Interim Report On The Use Of Medical Stop-Loss Insurance In: Fill & Download for Free

JD Group announced in September 2020 that its subsidiary JD Health, a unicorn of JD Group, would be listed in Hong Kong. JD Health has also become another medical and health platform to be listed, following Ping An Good Doctor and Ali Health.Chinese Internet giants including Tencent, Baidu and ByteDance, in addition to Ali and JD Group, have all stepped into the medical and health sector. Specifically, Tencent launched the popular medical science product Tencent Medical Dictionary (formerly Penguin Medical Dictionary), introducing overseas high-quality medical health knowledge. The company has cooperated with top hospitals to transform difficult professional knowledge into content that is easier for the public to understand. Baidu Health released a one-stop medical service solution for users at 2020 Baidu World Conference. In August, ByteDance completed the acquisition of all assets of Baike http://Mingyi.com, a domestic professional medical knowledge platform, for RMB 500 million, further improving its ecology.On the other hand, the performance of insurance companies in the healthcare sector is also satisfying. Ping An Good Doctor registered RMB 860 million in online medical revenue, a year-on-year increase of 108.9%, according to Ping An Group’s 2019 report. During the epidemic, visits to the platform reached 1.11 billion, and new users increased by 10 times. The average daily consultations from new users was 9 times that of normal times, and the cumulative number of videos related to epidemic prevention was more than 98 million.Giants have all entered into the medical and health field to improve their health ecology, with the intention of providing users with one-stop medical solutions. IResearch pointed out in a report that the integration of Internet and medical care in China is currently in the transitional period from 2.0 to 3.0, and is about to move towards the 3.0 stage with Internet hospitals as the direction of transformation. In the final stage 3.0, a comprehensive Internet hospital will be established to offer services such as online consultation, diagnosis, remote treatment, prescription and delivery of medicines to home. In 2020, the scale of China’s Internet + medical market is expected to be RMB 40.89 billion, a year-on-year increase of 50.5%. It seems that the healthcare industry is facing a blue ocean, but is this an easy business?Ali Health: E-commerce is the starting point, but not the endAs a platform that embodies Alibaba’s “Double H” strategy (Health and Happiness) in the field of health, Alibaba Health takes users as the core, promotes pharmaceutical e-commerce and new retail business through all channels, and provides comprehensive online and offline integrated solutions for the health industry by relying on Alibaba Group’s advantages in e-commerce, Internet finance, logistics, big data and cloud computing, hoping to achieve cross-regional shared allocation of existing social medical and health resources, and at the same time offering convenience to patients seeking medical treatment and purchasing drugs, and satisfying consumers’ need to pursue a healthy lifestyle on the basis of ensuring safety.At present, Alibaba Health’s business is concentrated in the fields of medical e-commerce and new retail, Internet medical care, consumer medical care, and smart medical care. Ali Health entered the medical and health market from the e-commerce field, but did not intend to stop there.The pharmaceutical e-commerce platform and the pharmaceutical self-operated business recorded RMB 1.17 billion and RMB 8.13 billion in revenues, respectively, accounting for 97% of the annual revenue, according to the annual report released by Ali Health for the year ended March 31, 2020. The rapid growth of these two parts greatly contributes to the increase in the revenue during the year.Although the revenue generated by the Internet medical business during the year increased by 221.2% year-on-year, whether the rapid growth can be maintained in the post-epidemic period is still uncertain. Undeniably, e-commerce still contributes greatly to Ali Health’s revenues.In 2016, Alibaba Health issued an announcement that it had signed a three-year service agreement with Tmall, a subsidiary of Alibaba Group, to exclusively operate Tmall’s medical and healthcare e-commerce business and charge service fees. Notably, Alibaba Health’s self-operated pharmaceutical business is also growing rapidly in addition to the pharmaceutical e-commerce platform business. As of March 31, 2020, the total annual commodity transactions generated by the Tmall pharmaceutical e-commerce platform operated by Alibaba Health exceeded RMB 83.5 billion. The annual active consumers have exceeded 190 million, an increase of 30 million over half a year ago. The annual active consumers of online self-operated stores exceeded 48 million, an increase of 11 million over six months ago.In the consumer medical business, physical examination is a driving factor for the growth of Ali Health. In October 2019, Meinian Health announced that the company’s controlling shareholder Shanghai Tianyi Assets and other shareholders intended to transfer 5.58%, 5.24%, and 5.34 of Meinian Health’s shares to Alibaba Network, Hangzhou Xintou and Shanghai Qijun, respectively. After the transfer, Ali and its subsidiaries will hold 10.82% of Meinian Health’s shares and become its second largest shareholder. Prior to this, Ali has completed the holding of iKang Guobin, a health management institution that provides medical examination and medical services.On October 26, Alibaba Health forecast that the company would record a profit of no less than RMB 200 million as of September 30, 2020, compared with a loss of 7.6 million in the same period last year. Notably, this is also the first time that Ali Health has turned losses into profits. There are three main factors that can explain the profitability. First, user Internet and health awareness. Users on multiple platforms of the company have grown rapidly. Second is the income generated from the acquisition of pharmaceutical categories from Ali JK Nutritional Products Holding Limited in April 2020. The third is efficiency improvement and cost optimization driven by the scale of the platform.Ping An Good Doctor: Focusing on online diagnosis and treatmentDifferent from Ali Health that regards the e-commerce platform as its starting point, Ping An Good Doctor, a key player of the Ping An medical ecosystem, intends to achieve growth on the basis of online diagnosis and treatment. Ping An Good Doctor currently serves 346 million users. It has a medical team of over 1,800 people, and has gathered nearly 10,000 experts across China, according to the data provided by Ping An. It has established the largest offline service network which includes 110,000 pharmacies, 49,000 clinics, and more than 2,000 physical examination centers. It can be seen from Ping An Good Doctor’s case that offline channels cannot be ignored.Although Ping An Good Doctor chose a different starting point from Internet giants to expand business in the medical and health sector, the goal is to connect the upstream and downstream of the industry chain, and at the same time integrate more technologies to eliminate barriers among social insurance and commercial insurance, hospitals, medicine and consumers, thereby improving efficiency.On the Open Day, Ping An Good Doctor launched a new service brand “Ping An Medical Home”, and the first “Online Medical Full-Process Protection” that covers medical responsibilities and medicine quality, including seven security guarantees including doctor qualification, diagnosis and treatment quality, and drug safety. The Internet medical liability insurance provides each doctor with an insured amount of RMB 1 million, which means that the platform will bear the liability risk of medical behavior, eliminate the concerns of doctors and patients.According to Ping An Good Doctor’s 2019 annual report and 2020 mid-year report, the revenues of Ping An Good Doctor mainly come from four major businesses: online medical care, consumer medical care, the health mall, and health management and interaction, among which the health mall contributes most of the revenues, known as the core business