148 Comments

废料 scrap, waste material

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I enjoy your articles a great deal. Regarding Xi, I recommend the books by Kerry Brown, Francois Bougnon, Evan Osnos’ NYer profile, George Magnus, and Jonathan Ward. For those interested, also:

https://thediplomat.com/2018/08/on-the-couch-in-beidaihe-the-political-psychology-of-chinas-president-xi-jinping/

https://www.thecipherbrief.com/column_article/path-not-preordained-profile-chinas-xi-jinping

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Bill, always value your perspective. I am an American working for a German company with sizeable presence in China. I can feel a growing negative China sentiment growing for sometime - not sure how much of this is a spillover from the avalanche from US or the realisation that Germany/EU is fundamentally behind on some leading edge technologies? Best. Al

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Do you have any suggestions on other newsletters (aside from Sinocism of course) to subscribe to that will provide deeper understanding on China? E.g. The Diplomat, Foreign Affairs, Foreign Policy, Asian Nikkei, etc.

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Hi Bill. Do you hear from foreigners living in China they are more and more afraid to be there?

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This is a great feature and I hope you continue to hold these Q&As in the future. I would also recommend a "Mail Bag" blog post every now and then, with you responding to reader email questions. That might allow for more in-depth questions and answers!

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thanks, good suggestion

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What is China's take on the Iran crisis? On the one hand, China is a huge importer of Gulf oil and a long-term increase in the price of oil is detrimental to China's economy; on the other, poor U.S. foreign policy in the Bush era vis-à-vis Iran focused the U.S. security lens away from a rising China.

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Poor U.S. foreign policy in the Bush era vis-à-vis the Middle East*

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Thank you very much for your really helpful response.

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Bill, i'm sure you have heard about Roger Robinson and how he is advocating the US Government start take steps to use our dollar based system to apply financial pressure to CCP (e.g. starve them of the USD's they need). Have you heard or seen anything to indicate this strategy is being or going to be employed by Trump Administration? Could this be the next phase of the conflict?

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Do you see any particular risks with WeChat and potential interference in US elections/politics?

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What do you think the lasting impact of Taiwan’s election will have on internal politics within the CCP?

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Do you think the NBA / Houston Rocket "woke moment" will rear its head again as a national discussion when election session truly gears up? Campaign China-bashing seems to be a common occurrence to gain support from voters.

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http://www.xinhuanet.com/2018-04/06/c_1122643633.htm

Here you go. An archeological team to my country unearthed Song and Yuan-era porcelain artifacts.

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Realize we are past the 11:15 cut off, so this may be a topic for future coverage. Your latest mail cites SCMP article re real estate and mentions 18% YoY drop in Beijing real estate prices in November. This looks like a material property market correction. Do you have more data on this? What is happening in other cities and what is transaction volume? Given high level of foreign debt issuance by PRC developers, how far can prices fall before their cash flow is impacted? Thanks!

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Hi Bill,

What do you think of the long term trajectory of Hong Kong? Do you think it will inevitably decline to become even less than a Tier 1 city?

What’s stopping the Chinese from allowing full RMB convertibility? To me, once that happens, HK will cease to serve much purpose for China and Shanghai will inevitably become the financial hub for China.

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The HK$:US$ peg is too important for them and will ultimately maintain HK as an international financial centre. Even if the social uprising becomes uglier and more dangerous, the financial markets will mostly carry on (think of London in the 80s). Every Chinese company or SOE that lists there is effectively dollarising their company. They have $ shares they can sell, or raise, they can pay themselves dividends offshore. That is far too valuable.

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i tend to agree

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Hi Bill

How do you think Southeast Asia states will do in balancing between China and the US? Do you think Southeast Asia is destined to become part of China’s sphere or influence due to the closer proximity?

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There cannot be a blanket answer to this question. Vietnam and Indonesia are far less likely to fall under a Chinese sphere of influence than Thailand and the Philippines. Malaysia and Singapore will be somewhere in between. Demographics will also play a role in decades to come as China ages but India retains a more youthful profile + stronger historical/cultural ties to most SE Asian states other than VN. Most SE Asian states are Indic rather than Sinic. Even Singapura is a Sanskrit name, the national anthem and SAF parade drill are in Malay. Singapore's flag is derived from the Majapahit naval banner, etc

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I guess I was wondering if SEA would be able to balance between the US and China, or if they would have no choice but to choose one

And also if a Chinese form of the Monroe Doctrine would

come about in SEA.

