TheChek News Flow

Gulf states tap cheap Chinese batteries to power renewable ambitions

Storage systems are seen as crucial to integrating solar and wind into electrical grids

Saudi Arabia and the United Arab Emirates are taking advantage of falling prices to load up on Chinese-made battery energy storage systems, so they can boost their renewable energy ambitions.

Battery storage systems are seen as crucial to integrating solar and wind energy into electrical grids. The systems soak up excess power that can be released back into the system when renewable energy is not available — for example at night — and are one of the fastest-growing uses for batteries.

Oil-rich Saudi Arabia and the UAE had been slower to develop renewables than many countries that have to import energy. Saudi Arabia still burns oil to generate electricity, which accounted for just under half its power-generating capacity in 2023, according to BloombergNEF. The International Energy Agency’s latest data shows that the Middle East region accounts for 13 per cent of the world’s fossil fuel investments, but contributes just 2 per cent of those in clean energy. 

However, the two Gulf nations have stepped up construction of solar power plants in recent years, eyeing an opportunity to export more fossil fuels and ease their reliance on imported gas. Riyadh has set itself an ambitious target of 50 per cent of energy use to come from renewables by 2030, while the UAE is aiming for a more modest 44 per cent from clean energy by 2050. Both will require battery energy storage to support their renewables targets, experts say. 

Rystad Energy expects Saudi Arabia’s battery energy storage capacity to surpass 11 gigawatt hours (GWh) by the end of the year, from zero at the start of 2024. According to the consultancy, Saudi Arabia plans to have the world’s fifth-largest utility-scale battery storage capacity, after China, the US, Australia and the UK. 

Meanwhile, the UAE has launched a “gigascale” solar and battery project in Abu Dhabi, which is planned to provide baseload energy 24 hours a day. The plant will have a 19GWh battery storage system, and is a partnership between utility Emirates Water and Electricity Company and renewables group Masdar. Abdulaziz Alobaidli, Masdar’s chief operating officer, says it is the company’s “largest and most ambitious project to date”.  

The latest advances in Chinese battery technology have made the systems better suited for deployment in the Gulf’s harsh conditions, experts say, with the batteries now housed in containers that can be cooled and protected from dust. 

“First it was solar technology to change. That’s got so much cheaper,” says Dave Jones, director of global insights at think-tank Ember. “And now the battery technology has actually improved in itself.” 

Jones says battery units produced in China have improved “by an order of magnitude” over the past two years, and there has been a “remarkable fall” in price thanks to factors such as a greater supply of crucial element lithium than had been previously anticipated. 

Battery cell prices fell to an “unsustainably low level” in 2024, of $50 per kilowatt hour, according to industry think-tank Volta Foundation. These rock bottom prices made competition ever fiercer and discouraged investment, Volta says. With China dominating the supply chain, it drove some companies to diversify overseas, where they could command higher profit margins.

But for Saudi Arabia, cratering battery prices have been a boon. Rystad estimates the cost of installing battery energy storage is far lower than in Europe or the US, because Chinese suppliers charge less and workers are paid less. While building a kilowatt-hour’s worth of battery energy storage in Europe or the US costs about $250, Rystad estimates in Saudi Arabia it is less than $200.

Chinese battery maker BYD, whose electric vehicles are popular in the region, dominates the market in Saudi Arabia. It supplied the equipment for what is said to be the world’s “largest single-phase grid-connected energy storage project” in Bisha, in Saudi’s Asir region. The 2.6GWh project connected to Saudi’s grid early this year. BYD has also signed a contract with the Saudi Electricity Company for a 12.5GWh energy storage project. 

Marek Kubik, director of energy storage at Saudi’s Neom megaproject, estimates the Bisha project “could supply over 90,000 US homes for a whole day off one single charge”.

Meanwhile, technology for Abu Dhabi’s round-the-clock solar and battery project will be provided by Chinese battery maker CATL, whose listing in Hong Kong in May was the world’s biggest so far this year. Kuwait’s sovereign wealth fund was among the cornerstone investors.