of online medical care. However, the business is not the core.Ping An Good Doctor relies heavily on Ping An Group for development. In 2019, the top five customers of Ping An Good Doctor were Ping An Life, Ping An P&C, Ping An Health, Ping An Bank, and Ping An Annuity, which contributed 39.7% of the total revenue. Similarly, Ping An companies are the main consumers of Ping An Good Doctor’s products and services in the major transactions in the 2020 interim report,Although relying on Ping An for traffic and business, Ping An Good Doctor has suffered losses from 2015 to 2019, with a cumulative loss of nearly RMB 4 billion in five years. Problems such as slow growth in users, losses, and the overdependent on Ping An have hindered the development and growth of Ping An Good Doctor.In addition to Ping An, Pacific Insurance and other insurance companies have stepped into the healthcare sector. In September 2019, Pacific Insurance and the well-known Chinese tertiary A hospital Ruijin Hospital reached a cooperation, under which the two parties will cooperate to build an Internet hospital. According to reports, two platforms and three centers will be created. The two platforms refer to a doctor management platform and an AI Technology platform, and three centers refer to the medical consortium construction center, the medical product development center, and the commercial insurance service development center. At the same time, the construction of an Internet medical platform has also been included in the development strategy of Pacific Insurance.Medical payment: another starting point in the health fieldIn addition to innovations in medical technology, medical payment has also become a starting point. In August 2020, Waterdrop CEO Shen Peng revealed that Waterdrop had launched a new project to explore the “risk + medicine” model a few months ago, called “Good Medicine Payment”, hoping to use commercial insurance to integrate payers and pharmaceutical companies and offer consumers better treatment with less cost. In the future, Waterdrop’s goal in the field of health is to build a Chinese version of UnitedHealth Group.On the other hand, supervision is also promoting the construction and development of Internet healthcare. The newly revised circular Drug Administration Law of the People’s Republic of China released in 2019 stipulates that prescription drugs, except drugs subject to special administration such as vaccines, blood products, narcotic drugs, psychotropic drugs, medical toxic drugs, and radioactive drugs, can be sold online.The National Medical Security Administration issued the Guiding Opinions on Promoting the Payment of Internet Medical Services and Medical Insurance in November 2020, clarifying that qualified Internet medical institutions can sigh up to be included in medical insurance relying on physical medical treatment institutions, and Internet medical insurance payments can also be reimbursed.Giants have a common goal in the healthcare sector, that is, to break the barriers of commercial insurance, hospitals, and pharmaceutical companies with the help of the Internet and technology, regardless of the starting point each giant has chosen, be they e-commerce or online diagnosis or treatment. Only this goal was achieved can patients get more convenient and high-quality treatment with less money. Plus, the diagnosis efficiency will be greatly improved with the help of technology, and doctors can bring patients more peace of mindAlthough the medical and health industry has faced a blue ocean, not everyone has the strength to enter the market. Enterprises have to invest huge manpower and financial resources during this process, and they may suffer losses in the initial stage. Also, the acquisition of online traffic has become more difficult, and Alibaba Health and Ping An Good Doctor are also seeking various possibilities in offline channels to expand business.Challenges and opportunities coexist, and more possibilities in the medical and health industry also need to be explored with giants entering the sector. Insur View will continue to report the latest trends in the medical and health field, and look forward to seeing more integration of the medical and health and insurance industries.

Listed for Three Years, Lost For Three Years. Is the "First Internet Insurance Stock" Zhong An Still Good?Backed by Tencent, Ping An, Alibaba, and Ctrip, Zhong An Insurance was established in 2013 with a registered capital of 1 billion. The actual controller is Ou Yaping.In 2015, it completed a round of financing of 5.775 billion backed by institutional investors including Morgan Stanley, Dinghui, and SAIF.In 2017, it completed the Hong Kong stock IPO and became the “first Internet insurance stock”, raising 11.5 billion Hong Kong dollars (approximately 10 billion yuan). The cornerstone investors include SoftBank.The time comes to the beginning of 2021. Zhong An has been listed for three years, and has lost for three years in a row. It is about to release its fourth annual report. What is its performance then?1.Whether have Zhong An's three sectors failed to achieve growth?Since the disclosure of the IPO prospectus, Zhong An has been talking about the five major ecology: living consumption, aviation travel, consumer finance, automobiles, and health. In every annual report, the order will be different. But the data is worthy of recognition.First look at the premium income of the five major business sectors.First, each sector has a driving force for growth, but the driving force is not enduring, so it cannot support the long-term growth.Second, each sector is backed by shareholders, which not only shows that the ZhongAn has foresight, but also shows that the business of ZhongAn’s shareholders has obvious shortcomings.Third, the health insurance, which lacks the support from shareholders, may become the largest driving force for ZhongAn’s growth in the future.Zhong An’s consumer spendingSince 2014, the return freight insurance that grew out of the Taobao e-commerce ecosystem has been widely recognized in the industry, and its success stories have also been widely spread. Its biggest highlights: Firstly, it proves that the insurance business under the Internet ecology is possible; secondly, it proves the subversion of traditional insurance pricing by big data; thirdly, it proves that only advanced systems can satisfy the massive and high concurrency of the Internet.However, from 2015 to 2018, the premium income of the consumer ecological business has remained at around 1.6 billion, of which the return freight insurance was about 1.1 billion.In 2019, Ali began to provide support again. Therefore, the scale reached 3 billion that year, and the scale was expected to be around 3 billion in 2020. While, the rest of the life consumption ecology has been "stably" maintained at 500-600 million.The prospectus stated: “China’s e-commerce and retail-related insurance market is entirely a potential market for insurtech companies. According to the Oliver Wyman’s report, the size of the market reached RMB 5.3 billion yuan in 2016 and is expected to increase in 2021, up to 56.9 billion yuan. That means a compound growth rate of 60.8%.” This assumption is based on the rapid growth of e-commerce business and revenue.From 2015 to 2020, Ali’s revenue has increased by about 7 times. Although it is not ten times, it is good enough. It is not wrong to expect the good performance of insurance business related to e-commerce. The fault is that investors rely on e-commerce as Zhong An’s growth in this field.The total loss rate and channel fee rate of the life consumption ecology are maintained at about 94%, which does not include the possible middle platform and background support costs. To put it bluntly, this business relies heavily on Ali. To a large extent, it is a tool for Ali to establish cooperative relations with the majority of large and middle P&C insurance companies and exchange potential benefits, and push large and middle P&C insurance companies to use Ali Cloud services.Zhong An's aviation ecology (aviation delays and aviation accidents)Beginning from 2016, minority shareholder Ctrip began to provide support. The income of the cooperative aviation travel eco-insurance that year went from 300 million to 1 billion, and remained at around 1.4 billion from 2017 to 