China economy

China financial news service shuts down, ‘sorry’ for unspecified mistakes

Service suspended without explanation but US-China trade war may be to blame

PUBLISHED : Tuesday, 11 September, 2018, 7:00pm
UPDATED : Tuesday, 11 September, 2018, 7:00pm

The economic and financial news channel of Nasdaq-listed NetEase, one of China’s leading internet portals, stopped updating its content from noon on Tuesday for “rectification” of unspecified mistakes.

In a statement on its website and its mobile app, which had the style of a public self-criticism letter, the company did not explain what mistakes had been made.

The decision to close the sometimes outspoken news service comes at a time when Beijing is trying to maintain an upbeat economic narrative to ensure confidence in the economy and prevent further deterioration in financial markets.

NetEase said only that it had encountered “serious problems” and the firm, with a market value of US$24.7 billion, had conducted “in-depth and comprehensive reflections” and decided to close down the channel for an undisclosed period of time.

The suspension of service is intended to “maintain order in cyberspace communications” and “create a clean and tidy cyberspace” – phrases that come directly from a speech by Chinese President Xi Jinping in April 2016 and which have since become overriding policy principles for Beijing’s tighter control of the internet.

The statement was published at 11.54am, six minutes before the suspension started. The vagueness of the statement triggered wild guesses about what the channel has done to anger Chinese censors.

Phone calls to the public relations office of NetEase went unanswered.

A source close to the firm’s operation team said the channel’s loud and persistent appeal for a deeper cut in personal income taxes may have crossed the line for Beijing.

China tax cut finalised but leaves many unimpressed

When China’s largely ceremonial legislature started to solicit public views to amend China’s personal income tax law, the channel published a petition letter in the name of its own “NetEase research bureau”, saying China should raise the monthly personal income tax threshold to 10,000 yuan (US$1,450) from the previous 3,500 yuan.

The legislature did not heed the NetEase appeal, instead raising the threshold to 5,000 yuan a month. After the law’s passage, the channel published another opinion piece by an outspoken academic, saying the new threshold did not reflect public opinion.

A source from another mainland internet portal, which receives instructions from Chinese censors, said the harsh punishment over NetEase’s financial and economic news coverage may be linked to an ongoing campaign by Beijing to stabilise confidence in China’s economic prospects amid an escalating trade war with the United States.

“Trade war is the likely reason,” said the source, who declined to be named. “We’ve received warnings about trade war coverage.”

Beijing seeks to avoid ‘black swan’ financial market disruptions as trade war fears rise

China has previously told its journalists to play down negative impact of the US-China trade war and banned them from linking the trade war with financial market turmoil, from stock market declines to depreciation in the value of the yuan.

Government officials and state media outlets are sending a consistent message that China can successfully manage any fallout from the trade war. China’s top leadership has listed “stabilising expectations” as a key priority in its management of the economy.

In the latest meeting of the Financial Stability and Development Committee, the agency coordinating financial regulation chaired by Vice-Premier Liu He, China’s top financial officials pledged to ensure stability in stocks, bonds and foreign exchange markets, and to avoid any “black swan” disruptions.

NetEase had been pulling analysis and views from social media platforms in its financial news, with many articles detailing the possible harm China could suffer from the trade war.

In the statement on Tuesday, NetEase said it would bear its “social responsibilities in mind” in future.

A third source, who is close to China’s cyberspace administration, said NetEase was punished because it organised a big economics conference but did not let the censors know beforehand.

China launches Piyao platform to crack down on online ‘rumours’

The Cyberspace Administration of China, the internet regulator, has not published any notice about the suspension of NetEase’s financial channel.

But it was not the first time China’s censors have punished NetEase. In April, the company removed its news app from app stores for one week, saying it had “damaged the order in communications in cyberspace”.

The cyberspace watchdog has stepped up its intervention in the internet, from routinely deleting day-to-day posts to wholesale blockages of popular channels and apps that may have millions or even hundreds of millions of users.

In April, a popular parody and jokes app developed by Beijing-based news and information platform Jinri Toutiao was shut down permanently over allegations of vulgarity.

Zhang Yiming, chief executive of Jinri Toutiao, issued a letter of self-criticism and the firm hired thousands of in-house censors to ensure its content meets the government’s decency standards.