Pelosi and Taiwan; Outbreak; Didi decision; Xi and civilization
Summary of today’s Essential Eight:
Pelosi and a possible Taiwan trip - There have been rumors going around that before her planned April trip warnings were sent to the US government that her plane would not be allowed to land. If that is one of the things that the PLA is considering then things could really dangerous really quickly. We are still at least 10 days away from any possible trip, one thing to watch will be if and how authoritative media like People's Daily warn about the consequences a Pelosi trip. The fact that the US military does not think a trip is a "good idea", and I assume by that Biden mean USIndoPacom, who would bear the brunt of anything kinetic over her trip, is an indication that threats are being taken seriously and that the PLA has lots of capabilities that could cause the US military and Taiwan military a lot of problems.
Outbreaks - Shenzhen has a small spike in cases but the local government will “mobilise all resources and adopt all measures”. Shenzhen did a good job earlier this year, just before Shanghai’s lockdown disaster, let’s hope they can do it again. The National Health Commission reminded everyone that the tweaks to Covid policies are to optimize the measures, not relax them.
Real estate - The regulators are saying the right things, but the only way out of the delayed delivery mess is more financing for developers and forced project/ company/mergers.
Cyberspace regulator fines Didi - The amount is not a surprise, the question now is whether this marks an end to to the worst of the regulatory crackdown, as many investors are hoping. I do not know but am skeptical it does.
A different kind of Partying for HSBC bankers bankers - The Financial Times reports that HSBC has established a Party committee in its China investment bank entity. I am not sure why anyone would be surprised by this. The Party leads everything in the Xi Era and one of his initiatives has been to reinsert the Party into almost every entity of any size in the country. What is more interesting is what this means for other Western banks operating in the country, as overt Party cells in banks like JP Morgan and Goldman Sachs may cause them some headaches in their home market.
Indonesia President visiting the PRC next week - The PRC really wants to make sure the G20 meeting in November avoids topics it does not like, and so are courting Joko, who holds the G20 presidency this year, hard. Note that the Wang Wenbin response says “President Xi Jinping will hold talks with President Joko Widodo and Premier Li Keqiang will meet with him” so that sounds like he may see Xi on a video screen but actually meet Li in person.
Xi on civilization - The July 15 issue of Qiushi has Xi’s May 27th speech to the Politburo session that discussed furthering “a national research project on tracing the origins of Chinese civilization”. (See the May 31st Sinocism for more on that meeting). The title of Xi’s speech running in Qiushi is 把中国文明历史研究引向深入 增强历史自觉坚定文化自信, which we discussed in last week’s open thread. Tuvia Gering, author of the excellent newsletter Discourse Power (free here) among other things, has written a good essay on what Xi and the leadership may be thinking.
America just can’t quit Huawei - On the hand one the government is worried Huawei equipment in rural networks around the US may be used for espionage, on the other it will not give local carriers the money needed to swap out the cheap and reliable Huawei gear.
Thanks for reading, and I hope to see many of you in tomorrow’s weekly discussion. Please let me know in the comments to this issue if there are any specific topics you would like to discuss.
The Essential Eight
1. Pelosi and a possible Taiwan trip
From a Politico reporter:
There have been rumors going around that before her planned April trip warnings were sent to the US government that her plane would not be allowed to land. If that is one of the things that the PLA is considering then things could really dangerous really quickly.
We are still at least 10 days away from any possible trip, one thing to watch will be if and how authoritative media like People's daily warn about the consequences a Pelosi trip. The fact that the US military does not think a trip is a "good idea", and I assume by that Biden mean USIndoPacom, who would bear the brunt of anything kinetic over her trip, is an indication that threats are being taken seriously and that the PLA has lots of capabilities that could cause the US military and Taiwan military a lot of problems.
I am very worried this could get really dangerous. I think Biden's comments yesterday were really not helpful. They make it look like Pelosi has been coordinating with the administration, which of course Beijing thinks (the co-equal branch of government discussion with PRC interlocutors never goes well…), and now if she doesn’t go will make it look the PRC threats worked, which will cause all sorts of domestic political issues for the Democrats. And what does Taiwan, whose people there will bear the brunt of whatever the reaction may be, think about her visit?