Europe’s air defence dilemma: can Franco-Italian system rival US Patriot?

New SAMP-T system on display at Paris Air Show seeks buyers amid Europe’s efforts to re-arm

France and Italy are wooing potential buyers of their new joint air defence system at this week’s Paris Air Show, in an effort to convince European armies to reduce their reliance on US weaponry.

European missile champion MBDA, French defence group Thales and Italy’s Leonardo are casting their new generation SAMP-T surface-to-air weapon system as a viable alternative to the best-selling US Patriot. 

With first deliveries expected next year, the commercial performance of the SAMP-T NG will be a litmus test of Europe’s resolve in manufacturing and buying more of its own weapons as it re-arms to face the Russian threat. 

But the Franco-Italian pitch may be an uphill struggle since the older model was not as good as the Patriot, and many countries already have the US system installed.

One factor playing in their favour: the geopolitical shifts triggered by the Trump administration.

Donald Trump’s cold shoulder to Europe has prompted even staunch Atlanticists such as Germany and Poland to question whether the US president is still a reliable ally. 

“It always used to be a safe buy if you bought American,” said Douglas Barrie, senior fellow for military aerospace at the International Institute for Strategic Studies. But now “if you are an American defence contractor you will be aware [that geopolitics] . . . make your sales pitch that little bit harder”. 

In a sign of the SAMP-T NG’s strategic importance, the French and Italian defence ministers on Wednesday are scheduled to jointly visit the stand where the weapon is on display. Last year, the pair also wrote a letter to their European peers to vaunt the system’s advantages compared with the Patriot.

French President Emmanuel Macron and European Commission president Ursula von der Leyen have argued that the region needs to be more self-sufficient, but it remains to be seen whether this will curb decades of reliance on US-made equipment. 

Europe’s lack of domestic air and missile defence capabilities has come into sharp focus since the start of the war in Ukraine. Nato secretary-general Mark Rutte has estimated that about four times more systems are needed than the alliance has today.

MBDA, Thales, and Leonardo are eager to be part of the rearmament push. 

Usually mounted on a truck, the SAMP-T NG uses precise radars to target and fire long-range missiles that can shoot down aircraft, cruise missiles and ballistic missiles, at a distance of more than 150km. It can fire up to 48 Aster missiles, which are manufactured by MBDA and battle tested in Yemen and Ukraine.

The original version of the SAMP-T that debuted in 2010 got little traction as so many countries were already locked into the American system. The first SAMP-T was only bought by France and Italy, while a marine variant was also bought by them and the UK Royal Navy. Only 23 in total were produced.

Ukrainian forces have reported subpar results from the original SAMP-T, including targeting issues and its inability to intercept Russian ballistic missiles. Patriot, by contrast, has been crucial in defending Kyiv and other cities from Russia’s aerial attacks.

For those reasons, some experts believe that the US model will continue to be the market leader. But backers of the SAMP-T NG claim that the new version matches the Patriot, while being cheaper to operate since it requires less manpower and is easier to transport. 

Eric Beranger, the chief executive of MBDA, said he was convinced the SAMP-T NG would have better commercial prospects than its predecessor. “Air defence is indeed now a very, very key concern for a number of countries. We have countries who are interested,” he told the Financial Times this spring.

The French and Italian armies will be the first customers, receiving the SAMP-T NG starting next year.

Denmark and Belgium were both evaluating the SAMP-T NG versus the Patriot in ongoing procurement processes, said people familiar with the matter. For Belgium, it would be the first time it has bought air defence systems in years, so an official said the process could take several years given that its expertise was “almost zero”. 

But the current rightwing Belgian government has pledged to follow its neighbour, the Netherlands, which has committed to buying more Patriots — although no final decision has been taken yet.

