The Sinocism China Newsletter 03.20.17-The Calm Before The Storm In US-China Relations?

AnchorTHE ESSENTIAL EIGHT *

1. Commentary: Cooperation the correct choice for China-U.S. relations – Xinhua China-U.S. relations seem to have found a good rhythm, as U.S. Secretary of State Rex Tillerson wrapped up his visit to China. While Chinese President Xi Jinping said China and the United States could become “good cooperative partners,” and that “cooperation is the only correct choice for both countries,” Tillerson vowed that the U.S. side is ready to develop relations with China based on the principles of non-confrontation, no conflict, mutual respect and win-win cooperation. Tillerson’s reiteration of the important principles originally proposed by China in 2013 is a positive sign for China-U.S. relations, in which cooperation should always prevail.// Comment: Chinese media are happy but it is still too early to know if Tillerson’s use of the PRC’s formulation “no conflict, no confrontation, mutual respect, and win-win cooperation” was a mistake, a real concession, or just giving Beijing face publicly while presenting a much tougher line privately. Tillerson made nice with his Beijing hosts but it still looks more like the calm before the storm to me.

Related: China says preparatory work for Xi-Trump meeting has begun | Reuters “On this visit to China by Secretary of State Tillerson, both sides had a deep discussion on arranging a meeting soon between the two heads of state and began relevant preparatory work,” Foreign Ministry spokeswoman Hua Chunying said.

Related: Sino-US cooperation correct option: Xi – Global Times In 2010, China put forward a new model of major power relations, in which the core concepts are “no conflict, no confrontation, mutual respect, and win-win cooperation.” Beijing hoped Washington would accept these principles to develop the Sino-US relationship as the right way to avoid the Thucydides trap, a theory which says that a rising power and an established super power are bound to engage in conflicts. While China welcomes the endorsement of its model, which the previous administration of Barack Obama refused to do, we need to observe the US’ words and deeds going forward to see if it is credible, said Shi Yinhong, director of the Center for American Studies at the Renmin University of China. “Tillerson said these words because Trump wants to create a friendly atmosphere and environment for the upcoming summit,” Shi said.

Related: 海外版望海楼:合作是中美最大公约数–人民网

Related: Axios-What China wants from Trump  To get a preview of the talks I spoke with Richard McGregor, who wrote “The Party,” [A must read] a seminal book on China’s Communist Party. The takeaway: China does not want (for the moment) to upend the status quo.

2. China prepares to counter any U.S. trade penalties: sources | Reuters China’s government has been seeking advice from its think-tanks and policy advisers on how to counter potential trade penalties from U.S. President Donald Trump, getting ready for the worst, even as they hope for business-like negotiations. The policy advisers believe the Trump administration is most likely to impose higher tariffs on targeted sectors where China has a big surplus with the United States, such as steel and furniture, or on state-owned firms. China could respond with actions such as finding alternative suppliers of agriculture products or machinery and manufactured goods, while cutting its exports of consumer staples such as mobile phones or laptops, they said. Other options include imposing tax or other restrictions on big U.S. firms operating in China, or limiting their access to China’s fast-growing services sector, they added.

Related: China’s Taxes on Imported Cars Feed Trade Tensions With U.S. – The New York Times Comment: As Axios reported Sunday in Axios Sneak Peek – 1 big thing: Trump’s potentially explosive China play.

3. ‘Don’t use Taiwan’, Taipei frets ahead of Trump-Xi meeting | Reuters “We call on the United States and China, when they improve relations, to not use Taiwan in their own interest or as a chess piece,” Catherine Chang, Taiwan’s minister in charge of China affairs, the Mainland Affairs Council, told reporters. // Comment: A real risk for Taiwan, I think anyone who believes Trump actually cares about Taiwan is fooling themselves

Related: Beijing piling on pressure against Taiwan independence: MAC – The China Post A Mainland Affairs Council (MAC, 陸委會) report released Sunday paints a bleak outlook for the thawing of the cross-strait freeze.

