China worried about imported cases; PLA vaccine?; China threatens retaliation over US media restrictions; Viral censorship

China announced the lowest number of new virus cases in over a month, and there are signs the economy is slowly restarting. Now the authorities are worried about imported cases from travelers coming to China from countries with growing outbreaks. The Chinese government was very critical of countries like the US that put restrictions on travel from China, it will be interesting to watch how the Chinese government spins it now that they are on the other side.

The propaganda organs are certainly spinning up the narrative that China’s fight has helped save the world from much worse, and that they are willing to share their experiences and help other countries. There is also glee in some quarters with what so far has been a slow response by the US government, but as this newsletter has pointed out a couple of times the last thing China should want is a significant outbreak in the US or any other major economies, as the PRC economy is going to need all the help it can get to recover.

Anyone hoping that the January Phase One trade deal would put even a temporary floor under the US-China relationship will be disappointed. I expect another round of American reporter expulsions from China in response to yesterday’s actions. A new Gallup poll finds Americans' favorable rating of China has declined to a record-tying low, and some of the China-related discussions at the recent Conservative Political Action Conference (CPAC) presage an ever greater drop in future polls, especially as we head into what could be a very expensive and disruptive virus epidemic in the US that will have even more people blaming China.

Buckle up.

Thanks for reading.

The Essential Eight

1. The outbreak

China's crisis wanes as epidemic takes hold in US, elsewhere - AP

The health ministry announced just 125 new cases detected over the past 24 hours, China’s lowest number since Jan. 20. Another 31 deaths were reported, all of them in the hardest-hit province of Hubei. The figures bring China’s total number of cases to 80,151 with 2,943 deaths.

Official says China's Hubei province will continue with strict measures to curb coronavirus - Reuters

The risk of new cases is not totally under control, and there are still uncertainties in containment, said Yang Yunyan, Hubei’s vice provincial governor, speaking at the same event.


Yang Yunyan, deputy governor of Hubei told reporters that the situation in Hubei is still severe and the lockdown of Wuhan and other draconian measures will still be kept in place. There are more than 20,000 patients in the province that are receiving treatment, including more than 6000 in critical condition. In addition, the authorities have not yet been able to stop the increase of new cases…Yang also admitted that some discharged patient tested positive again for carrying virus, and some patients with no symptoms also tested positive.

China Faces Growing Virus Threat From Outside the Country - Caixin

All eight individuals appear to have caught Covid-19 in Bergamo, a town in virus-ravaged northern Italy, where they worked at a restaurant, Qingtian officials say.

Chinese authorities call these “backflow cases” — people who contract the disease that originated in China outside the country, and bring it back...

Now, local authorities are concerned those migrants will return from Italy ahead of Tomb Sweeping Day, a national holiday to pay respect to one’s ancestors, which falls on April 4 this year.

Qingtian government officials told Caixin that around 100,000 people from the county are thought to live in Italy. “When Tomb Sweeping Day approaches every year, Chinese migrants who did not return during the Lunar New Year will return home to worship their ancestors.

As Virus Outbreak Grows in Beijing, City Turns Its Eye to the Roads

The Beijing government has banned all taxis and carpooling services from traveling in or out of the city in its latest measure to control the spread of the coronavirus.

The Weibo about the vaccine - 微博 -军事医学前方专家组已经在武汉工作了一个多月。由军事医学研究院陈薇院士领衔的科研团队争分夺秒,集中力量展开应急科研攻关,在疫苗研制方面取得了重要阶段性成果

Comment: If China thinks it has a vaccine developed I doubt they will wait a year for clinical trials. And interesting this is publicized the day after Xi visits the Academy of Military Medical Sciences.

Meet Chen Wei, the major general on China’s coronavirus scientific front line | South China Morning Post

According to a military insider, Chen is leading the effort from the Wuhan Institute of Virology, a laboratory with the highest biosafety classification.

China confirms no cases of coronavirus infection in military - China Military

The ongoing novel coronavirus pneumonia (COVID-19) outbreak did not cause cases of infection among the military medics and service members, but improved the combat readiness of the Chinese military instead, said a Chinese PLA officer at the Press Conference of the Joint Prevention and Control Mechanism of the State Council on the morning of March 2.

Comment: Seems hard to believe given the number of civilian front line medical workers who have been infected

China urges overseas Chinese to stay away as imported virus cases rise - Reuters

Chinese authorities on Tuesday asked overseas Chinese to reconsider or minimize their travel plans as the coronavirus epidemic spreads across the world and prompts an uptick of imported cases arriving in the country.

坚决打赢抗击疫情阻击战 推动构建人类命运共同体 - 求是网

Wang Yi wrote an article in the latest Qiushi praising China and the foreign ministry for doing a good job during the outbreak, for winning international support, doing great propaganda, and that China’s performance in controlling the virus spread has become a model for rest of the world.