Other countries such as Greece, Saudi Arabia, and Brazil may also look at the Franco-Italian model when their existing Patriot systems will require an upgrade, although that would be years off. 

“Today the decision to buy Patriot or SAMP-T is more political than qualitative,” said Michel Yakovleff, a former general in the French army who also served at Nato.

“Among European countries, there is simply a lack of dedication to buying European.”

Many European countries buy American in an implicit bargain that they will continue to benefit from the US security umbrella. The US government does play an active role in cajoling purchases from European countries, which are all too aware of the importance of having access to America’s extensive intelligence and surveillance network. 

Europe remains divided on the strategy for air defences, although all agree much more investment is needed. Those rifts were on stark display when Germany spearheaded the creation of Sky Shield in 2022, a buying club for countries to jointly order Patriot, and Israeli and German systems. Some 25 countries have since joined, although only a few have put in orders. 

Macron has vehemently opposed Sky Shield since it excluded the SAMP-T, and would lock European countries into the Patriot for decades to come.

“The US is a historical ally, but at a certain point they will put their interests first,” Macron told the FT this year. “Do you think they will have enough Patriots for other customers then? Well, that’s why it’s good we have the new SAMP-T NG — and it is better than the Patriot.” 

Justin Bronk, an expert on air power at the Royal United Services Institute, said it was “more likely” that the SAMP-T NG would be “selected over Patriot than in previous” tenders given the focus among European governments on boosting sovereign resilience.

A shortage of Patriot interceptor missiles, the PAC-2 and the PAC-3, which have mostly been funnelled to Ukraine, was another factor in considering the Franco-Italian option, Bronk said. 

Raytheon, maker of the Patriot system together with Lockheed Martin, told the FT that the company continued to “invest to increase production”. Tom Laliberty, president of land and air defence systems at Raytheon, said that by the end of this year the company would have “accelerated delivery times for Patriot radars by 25 per cent”. 

Bronk added that it would also help the SAMP-T NG’s chances if Europe were able to “up its game and deliver” faster manufacturing, although this would “require more aggressive investment in production”.

The European Commission has spearheaded several initiatives on how to expand investment in the arms sector, including by offering governments more funding, relaxing fiscal rules for defence spending and offering to pool orders to scale up production.

The defence contractors behind the SAMP-T said they will be able to keep up, if the demand comes. At a factory in Limours, south of Paris, Thales has multiplied its production of its radars by three to respond to strong demand.

Hervé Dammann, who heads land and air systems at Thales said: “Give us more orders, we have already proven our ability to ramp up, and are ready to do even more.”

President of US manufacturer argues small modular reactors can solve energy transition challenges

The world cannot meet climate targets and ensure reliable power supplies without the rapid deployment of nuclear energy, according to the president of Holtec International, a US company developing small modular reactors (SMRs) and reopening a large-scale nuclear plant in Michigan.

Kelly Trice says nuclear energy will be “indispensable” if countries are to meet the Paris Accord — the international treaty on climate change — because it provides the type of round-the-clock power needed to stabilise national grids at a time when electricity demand is surging.

He adds that intermittent power sources such as wind and solar on their own cannot meet the demands of artificial intelligence data centres and electric cars without the backup of nuclear, which is carbon-free and provides so-called baseload power — the minimum amount needed to meet demand at all times.

“Spain had the two-day blackout. A lot of people ascribe that to the over reliance on wind and solar, as well as the instability of the grid, as a result of the ups and downs of that kind of [renewable] power,” Trice says. “The demand for power is insatiable and the result is, you don’t have a choice. Nuclear is a very viable, strong component and is indispensable, as baseload power stabilises the grid.”

Trice says SMRs, new types of reactors with a typical power capacity of 300MW or less, would help solve some of the difficult transition challenges facing governments and industry. Extending the lifespan of existing reactors and restarting mothballed ones could also help to meet surging demand, he says.