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How committed do you think China will be in meeting the purchase targets in the US-China trade deal? If committed, do you have any sense of the impact of the trade diversion from other trading partners?

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Hi Bill, Lighthizer and Mnuchin have said a lot about enforcement mechanisms in the deal, but after an admittedly quick read through, I don't necessarily see that in there. Is there anything holding them to these concessions other than a threat of return to tariff escalation and a general desire to cool tensions? At the moment I'd say they want it to work and it shouldn't be much of an issue, but if that's not the case later this whole thing might just start over.

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Apologies if I did not get to your question, I have to drop off now, will try to jump back in later and answer what i can. thanks everyone for joining with no advance notice!

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I’m cheating, and I know it. I have three questions, two from me, one from my son.

One, does China’s private and public debt pose a genuine threat to its economic prosperity and regime stability in a world of seemingly perpetual low interest rates?

Two, how might the contraction of China’s population and particularly the contraction of its population of women of childbearing age threaten China’s geopolitical position in the latter half of this century? (...assuming that robots, genetic engineering, and AI do not produce dramatic relativity productivity increases...)

Three, does the opening of China through the Phase One deal to American investment banks help to improve China’s capacity to continue financing its growth?

With gratitude for all your work,

Tom

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fears were confirmed last year that the SAMR/MofCom antitrust review of NXP Semis / Qualcomm was delayed politically, do you think the Phase 1 deal, temporarily or otherwise, removes or reduces this political influence on current US deals being reviewed by the anti-trust authorities in China?

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What do you see as the likely future (next 20 years) for the Chinese-South Korean relationship? Will SK shift more into China’s orb than the US?

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Thanks for this, and your work generally (◕‿◕✿)

What's the future of PRC disinfo ops (ala Russia style in Taiwan, HK, Tibet etc.) or election interference (Cambodia)?

Does cooperation with Russia on these seem likely/feasible?

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Have you heard of the concept raised by a psychiatrist Wu Zhihong calling China a nation of Giant Babies? Grown adults with less mature psychology. What do you think? Is this giant baby thing more of a particular problem in china or it’s irrelevant and it’s the same everywhere?

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I struggle with this. I think the policies to encourage FDI — namely the FDI Law and effort to do more to protect IPR. Others that come to mind are tax reforms at least partly aimed at boosting consumption — to the VAT and to individual income tax rates, such as allowing deductions for costs associated with supporting elderly family members. I’m thinking inside the box here...

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Do Xi and company have carte blanche to cock-up nearly anything they care to? Even the results of the Taiwan election (a resounding rebuke of Xi's policy approach) seems to have simply slid past Xi's ship of state with all the other flotsam (the failures in Hong Kong, the continued and expensive support of SOEs, the massive increase in the number of "ideological asks" he has made of Communist Party officials, government officials and "the people" more generally). How does he manage to get away with it all?

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I think it is not as simple as you portray. Managing China, the economy, the political tensions, the need to find a workable balance of stability and growth while endeavouring to offer a consistent narrative to the Party and the people in a world of change, is a huge challenge for any leader democratic or authoritarian. Then there are the external erratic political and economic uncertainities which we observe almost every day. Despite the many critical comments about China, the last 40 years have seen China more stable and prosperous than it has been for 200 years.

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Lest there be a misunderstanding, my comment was in response to the post by A Canadian observer.

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PS: Sinocism is a terrific resource. Thanks to you and yours for all that you do to make it happen.

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thanks

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Hi Bill. What do you make of the theories of tension and conflict between Xi and Wang Qishan? Should be totally ignored or is there some fire behind the smoke?

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i have no seen evidence of that

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Thanks. This kind of expert comment is very helpful.

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Hi Bill, are there a few Chinese policy think tanks, blogs, or similar you recommend following that are influential in China?

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What's the current status of Confucius Institutes? Is there any kind of a re-evaluation going on after all the recent blowback? (maybe a move towards a subtler and/or less political version that would nevertheless continue their more fundamental purpose of promoting Chinese language / culture worldwide?)

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in china? not sure to be honest

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Hi Bill, I note that some believe the CCP would prefer to see Trump re-elected. Is there any chance they agreed to this “phase one” deal, at least in part, to help bolster Trump’s re-election chances? It certainly gives Trump a “victory” to hold up, when he’s making the case for “keeping America great.” And if the CCP can keep any domestic criticism under control… I mean, the CCP’s “concessions" on paper won’t do any harm if they aren't actually implemented in the long run...