China’s CDC sent a team of experts to Iran to help contain the virus spread - 中国疾控中心病毒病所马学军研究员赴伊朗援助新冠肺炎疫情防控

Is US able to protect the lives of its people as COVID-19 spreads? - People's Daily Online

The right to life, security and health is the foremost human right. Whether the most powerful nation in the world is prepared for the test brought by this health crisis is a question that is yet to be answered. For many Americans, all they can do is pray that they do not get infected.

China’s aggressive measures have slowed the coronavirus. They may not work in other countries | Science | AAAS

These are some of the startling observations in a report released on 28 February from a mission organized by the World Health Organization (WHO) and the Chinese government that allowed 13 foreigners to join 12 Chinese scientists on a tour of five cities in China to study the state of the COVID-19 epidemic and the effectiveness of the country’s response. The findings surprised several of the visiting scientists. “I thought there was no way those numbers could be real,” says epidemiologist Tim Eckmanns of the Robert Koch Institute, who was part of the mission.

But the report is unequivocal. “China’s bold approach to contain the rapid spread of this new respiratory pathogen has changed the course of a rapidly escalating and deadly epidemic,” it says. “This decline in COVID-19 cases across China is real.”

'Shanghai mode' of stricter COVID-19 discharge standards ensures zero relapse - Global Times

Zhang Wenhong, director of the department of infectious diseases at Huashan Hospital who heads a Shanghai medical team to fight the epidemic, confirmed the more stringent measures and standards with the Global Times during a group interview in Shanghai, noting "The city has made preparations in advance to respond to [the possible disease rebound]."

Zero patients have tested positive after being discharged from hospitals in Shanghai as of Tuesday.

‘No Way Out’: In China, Coronavirus Takes Toll on Other Patients - The New York Times

Chen Xi, an assistant professor of health policy and economics at the Yale School of Public Health, said he thought it was likely that deaths from cardiovascular and other chronic diseases that could have been prevented could outnumber the lives saved from treating coronavirus patients.

Mr. Chen said that the Chinese government could have avoided the crisis if it had not initially played down the epidemic, and, in Wuhan, possibly made it worse by suddenly imposing a security cordon.

China charters flight for 200 citizens in coronavirus-hit Iran | South China Morning Post

The flight would land in Lanzhou, Gansu province, and was not an evacuation, the report said, adding the passengers had to pay for the flight.

Colleague of China's coronavirus whistle-blower Li Wenliang also dies of the deadly disease | Daily Mail Online

Dr Mei Zhongming, 57, was declared dead by Wuhan's Jinyintan Hospital today at noon local time after 'all-out rescue efforts failed', said Wuhan Central Hospital where he worked.


Mei is the third doctor that died of the coronavirus in the Wuhan Central Hospital. Caixin reports that more than 200 medics in that hospital have contracted the virus and several of them are in critical conditions.

Mr. Chen Goes to Wuhan - This American Life

What happens when a Chinese man—just a guy, not a journalist or dissident—decides to go to Wuhan and investigate the country’s response to coronavirus? Reporter Jiayang Fan brings us the story.

2. The economy

China to take more steps to stabilize economic, social development - Xinhua

More targeted measures will be rolled out to keep employment, finance, foreign trade and other major aspects of the economy stable, according to a State Council executive meeting chaired by Premier Li Keqiang Tuesday...

The meeting stressed steady and orderly resumption of work and production in transport, delivery and other logistics sectors to realize stable growth, while calling for improved administrative services and bigger tax and fee cuts.

Insurers are encouraged to reduce or waive related insurance fees for motor vehicles, boats and planes that have been forced out of service due to the epidemic. Different localities are also encouraged to adopt effective measures to help taxi drivers tide over the tough period.

Local governments will enjoy stronger fiscal support, including retaining a bigger proportion of money after turning in a specific share of fiscal revenue to the central government for certain periods of time, faster allotment of transfer payments. General expenditures will be slashed further, according to the meeting.

李克强主持召开国务院常务会议 部署完善“六稳”工作协调机制;有效应对疫情影响促进经济社会平稳运行 确定支持交通运输快递等物流业纾解困难加快恢复发展的措施; 决定加大对地方财政支持 提高保基本民生保工资保运转能力

The policies are targeted to achieve the “six stabilities” (employment, finance, trade, foreign investment, investment and confidence)

Yicai Global - China to Ease Burden on Business by USD73.1 Billion This Year, Finance Ministry Says

The tax and social insurance measures China unveiled in the wake of the novel coronavirus epidemic are expected to ease the burden on companies by more than CNY510 billion (USD73.1 billion) this year, according to a senior finance ministry official.

IPhone Maker Hon Hai Expects China Plants Back to Normal in March - Bloomberg

Hon Hai Precision Industry Co., Apple Inc.’s most important manufacturing partner, expects its Chinese plants to begin operating normally by the end of March after resolving severe labor shortages brought on by the coronavirus outbreak.