Until recently, demand for nuclear energy in western countries had flatlined because of safety concerns following the Fukushima nuclear accident in Japan in 2011, the growth in renewable energy and the rollout of natural gas power plants. But a surge in power demand from data centres, reshoring of manufacturing and electrification of transport — which is forecast to increase electricity demand in the US by 50 per cent by 2050 — and Big Tech’s commitment to cut emissions, are fuelling a nuclear investment boom. 

Energy security, which moved centre stage following Russia’s full-scale invasion of Ukraine in 2022, and technology advances have also helped to rejuvenate a sector that investors had previously shunned because of delays and cost overruns on mega projects. As the US and China compete aggressively to dominate AI technologies, presidents Donald Trump and Xi Jinping are providing industry with tens of billions of dollars in government support to build additional capacity.

In September, Holtec was awarded a $1.5bn federal loan to help fund the restart of the Palisades nuclear power plant in Michigan, which was mothballed in 2022. If it is successful, it will mark the first time a nuclear power plant in the US has been restarted after being shut down for decommissioning.

“We are on schedule and under budget,” says Trice, adding that the Palisades plant should reopen in the fourth quarter of 2025 following repairs to equipment, safety checks and regulatory approval. 

He says reopening existing nuclear plants and extending their lifespan is much cheaper than building new facilities, and that Palisades has a total budgeted cost of $2.2bn. The project should come in under budget by several hundred million dollars, says Trice, adding that Holtec plans to place two SMRs at Palisades, which should almost double its 800MW capacity.

Holtec is one of dozens of companies developing more than 80 different SMR designs globally. As these reactors are modular, it means most of their components can be built in factories and assembled on site. So far China and Russia have built a handful of SMRs and the first western designs are expected to be deployed by 2030.

Nuclear advocates expect the smaller scale and more advanced technology in SMRs to reduce the risk of budget overruns and delays, which have blighted large-scale nuclear projects in recent years.  

The last two large-scale nuclear reactors built in the US, at the Vogtle power plant in Georgia, were completed seven years late and $17bn over budget. In Britain, EDF’s Hinkley Point nuclear power plant project is forecast to cost £46bn, up from an initial estimate of £18bn.

Holtec’s SMR-300 design is a pressurised light-water reactor that will produce at least 300MW of electric power on a small parcel of land. Unlike most traditional nuclear power plants that require large quantities of water, the SMR-300 can be adjusted to use an air-cooling system to produce reliable heat and power in arid environments.

The company plans to start construction of its first SMRs at its plant in Camden, New Jersey, later this year, says Trice, adding that it has plans to build fleets of SMRs in the US, Europe and Asia.

Holtec, which is a private company that specialises in nuclear fuel storage, transport and decommissioning, still faces a significant financing challenge to realise its ambition of deploying a global fleet of SMRs. Trice says the company is in advanced negotiations with International Holdings Company, an Abu Dhabi-based investment fund, over a potential $10bn fundraising.  

“The deal is in serious negotiations. We intend to do it and I believe we will consummate the deal before the year is out,” Trice says.

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Welsh biotech wins funding to develop new depression treatments

$140mn financing will allow Draig Therapeutics to move drug candidates into clinical trials

A biotech company founded in Wales last year has raised $140mn in its first financing round to develop drugs for severe depression and other brain disorders that have few safe and effective treatment options.

Draig Therapeutics, named from the Welsh word for dragon, was formed by a partnership between Cardiff University’s Medicines Discovery Institute and venture capital firm SV Health Investors. Five other investment funds joined the oversubscribed Series A round.

The funding will enable Draig to move its lead drug candidate DT-101 into the second phase of clinical testing for major depressive disorder this year. The compound, which is a small molecule taken orally, has already completed Phase 1 safety testing in 60 volunteers. Two more Draig drug candidates are due to move into clinical studies in 2026.

“It is incredibly unusual to have scientists in academia building up a clinical stage pipeline of such high quality,” said Kate Bingham, SV Health managing partner. It is notable too that Draig comes from outside the “golden triangle” of Oxford, Cambridge and London where most biotech start-ups are located, she added.