2019, not reaching a new level then and later. However, due to the impact of the pandemic in early 2020, the aviation travel ecology has been directly and greatly affected. There are great uncertainties on the questions when it will recover and the speed of recovery.This part of the business is the same as the return freight insurance:The first similarity is that they both help ZhongAn to expand business, and they can hardly generate revenues. The total loss ratio and expense ratio of the past three years were 104%, 99%, and 94%.The second similarity is the two sectors depend on shareholders, and Ctrip holds less than 5% of the shares in Zhong An.Of course, Zhong An also knows that relying entirely on Ali and Ctrip will not make money at all. In particular, flight delays and navigation plans are businesses that directly give money to the parties that provide traffic, and the commission rate exceeds 80%. Therefore, ZhongAn introduced "Willful Refund" (covering the return freight insurance of the entire network of e-commerce) and "Accompany You During Waiting" (covering the delay insurance of all flights throughout the year).Three or four years past since the two products have been launched, but the two products, which are sold through self-operated channels (purchased directly through the Zhong An app or official account), did not develop so well.Operational efficiency is one aspect, and the conflict of interest with the shareholders may be even more critical. Therefore, the aviation travel ecology may suffer losses in 2020 and 2021, and it can not achieve growth and make profits in the future.Zhong An's consumer finance sector (credit guarantee insurance)This consumer finance business is essentially a credit business. Individual customers must purchase a credit guarantee insurance from a property insurance company (monthly rate, equivalent to annualized interest rate is 10%-15%) in order to obtain unsecured credit loans from banks (or other funding sources) (bank annualized interest rate is 6-8%).This type of business, either in the form of credit guarantee insurance, or in the form of guarantees, is collectively referred to as "loan assistance", which is mainly for those subprime mortgage groups, that is, customers with low credit ratings and unstable incomes.The credit insurance business ushered in a rapid growth of the entire industry in 2017-2018 (annual growth rate is about 100%).2015-2019 credit guarantee insurance business data of property insurance companiesIn addition to Zhong An that has achieved great progress, Ping An Inclusive, PICC, CPIC, China Continent Insurance, Sunshine Credit Insurance, etc. have also gained a lot from the industry. Some companies have begun to do more in-depth operations in order to pursue large-scale operations, including advertising on the front desk to obtain customers, transformation between telemarketing and online sales on middle platform, and background docking with bank funding channels.Zhong An’s main cooperation channels include Xiaoying Finance (an affiliate of Boss Ou), Lexin, Nongfenqi (Agricultural installment loan), Mimo Financial, and various ITFIN companies.However, after two years, the consumer finance business has completely stopped.Under the background of the macroeconomic downturn, the guys who are carrying various loans are either unemployed, or their own business is not good enough. They cannot repay the previous loans, and there is no new wool platform (mainly P2P) to borrow the new loans and repay the old ones. Various ITFIN platforms have also imposed comprehensive debt collection methods, as examples, mobile phones have been blown up, relatives and friends have been harassed...After P2P has been rectified, financing guarantee and credit guarantee insurance businesses are also in a total mess.The Regulations for the Supervision of Credit Insurance and Guarantee Insurance Business (Consultation Draft) in November 2019, (Official Version in May 2020), and the Interim Measures for the Administration of Internet Loans of Commercial Banks in July 2020, all further require Institutions to be licensed; the ultimate goal is to "decrease leverage in the residential sector" in macro-control.What reflected in the report of Zhong An is the reduction in loan balance and premiums. In 2019, the loan balance decreased by 7.2 billion, and in the first half of 2020, it decreased by 11.2 billion. At this rate, it is estimated that there will only be a balance of 2 to 3 billion in the annual report. Whether this sector will be included in the annual report in the future is a big question.2."Two Pillars": Can they support the development of ZhongAnThe first pillar of ZhongAn: Is there a promising future for UBI insurance?ZhongAn Auto Insurance adopts a co-insurance model with Ping An Property Insurance. According to the annual report, “Zhong An uses its own technological advantages to connect with Internet platforms and aftermarket service channels to promote customer acquisition, while Ping An Property Insurance uses its offline claims network to provide users with high-quality claim services.”Since the program was approved in 2015, the two parties have issued policies nationwide in May 2018. With regional expansion, auto insurance premiums in 2018 have increased nearly tenfold compared to 2017 (the total auto insurance premiums after restoration were 263 million in 2017, 2.298 billion in 2018. There are 740,000 insured customers, with an average of about 3,000 yuan).Auto insurance as a whole has entered an era of low growth rates, which has become the consensus of the industry.The reasons include: 1) New motor vehicles maintained a low and stable growth every year. 2) Regulators requires reducing the handling fee rate. 3) Transparency of parts and maintenance costs.The industry-wide auto insurance growth rate is expected to be 2-3%, and the pandemic has little impact on this.However, auto insurance is the main business of property insurance companies (premiums account for more than 60%). I think there is still a lot of room for ZhongAn, and UBI is the only breakthrough:Firstly, young car owners are apt to purchase auto insurance online (using the Internet and mobile terminals). Especially after the handling fee rate is strictly controlled and compressed, "discount rebates" have become more difficult for offline channels to attract customers.Secondly, ZhongAn will not have any advantages using the existing paradigm clauses. Only differentiated forms and pricing (UBI) can become barriers. Judging from the recent rate reform, regulators support innovations such as mileage insurance (UBI), while they also gradually liberalize the range of independent pricing coefficients.Thirdly, ZhongAn does not have to face the burden of traditional channels (such as car dealers), so the reform speed can be faster and more determined. Moreover, since 2016, it has been paying attention to the domestic and foreign trends and leading practices of UBI auto insurance, and has cooperated with many partners to start data modeling.Fourthly, the market of 500 billion private cars and 300 billion trucks is large enough for ZhongAn. With a goal of entering the second echelon (2% market share, about 16 billion) in a short period of time (3-5 years), Zhong An’s goal is to expand the business 8 times.Fifthly, as insurance premiums increase and capabilities become stronger, ZhongAn will definitely require the co-insurance ratio to tilt toward itself, such as 70:30 (the current five-to-five ratio contract will continue until the end of 2022).We are optimistic that the scale of Zhong An's auto insurance will reach tens of billions and become a pillar in the future. But the trend that the auto insurance business is not profitable is difficult to change, namely the comprehensive cost ratio is slightly lower than 100%. To make money requires two conditions: 1) Have a unique, low-cost customer acquisition channel. 