China grain output must stay stable amid coronavirus outbreak, provinces told - Reuters

China must not let grain output decline this year, a government working group said on Tuesday, amid worries that measures to contain the ongoing coronavirus outbreak could hurt food security in the world’s most populous country...

In a statement posted on the government’s website, the group also said that regions with good growing conditions should restore double-cropping of rice, reversing recent years’ policy that had sought to target higher quality grain over quantity.

The statement - 中央应对新型冠状病毒感染肺炎疫情工作;领导小组关于印发当前春耕生产工作指南的通知

U.S. not considering suspending tariffs on China in response to coronavirus: Mnuchin - Reuters

“We’re not considering that at the moment, but as this progresses ... we’ll look at all the options that we think are important to help particularly SMEs and particular areas of the economy that are impacted by this,” Mnuchin told a hearing of the House Ways and Means Committee.

China Stopped Its Economy to Tackle Coronavirus. Now the World Suffers. - The New York Times

“An economy is an object in motion,” said Rodney Jones, an economist specializing in China. “A lot of things work in connection: supply chains, shipping, transport, movement of goods. There is no one standing over it telling it which component goes where.”

“The idea that we can stop an economy and restart it is crazy,” he added.

Fiscal tweaks likely to minimize COVID-19 fallout - China Daily

"Fiscal policy has advantages compared with the monetary policy, as it can be targeted and temporary, with a short lag. Thus, fiscal policy is more appropriate and should play the lead role in dealing with the one-off short-term impact of the epidemic," said Zhang Bin, a senior researcher of the China Finance 40 Forum, a think thank.

Chinese policy bank steps up financial support for major projects - Xinhua

As of Feb. 28, the CDB had issued loans worth 144.1 billion yuan (around 20.7 billion U.S. dollars) for work resumption and 26 billion yuan for epidemic control, according to the bank.

China to enhance legal services for epidemic control, work resumption - Xinhua

China's Ministry of Justice has issued a guideline on setting up green channels for legal services concerning the prevention and control of the novel coronavirus, as well as work and production resumption amid the epidemic.

Asking all legal service providers to fully carry out their duties and functions, the guideline calls for prioritized and swift handling of legal services including notarization, authentication and arbitration required in epidemic control and work and production resumption

As Traffic Lockdown Blocks Human Migration, Employers Start Sharing Workers to Maintain Business- PingWest

In a desperate move to maintain businesses amid the ongoing coronavirus outbreak that blocked human migration on a national scale, factories and other service companies began hiring each others' employees to make up for their own loss of workforce due to traffic lockdown, PingWest has found.

Chinese Businesses Are Running Out Of Time—And Cash - WSJ $$

More help from Beijing is definitely coming, but the scale of the response may not be as large as investors hope for the simple reason that China’s banking system isn’t well-equipped to help the small businesses most at risk...

The first quarter is always tough for such businesses in China because of bonuses paid to employees, combined with the long Lunar New Year holiday. The coronavirus has supercharged the problem. ANZ Bank estimates that the quarantine measures will cost corporate China at least 2.6 trillion yuan ($372 billion) in cash flow in the first quarter, while consulting firm Gavekal puts the hit at around 4 trillion yuan.

Coronavirus leaves chefs idle and vegetables rotting. China’s restaurants say their goose is cooked. - The Washington Post

Several weeks into an epidemic that brought the country to a standstill, Chinese officials and economists are increasingly worried about the devastation wrought on a crucial part of the economy: restaurants and retailers, karaoke halls and family-owned factories — countless small and midsize businesses that collectively employ 80 percent of China’s workers and produce 68 percent of the country’s business revenue...

A nationwide survey led in February by Peking University found half the country’s small businesses will run out of cash within three months, and 14 percent might not survive past mid-March. Unlike large state conglomerates or multinational companies that could weather the storm, China’s small businesses say they simply do not have cash reserves to continue paying wages and rent.

Some local manufacturers in Zhejiang asked to falsify work resumption - Global Times

Wenzhou in East China's Zhejiang Province, a major manufacturing base in China, has asked grassroots regulators to rectify policies and remove hurdles that impede business resumption, as an industrial plant in the city was found to be running idle machines to consume electricity.

Coronavirus outbreak is a major wake-up call for U.S. auto industry - Automotive News

My company, ZoZo Go, has never been busier. Since early February, we have gotten waves requests for support from supplier risk-management teams across the industry. They understand the need to find parts supply outside of China. A comment from one executive brought home the gravity of the situation: "We [are] ass-deep in this one."

When will China get back to full production? Recovery will vary by region and by part. But late April is probably the most optimistic timing.

Comment: ZoZoGo also offers a free weekly newsletter on China and the automotive industry

3. Polls and political conference presage worsening US-China relations

Fewer in U.S. Regard China Favorably or as Leading Economy - Gallup

A new Gallup poll finds Americans' favorable rating of China has declined further in the past year, sinking to a record-tying low. For the first time in more than a decade, Americans regard the U.S. rather than China as the world's leading economic power. And with fewer Americans than in 2019 naming Russia as the United States' greatest enemy, Russia and China now tie for first on that list.

