Xi leaving the country, may meet Putin; Li Keqiang chairs another meeting on stabilizing the economy

The PRC was officially on holiday Monday for the Mid-Autumn Festival.

Summary of today’s Essential Eight:

1. Li Keqiang chairs another meeting on stabilizing the economy - Monday is an official holiday but Li Keqiang and all four vice premiers attended a “special meeting” on stabilizing the economy that heard reports from two working groups that had been sent by the State Council to “16 provincial-level regions to supervise and provide services to the localities in resolving difficulties in policy implementation”. [Update: This meeting was actually held Thursday, September 8, only disclosed Monday the 12th] It sounds like more supportive measures are coming, including more infrastructure construction, an increase of “the quota of the policy-backed and development-oriented financial instruments based on the local needs”, and more relaxation of housing purchase restrictions on a city by city basis. There was a rumor going Friday that policymakers are planning to remove all property purchase restrictions in non-Tier 1 cities. If that rumor out turns it to be true, it would be another sign of how desperate they are getting about the real estate market. Li’s comment that “We have not significantly increased the fiscal deficit or excessively printed money. Because of this, prices have remained stable, and a series of policy tools are reserved for the introduction of policies this year 这几年我们保持宏观政策可持续性，没有大幅增加财政赤字、超发货币，正因为如此物价保持了平稳，为今年出台政策预留下系列政策工具” may get some excited that this could a signal the policy floodgates may start to open much wider. More.

2. Xi going abroad - Xi is making his first overseas trip since January 2020 this week, to visit Kazakhstan and Uzbekistan and attend a leadership summit of the Shanghai Cooperation Organization in Samarkand. The PRC has not announced that Xi will meet Putin around the SCO summit, but Russia media has said he will. More.

3. Li Zhanshu’s Russia trip - Li Zhanshu, number three in the CPC hierarchy, has concluded his trip to Russia. The Duma released a statement attributing quotes to Li that do not appear in the official Xinhua readout of his visit, which did not even mention Ukraine. The ones attracting the most interest, especially given Xi may meet Putin in just a few days, are “We fully understand the necessity of all the measures taken by Russia aimed at protecting its key interests, we are providing our assistance” and “On the Ukrainian issue, we see how they have put Russia in an impossible situation. And in this case, Russia made an important choice and responded firmly”. Would the Duma make up quotes from Li? More.

4. More possible US semiconductor-related export controls - Reuters reports that the Biden Administration will move forward with more restrictions on semiconductor-related exports to the PRC. These new regulations look quite tough, but much can change in the implementation. It appears the PRC reaction to the Pelosi visit to Taiwan may have hardened some attitudes around tech controls in the Biden Administration, along with the Russian invasion of Ukraine and Xi's continued support for Putin. More.

5. Outbreaks and suffering - Reports of people suffering in Covid lockdowns in Xinjiang exploded on the PRC Internet over the last few days. It is remarkable that local officials seem unable to learn the lessons from the problems of lockdowns in other cities, but then again the political incentives appear skewed towards locking down fast and then figuring out the logistics of how to provide food and access to medical care, as local officials get in much more trouble for allowing an outbreak to occur in their jurisdiction than they do for causing their residents to suffer in a lockdown. Officials say the outbreaks at three universities in Beijing that have led to 96 confirmed cases so far are from three independent transmission chains. Beijing is really going to have tighten restrictions between now and the Party Congress; even in the Pre-Covid times the city would lock down around a Party Congress. More.

6. More speculation on the 20th Party Congress revisions to the Party Constitution - Xinhua has released an official translation of the readout of the Friday Politburo meeting. If you can identify “the latest achievements of adapting Marxism to China's context and new circumstances will be fully epitomized and so will the new ideas, new thinking and new strategies of governance developed by the CPC Central Committee since the Party's 19th National Congress in 2017” then you may have a good idea of what will be amended. I think it is likely that the "draft amendment to the CPC Constitution" will include something like the “new development philosophy 新发展理念“，the “two establishes 两个确立", but we might we also see one or more of the “ten clarifies” 【See the February 15, 2022 Sinocism]. More.

7. Going extraterritorial to crackdown on scammers - The PRC is pushing its citizens to return from countries that have high level of telecom and Internet fraud against people in the PRC, and a new law that comes into effect December 1 will give authorities a lot more enforcement power, including to pursue suspects abroad. More.

8. PRC and the Office of the United Nations High Commissioner for Human Rights - The office has a new leader, now is a good time for the PRC to try to stake out a very hardline position and wait for the UN to work towards mollifying them. More.