2) Have data advantages or model advantages leading the industry. These two points are currently not available.The second pillar of ZhongAn: Million MedicalMillion Medical has ignited the development of Zhong An's health insurance business. It is the most successful one of the five major businesses. The premium income has shown an exponential growth trend, with the proportion of premiums continuing to increase. It is estimated that the premium income in 2020 will be about 7 billion, accounting for more than 45%.At the same time, two teams were incubated during the development process:Firstly, an agent tool —— ICloud was created in 2016 driven by the needs of channel expansion.Secondly, a dual-core intelligent system and health service vendor management —— Nuanwa Technology was created in 2018 driven by the needs of ecological expansion and digital operation.This is the only business that ZhongAn has not relied on its shareholders. And it is also a pillar with the highest certainty and the strongest profitability in the future.The reasons are:Firstly, Internet celebrity products: As the first Million Medical product, the "Exclusive Series" has been widely recognized by the market and customers, whether it is promoted by online advertising or the agent ICloud Insurance.Secondly, customers are able to enjoy a series of services: 1) U health services, including smart body fat scales, smart bracelets, online consultations, home delivery of medicines, discount coupons for cancer screening, discount coupons for gene sequencing, discount coupons for tooth cleaning, etc. 2) ZhongAn Internet hospital services, including online consultation, home delivery of medicines, etc. 3) Other services, including advance payment of medical expenses, green pass for severe illnesses, post-operative care, psychological counseling and so on. The increased service rights and interests yearly strengthen users’ stickiness and enhance the sense of acquisition towards insurance products.Thirdly, controllable channels: The proportion of the premium of “Exclusive Series” sold on its own platforms (Zhong An apps, mini programs, etc.) has increased from 8% in 2018 to 24% in 2019, and up to 34% during the first half of 2020. Coupled with the first launch of ICloud Insurance and Alipay, the channel is highly controllable.In terms of business data, it shows a compound growth rate of more than 100% per year.The profit of this business comes from:Firstly, just focusing on personal insurance. ZhongAn adjusts the structure and giving up group insurance, which means giving up the channel that is easy to scale up quickly, but the benefit is a reduction in the loss ratio.Secondly, smart claims: On the basis of OCR identification, ZhongAn further realizes data direct connection with more than 1,100 hospitals (covering 28 provinces) and medical insurance centers/regional health information platforms in 11 provinces and cities, effectively verifying claims Data to prevent fraud.Thirdly, sports data: “Step-by-step” health insurance, which cooperates with Millet and Ledongli Fitness, has obtained the sports data authorization of about 33 million users. The model trained after long-term data accumulation has established a solid foundation for customer selecting and optimized pricing.In terms of compensation data, it is shown as follows: In the first half of 2020, the overall compensation rate of the health ecology improved to 45.1%, a year-on-year decrease of 15.2 percentage points.The health insurance business is likely to reach a scale of tens of billions in 2021, and with the strengthening of anti-fraud capabilities and the increase of brand premiums, the profitability is worth looking forward.The third pillar of Zhong An: What else?In terms of personal customers’ property insurance business, pet insurance and housing insurance are the only types of insurance that can be expected to get hot.From the perspective of technology business, ZhongAn Technology learned from eBaoTech's products and re-developed the core system products. It wanted to export it to domestic and foreign property insurance companies. In China, it is mainly selling modules separately at present, such as the digital operation module of Hengqin and the intelligent marketing module of Evergrande. Abroad, the main customers are Sompo and Grab introduced by SoftBank. The revenue in 2019 was about 270 million. Due to the low unit price of individual modules, the long business cycle, and the large amount of resources invested in productization in the early stage, the loss was 330 million that year.In terms of international business, ZhongAn Bank (100% holding) was approved to open in Hong Kong at the end of 2019. and Zhong An Life (65% holding) was granted a license in May 2020. It is still unclear about its strategic direction and how to collaborate with Chinese mainland customers.3.How should Zhongan be valued?Based on the aforementioned analysis of each section, we predict the target of Zhong An in the next 3 years (Zhong An Technology and Hong Kong business are not considered for the time being):Firstly, in terms of incomeAssumptions: 1) The healthy ecology is based on 7 billion in 2020, with a compound annual growth rate of 80%. 2) Consumer finance actively reduces the balance. 3) The automotive ecology is based on 1.2 billion in 2020, with a compound annual growth rate of 30%. 4) Living consumption depends on Ali, which maintains 4 billion per year. 5) Air travel depends on OTA, which will be restored to 1.3 billion in 2021, an annual increase of 10%.Secondly, in terms of profitLiability side:Assumptions: 1) Through brand service premium and smart claims, the comprehensive cost ratio of the health ecology reaches 95% (approximately 100% in the industry). 2) The automobile ecology is maintained at the same level as the three companies (China Life Insurance, China Pacific Insurance, and Ping An Insurance), and the overall cost rate is about 98%. 3) Living consumption and air travel rely on traffic, and the overall cost rate is about 99%. 4) Other categories maintain a breakeven.Investment side:Zhong An adopts the conventional and prudent practices of insurance companies, partly self-operated and partly managed (such as Ping An Asset Management) to be responsible for the investment. The rate of return on investment is assumed to be around 5%. Investable assets are expected to reach 36 billion in 2023, namely the annual investment income is about 1.8 billion.Thirdly, in terms of valuationThis is a property insurance company with a premium scale of about 50 billion yuan, an underwriting profit of about 2.148 billion yuan, an investment income of about 1.8 billion yuan, and an ROE of more than 30%. (For the time being, its Hong Kong life insurance license and banking license are not considered, for one reason it is because the current strategy and business are not yet clear, and for the other reason it is because of the recent strong supervision, which may requires business divestiture or splitting)The benchmark property insurance company’s 10 times PE ratio (China Life Insurance A: 10 times PE; Progressive: 11 times PE), based on a pre-tax profit of 4 billion yuan and a net profit of 3 billion yuan, will reach a valuation of approximately 30 billion yuan in 2023 under ideal conditions. (As of the end of 2020, its market value is 53 billion Hong Kong dollars, namely about 45 billion RMB)Fourthly, in terms of solvencyAccording to the solvency requirements of property insurance companies, if ZhongAn maintains its actual capital of about 12 billion in the short term (3-5 years), with 150% as the warning line, its minimum capital is 8 billion.According to the minimum capital calculation formula and the above simplified financial calculation, ZhongAn’s premium income is about 50 billion (8 billion/16%). That is, the solvency line will be reached in 2023, and financing will continue in 2024 to replenish capital.In other words, without capital replenishment, the state of the business in 2023 and the valuation of 30 billion yuan have reached the top of the capital supportable under a static perspective. Only relying on endogenous growth and the annual net profit supplement of 3 billion will bring the supplement of the minimum capital of 2 billion and the incremental space of 12.5 billion in premiums.Although there is a bubble, there is a turning point. The road ahead is long, worthy of paying attention while walking along.Looking back at past developments, the life consumption, consumer finance, and aviation ecology all had no potential to develop.However, we are still optimistic about the auto insurance and health insurance business of ZhognAn, especially the service innovation around the health sector. The annual doubling growth is likely to continue in the future, and the underwriting profit rate is extremely sensitive, and the profitability is likely to increase greatly.More than 20 years of history is showing that1) The Internet economy cannot be overestimated in the short-term and cannot be underestimated in the long-term.2) The Internet/new technology will penetrate every industry. Traditional giants must be careful because new players work hard.3) Historical financial performance cannot reflect the future. A dynamic perspective is difficult but important.There is a long way to go and look ahead. We expect to see the performance of ZhongAn as it is going to release the fourth annual report!Disclaimer: The author of this article uses publicly listed company data and peer interview information to do business model deduction and analysis, and does not constitute any investment advice.