Thirty-three percent of Americans currently have a favorable opinion of China, a 20-percentage-point decline since 2018 and an eight-point drop in the past year. China's current favorable rating ties prior readings from 1997 and 2000 as the lowest in Gallup's trend, dating back to 1979. It is similar to the 34% reading in 1989, taken after the Chinese government's crackdown on student protestors in Tiananmen Square.

And for a view of how the US Republican Party as embodied by the recent Conservative Political Action Conference (CPAC) views China, here are two videos from the recent conference- CPAC 2020 - China's New Weapons of War - YouTube

With an opening statement from Gordon Chang, His wife Lydia Tam and others...Rep. Cathy McMorris Rodgers (R-WA), James Carafano, former acting Attorney General Matthew Whitaker and Gordon Chang addressed the audience at the Conservative Political Action Conference

CPAC 2020 - Micheal Pillsbury lavishes praise on Trump’s China policies - YouTube:

And then there is this - Fox News Host Jesse Watters Claims Chinese People Eating ‘Raw Bats’ to Blame for Coronavirus

With fears heightening around the virus as the death toll in the United States jumped to at least six on Monday, Watters began Monday’s broadcast of Fox News chatfest The Five by lashing out at China, which has been the epicenter of the growing pandemic.

“I would like to just ask the Chinese for a formal apology,” Watters said. “This coronavirus originated in China, and I have not heard one word from the Chinese. A simple ‘I am sorry’ would do.”

4. More retaliation against US reporters threatened

‘Political oppression’: China hints at payback for US limits on Chinese state media | South China Morning Post

Chinese foreign ministry spokesman Zhao Lijian said on Tuesday that the US was conducting “political oppression” on Chinese media in the US, and the move would seriously harm ties between the two countries.

“The Americans broke the rules of the game first, and we have to follow,” he said.

He accused the US Department of State of making the decision based on a cold war mindset and ideological bias, and showing hypocrisy about freedom of press...

Pang Zhongying, a Beijing-based international relations scholar, said that this kind of interaction between Beijing and Washington was a throwback to the Cold War, when the US and the Soviet Union occasionally expelled each other’s diplomats, agents and journalists.
“This is a typical cold war symptom, and the China-US relationship has developed quite some symptoms,” he said.

Hua Chunying tweeted a threat:

Comment: Multi-entry vs single-entry visa issue is real. PRC journalists have to reapply for a visa every time they leave the US, foreign journalists can leave and enter the PRC as many times as they want during visa term. Beijing changing those to single entry would cause huge hassles.

China vows revenge on US after limits put on its journalists - The Washington Post

While the United States does give only single-entry visas to Chinese journalists, they are indefinite, meaning a Chinese journalist can stay in the United States for a decade or longer if they want, as long as they do not leave the country.

But foreign reporters in China generally receive only year-long visas, although the Foreign Ministry is increasingly giving six- or three-month visas — and in some recent cases, only one month — to warn resident journalists whose work the ministry does not like.

Global Times not happy with the US moves against PRC/CCP outlets in the US, but seems to lean towards not making it worse with tit-for-tat-Washington’s ridiculous war against Chinese media - Global Times

Washington invented the war on the media. First it pushed Chinese media outlets to register as "foreign agents." Then it designated five Chinese media outlet's operation in the US as  "foreign missions," and now it imposes a cap on the number of Chinese reporters in the US. China revoked three WSJ reporters' press credentials as a punishment for that outlet's publication of an insulting headline and its refusal to apologize, which is a specific case. What the US is doing against the Chinese media is policy-level suppression. The two matters are completely different...

We don't suggest China follow Washington's logic and engage in a tit-for-tat confrontation. China should maintain its principle, continue to offer service and assistance to foreign reporters based in China and carry out necessary management. Foreign reporters who violate professional ethics should be subject to punishment regardless of Washington's reaction

US capping of Chinese journalists defies respect for differences - Global Times

Da Wei, director of the Center for Strategic and International Security Studies of University of International Relations:

There have been many disputes between China and the US in terms of the media. The US government and many US think tanks have issued reports and discussions about Chinese media outlets exerting their influence in the US. The US' move this time can be seen as a step that further leads to China-US decoupling. Such incidents will accumulate and eventually lead to a complete decoupling. The US is accelerating this trend.

Under these circumstances, I believe that China should remain rational and show a responsible attitude toward the development of China-US relations. Indeed, there must be diplomatic opposition and negotiations, but I do not recommend that we adopt tit-for-tat retaliatory measures, which might create a vicious circle. Currently, China should show a rational attitude which is different from that of the US.

Xin Qiang, deputy director of the Center for American Studies at Fudan University:

If the Chinese government imposes similar measures in response, judging from the way US President Donald Trump administration behaves, the US may escalate its retaliation, and a vicious circle will be established between the world's two largest economies. The confrontation and the pattern of tit-for-tat retaliation between the two countries could undermine the already deteriorating bilateral ties.