Related: Why China Will Not Unify with Taiwan by 2020—and Beijing Lacks Compelling Military Options – Lawfare- Timothy Heath Despite declining prospects for peaceful unification by 2020, China faces serious constraints on its ability to invade and subjugate Taiwan. The geostrategic risks attending regional polarization have narrowed the range of acceptable Chinese justifications for attack. China might experience fewer international repercussions if it attacked a Taiwan that suddenly declared independence. However, in most scenarios, neither the U.S. nor any other major power would recognize Taiwan, rendering such a declaration pointless. The futility of such a gesture is perhaps why popular support in Taiwan for de jure independence remains minimal. More plausible is the idea that Beijing might justify an attack on the ground that Taiwan has continued to resist demands that it adhere to a “one China” policy or other political demands. Recent media reports claim that Beijing is considering revising the Anti-Secession Law to create such red lines. Such laws could lay the legal and moral groundwork to justify military action

4. Canada, 10 other countries call out China for torturing human rights lawyers – The Globe and Mail The Globe and Mail obtained a copy of the Feb. 27 letter, which has not been made public. It was addressed to Guo Shengkun, China’s Minister of Public Security. It was signed by ambassadors and chargés d’affaires from Australia, Canada, Japan and Switzerland, along with seven European Union member countries: Belgium, the Czech Republic, Estonia, France, Germany, Sweden and the United Kingdom. //Comment: Was the US asked to sign but declined?

5. Can China’s ‘Leather Capital’ Repay Its Environmental Debts? – Caixin Global Comment: With a scary accompanying video. As bad as the air pollution is, water and soil pollution may be an even bigger long-term catastrophe.  //  Xue is worried about his corn. The wells in Gaomiao are almost 100 meters deep, but the water they provide is black and foamy. Five years of applications to the local government to build a new well have been fruitless. About 100 meters downstream, a group of workers are installing tubes to pump out the river’s water, so black and thick it is better described as sludge, and treat it with a coagulating powder to separate out pollutants, before pumping it back into the river. Their work is part of a vast and complex provincial project that began last year in response to a central investigation led by the Ministry of Environmental Protection. It found that levels of hexavalent chromium, a known carcinogen with many industrial uses, were five times greater than the government standard in soil samples collected in the city of Xinji, along the Hutuo’s southern bank in Hebei.

Related: China’s water cleaner in 2016, but still short of expectation: official – Xinhua Last year, 67.8 percent of monitored surface water areas were ranked from Grade I to Grade III, indicating relatively good quality, Zhang Bo, head of water environment division under the Ministry of Environmental Protection, said at a monthly press conference. The share was slightly higher than 66 percent for 2015, and exceeded a target of 66.5 percent for 2016, according to Zhang. Only 8.6 percent of monitored areas received the lowest rating of Grade V for very poor quality, lower than 9.7 percent for 2015.

Related: China to roll out system of spot checks on polluters across the country | South China Morning Post

6. South Korea complains to WTO over China response to missile system | Reuters “We have notified the WTO that China may be in violation of some trade agreements,” Trade Minister Joo Hyung-hwan told parliament in response to questions about China’s reaction.

Related: Chinese FM responds to South Korea’s WTO compliant – CGTN ‍”We support normal business and other exchanges between China and South Korea, but everyone knows this needs a corresponding basis in public opinion,” said Chinese Foreign Ministry spokesperson Hua Chunying, in response to South Korea’s WTO complaint, on Monday.

Related: China’s CCTV Snubs Korean Golfer’s Triumph – The Chosun Ilbo Korean golfer Kim Hae-rym won the SGF 67 World Ladies Championship at the Mission Hills Haikou Blackstone Course in Hainan, China, on Sunday. But Chinese state broadcaster CCTV, which showed the match live, seemed so deep in a funk over Korea’s decision to let the U.S. deploy a Terminal High-Altitude Area Defense battery in Korea that it avoided showing Kim at all cost.

Related: Caught between THAAD and North Korea, China’s Northeasterners ponder patriotism and safety concerns – Global Times In a video that went viral online last week, the man from Shenyang, Northeast China’s Liaoning Province, destroyed all of his girlfriend’s makeup while shouting slogans condemning Seoul and the South Korean retailer Lotte which provided land for THAAD, and encouraging his girlfriend, who can be heard off camera, to do the same. The man in the video, named Lü Riyang, has more than 360,000 followers on Weibo. He wrote on his Weibo account, “The important thing is not that we destroyed this makeup. The important thing is our attitude. We follow laws and policies and do not go around smashing any cars … destroying what we once bought in Lotte can vent our anger!”