Biden administration officials are concerned that China could seek to declare a no-fly zone over Taiwan ahead of a possible visit by House Speaker Nancy Pelosi as an effort to upend the trip, potentially raising tensions even further in the region, a US official told CNN.
As for not allowing her plane, which would be a US military aircraft (aka Milair), to land, is the genesis of that rumor from April this email, or is there more to it? - Talk of Nancy Pelosi visiting Taiwan angers China | The Economist
“The Chinese appear to perceive the need to demonstrate that the us cannot keep salami slicing its one-China policy with impunity,” says Bonnie Glaser of the German Marshall Fund of the United States, a think-tank. She added that in April a former Chinese army officer emailed her to express his “personal opinion” that China’s air force would stop Ms Pelosi’s plane from landing in Taiwan. Such aerial brinkmanship is still unlikely given the risk of escalation. But one thing is certain: there is turbulence ahead
Rand from earlier this year - Implications of a Coercive Quarantine of Taiwan by the People's Republic of China
China's coercive options for Taiwan range from routine violations of Taiwan's declared Air Defense Identification Zone to a full-scale invasion. Within the spectrum are efforts to isolate Taiwan to prevent it from sending exports or receiving imports. Typically, this would be called a blockade. However, because China does not view the government on Taiwan as sovereign and thus rejects the idea that a state of war could exist, blockade is not the correct term. Therefore, in this report, the authors examine how China might implement a quarantine of Taiwan. Unlike in a blockade scenario, China's goals for the quarantine would not be to completely cut off food and supplies to Taiwan, but rather to demonstrate de facto sovereignty by controlling the air and maritime space around the island, as well as which cargo deliveries, ships, aircraft, and people have access to Taiwan.
China will act strongly if U.S. official insists on visiting Taiwan: FM spokesperson-Xinhua
"If Speaker Pelosi visits Taiwan, it would seriously violate the one-China principle and the stipulations in the three China-U.S. joint communiques and harm China's sovereignty and territorial integrity," Wang [Wenbin] said...
"Should the U.S. side insist on making the visit, China will act strongly to resolutely respond to it and take countermeasures. We mean what we say," Wang said.
Wang Wenbin’s comments - 外交部警告佩洛西访台计划：如美方一意孤行 必将反制！_凤凰网
如果美方一意孤行，中方必将采取有力措施予以坚决应对和反制。我们说到做到。
In recent years, the Taiwan authorities have refused to accept the one-China principle and pursued a "gradual Taiwan independence" with the help of the US. In the meantime, Washington has been distorting and hollowing out the one-China principle, wantonly improving its official relations with the island of Taiwan, sending senior officials to visit the island, selling Taiwan a large number of advanced weapons and making wrong remarks about "military defense of Taiwan," according to Qin.
We will not abandon non-peaceful means, not against the residents of the island, but to contain "Taiwan independence" forces, prevent external interference and safeguard the prospect of China's peaceful reunification, Qin stated.
An American perspective on the role of Taiwan in US-China relations - Ryan Hass
This paper argues that the future of Taiwan will turn on whether the people of Taiwan can maintain confidence in their future. Confidence is the essential ingredient to gird the Taiwan people to resist fatalistic conclusions that resistance is futile and instead protect their autonomy and democratic way of life until such time as peaceful, uncoerced solutions emerge to resolve cross-Strait differences. Since 2016, the PRC has intensified its campaign of coercion to undermine the Taiwan people’s confidence in Taiwan’s future autonomy and democratic way of life. For the United States to preserve its abiding interest in upholding peace and stability in the Taiwan Strait, it will need to visibly support efforts to enable Taiwan to enjoy dignity, security, and prosperity, even as it also maintains a credible military presence around Taiwan.
U.S. policymakers also will need to restore coherence to policy decisions and public messaging relating to Taiwan. It will be important for American policy to be guided by consistent precepts, including the principle that the United States supports Taiwan for its own sake and not as a tool for harming China. Washington can play an important role in managing tensions, but ultimately it will be up to Taipei and Beijing to resolve cross-Strait differences.
Central Intelligence Agency director Bill Burns played down speculation that Chinese president Xi Jinping could move on Taiwan after a key Communist party meeting later this year.
“The risks of that become higher, it seems to us, the further into this decade that you get,” Burns said, adding: “I wouldn’t underestimate President Xi’s determination to assert China’s control” over self-ruling Taiwan.