5. New report on viral censorship

Censored Contagion: How Information on the Coronavirus is Managed on Chinese Social Media - The Citizen Lab

Key Findings:

YY, a live-streaming platform in China, began to censor keywords related to the coronavirus outbreak on December 31, 2019, a day after doctors (including the late Dr. Li Wenliang) tried to warn the public about the then unknown virus.

WeChat broadly censored coronavirus-related content (including critical and neutral information) and expanded the scope of censorship in February 2020. Censored content included criticism of government, rumours and speculative information on the epidemic, references to Dr. Li Wenliang, and neutral references to Chinese government efforts on handling the outbreak that had been reported on state media.

Many of the censorship rules are broad and effectively block messages that include names for the virus or sources for information about it. Such rules may restrict vital communication related to disease information and prevention.

6. China and think tanks in Europe

China’s New Think Tanks in Europe | Echowall - David Bandurski

or well over a decade, the question of how to project a strong and positive image of China globally in order to enhance the country’s “soft power” has been a central concern for the country’s leadership. Since 2007, when Joseph Nye’s concept made its first high-level official appearance in the Chinese Communist Party’s political report, much of the focus has been on strengthening China’s global media presence. But another key priority, particularly since Xi Jinping came to power in November 2012, has been the development of domestic and global think tanks.

This article reviews the push to develop global Chinese think tanks and takes a brief look at one think tank that has been characterized by official Chinese media as “China’s first independently registered think tank in Europe” — the China-CEE Institute in Budapest...

International think tank development is now a priority for China’s leadership, and it is regarded as an extension of China’s global “soft power,” serving the Chinese Communist Party’s narrative about China’s development and its role in the world. “In today’s world, the development and competition between countries is also to a definite degree about the competition of knowledge and strategy,” said Wei Liqun, a former director of the Research Office of China’s State Council, shortly after the release of the January 2015 policy on think tanks. “Therefore, high-level and international think tanks have already become an important indicator of a country’s international discourse power and soft power.”

Read the whole thing here.

Yan Xuetong is editor in chief of The Chinese Journal of International Politics. Creating academic journals is also "an important indicator of a country’s international discourse power and soft power" - Narrating the China Threat: Securitising Chinese Economic Presence in Europe | The Chinese Journal of International Politics | Oxford Academic

This article unpacks the discursive construction of a European ‘China Threat’ narrative by European think tanks. We theorise think tanks as crucial actors in the securitising process, especially at the initial stages where ideas and reference frames are formed. Despite having no decision-making authority, think tanks participate as securitising actors in the process of idea formation and bidding, articulating a securitised frame of reference for policy makers. In the case of EU–China relations, we observe an emerging congruence between think tanks and policy makers that engage in a non-linear construction of a ‘China Threat’ policy frame. In this article, we review key think tank reports that are circulated through official EU policy channels and deconstruct the assumptions behind the ‘China Threat’ discourse.

7. Wikileaks, Qihoo and a report on CIA hacking of China

The CIA Hacking Group (APT-C-39) Conducts Cyber-Espionage Operation on China's Critical Industries for 11 Years - 360 核心安全技术博客

Dating back to 2017, WikiLeaks received a "backup copy" of the hacking materials from Joshua Adam Schulte and disclosed 8716 documents from the CIA of the United States, including 156 confidential documents that detailly record the CIA hacking group’s attack methods, targets, tools and technical specifications and requirements. The disclosure contains a hacking tool Vault 7 (code name) which is considered to be the core cyber weapon.

Qihoo 360 analyzed the leaked material of Vault 7 and associated with the team’s researches, it discovered a series of targeted attacks against China's aviation industry, scientific research institutions, petroleum industry, large Internet companies and government agencies. These eleven-year attacks can be traced back to 2008 (spanning from September 2008 to June 2019), and are mainly distributed in provinces such as Beijing, Guangdong, and Zhejiang. The above-mentioned targeted attacks are all attributed to a U.S.-related APT organization - APT-C-39 (according to Qihoo 360’s code-naming system).

China needs robust action against US cyber-attacks - Global Times

Qihoo 360, one of China's biggest cybersecurity firms, on Tuesday published a document detailing how the US Central Intelligence Agency (CIA)'s hacking group (APT-C-39) has attacked a wide range of Chinese sectors including aviation, scientific research institutions, the petroleum industry, internet companies and government agencies. The company identified the person in charge - a former CIA employee (Joshua Adam Schulte) the cyber weapon that was deployed (Vault 7), and listed five relevant pieces of evidence. The attacks lasted for eleven years, the firm said...