Ruth McKernan, neuroscientist and biotech entrepreneur, is Draig’s co-founder and executive chair. She said the company’s approach was to correct the imbalance between neurotransmitters that excite and inhibit brain activity — a fundamental cause of depression and other psychiatric disorders.

Draig’s scientists, led by professors John Atack and Simon Ward, have designed new molecules to modulate two key neurotransmitters, glutamate and gamma-aminobutyric acid (gaba). DT-101 rebalances brain activity by targeting a specific site on nerve cells.

The company plans to recruit around 300 people with major depression for the phase 2 trial of DT-101, which is due to start this year, and to provide a first readout of clinical data in 2027.

“It is a global study including the UK,” said McKernan.

An important tool in Draig’s research is magnetoencephalography (Meg), a relatively new non-invasive imaging technology that measures magnetic fields created by electrical activity in the brain.

“Meg is quite an advantage, because you can get a sense of what is going wrong in the brain — is it overexcited? is it over-inhibited? — through a functional measurement,” said Bingham.

According to the Brain Health Atlas, depression is among the world’s top causes of poor health, affecting 330mn people — an 89 per cent rise on 1990. Existing drugs, particularly the selective serotonin reuptake inhibitors most frequently prescribed for major depression, have limited efficacy, are slow to act and can have adverse side effects.

Although the pharmaceutical industry is giving depression more attention after many years of neglect, including new treatments based on ketamine and psychedelic drugs, Draig’s investors are backing its more traditional approach to medicinal chemistry.

The five other funds that joined the round are Access Biotechnology, Canaan Partners, SR One, Sanofi Ventures, Schroders Capital and ICG.

Some people in European life sciences lament the fact that US investors dominate the funding of many of the region’s start-ups, which then go on to IPO on the Nasdaq in New York. US-based funds contributed most of Draig’s Series A funding, but Bingham said that did not worry her.

“I think raising money in the States but building them here is just fine because we’re miles away from being able to compete with Nasdaq,” she said. “The way we keep them as UK companies is to capitalise them properly.”

Can AI tell us how much art is really worth?

New businesses such as Appraisal Bureau are bringing greater efficiency to buying art

Forget the old-school charms of the BBC’s Antiques Roadshow. Art valuations today are more likely to rely on artificial intelligence to help close the gap between educated guesswork and reality — as much as this mysterious market will allow.

“We are using AI for efficiency. It can process millions of data points instantly, then sort, clean and label the information. It is not ‘ask ChatGPT the value of my art’,” says Caroline Taylor, founder of Appraisal Bureau, a young business headquartered in New York.

Valuing art has long been an inexact business, but it supports industries including insurance, banking and the tax authorities. Insurers and firms that lend against art often stipulate annual valuations, generally conducted on site, while in the US, the Internal Revenue Service requires a qualified appraisal for collectibles worth more than $5,000 to claim generous charitable relief. Lawsuits, notably last year’s failed $377mn damages claim by Russian billionaire Dmitry Rybolovlev against Sotheby’s, often call on appraisers as expert witnesses. 

“Getting updated valuations is a big headache, collectors just dread it,” says Taylor, a qualified appraiser who previously worked as a private art adviser. She recalls, “I hired one of the big appraisal firms for a client, the process took two and half months, and it cost about $3,000 for a PDF with some auction comps [comparisons to auction prices].” In some cases, Taylor says, reports “were based on only one data source”. Her processes now involve 20 what she calls “ingestion points”, ranging from gallery exhibitions to wider economic indicators, each of which has “millions of data points behind it”.

Appraisal Bureau, which launched in 2021, is gaining ground in the art market. This is as much because of its independence as its technology (unlike other valuation firms, it doesn’t run any art-adjacent businesses such as advisory, lending or sales). “A standalone appraisal company that leverages AI is providing welcome transparency and neutrality to the art market,” says Rebecca Fine, CEO of Athena Art Finance, an independent speciality art lender. 