Another standing committee meeting; Infected woman drives from Wuhan to Beijing; More evidence of coverups in Wuha…Bill Bishop at Sinocism <[email protected]:19 PM (15 minutes ago)Read in browserI decided to make today’s issue of the newsletter free. If you like what you see please sign up for the Sinocism China Newsletter here. Group and education discounts are available.Another standing committee meeting; Infected woman drives from Wuhan to Beijing; More evidence of coverups in Wuhan; Q1 GDP growth 0?Bill BishopFeb 26The growth of new cases in Hubei and the rest of China continues to slow according to the official data.A loyal reader in China suggests that I add one more item to my unmistakable signs the Party thinks victory really is at hand.Xi visits Wuhan;The announcement of a date for the “Two Meetings”Kids go back to schoolThis reader is correct, as the political risk of sending kids into harm’s way is too high. And until it is safe for kids to go back to school it is hard to see the economy operating at anywhere near normal levels.The Chinese Internet is in a bit of an uproar after a woman was able to travel from Wuhan to Beijing by car last week, after leaving prison. She is now in Beijing and is confirmed to have the virus. The speculation is she must be somehow very connected, but now that the news has exploded online it has become a political problem and an investigation is underway. There is more on this in item #5, as well as reports from Caixin and Caijing that give more evidence of a coverup in Wuhan at the start of the outbreak.I will hold another open thread tomorrow morning, this time for paying subscribers only. I’d love to hear from you.Thanks for reading.The Essential Eight1. Another standing committee meetingI don't remember so many reports about standing committees in such a compressed period of time.Xi Focus: Xi chairs leadership meeting on COVID-19 control, makes donation - XinhuaXi Jinping,...chaired a meeting of the Standing Committee of the Political Bureau of the CPC Central Committee on the prevention and control of the novel coronavirus disease (COVID-19).Responding to a call of the CPC Central Committee to all Party members, Xi Jinping, Li Keqiang, Li Zhanshu, Wang Yang, Wang Huning, Zhao Leji and Han Zheng all made donations to support the COVID-19 prevention and control work.Addressing the meeting, Xi said the positive trend in preventing and controlling the epidemic is expanding and economic and social development is rapidly recovering, but the situation in Hubei Province and its capital city of Wuhan remains complex and grim, and the risk of a rebound of the epidemic in other regions can not be overlooked...Prevention and control work in Beijing and other key provincial-level regions should be strengthened to resolutely block any possible source of infection, according to the meeting.The meeting demanded better protection measures for special venues such as the elderly care, childcare and mental health facilities where vulnerable groups of people are housed in enclosed premises.Comment: Interesting to see that PBSC specifically mentioned “elderly care” given the Caixin report about deaths in nursing homes in Hubei.CCTV Evening News on the meeting, no video from inside- 中共中央政治局常务委员会召开会议 分析新冠肺炎疫情形势研究近期防控重点工作 中共中央总书记习近平主持会议 响应党中央对广大党员的号召 习近平李克强栗战书汪洋王沪宁赵乐际韩正同《大国战“疫”》近期出版The CCP’s propaganda department said it will soon publish a book on China’s efforts to combat the coronavirus, and the book “focus on showing General Secretary Xi Jinping, as a major power leader, his care for the people, his sense of mission and responsibility, his strategic vision and great leadership.” It will be published in six different languages.2. The outbreakMainland China reports 406 new cases of coronavirus on February 25, deaths up by 52 - ReutersAll the new deaths were in Hubei province, the epicentre of the outbreak. Hubei also reported 401 new cases on Feb. 25, down from 499 a day earlier.Outside Hubei, the number of new mainland China cases fell to 5, down for the fifth consecutive day and the lowest since Jan. 20, when the NHC began publishing nationwide figures.China Tightens Screening of Travelers, Fearing Reinfection From Abroad - WSJ $$A number of Chinese municipal governments are imposing stricter health screenings on people entering China and, in some cases, even quarantine measures on those arriving from coronavirus-afflicted countries. These controls come after Beijing waged a concerted campaign urging other governments not to impose restrictions on travel to and from China, saying such measures were out of line with World Health Organization guidance.Beijing to quarantine people if they visited countries seriously hit by coronavirus - ReutersChina’s capital will quarantine people for 14 days at home or in groups if they have been to countries seriously hit by the coronavirus, the city’s health commission spokesman Gao Xiaojun told a press briefing on Wednesday.14% of Recovered Covid-19 Patients in Guangdong Tested Positive Again - CaixinThere is no clear conclusion on why it happens and whether such patients could still be infectious, said Song Tie, deputy director of the Guangdong Center of Disease Control And Prevention (Guangdong CDC), at a Tuesday briefing.Teachers advised to wear masks in class after primary schools reopen - XinhuaTeachers are advised to wear medical masks in class after primary and middle schools reopen in China as part of the country's novel coronavirus prevention and control efforts, according to a circular issued by authorities.Jingmen Party chief, mayor sanctioned for reporting incorrect numbers of COVID-19 infection - Global TimesParty chief Zhang Aiguo and city mayor Sun Bing of Jingmen, Hubei Province, have been punished by the provincial Party discipline watchdog on Wednesday, after the city reported minus 107 cases to the daily update feed on confirmed cases of COVID-19 on February 19, showing an obvious numerical error.Beijing offers free medical, psychological, legal consultation amid epidemic - XinhuaThe experts are renowned specialists in related areas or professors at Beijing's top universities, said Qi Jinli, deputy head of the united front work department of Beijing.So far the hotline has received over 5,500 phone calls, Qi said, adding that most calls were from people who need help with psychological issues related to the epidemic, with some suffering from insomnia and stress.3. EconomyFive more Chinese regions lower emergency response level as virus threat recedes - ReutersThe northwestern Chinese regions of Inner Mongolia and Xinjiang, the southwestern province of Sichuan, the northeastern province of Jilin and the southern island of Hainan have all cut their emergency response levels.Comment: Mother-in-law has been in Hainan, the last few days things have started to loosen upAs China’s Economy Suffers, Xi Faces Pressure to Lift Virus Restrictions - WSJ $$Businesses executives and some local leaders are becoming more vocal about the need to streamline rules to reopen factories and get workers and supplies moving again in many parts of the country where activity remains at a standstill.But many local officials fear doing so could risk a resurgence of infections, prolonging the outbreak and putting their jobs on the line. Many privately complain that President Xi Jinping has put them in an impossible position, demanding they keep growth on track while also ensuring the virus doesn’t spread...