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RT @cpagri_leads: 🇨🇳 Beijing sharpens ag strategy. In H1 2025, China accelerated innovation, confronted escalating trade tensions, and tigh….

11/11. Source: “中信建投：A股继续“上台阶”，关注中报与“反内卷”". Thanks for reading! You can learn more about China’s campaign against involuted competition here:

10/11. “We are optimistic about the subsequent investment opportunities of the two combinations of ‘reverse of a difficult situation’ and ‘expansion of capacity.’”.

9/11. “The intensity of the policy campaign is not enough to shift long-term fundamentals…the pricing of most sectors is expected to return to normal after the heat subsides.”.

8/11. They argue, however, that any adverse impact on A-shares is set to be short-lived, once the negative effects subside, and the anti-involution campaign restores key Chinese industries to sound health.

7/11. Analysts from China Securities expect the release of specific anti-involution policies by various ministries and commissions to be concentrated around September this year.

6/11. “The anti-involution campaign is reflected more in short-term market prices, as a form of supply-side reform,” China Securities analysts write.

5/11. In a recent research note, China Securities (中信建投) argues that the impact of this campaign could have heavy impact on the Chinese A-share market this year, particularly as policy measures intensify in the 4th quarter.

4/11. As a consequence, cracking down on involuted competition is one of Xi’s key economic policy themes for 2025. A dramatic crack down of this nature will no doubt have a major impact on capital markets, especially in a heavily state-directed economy such as China’s.

3/11. Leading economists in China argue that it’s undermining key industries by squeezing out profits and worsening product quality.

2/11. “Involuted competition” refers to market competition deemed to be detrimental to the health of the Chinese economy, involving excessive price cutting and investment in capacity build ups.

1/11. Xi Jinping’s crack down on adverse market competition could roil Chinese stocks. A leading Chinese brokerage expects Beijing’s campaign against “involuted competition” to have a major impact upon the country’s A-share market in the second half of 2025 (🧵):

8/8. Read the briefing for free and in full right here:

7/8. Third - in seeming contradiction to the second - is the intensification of domestic market competition, creating a nation-sized crucible for the forging of globally competitive Chinese companies.

6/8. The second is bringing an end to "involuted competition" - the excessive price and investment-driven competition that Chinese economists believe is ruining domestic industry by sapping it of profits.

5/8. First on the list is the optimisation of China's ability to allocate resources and factors of production - the indispensable inputs for the process of economic production.

4/8. They expect the grand unified market policy to boost China's economic growth across several fronts.

3/8. His economic advisors hope the move can help to overcome the secular headwinds of aging demographics and a dwindling working age population, alongside the declining effectiveness of an outmoded investment-driven development strategy.

2/8. Xi Jinping has issued another call for the transformation of China into a “grand unified market,” as an essential means of dealing with its besetting economic challenges.