This month, Appraisal Bureau’s platform will go live with an automated valuation service for collectors. Early adopters include the investment firms Oaktree Capital and Hivemind Capital Partners — the latter runs a fund for digital art, something that Taylor welcomes. “We still have quite a few clients that are NFT [non fungible token] funds, despite what’s happened in those markets.” Here, though, misinformation abounds. Hivemind’s “One One Overflow” (2022), an NFT by Texas generative artist Tyler Hobbs that looks like a broken TV screen, has a “top offer” on the NFT marketplace OpenSea of 0.008 WETH (about $21) — such prices can be posted by anyone, including bots, Taylor says — versus Appraisal Bureau’s six-figure valuation. 

The NFT phenomenon has proved an inspiration to the business. “We look at them to inform how we handle data,” Taylor says. “NFTs have labelled traits that make valuations much easier than for fine art. All the data is on the blockchain, it’s already structured, so on our pipeline we structure fine art in the same way.” She gives an example: “We create labels, like Rashid Johnson ‘Anxious Red’ works sell for better prices than his ‘Blue’ [versions].” 

Other dynamics chime with the shifting demographics of today’s scene. “If you look at the collectible market now, there is more buying at lower levels, which is harder to quantify,” says Charlie Horrell, head of fine art and luxury brands at Marsh Insurance. He finds too that digital art and NFTs are increasingly in the mix — Marsh was the first broker to place a pure NFT policy in the market, he says — while today’s fluctuating market requires more regular revaluations. Overall, he says, “AI gives a clearer idea of insurable value.”

Traditional appraisal firms are also taking note. “When I value a painting, which I do several times a day, I look at the picture, then go on to a database to find other similar works. They won’t be exactly the same, and won’t have sold five days ago, so you have to adjust accordingly, take into account things like different dimensions and the market backdrop. All of this can be sped up by AI,” says Harry Smith, executive chair of Gurr Johns, and an expert witness in the Rybolovlev vs Sotheby’s suit. Smith’s business recently launched a machine-learning-based collections management tool, called Art Metadata, which supplies users with information relevant to their works.

Smith emphasises, though, that once the AI has pooled the data, “the next stage, when looking at the relative quality of one work versus another, has to be done by a specialist. Final judgment requires an expert.” Taylor’s firm also uses qualified appraisers to oversee results. For example, she says, if the data includes a reported sale price from an art fair, “we check with the gallery.”

All the same, AI’s accuracy has vastly improved in just a few years, says Alessandro De Stasio, founder and CEO of online sales and collections management platform Artscapy, which uses an AI-based methodology to offer services including valuations and loans. He compared sales prices from the platform against their AI valuations and found that the machine’s value was correct about 65 per cent of the time in 2022, a year after he launched the business. By 2023 accuracy was at 75 per cent, he reports, and since 2024 this has hit 85 per cent. “The incremental percentage is the one that is increasingly hard to fill with the current models. However, I can see this closing within 18 months,” De Stasio says.

There are, meanwhile, varied valuations in this complicated market. “Retail replacement” is the replacement value of a work (including metrics such as auction house fees) and is generally used by insurers. “Fair market value” represents what a dealer would pay today for a work, and the difference between the two can be as much as 40 per cent, experts say. Auction house estimates, which can look like valuations, are more likely the result of intense negotiations with consignors and can be set deliberately low, for example to encourage bidding. Legal situations sparked by divorce or probate can also affect the preferred levels of pricing.

While precise values might always remain an art, AI’s proponents believe that improving efficiencies and liquidity could help drag the art market’s mechanisms into the 21st century. “AI means we can offer valuations and appraisals at a fraction of the cost and is giving us back a lot of time,” De Stasio says.

For now, though, Smith believes old-school valuation still has its place. “AI is going to make our businesses better, but we are not all out of a job.”