“Propaganda can’t move mountains,” wrote Zhang Anyuan, an economist at CFC Financial, a Chinese securities firm, in a Feb. 24 report. Mr. Zhang is among the experts who think first-quarter growth could come in at zero or worse.“Based on the seriousness of the economic losses in the first quarter, adjusting and downplaying growth targets would be understandable and acceptable to the people,” he said.张岸元：疫情冲击下的经济、政策与金融市场Very detailed analysis of the coronavirus’ impact on Chinese economy by former NDRC economist Zhang Anyuan. He believes it will be “extremely difficult” for China to achieve the 5% growth goal for 2020 if there is zero growth in Q1. He also said the capital flight out of China in the past years has been “stunning 触目惊心”. His calculation suggests that since 2015 the capital flight not included in China’s official statistics has totaled nearly one trillion USD.The COVID-19 coronavirus and its economic impact (updated 26th Feb.) - Capital EconomicsThe charts on this page track the spread of the virus in China and its economic impact. Most include daily data, which we are updating every working day. This page also contains links to our latest analysis on the impact of the outbreak in China and around the world.Comment: Useful charts, and in a note this morning the analysts wrote:With normal activity taking longer to recover than seemed likely earlier this month, we now think that China's economy will contract outright in year-on-year terms this quarter, for the first time since at least the 1990. The leadership appears to be readying significant stimulus which should restore employment and output by the third quarter, but the hit to output during the first half of the year will still result in much slower annual growth北京日报：全国中小企业的复工率目前只有30%左右China’s Ministry of Industry and Information Technology said in a presser yesterday that the small- and mid-sized companies in China so far have resumed only 30% of their business.China ups measures to support catering, accommodation sectors amid epidemic - XinhuaAs the epidemic has had a great impact on the sectors, the value-added tax will be waived from their revenues, Xian Guoyi, an official with the MOC told a press conference Wednesday.In the meantime, enterprises in the hardest-hit Hubei Province will be exempted from pension, unemployment and work-related injury insurance premiums from February to June this year with a 5-percent electricity price cut, while the payment of the housing accumulation fund will be deferred, Xian said.Caixin: Companies Jump on Coronavirus Bandwagon With $8 Billion of Bond SalesChinese companies have wasted no time taking advantage of a “green channel” created to fast-track bond sales by businesses needing money to fund operations related to the Covid-19 epidemic or who are suffering liquidity pressure stemming from the coronavirus outbreak...A closer look at the details in the bond prospectuses suggests many companies are taking advantage of the “green channel” to get quicker access to cash and at a lower cost...Of the total amount raised, only 22.4% on average is being used to directly support prevention and control activities, with the bulk of the money earmarked for paying down existing debt or supplementing working capital, according to Caixin calculations based on data from Wind Information独家|不是谁都能拿专项再贷款！煤炭、城投等48家企业出局Citing sources, Caixin reported that to prevent moral hazard, the central government had named 48 companies, mostly state-owned enterprises in industries with overcapacity, who will be denied access to the preferential loans issued for “anti-virus” purpose. The article mentioned that some of these companies had tried to get these cheap loans by pretending to produce things like disinfectant and masks.China’s Virus-Hit Airlines Are Showing Signs of Recovery - BloombergScheduled airline capacity within China is up more than 25% -- by 1.3 million seats -- week-on-week thanks to a rebound in domestic capacity, according to OAG Aviation Worldwide. Air China Ltd. appears the most optimistic as it has added back 306,000 seats, almost double its capacity from the previous week, analyst John Grant wroteCoronavirus: China’s legal system ‘will be more lenient’ on private sector | South China Morning Post“If the law allows more lenient measures, [we] should try not to use forceful measures that would limit their personal freedom and property rights,” Zhang Shuyuan, vice-president of the Supreme People’s Court, said during a Wednesday press conference in Beijing.Apple iPhone maker Foxconn taps famed scientist as coronavirus advisor - CNBCNow Foxconn has tapped his expertise in respiratory diseases to serve as a consultant for the firm’s prevention and rehabilitation efforts. In a statement on Tuesday, Foxconn said Zhong Nanshan will give advice and guidance to the company.Air Canada cancels China flights until April amid coronavirus outbreak | NewsAfter announcing last month it was temporarily suspending all direct flights to Beijing and Shanghai until February 29 amidst growing concern surrounding coronavirus, Air Canada said on Tuesday it has extended that timeline until April 10 – a move it said is reflective of “reduced market demand.”Big unknowns for millions as they return to work in China’s economic powerhouse | South China Morning PostFeng Huiqiang, a senior official from provincial health commission of Guangdong, said: “We want to tell people from high-risk areas that they should not rush to return to Guangdong. If they must come back, then they should first stay under quarantine for 14 days. All conferences and sporting activities should be cancelled to prevent people from gathering.“Everyone should follow the guidelines – apart from going to work, don’t go out, don’t gather, don’t dine together, don’t eat wild animals. And don’t be over optimistic.”Coronavirus, trade war a ‘double whammy’ for foreign firms in China, EU chamber boss says | South China Morning PostAfter more than 19 months of uncertainty and difficulties caused by the US-China trade war, the signing of an interim deal to end the conflict on January 15 gave many foreign firms reason to be optimistic. But their hopes were short-lived as the virus outbreak delivered a painful “double whammy”, said Paul Sives, chairman of the southwest branch of the European Union Chamber of Commerce in China...“Some member companies have already moved certain production lines to factories they have elsewhere in the world, to supply the goods that they cannot supply from China,” Sives said.4. Will the propaganda and censorship work?Coronavirus: China tries to contain outbreak of freedom of speech, closing critics’ WeChat accounts | South China Morning PostQin Qianhong, a law professor from Wuhan University, a top-ranking institution in the city that has been the epicentre of the outbreak, said his WeChat account had been disabled since last Wednesday.He said it could be because he raised concerns in his WeChat posts over the extreme lockdown measures imposed on the Hubei provincial capital, and questioned state media reports that praised the sacrifices of Wuhan residents.The Story of Jiangshanjiao (江山娇) – Elephant Room: Make China Relatable12 hours, that was how long I lived, from the moment I was launched on the Chinese Internet to the moment I vanished, along with my younger brother Hongqiman. Our short lifespan was something no one expected; we were born to be something great, something iconic. We were made to be stars, or more accurately, to be idols. We were going to be huge hits; people, especially China’s young generation of patriotic netizens, were going to love us.We had absolutely all the right elements to be loved, or at least, that was what our creator, the Communist Youth League believed. China’s young generation loved the League, which had been known for its agility in catching up with the latest internet trends. On Weibo, my creator had almost 13 million followers, and even a cute nickname, Tuantuan (团团)...But the public reception of our launch took a completely unexpected direction: the League’s Weibo account was flooded with negative comments. People hated us, or more accurately, they hated the fact that the Youth League tried to idolize its own image by creating us. As it turned out, the strategy of personifying a party organization for political purposes didn’t work as well as my smart creator had planned...You