7. Autistic Boy’s Death Was One of Many at Squalid ‘Care Center’ in China – The New York Times The deaths at the facility in Shaoguan, Guangdong Province, came to light in an unusual exposé published by a state-run newspaper. The case tapped into broad concerns in China over the government’s treatment of the poor and disadvantaged, especially rural migrants vulnerable to discrimination and detention in Chinese cities.

Related: 被救助人员何以在托养中心高频死亡_综合_新京报网 Comment: The startling expose behind this story

8. Fu Chengyu’s frank talk on SOE reform | Andrew Batson’s Blog In the current Chinese climate where frank discussion of economic problems and constructive criticism of economic policy is very rare, the intervention during the session by former SOE executive Fu Chengyu was I thought fairly noteworthy. Fu previously ran two of China’s biggest SOEs, CNOOC and Sinopec, and was widely considered an effective, forward-looking and market-oriented executive. It’s not surprising that Fu is critical of the current program of state-owned enterprise reform; just about everyone who has looked at it has come away pretty depressed. What’s interesting is that he is both willing and able to speak his mind. The following is my translation of his statement on March 9, as reported by Xinhua

Related: Two State-Owned Nuclear Companies to Consolidate – Caixin Global China National Nuclear Corp. (CNNC) and China Nuclear Engineering & Construction Corp. (CNEC) are working on “strategic recombination plans,” which then need to be approved by the central government. Two listed companies owned by CNNC and another listed by CNEC announced the planned merger over the weekend.


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AnchorBUSINESS, ECONOMY AND TRADE *

Ex-Finance Minister Says Government Not Pushing Economic Overhaul Hard Enough – Caixin Global Stimulus policies that followed the financial crisis of 2007-08 have created an illusion of economic stability in China, making the government reluctant to promote painful reforms, a former finance minister said. Lou Jiwei made the remarks at the China Development Forum, held over the weekend in Beijing. Lou’s opinion was echoed by other experts who remain skeptical about the strength of China’s economic recovery, which started in the last quarter of 2016, and through the first two months of 2017.

何立峰:重点做好五项工作 化解三方面结构性失衡–财经–人民网  Comment: NDRC head He Lifeng’s comments at the China Development Forum

滴滴北京三环内停止派单给外地车,新政终于开始落地 |  PingWest品玩 Comment: PingWest reports that as of March 20 DiDi is no longer routing orders for trips inside Beijing’s Third Ring Road to cars that do not have Beijing license plates

FX Chief Warns Over ‘Irrational’ Overseas M&As – Caixin Global China’s top foreign-exchange regulator said that the country’s outbound direct investment (ODI) surged rapidly in 2016, but the central government considered some of those investments “irrational” and “abnormal.” Pan Gongsheng, the head of China’s State Administration of Foreign Exchange, made the comments Monday during the China Development Forum in Beijing.

Russia to Open Yuan Clearing Center in Moscow – Caixin Global Russia will open a yuan clearing center in Moscow on Wednesday, while the Russian Ministry of Finance plans to launch $1 billion worth of yuan bonds, according to Russia’s central bank.

Chinese Car Sales Run Out of Gas – Bloomberg Gadfly Auto companies don’t discount vehicles for the fun of it. Generally, it’s a sign that there’s too much stock around and they’re trying to clear the overhang. Sure enough, an inventory alert compiled by the China Automobile Dealers Association, designed to show when too many unsold cars are sitting around in dealerships, has surged over the past few months. In December, it was at its lowest level in records dating back three years; last month was the second-highest reading.

Guangzhou, four cities follow Beijing’s lead to curb home purchases | South China Morning Post A total of 18 municipal governments have rolled out cooling measures in March, including all major mainland China cities.

Tencent becomes China’s first $100 billion brand: WPP survey-CNBC Tencent, owner of messaging app WeChat, is valued at $106.2 billion and ranks as China’s most valuable brand, says the annual BrandZ listing compiled by advertising agency WPP and Kantar Millward Brown. It has gained more than $24 billion in value, or 29 percent, since 2016. E-commerce giant Alibaba is next on the Chinese ranking, with a brand value rising 22 percent to just over $58 billion, a $10 billion increase on last year. It overtakes China Mobile to the second spot. Meanwhile, social network Baidu ranks fifth, with a valuation of $23.9 billion – down 11 percent on last year.