Finally, cybersecurity is a global challenge that requires collaboration among all countries. Even before the Qihoo 360 report, leaked documents from the US have shown the US' massive global surveillance programs and cyber-attack capabilities. In an apparent bid to hide its vicious attacks, Washington has waged a relentless global campaign to accuse China and other countries of cyber-attacks without any proof. The world cannot be fooled by the US and turn against each other to help the US crack down on Chinese tech companies. Countries should join hands in addressing cybersecurity issues.

Ex-C.I.A. Analyst Faces Trial in Biggest Leak of Agency’s History - The New York Times

The breach, known as the Vault 7 leak, was the largest disclosure of classified C.I.A. information in the spy agency’s history and caused “catastrophic” damage to national security, the government said.

This week, Joshua Schulte, a 31-year-old computer engineer who worked at the C.I.A., began trial in federal court in Manhattan to defend against charges that he was the leaker.

8. Gwadar becoming a flaw in the string of pearls?

A China Belt and Road Project Becomes a Corridor to Nowhere - Bloomberg

This is Gwadar, a remote scratch of land on Pakistan’s southwest coast. Its port is the last stop on a planned $62 billion corridor connecting China’s landlocked westernmost province to the Arabian Sea, the crown jewel of President Xi Jinping’s Belt and Road Initiative, designed to build infrastructure and influence around the world.

Plans originally called for a seaport, roads, railways, pipelines, dozens of factories and the largest airport in Pakistan. But, almost seven years after the China-Pakistan Economic Corridor was established, there’s little evidence of that vision being realized. The site of the new airport, which was supposed to have been completed with Chinese funding more than three years ago, is a fenced-off area of scrub and dun-colored sand. Specks of mica in the dirt are the only things that glitter. The factories have yet to materialize on a stretch of beach along the bay south of the airport. And traffic at Gwadar’s tiny, three-berth port is sparse. A Pakistan Navy frigate is the only ship docked there during a recent visit, and there’s no sign of the sole scheduled weekly cargo run from Karachi.

Business, Economy and Trade

As Epidemic Hurts Growth, Local Governments Start Early Bond Binge - Caixin In the first two months of 2020, provincial-level governments sold 1.2 trillion-yuan ($172 billion) of bonds, 56.4% more than the same period last year, data released (link in Chinese) Tuesday by the Ministry of Finance show. Issuance of special-purpose bonds (SPBs) almost tripled to 949.8 billion yuan from 326.1 billion yuan after the central government increased the annual quota of the debt that could be issued early

Zambia Awards China Railway $825 Million Deal for Line Upgrades - Bloomberg The project will last eight years and will cover nearly 650 kilometers (404 miles) of lines, China Railway said a statement, without saying how it will be financed.

Tim Cook and Apple Bet Everything on China. Then Coronavirus Hit. - WSJ $$ Some operations executives suggested as early as 2015 that the company relocate assembly of at least one product to Vietnam. That would allow Apple to begin the multiyear process of training workers and creating a new cluster of component providers outside the world’s most populous nation, people familiar with the discussions said. Senior managers rebuffed the idea. For Apple, weaning itself off China, its second-largest consumer market and the place where most of its products are assembled, has been too challenging to undertake.

Developer China Evergrande's aggressive promotions expected to intensify competition - Reuters China Evergrande Group , the country’s No.3 developer by sales, surprised the market on Sunday when it said it sold more than 99,000 units worth 102.7 billion yuan ($14.7 billion) online in February, boosted by aggressive promotions, despite the coronavirus outbreak. Initiatives including allowing a deposit of as little as 5,000 yuan - with the option to cancel and get a refund - helped Evergrande record bumper transactions in a nearly frozen property market.

Coronavirus: China reports surprising rail freight growth in February despite factory activity tumbling | South China Morning Post Compared to air, road and sea freight, rail freight in China is relatively immune to disruptions, as transport agreements for cargoes such as coal are locked in over long periods, even if the coal is not consumed. In addition, trains have not been subject to blockages by local authorities.

China’s Declining Birth Rate and Changes in CCP Population Policies - Jamestown Online discussions regarding falling birth rates provide a jarring reminder of the rapid shift of China’s demographic situation in recent years. Furthermore, the gap between official and unofficial birth numbers may reflect a broader lack of confidence in government statistics among Chinese netizens. This demographic mystery may not be satisfactorily resolved until after the next PRC census in 2020, and after the Chinese government publishes school enrollment numbers in the next decade (when the most recent population data will be available, and can be compared to school enrollment numbers).

China-made Tesla vehicles downgrade hardware amid epidemic - Xinhua Tesla China issued a statement Tuesday on "downgrading" hardware on the made-in-China Model 3 due to the supply chain status amid the epidemic and promised free upgrades. Some Chinese consumers noticed the hardware in their newly delivered Tesla Model 3 vehicles was inconsistent with their orders. Tesla China responded that the Hardware 2.5 version was installed in some vehicles instead of the promised Hardware 3.0 version

Lawmakers Propose Making E-Commerce Companies Liable for Counterfeits - The New York Times A bipartisan House bill aims to stem the flow of fake goods from China by putting pressure on companies like Amazon.

