are likely to rely on a combination of tools to maintain growth next year, rather than any single policy option.

Wang said in a note to clients on Friday accommodative policy was likely to be conducted in a less aggressive manner than what markets expect.

China’s economic growth cooled to 6.0% in the third quarter, a near 30-year low, but policymakers have been more cautious about growth boosting measures than in past downturns.

Retail sales rose 8.0% year-on-year in November, compared with an expected 7.6%, buoyed by the November Singles Day shopping extravaganza.

Reporting by Kevin Yao and Stella Qiu; Editing by Sam Holmes

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China and U.S. should continue trade talks, remove tariffs: stats bureau

FILE PHOTO: Flags of U.S. and China are placed for a meeting between Secretary of Agriculture Sonny Perdue and China’s Minister of Agriculture Han Changfu at the Ministry of Agriculture in Beijing, China June 30, 2017. REUTERS/Jason Lee

BEIJING (Reuters) – China and the United States should continue bilateral trade talks and work toward removing all existing tariffs, China’s National Bureau of Statistics spokesman Fu Linghui said on Monday.

Fu also told reporters during a briefing that China’s economic operations showed positive changes in November and reiterated that China can achieve its full-year economic growth target.

Reporting by Kevin Yao; Writing by Se Young Lee; Editing by Tom Hogue

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