Data sets back hopes that struggling market could stabilise this year

Just days after Premier Li Qiang called for “greater efforts” to halt a decline in China’s housing market, fresh data on Monday laid out why the country’s top leadership still has such cause for concern.

New home prices across 70 Chinese cities fell 0.2 per cent in May from the previous month, while those of second-hand homes declined 0.5 per cent, according to a Financial Times analysis — the fastest pace of decline in seven and eight months respectively.

Real estate investment was also down 10.7 per cent in the first five months of 2025, the data showed.

Years after Chinese home prices started to fall following a series of developer implosions, the prospect of a stabilisation remains in doubt, piling pressure on policymakers as they contend with a weaker economic backdrop.

“A nationwide turnaround looks a distance away,” said Louise Loo, lead economist at Oxford Economics.

Sentiment was buoyed earlier this year by data showing a moderation in falls, and month-on-month growth in prices in tier 1 cities, in a period after Beijing unleashed a series of supportive measures in September.

But any sense of improvement stalled in May, despite a trade war truce with the US.

“Even the primary prices started to see some weakness,” said Karl Choi, head of Greater China real estate research at Bank of America, of the May figures. “That was a bit of a difference from the last few months, when primary prices were relatively stable.”

The setback comes despite numerous government efforts to support the market, including mortgage rate cuts, funds to complete unfinished residential projects and plans to convert unused homes into social housing.

Housing prices are typically measured through sales of new homes, reflecting China’s rapid pace of urbanisation. But the secondary home market was “a more definitive gauge of sentiment, given looser price controls”, said Loo, who noted that second-hand prices were flat or rose in just three of 70 cities tracked by the National Bureau of Statistics in May.

The property market was “still searching for a bottom”, said Jian Chang, chief China economist at Barclays, pointing to recent declines in secondary market prices in big cities following “some stabilisation in March”.

Top cities, where housing is still expensive, have scrapped purchase restrictions to try to restore confidence, with the latest announcement coming from Guangzhou last week. Monthly price changes for new homes in tier-one cities turned negative in May for the first time this year, and fell sharply for second-hand homes.

Other indicators paint a less gloomy picture. Prices are falling less steeply on a year-to-year basis, with new home prices declining 4.1 per cent in May compared with more than 6 per cent in October.

Michelle Kwok, head of Asia real estate research at HSBC, suggested that “things have already started to turn” from the depths of the now four-year crisis. “Big cities are leading the recovery,” she said.

Most economists had not anticipated a return to rising prices for some time, even before the added setback of a full-blown trade war with the US.

“Stabilisation, much less recovery, is not expected in 2025,” said Yuhan Zhang, principal economist at the Conference Board’s China Center. He added that “oversupply remains a serious challenge”, though he noted that inventory levels were expected to rise less quickly than last year.

John Lam, property analyst at UBS, said uncertainty around tariffs had delayed a recovery in tier-one cities in April but stabilisation might still be possible in the fourth quarter. Yi Wang, a Goldman Sachs property analyst, said she did not expect spot prices in the primary or secondary markets to stabilise until the second half of next year.

Further afield, the nationwide picture poses an acute challenge to policymakers. Goldman Sachs on Monday forecast that urban demand for new properties would remain below 5mn units per year in the coming years, down from a peak of 20mn in 2017.

Han Jun, who runs a trade advisory business in the textile manufacturing capital of Keqiao in coastal Zhejiang province, said last month that local housing prices had fallen about one-third from their peak. “They keep going down, and it doesn’t look like it’s turning around,” he said.

Li, in comments that were read out on state broadcaster CCTV, called on policymakers to “focus on the long term”.

But if there are still doubts over China’s richest cities, the recovery remains even more uncertain outside of them.

“We go as far as saying, just write off the lower tier,” said Kwok at HSBC. “We just have to accept that it’s not going to be a ‘rising tide lifts all boats’ coming out of this crisis.”