Oil Trader’s Financial Difficulties Caused by Virus, Lawyer Says - Bloomberg Chinese oil trader Hontop Energy‘s financial difficulties are due to a collapse in demand because of the coronavirus but it expects to recover once refining picks up again in China, according to the company’s lawyer.

Politics and Law

新京报:情绪化反对外国人永久居留权,无益于认识真问题 Liu Yuanju, a columnist for Beijing News, wrote that those who are angry about China’s new green card rule should understand the green cards are for well-educated foreigners, experts only. They should stop seeing this new rule with racisms and xenophobia and understand that bringing in new talents is good for the country.

人事观察|武警北京总队司令员调整, 李维杰少将履新 Major General Li Weijie is the new head of armed police in Beijing. Caixin said this is part of the routine armed police leadership reshuffle beginning late last year.

Yicai Global - Crook Gets Jail in Shanghai's First Trial of USD237,900 Face Mask Scam A Shanghai court has sentenced a man to six years and six months in prison for a scam involving non-existent face masks, a commodity in high demand as protection from the novel coronavirus. It was the first case of its kind.

Xinhua Headlines: Guitars, roads and red tours: former revolutionary base casts off poverty - Xinhua On Tuesday, the government of Guizhou Province announced that Zheng'an County in the province has shaken off poverty. The county is under the jurisdiction of the city of Zunyi, where the CPC conducted its early revolutionary activities. The announcement means that more than 8 million people in the entire city of Zunyi have officially bid farewell to poverty.

Coronavirus tests Xi Jinping's 'heavenly mandate,' but proves a godsend for China's surveillance state - The Washington Post “The novel coronavirus has exposed flaws in Xi’s autocracy: the control on information, the absence of civil society and the lack of transparency have all had human costs,” said Natasha Kassam, a former Australian diplomat in China who is now at the Lowy Institute, a Sydney think tank. “But rather than prompt a rethink in Beijing, Xi and China’s leaders are more likely to double down on the most repressive elements of the regime.”

Opinion | China’s Coronavirus Crisis Is Just Beginning - The New York Times OpEd - By Geremie R. Barmé As both Xu Zhangrun and Xu Zhiyong have pointed out, it is the canker in China’s body politic that turned the coronavirus outbreak into a health crisis far worse than it needed to become. And the epidemic, in turn, has only exposed the extent of the party-state’s sickness.

Foreign and Defense Affairs

听,人类命运共同体的大合唱——中国同国际社会携手抗击新冠肺炎疫情述评-新华网 Long Xinhua piece on how China is working with the rest of the world to fight the virus

China’s state-owned enterprises ‘prime target’ of new EU competition plan | South China Morning Post Margrethe Vestager, the EU’s chief of competition policy and a vice-president of the European Commission, revealed on Monday that the EU would set out a plan in June to strengthen the bloc’s power over “fair competition”. According to a European Union source familiar with the proposal, it will “clearly have in mind Chinese state-owned and state-backed enterprises as the prime target, given their increasingly dominant and aggressive role over critical sectors in Europe”.

Kenyan high court's decision to suspend flights from China not govt stance: Chinese Embassy - Global Times The Chinese Embassy in Kenya has not received a notice of temporary suspension of all flights from China, which was a decision made by a local high court on Friday, and relevant Kenyan government officials have stated that the court decision does not represent the government stance over the matter, the embassy told the Global Times in an exclusive email interview on Tuesday.

China defense minister discusses coronavirus with U.S. - Reuters Wei said the positive trend in China’s coronavirus situation was expanding, according to a statement posted on the Chinese defense ministry’s official WeChat account. He also said that the two militaries should resolve their differences via dialogue and consultation.

Who will head WIPO? - The Washington Post China’s growing economic stature translates into more resources for bargaining and coercion — and here’s how Beijing is using these levers. Last year, China forgave Cameroon’s debt the month before the small African nation withdrew its candidate to head the Food and Agricultural Organization. According to U.S. officials, China also threatened to cut off key exports from Argentina, Brazil and Uruguay if those countries did not back Dr. Qu Dongyu, Beijing’s FAO candidate. China is now reportedly using investment and job opportunities as incentives for votes for its WIPO candidate.

Feature: China's contribution to global IP governance "remarkable" - Xinhua When talking about the development of intellectual property (IP) in China, World Intellectual Property Organization (WIPO) Director General Francis Gurry said "it's a remarkable journey and a remarkable story." Born at the start of reform and opening-up, China's IP cause has taken only decades to accomplish what the western IP system took hundreds of years to develop. While developing and improving its IP system, China has been active in international cooperation to boost global IP governance. // Comment: XInhua lays out China's case for the WIPO director general contest

Why China’s Growing Military Might in Tibet Should Worry India – The Diplomat Beyond individual exercises and more broadly, these developments demonstrate the growing air infrastructure in the TAR, including civilian airports, many of which are used by the PLAAF.  These exercises have continued to grow bigger and more sophisticated.  Even amidst the Doklam crisis in 2017, the PLA was engaged in a joint military exercise on the Tibetan plateau to test agility and combat proficiency in tasks such as assaults on enemy positions.