China’s Mobike Wants its Bicycles to Cover 100 Cities This Year – Bloomberg Mobike’s orange-hued bicycles have become a staple of Chinese sidewalks since it started formal operations last year. It’s attracted hundreds of millions of dollars from backers including Tencent Holdings Ltd., Warburg Pincus LLC, TPG Capital, Temasek Holdings Pte and Foxconn Technology Group. The startup will officially start services Tuesday in Singapore, its first non-Chinese location, where rival Ofo has also expanded

How China’s overseas property dream turned into a nightmare | South China Morning Post Capital controls mean people who signed up for flats in Malaysia cannot send money from mainland

造城者:神话与阴影_专题频道_财新网 导读:新一轮楼市调控近半年,投资客和投机客仍四处出击。2017年一季度,从一线城市、热点城市到三四线城市,房价上涨之声此起彼伏,难以遏制

Eyewear Company Accused of Scamming Nearsighted Students | Sixth Tone Zhengzhou business closes after being called out on CCTV’s ‘315 Evening Gala.’

China backs down on tough new e-commerce laws in boost for Aussie exporters | afr.com China has delayed indefinitely tough new-cross border e-commerce laws that had threatened to disrupt the flow of Australian vitamins, milk powder and cosmetics into booming markets on the mainland. The surprising backdown by Beijing comes ahead of Chinese Premier Li Keqiang arriving in Australia on Wednesday for talks on upgrading the free trade agreement and how to eliminate other non-tariff barriers


 

AnchorPOLITICS AND LAW *

Chinese Law Prof Blog-Random comments on China’s new civil code What follows are some more or less random comments on particular features of the GRCL that struck me as I read through the text. They are not intended as a comprehensive evaluation.

China to launch anti-bureaucracy inspection – Xinhua China’s State Council said Monday that it would send inspection teams to check how its anti-bureaucracy policies were being implemented throughout the country.

初心·正定篇_新闻_央视网(cctv.com) 在陕北,他“看到了人民群众的根本,真正理解了老百姓”;在正定,他实现了改善农民生活的承诺;在80年代末的宁德,他说“当官不要想发财”。跟随央视原创微视频,一起追寻习近平总书记的初心。

China to deepen reform on literary, art federation – Xinhua China released a reform plan Monday, calling on the China Federation of Literary and Art Circles (CFLAC) to update its literary and art exchange mechanism. 中共中央办公厅印发《中国文联深化改革方案》 


 

AnchorFOREIGN AND DEFENSE AFFAIRS *

Chinese’s military dominance in S. China Sea complete: report | Kyodo News China has secured the central leadership role in the South China Sea and other players cannot match its military supremacy in the region, according to an internal magazine of the People’s Liberation Army (PLA) obtained by Kyodo News. Amid staunch denials by China that it is militarizing the South China Sea, the article amounts to a rare admission by its military of its true intentions in the region. Specifically, it sheds light on the policy of boosting the military influence in the area under the cloak of “civilian activities” such as private aviation.//Comment: And the PLA would be correct…

Vietnam seeks South Korean support in South China Sea | Reuters “The Prime Minister proposed that South Korea continue its support over the position of Vietnam and Southeast Asia on the South China Sea issue and to help the country improve its law enforcement at the sea”, the government said in a statement on its website after the meeting between Prime Minister Nguyen Xuan Phuc and South Korea’s Foreign Minister Yun Byung-se.

After Saudi king, China warmly welcomes Israel’s prime minister | Reuters Netanyahu said there was much to talk about in tech cooperation. “And at the same time there is a great deal of convulsion in the world, including in our part of the world,” Netanyahu said, in comments made in front of reporters. “And I would like to have the opportunity to exchange views with you and to see how we can cooperate together for the advancement of security, peace and stability, and prosperity.”

China angered as Dalai Lama shares stage with Indian officials | Reuters “Recently, India ignored China’s solemn representations and strong opposition and insisted on inviting the 14th Dalai Lama to attend an international Buddhist conference organized by the Indian government,” Chinese Foreign Ministry spokeswoman Hua Chunying said.