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hi, i am not sure they did it to help him, but i think they believed they had leverage because a deal would help him

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Any reflections on how foreign university campuses / partnerships in China will fare in terms of academic freedoms in the next few years?

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it is going to be tough given the encroachment of the Party and the broader crackdown on free-ish expression

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The Trump administration is pressuring TSMC to stop selling to Huawei and start building military-grade chips in the US. From what you're hearing, will TSMC be able to wave off us demands? Or does the US government have enough leverage to force TSMC to adjust its business strategy?

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if the us really pushes tsmc will not be able to. but so far the us is not really pushing, there is dissent inside the usg over how hard to push, and a lot of industry lobbying to not go too far

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Bill, my understanding is that Chinese has no character for "scrap," or "recyclable," and this is why the Chinese called those items "garbage," particularly when they come from the rest of the world into China. Now the Chinese seem to be walking back their efforts to block all these recyclables from coming to their factories, with some new restrictions. Do you have any knowledge of this?

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回收 China does use the word recycle

回收

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How about "recyclable?" Or a character for the word "scrap?"

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As someone who does small business with Chinese citizens, transactions under $1000, it amazes me how hard it is to receive funds via an app or any way other than a bank transfer. Is this likely to change in the short term?

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maybe with paypal's entry, but the prc is still very focused on controlling capital flows and so i don't think they will make it significantly easier any time soon

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Do you think anything has changed with regard to EPS providers' licensing prospects, following the agreement?

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Do you happen to know anything about Sharing Economy concept that some of Chinese associations are promoting with support from former foreign state leaders from GLASE project? Can it be seen as a software philosophy of the BRI hardware? Or it is just a marketing sheet? Thank you!

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I do not, first i have heard of it. does it sound interesting?

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Well, there's Kevin Rudd, Boris Tadić and a bunch of other retired guys expressing support for this new (at least for me) vision of possible alternative to the current economic concept... And this philosophy is being discussed by several guys from NDRC...

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How helpful do you think programs like the Schwarzman and the Yenching are? For the average young adult trying to understand China better, would you be better off doing one of those, or doing an intensive language program like IUP?

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i am a proponent of all these programs, having done my time on programs in beijing and taipei back in the day. for language i think iup is the best, i did it 90-91 when it was as 台大

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Even in spite of all the influence peddling and potential for providing the CCP services a ready-made platform for recruitment? The world is quite a bit different from the 2000s. https://www.theatlantic.com/international/archive/2020/01/stephen-schwarzman-china-surveillance-scholars-colleges/604675/

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I'd argue that the counter-concern - that we need more higher quality dialogue between leaders in the US and China - easily outweighs espionage concerns. My question was actually motivated by reporting that suggests that they don't do a good enough job of fostering communication and trust between the Chinese and non-Chinese cohorts.

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Having done Schwarzman, I would say those reports (both of influence peddling and lack of communication/trust within cohorts) were overblown. Individual experiences may vary but I found the program to be highly worthwhile and would recommend. It is a very different experience than being in an intensive language program though so in my opinion choosing between the two types of programs should be based on the applicants personal objectives.

Schwarzman provided an unparalleled opportunity for me to meet key individuals involved in China's past and present development, to study with leaders in the field, and to discuss all of these experiences with a like wise interested cohort. I don't believe an intensive language program would have provided such access, instruction, and discussion opportunities. That being said, my Chinese is not as advanced as I would prefer and would be much further along if I had done IUP.

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Thanks - wow, didn't realize IUP was that old!

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yes, sadly, was in taiwan for a long time, taiwan government cut the funding and so it moved to beijing, big loss for taiwan as was a big reason many us scholars went to taiwan, as in its era it was the best language program

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Do you see any political individuals, organisations, parties or forces in the US that would rather have the KMT win the election and rule Taiwan than DPP?

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The defense industry are old and strong supporters of Taiwan and the KMT. That is in part because the Taiwan military has long been dominated by the KMT.

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Bill , China is sending archeological teams to many countries unearthing Chinese stuff and using it as a tool for building Chinese global discursive system, Can you explain more on that.

Thank you

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I went to this show of Chinese blue and white ceramics at the Smithsonian Museum in 2004. In 850-900 AD China was exporting tons of beautiful porcelain that greatly influenced the regional pottery.

