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Asian Development Bank President Takehiko Nakao on US-China dispute, benefits of open trade

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Countries around the world have benefited from open trade and investment and they should now put in their “utmost effort” to maintain and strengthen that system, according to Takehiko Nakao, president of the Asian Development Bank.

Nakao’s comments came as officials from the U.S. and China convene in Beijing to iron out their trade tensions — a meeting that’s widely watched by investors globally.

“Open trade and investment regime is so important, we should continue to have our utmost effort to maintain and strengthen the system,” Nakao told CNBC’s Oriel Morrison at an ADB meeting in Manila in the Philippines.

He added that trade over the past year has been responsible for lifting growth in many countries, some of which weren’t growing before picking up again recently. The U.S. is among those that benefited, although the Trump administration has been arguing against free trade, which it blames for hurting American workers and companies.

Nakao acknowledged that some workers may have been sidelined in an open trade system. But governments should address that, and it shouldn’t come at the expense of free trade, he added.

“What is the most important is to look at the benefit side of trade and we should keep and strengthen open trade and investment system, although we must address those issues on workers,” he said.

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U.S. reports more than 83,000 coronavirus cases, record daily total, as experts warn of difficult winter

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Chinese fintech giant Lufax seeks up to $2.36 billion in U.S. IPO

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A logo of of Lufax website Lu.com, is seen at the company’s headquaters on May 28, 2020 in Shanghai, China.

Wu Jun | Visual China Group | Getty Images

GUANGZHOU, China — Chinese lending and wealth management firm Lufax is seeking up to $2.36 billion from a U.S. initial public offering (IPO).

Earlier this month, the Shanghai-headquartered firm, which is backed by financial giant Ping An Group, said it planned to list on the New York Stock Exchange under the ticker “LU.”

It has now released details on pricing. Lufax said it will issue 175,000,000 American depositary shares (ADS) which will be priced between $11.50 and $13.50 per share.

At the top end of the range, Lufax’s offering would be valued at $2.36 billion.

Chinese technology companies have been looking to take advantage of a rebound in stock markets to go public, including on Wall Street, despite the geopolitical tensions between the U.S. and China. 

Electric carmakers Xpeng Motors and Li Auto both went public in the U.S. earlier this year

Lufax’s New York listing comes as rising tensions between the U.S. and China threaten American-listed Chinese firms. Lawmakers in Washington are pushing for greater scrutiny of Chinese companies through proposed legislation that threatens to delist some firms in the U.S. 

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Huawei’s growth slows sharply as U.S. sanctions bite

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GUANGZHOU, China — Huawei’s revenue growth slowed sharply in the third quarter while its margin dipped as U.S. sanctions disrupt its business.

Revenue for the September quarter came in at 217.3 billion yuan ($31.91 billion), up just 3.7% from the 209.5 billion yuan recorded in the same period last year.

For the first nine months of the year, revenue totaled 671.3 billion yuan ($98.57 billion), up 9.9% from the 610.8 billion yuan reported in the same period last year. That is a significant slowdown in growth. In the first nine months of 2019, Huawei’s revenue growth was 24.4%

Meanwhile, Huawei’s net profit margin was 8% for the first nine months of the year, down from 8.7% in the same period last year.

Washington’s sanctions are clearly hurting the Chinese technology giant. Last year, Huawei was put on a U.S. export blacklist known as the Entity List. Google cut ties with Huawei meaning the Chinese firm’s smartphones could no longer use licensed Android mobile operating system software. That has hurt Huawei’s smartphone sales outside of China, while its domestic market has thrived.

Huawei did not release a breakdown of what parts of its business contributed to revenue growth. Earlier this year, Huawei said that its consumer business, which includes its smartphones, was responsible for nearly all of the $12 billion shortfall in revenue it saw in 2019 versus its own targets.

For the first three quarters of 2020, Huawei said the results “basically met expectations.”

“As the world grapples with COVID-19, Huawei’s global supply chain was put under intense pressure and its production and operations saw increasing difficulties,” the company said in a press release.

“During the release, the company stated it would do its best to find solutions, to survive and forge forward, and to fulfill its obligations to customers and suppliers.”

Huawei is now facing even greater challenges. Earlier this year, Washington slapped further sanctions on Huawei which has threatened to cut off supplies of semiconductors from its main supplier TSMC. This could cripple its smartphone business, analysts previously told CNBC. Huawei has very few options to get around these sanctions.

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