What Would Closer U.S.-Russia Relations Mean for China? – Carnegie-Tsinghua Center Podcast Paul Haenle sat down with Carnegie scholars Andrew Weiss, Paul Stronski, and Alexander Gabuev on the sidelines of the Carnegie Global Dialogue Series to discuss the implications that changes made in the Trump administration’s policies toward Russia and China may have on China-Russia relations.

The Mirage of the Deal: Trump’s Grand Bargains with Russia and China – Carnegie-Tsinghua Center – Paul Haenle Trump needs to look beyond illusory bargains with Russia and China and instead develop clear-eyed frameworks to manage bilateral disagreements and make progress on common policy objectives based on U.S. national security interests.

China-Russia Military-to-Military Relations: Moving Toward a Higher Level of Cooperation | U.S.-China Economic and Security Review Commission  This staff report analyzes the three main components of military-to-military ties—military exercises, defense industrial cooperation, and high-level military contacts—which show increases in the level and quality of engagement, collectively reflecting closer defense relations. The report also describes the security implications of recent developments in Sino-Russian defense cooperation for the United States and the Asia Pacific.

China commissions 50,000-tonne dual-use semi-submersible | IHS Jane’s 360 Named Zhen Hua 33, the 50,000-tonne vessel is said to be “the largest civilian ship that meets [China’s] defence requirements”, and is reportedly capable of lifting ships of up to 10,000 tonnes, enabling emergency repairs or recoveries, in addition to the transport of ships, outsize cargo, and other floating structures.

Renewable Energy and the PLA’s Next Generation of Self-Sufficiency (Part 2) – Jamestown Part One of this series examined the state of renewable energy in China and the connections between civilian and military industry partners. Part Two looks in detail at the PLA’s developing energy strategy both on the mainland and, increasingly on offshore islands at the center of territorial disputes.


 

AnchorTECH AND MEDIA *

消息称小米与万科合作建房:员工可认购 价格对折_TechWeb  Comment: Xiaomi is partnering with leading real estate developer Vanke to build apartments in Beijing’s Haidian area, with steep discounts for Xiaomi employees

Moviemaking Culture Clash Raises Questions About Oriental DreamWorks’ Future – Caixin Global “The Chinese animation industry has been actively adjusting in coordination with the restructuring in Hollywood,” said China Media Capital (CMC), the major Chinese stakeholder in Oriental DreamWorks. “CMC will conform to the market changes and continue to seek overseas collaboration with leaders in production, creativity and distribution,” the company said in a statement on Monday. The statement followed a report from entertainment trade publication Variety last week that U.S. media group Comcast Corp. is in talks to give up the 45% stake that DreamWorks Animation, a Comcast subsidiary, has in Oriental DreamWorks. The joint venture has also reduced the number of employees by more than half from its peak of 250, the report said.

Paramount rejected in potential $1B film deal with China | New York Post The media giant’s Paramount Pictures movie unit has failed to strike a deal with two Chinese groups to receive $1 billion in financing for a fresh series of films, according to several Hollywood sources who spoke to The Post. “It’s DOA,” one source close to the talks said Friday. “China is passing on all investments.” A second source familiar with conversations confirmed that talks collapsed last week, adding: “Paramount deal is dead.”

Inside Tencent’s AI Lab: How It Created China’s Own AlphaGo In A Year – China Money Network FineArt, an AI Go-playing program developed by the AI Lab of Chinese Internet giant Tencent, is proving to be a prodigy, winning an annual world-wide AI Go tournament only a year after its creation and highlighting China’s rapid advance as it seeks to strengthen its AI capabilities. With its name adopted from an ancient Chinese poem during the Tang dynasty, FineArt beat incumbent, Japan’s DeepZenGo, yesterday at the Computer Go UEC Cup, an annual computer Go tournament held at the University of Electro-Communications (UEC) in Tokyo, Japan since 2007.

Tech In Asia is raising $6M to double down on its recruitment business | TechCrunch . Two sources indicated that the company solicited (and entertained) acquisition offers whilst it was out raising this time around. Ultimately, it didn’t find a match with a suitor and thus is taking on this new capital, which will keep it independent.