see what I am trying to say here? People have noticed. By February 17th, the day of my debut, the Chinese people, at least those who use social media, had been fed up with many of the government’s conducts. They had noticed the authority’s sneaky little tricks in managing this national crisis; the corruption, the irresponsibilities, the inefficiencies, all laid bare like never before thanks to the internet.Coronavirus Weakens China’s Powerful Propaganda Machine - The New York Times“Even if I say that I don’t trust the government, what could I do?” Ms. Lu said. “It seems there’s nothing I can do.”There’s no scientific way to gauge public sentiment in China. But hers is probably a widely shared attitude, and one that the Chinese government wants to nurture.To get there, Beijing has intensified internet censorship in the past few weeks. Social media accounts have been deleted or suspended. Starting Saturday, online platforms will be subject to new regulations that could ensure even tighter limits.Turning on the Kitsch | China Media ProjectIn yesterday’s People’s Daily we can find a consummate piece of kitsch propaganda given position of prominence right below the masthead. The article, “Heroic City, Heroic People,” is an emotional hymn dedicated to front-line medical workers, officials and ordinary people. But the real objective of the article is to underscore the Chinese Communist Party as the enabler of miraculous human feats.Comment: The mask has been ripped off in previous disasters too. Will the outcome be any different this time when it comes to political activism, or will more people just become more cynical and want to emigrate?5. Wuhan governance failings continuing财新：北京新怡家园确诊案例来自武汉, 系刑满释放22日回京A Beijing coronavirus patient is causing a huge scandal. She arrived in Beijing from Wuhan on Feb 22. Caixin reports she made it out of Wuhan despite the lockdown because she was newly released from prison and her family drove her all the way back to their apartment in Beijing. Rumors are swirling that she must have some powerful connections to make it through all the checkpoints between Wuhan and Beijing, and because she lives in a residential area who apartments cost 120,000 RMB per square meter. There has been a massive social media uproar and now there is an official investigation.胡锡进: 希望武汉官方和监狱管理机构及时对此事做出说明Global Times editor-in-chief Hu Xijin demands an explanation from the Wuhan authorities on why the woman was able to make it out of Wuhan and came all the way to Beijing, so not to undermine the public’s confidence in Wuhan’s ability to control the virus spread.How did COVID-19 patient leave Wuhan for Beijing? - Global TimesA confirmed COVID-19 patient returned from Wuhan on Saturday to Beijing, leading to questions over the management of the Wuhan government again two days after it issued a traffic easing policy but retracted it hours later.Such questions against Wuhan government have lurked on Chinese social media for days, as the central government repeated that channels to and out of Wuhan must be strictly controlled to win the battle against the epidemic.The woman, surnamed Huang, was found on Monday in a residential community in Dongcheng district. She came to Beijing from Wuhan on Saturday and underwent inspection right after her arrival, as she had been suffering intermittent fevers and throat pain since February 18 in Wuhan, said the Beijing Center for Diseases Prevention and Control on Wednesday.澎湃新闻：湖北多地继续严控离鄂通道ThePaper reported that local governments in Hubei have ramped up the measures to make sure no one can leave the province. Those temporary entry-exit permits issued earlier have been rescinded.Officials in China's Wuhan Deny Reports of Elderly Care Home Fever Deaths - RFACutting-edge news website Caixin said in a recent report that 11 elderly people had died at the Wuhan Social Welfare Institute from "fevers and respiratory failure."A statement on the official website of the Wuhan municipal cyberspace administration denied the report.Caixin then doubled down and published the names and dates of all of the deaths after a local official threatened to pursue the organization for rumor-mongering, a crime carrying a maximum jail sentence of seven years in China.独家|新冠病毒基因测序溯源：警报是何时拉响的Caixin reported that as many as nine virus samples had been examined by Chinese labs in late December and early January, and the labs had notified the authorities about the new virus. But somehow the government failed to act soon enough, and the Hubei officials tried to block the release of test results.回望2019年12月底至今年1月初的那几天，原本应是决定无数人命运的关键时刻。但彼时，公众对这种病毒日后会引发的后果还浑然不知。一位基因测序公司人士透露，2020年1月1日，他接到湖北省卫健委一位官员电话，通知他武汉如有新冠肺炎的病例样本送检，不能再检；已有的病例样本必须销毁，不能对外透露样本信息，不能对外发布相关论文和相关数据，“如果你们在日后检测到了，一定要向我们报告”。财经：追问卫健委第二批专家：为何没发现“人传人”？One member of the second expert group sent from Beijing in early January to investigate the coronavirus in Wuhan told Caijing magazine they didn’t find enough evidence of human-to-human transmission because the Wuhan Health Commission was hiding the truth from them. The expert group once told the Chinese public the disease is “preventable and controllable”.《财经》：为什么会出现这种情况？专家：他们根本不合作，这是最主要的问题。比如医务人员感染的事，你哪怕报一个医务人员感染，我们也就意识到它有传染性。《财经》：既然有怀疑，为什么没有直接向当地的政府或者医院发问？专家：当时我们讨论的时候，我们让他如实报。卫健委的领导当场就说了，他说，“你们是不是怀疑我瞒报啊？”他公开反问我们，专家组的都在场。他都这么说了我们还能说什么？《财经》：听到这句话，专家组心里是什么感觉？专家：你不应该找我们，你应该找找那个领导层去了解。现在这个卫健委的人已经被免职了。（注：2月10日，湖北省委常委会决定：免去张晋的湖北省卫生健康委员会党组书记职务；免去刘英姿的湖北省卫生健康委员会主任职务；上述两职务，由新到任的湖北省委常委王贺胜兼任。）6. Medical workers on the frontlineWuhan nurses' plea for international medics to help fight coronavirus | The GuardianYingchun Zeng, of the Guangzhou Medical hospital, and Yan Zhen, of the Sun Yet-sen Memorial hospital, also in Guangzhou, published a letter in the medical journal the Lancet on Monday describing mental and physical exhaustion and severe supply shortages on the frontlines of the outbreak...The virus has claimed more than 2,715 lives and infected at least 80,000 people. On Monday, China’s National Health Commission said more than 3,200 health workers had contracted Covid-19, about 90% of those cases in Hubei province. According to tallies of deaths reported in the Chinese media, at least 22 health workers have died from the virus.The letter - Chinese medical staff request international medical assistance in fighting against COVID-19 - The Lancet Global HealthIn addition to the physical exhaustion, we are also suffering psychologically. While we are professional nurses, we are also human. Like everyone else, we feel helplessness, anxiety, and fear. Experienced nurses occasionally find the time to comfort colleagues and try to relieve our anxiety. But even experienced nurses may also cry, possibly because we do not know how long we need to stay here and we are the highest-risk group for COVID-19 infection. So far 1716 Chinese staff [Note: Over 3000 now] have been infected with COVID-19 and nine of them have unfortunately passed away. Due to an extreme shortage of health-care professionals in Wuhan, 14 000 nurses from across China have voluntarily come to Wuhan to support local medical health-care professionals. But we need much more help. We are asking nurses and medical staff from countries around the world to come to China now, to help us in this battle.广东援助湖北武汉医疗队：请柳叶刀撤销文章 澄清事实并道歉The Guangdong medical team in Wuhan soon issued a statement through Southern Metropolis Daily saying the two authors are not part of their team and the article is a “outright misrepresentation”. But this statement has been deleted.Shaved Heads, Adult Diapers: Life as a Nurse in the Coronavirus Outbreak - The New York TimesThe most difficult moment for Ms. Zhang came when her superiors — almost all men — told her and her female colleagues that they “lacked the spirit of devotion” and discipline after they sought help getting pads and tampons.Coronavirus: China not sharing data on medical personnel cases, WHO says - The Washington Post“We received disaggregated information at intervals, though not details about health care workers,” said Tarik Jasaravic, a spokesperson for the Geneva-based organization.The comment, in a Saturday email to The Post, was one of the first instances that the U.N. health agency has directly addressed shortcomings in China’s reporting or handling of the coronavirus crisis.陈一新抗疫这一招的背后寓意是什么？