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Long before the European voyages of discovery, Arab and Persian seafarers successfully mastered the long ocean crossing from the Persian Gulf to China. Muslim merchants established themselves in Chinese ports and, upon their return, supplied Near Eastern markets with luxury Chinese goods such as raw silk, silk brocades and tea. Imported Chinese ceramics were particularly admired in Iraq for the shiny white surfaces and hard bodies that were produced from locally available clays. It was not Chinese going to Iraq but Arab traders going to China. China always stayed within its walls until the CCP.

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Hi, do you have any sources on that?

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interesting. i assume the findings would be used to support some interesting historical claims, as well as perhaps feed into the belt and road narrative? can you share more info about some of these?

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Bill , I have example from within the country, for example, official govt report mentions that there is pottery for Shang Dynasty in Xinjiang which is basis for why it is essentially Chinese (there argument), even though politically it wasn't until Qing (sorry I don't have the exact dept or report on my right now typing on my phone)...

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Hi Bill-what do you make of Xi's upcoming visit to Tokyo? Is it a temporary move by Beijing out of convenience given tensions with the U.S., or is this part of a long term effort to tug Japan under their influence?

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beijing and tokyo need to have a constructive relationship, and i think they can without someone tokyo pulling away from us influence.

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and readers weigh on with your own thoughts and comments, you all can talk to each other too

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Just want to say great work. Thanks very much

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thanks

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Hi Bill,

I just finished François Bougon's Inside the mind of Xi Jinping. As you may be aware, he sees Xi acting out of weakness ultimately. What is your take on this?

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i have not finished that book but i do think that xi saw a lot of weakness for the party when he took over in 2012, and a lot of policies since have been in reaction to that. i do not think xi is personally weak now, quite the opposite in fact

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What was the deal with all the CEOs at the Phase 1 signing ceremony? Were they heavily involved in the negotiations? Are they cutting deals with China that have yet to be announced?

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$$, any deal removes some uncertainty, a big component of the deal is managed trade, they need good relations with both governments, showing up and being called out is good for their china business. schwarzman from blackstone and john thornton definitely were heavily involved in the backchannel

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hi bill, I listened to foreign China-based CEO today who claimed the ”recession” from the trade war and brexit had a significant psychological impact on high-end consumers who were say jittery as first-timers in a downturn. what do you make of this statement and if true, how much of an upswing could we expect this year? thanks! always appreciate your newsletter

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Hi Bill! Thanks for starting this thread! I am curious about your take on Trump's statement a while ago that he would visit Beijing this year to seal the final deal with Xi. The Chinese side has been silent on that (Xi didn't even mention it in his letter to Trump read out by Liu He). So what was that all about?

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when he tweeted it last month my sources said it had not been discussed with the chinese side. he said it again at the signing ceremony, have not gotten an answer on whether this time there has been some planning

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The US govt says China is scaling back support for Maduro in Venezuela.

https://www.reuters.com/article/us-venezuela-politics-china-russia/u-s-envoy-sees-china-scaling-back-economic-support-for-venezuelas-maduro-idUSKBN1ZE2BO

Do you agree? What sort of data or info should be used to measure whether that is accurate or not?

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i saw that, i do not know. matt ferchen would be the best to answer this, not sure if he has joined this thread

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I have followed educational policy in China since the 1980s, particularly at the pre-college level. What is happening in schools is predictive of the direction of society and where it will be in 15 years, so it's really important. I encourage you to include more education reporting.

Thank you for what you do. I look forward to Sinocism every day.

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thanks, an important point. and what would you predict given what you are seeing?

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What are Canada's options re: Meng Wanzhou?

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they have to go through the legal process unless the us drops the request. and that could take years

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So the Canadians arrested in retaliation will be in China for years? And Trudeau thinks it's worth it?

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Excluding mainland China, where is PRC propaganda most effective and/or abundant?

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Patriotic education in schools, beginning in 1994, in conjunction with patriotic tourism, television, films, music, have flooded society, and have made it impossible to separate Party from Country.

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and this is just intensifying right? we had our kids in a beijing public school grades 1-3. they were in the international department so they did not have young pioneers or some of the more intense political education but they used the same textbooks as the prc kids and you can see where it leads people

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If party and people are increasingly intertwined, does that mean their fates are bound? How could the two be separated so one might embrace the Chinese while opposing the CCP?

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A politically driven collective exercise on cultivating resentment and 19th century-style national pride...and generations raised with that education style are now acting accordingly

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great question

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I think the developing world, especially Africa

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What has China built in Africa? What has America built in Africa? Roads, railways, buildings, cell phones and factories are not propagada.

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any particular channel you see as most effective? (wire services, official messaging, CGTN, etc.)

what message is resonating most?

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