乐视汽车联合创始人丁磊离职:祝愿早日量产上市 |  PingWest品玩  Comment: LeCar co-founder Ding Lei has resigned. LeEco is a mess

FSI | Shorenstein APARC – Ian Johnson, longtime foreign correspondent, to receive Shorenstein Journalism Award Comment: Well-deserved

Pear Video is creating short news videos for China’s netizens-TechInAsia


AnchorSOCIETY, ART, SPORTS, CULTURE AND HISTORY *

China’s High-Tech Tool to Fight Toilet Paper Bandits – The New York Times At the Temple of Heaven Park, one of Beijing’s busiest tourist sites, many people said on Monday they were pleased by the new machines. “The people who steal toilet paper are greedy,” said He Zhiqiang, 19, a customer service worker from the northwestern region of Ningxia. “Toilet paper is a public resource. We need to prevent waste.” // Comment: Indigenous Innovation

More Tourist Shenanigans at Beijing Wild Animal Park, This Time With Kids | the Beijinger An entire family including two minors were seen exiting their white SUV on multiple occasions in the drive-thru area of the Beijing Wild Animal Park in Daxing Sunday. // Comment: Prompting the Beijing Public Security Bureau Weibo to remind people that Tigers are not vegetarians 老虎不是吃素的

China Focus: Legendary sunken treasure discovered in SW China – Xinhua After more than 10,000 items of gold and silver were recovered from the bottom of Minjiang River in Sichuan Province, archeologists confirmed Monday the tale of Zhang Xianzhong and his sunken treasure, dating back to the Ming Dynasty (1368-1644). Legend had it that in 1646, peasant leader Zhang Xianzhong was defeated by Ming Dynasty soldiers while attempting to transfer his large haul of treasure southward. About 1,000 boats loaded with money and assorted valuable were said to have sunk in the skirmish.

More than 100 Chinese cities now above 1 million people | Cities | The Guardian According to the Demographia research group, the world’s most populous country boasts 102 cities bigger than 1 million people, many of which are little known outside the country – or even within its borders.

My village didn’t even have a traffic light. Now it has 1.4 million people | Cities | The Guardian When author Xiaolu Guo was a child in the 1980s, her village was a remote farming settlement. Now, like hundreds of others across China, it has become a metropolis with four-lane roads, a cancer epidemic … and even a new language

Age of Empires: Chinese Art of the Qin and Han Dynasties (221 B.C.–A.D. 220) | The Metropolitan Museum of Art The works in the exhibition—extremely rare ceramics, metalwork, textiles, sculpture, painting, calligraphy, and architectural models—are drawn exclusively from 32 museums and archaeological institutions in the People’s Republic of China, and a majority of the works have never before been seen in the West

Room for Romance in China’s Love Hotels | Sixth Tone

Forget Love: In China, I’ll Marry You for Your License Plate – WSJ Millions can afford a car, but in big cities the right to drive is harder to come by // Comment: I know a foreigner who left China but kept their Beijing plate and leases it for 36K RMB/Yr


AnchorENERGY, ENVIRONMENT, SCIENCE AND HEALTH *

China considers ways to speed up time to market for imported drugs | Reuters


AnchorAGRICULTURE AND RURAL ISSUES *

农村“两权”抵押试点大范围推开  新华社《经济参考报》站 2017年农村金融改革将实现全方位推进。《经济参考报》记者获悉,政策层面上,多部门正在制定措施支持农业新型经营主体融资,为其建立贷款担保体系;试点层面上,农村承包土地的经营权和农民住房财产权等“两权”抵押贷款试点正大范围推开,各地进行了大量创新型探索,今年年底前将完成,并总结经验用于未来修法;企业层面上,大量互联网金融企业瞄准了传统金融机构触不到的领域,今年将加大涉水农村金融的力度。


 

AnchorEDUCATION *

Alienation 101 | 1843 There were hopes that the flood of Chinese students into America would bring the countries closer. But a week at the University of Iowa suggested to Brook Larmer that the opposite may have happened


AnchorFOOD AND TRAVEL *

China temporarily suspends imports of Brazilian meat after scandal: source | Reuters China has temporarily suspended imports of Brazilian meat from March 19 following a scandal in the South American country over the alleged bribery of health officials to allow the sale of tainted meat, a source said on Monday.

茅台镇暗藏“高端定制假茅台”_深度_新京报网 Comment: High quality fake Maotai liquor found in Maotai County

Finding the Joys of Jianbing Across New York – The New York Times  Comment: Please come to DC

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