-中国长安网Chen Yixin convenes meeting of alumnae of Wuhan universities and Hubei business representatives to ask them to make donations to help front line medical workersCCTV Evening News on the meeting, no video from inside the meetingComment: I don't remember so many reports about standing committees in such a compressed period of time .7. New Hong Kong budgetSpotlight: HKSAR government's new budget unveils 15-bln-USD measures to ride out economic difficulties - XinhuaFinancial Secretary Paul Chan said in his speech on the 2020-2021 budget that 2019 was "an unsettling year fraught with obstacles" for Hong Kong, while the spread of COVID-19 in 2020 "has dealt a severe blow to economic activities and sentiment in Hong Kong."Chan said Hong Kong's economy contracted by 1.2 percent in 2019, and he forecast full-year growth of between minus 1.5 percent and 0.5 percent in 2020...Chan also announced a payment of 10,000 Hong Kong dollars to each Hong Kong permanent residents aged 18 or above, with a view to encouraging and boosting local consumption on the one hand, and relieving people's financial burden on the other. This measure is expected to benefit about 7 million people.Hong Kong budget: HK$2.7 billion jobs outlay largely aimed at training programmes, employer subsidies | South China Morning PostHong Kong’s newest budget has set aside HK$2.7 billion (US$347 million) to bolster efforts to create and retain jobs amid the economic downturn, with HK$200 million of the amount aimed at the city’s struggling construction sector...The lion’s share of the employee support portion of the budget – HK$2.5 billion – will go toward bolstering existing vocational, innovative and generic skills-training programs for the unemployed and underemployed.Hong Kong police to ramp up manpower by more than 7 per cent with 2,500 new posts in ‘biggest boost since 1997’ | South China Morning PostHong Kong’s police force will ramp up manpower by more than 7 per cent in its biggest boost in decades, with an extra 2,500 posts to cope with operational needs, according to force insiders citing the latest budget address.The figures also showed that police overtime pay and other allowances in the 2019-20 financial year soared to HK$2.5 billion (US$321 million), 10 times the original estimate of HK$256 million.8. US-ChinaWIPO, world don’t need US bullying and interference - Global TimesNext week, the World Intellectual Property Organization (WIPO) will hold an election for its next director general. This was supposed to be a serious but standard matter handled in line with existing regulations and procedures of the agency. But the US, as it has done many times before, is seeking to interfere in the election and bend the agency's 191 other members to its political will and put its economic interests over those of others.After China nominated Wang Binying, who has risen through the ranks to be deputy director general in her 28-year career at the agency, to be the next director general, Washington apparently became paranoid and launched an extensive campaign against Wang's nomination. ..That brings us to the ulterior motives behind the US campaign against Wang's nomination: preserving its fading dominance in trade and technology through political gambits. The US has waged trade wars with not just China but also major economies in Europe and beyond. The US has also put up barriers to disrupt global cooperation in technology.Comment: It will be hugely embarrassing for the US if Wang become the director-general.Break with China? Top Trump aide eyes an opening with coronavirus - POLITICOPeter Navarro, the leading China critic in the Trump administration, is seizing the moment.The White House’s director of trade and manufacturing policy and the administration’s other China hawks are pushing to use the coronavirus crisis to press U.S. companies to end their dependence on foreign suppliers...Navarro also has written memos on the coronavirus that he's circulated to other White House officials, according to an administration official and an official from the National Security Council.The renewed focus on America First for medical manufacturing is a sign of what could become a broader push as multinational companies face the prospect of crippled supply chains as the virus shutters factories around the globe.Chinese naval fleet wraps up far sea exercise deep in Pacific Ocean - China MilitaryA far sea joint training fleet of the Chinese People's Liberation Army (PLA) Navy returned to base after sailing 14,000 nautical miles and crossing the International Date Line deep into the Pacific Ocean for the first time, a move that challenges US hegemony in the open waters and will become increasingly frequent in the future, experts said on Wednesday.US sanction on Chinese firms rebuked as 'long-arm jurisdiction' - Global TimesThe manager of a high-tech Chinese company sanctioned by the US for "helping" Iran's missile program denied on Wednesday that his company sells products to Iranian entities while Chinese observers believed that the US latest move shows Washington has never restrained from bullying practices as it imposed"long-arm jurisdiction"to sanction Chinese firms and exercised hegemonism as China is fighting arduously against the COVID-19 outbreak.China firmly opposes Pompeo's groundless accusation of COVID-19 control: spokesperson - Xinhua"Since Mr. Pompeo talks about freedom of speech so much, would he care to explain why he cursed at an NPR journalist? Why was the journalist denied press credentials to travel with him? Is that Mr. Pompeo's definition of 'freedom of speech'? I think it's typical discourse monopoly and double standards," said a Foreign Ministry spokesperson.China urges U.S. to stop interfering in China's internal affairs under pretext of religion - XinhuaSpokesperson Zhao Lijian made the remarks at a press conference when responding to a question on the words of Sam Brownback, the U.S. ambassador-at-large for International Religious Freedom, slandering China's measures regarding Muslims.Certain people in the United States have repeatedly made wanton accusations and rumors, attempting to undermine China's ethnic harmony and interfere in China's internal affairs under the pretext of religious freedom, Zhao said. "We firmly oppose that."China says Wall Street Journal ‘admitted its mistake’ over ‘sick man of Asia’ headline | South China Morning PostMinistry spokesman Zhao Lijian questioned the paper’s political motives and said it had yet to hold any individuals responsible for the headline, “China is the Real Sick Man of Asia”, on a February 3 column about the novel coronavirus outbreak...“The Wall Street Journal has already admitted its mistake and engaged in self-reflection, so why did Pompeo ignore international public opinion and continuously cheer for this paper, and criticise the Chinese side?” Zhao said.“This makes one wonder, is The Wall Street Journal an agent for the US state department?”不容种族歧视者胡说（钟声）In Wednesday’s People’s Daily Zhong Sheng weighs in on the WSJ's headline. The propaganda organs are really flogging this hardBusiness, Economy and TradeYicai Global - China-led Consortium to Operate Pakistan's First Metro Line Guangzhou Metro Group said it has formed a consortium with two other companies and the trio will take over the operation and maintenance of the Orange Line Metro service, Pakistan's first-ever mass rapid urban transit, for an eight-year term.Out of Stock: Coronavirus in China Threatens Amazon Sellers - WSJ $ Thousands of Online Shopping for Electronics, Apparel, Computers, Books, DVDs & more Inc. sellers who built their businesses using China’s cheap and efficient manufacturers are on the spot as the coronavirus shuts factories there. Sellers say Amazon’s ranking algorithm demotes products that are out of stock. To avoid that painful fate, many are raising prices to slow sales, and attempting to shift production to other countries.BYD electric bus deal one of the biggest for US · TechNode Shenzhen-based BYD will deliver a total of 130 all-electric buses to Los Angeles as part of the city’s initiative to convert its entire public bus fleet to zero-emission vehicles by the start of the 2028 Summer Olympics, the company said in a statement sent to TechNode on Monday. Two of four BYD buses from an earlier deal had already been delivered.Politics and Law...[Message clipped] View entire message