North Korea is being ‘affected negatively’ by coronavirus, China says - AP China’s U.N. ambassador said Monday that North Korea is suffering “negatively” from the coronavirus and called for greater flexibility from the United States and other countries on lifting sanctions against the country.

Two Chinese Nationals Charged with Laundering Over $100 Million in Cryptocurrency From Exchange Hack | OPA | Department of Justice In the two-count indictment unsealed today in the District of Columbia, 田寅寅 aka Tian Yinyin, and 李家东aka Li Jiadong, were charged with money laundering conspiracy and operating an unlicensed money transmitting business. “These defendants allegedly laundered over a hundred million dollars worth of stolen cryptocurrency to obscure transactions for the benefit of actors based in North Korea,” said Assistant Attorney General Brian A. Benczkowski of the Justice Department’s Criminal Division.  “Today's actions underscore that the Department will pierce the veil of anonymity provided by cryptocurrencies to hold criminals accountable, no matter where they are located.” // Comment: Quite the details in the complaint, including photos of the two indicted

China and the perilous politics of coronavirus - POLITICO Despite reports that Cui and Kushner still talk, people who know the gray-haired ambassador say he appears frustrated at an overall lack of access to U.S. officials, including at the State Department. It’s a frustration likely to rise if the U.S. keeps imposing more restrictions on Chinese diplomats in Washington. Cui also seems tired of his current position. “He just keeps getting extended. They won’t let him go home,” a Washington think tanker who knows him said.

U.S. Issues Formal Protest to China Over P-8A Lasing Incident in Philippine Sea - USNI News On Monday, Chief of Naval Operations Adm. Mike Gilday confirmed the incident and said the United States formally protested to China. “It happened. It’s the first time we saw it happen from that type of PLA ship. We do have protective gear onboard for our pilots, and importantly they’re also trained to deal with it. But I can confirm, it is the first time we saw it. We have, the U.S. government demarched China,” Gilday said while speaking at WEST 2020, cohosted by the U.S. Naval Institute and AFCEA.

The PRC’s Cautious Stance on the U.S. Indo-Pacific Strategy | RealClearDefense A report on the Indo-Pacific Strategy published by a Chinese think-tank, the Institute for China-America Studies, echoes these views. It claims that the Indo-Pacific Strategy, aimed at containing China, will face tough challenges: not only because domestic burdens in Washington will impact the Indo-Pacific Strategy, but also because the United States and its allies will not function well together, pursuing individual interests rather than collective gains. This analysis concludes that the impact of the Indo-Pacific Strategy will be limited, to the extent that China can smoothly proceed with the BRI and develop its diplomatic ties with regional countries (The Institute for China-America Studies, October 2019). From the Chinese point of view, the Indo-Pacific Strategy is not a sustainable concept in the long term.


'Provocative' China Pressures Taiwan With Fighters, Fake News Amid Virus Outbreak - Reuters In the last month, Taiwan has reported three nearby Chinese air force drills, and in two cases Taiwanese fighter jets scrambled to intercept them. Two sources familiar with the situation told Reuters that in one instance, a Chinese fighter's radar locked onto one of the Taiwanese aircraft.

Tech and Media

Film Exec Chris Fenton Sets Book About Hollywood and China’s Union – Variety Chris Fenton, a longtime Hollywood executive who witnessed and assisted in the birth of the mega-rich marriage between Hollywood and China, is set to release a tell-all book about the process...Fenton served as the president of DMG Entertainment and general manager of DMG North America, a multi-billion-dollar global media company headquartered in Beijing. He has produced or supervised twenty-one films, grossing $2 billion in worldwide box-office. // Comment: Looking forward to reading

Chinese Experts Push Data Privacy as Epidemic Systems Proliferate The Feb. 26 post by the "App Governance Working Group" of the China Electronics Standardization Institute (CESI), which is affiliated with the Ministry of Industry and Information Technology, followed a Feb. 9 notice from the Cyberspace Administration of China (CAC) encouraging various actors to "vigorously use big data including personal information" in the fight against the novel coronavirus, while still following established data protection rules.

DingTalk begs for stars on China's app stores · TechNode DingTalk, an online collaboration tool owned by Alibaba, was one of the platforms to step in to and facilitate classes as schools go online during the outbreak. In late January, the app launched new online education features such as grading homework, live-streaming classes, and video replays...Chinese students are not enthusiastic about taking online classes at home, to say the least. Many took to social media to vent and to app stores to leave one-star reviews for the platform.

Energy, Environment, Science and Health

China to establish modern environmental governance system - The guideline, jointly issued by the general offices of the Communist Party of China Central Committee and the State Council, aimed to put in place by 2025 a sound environmental governance system that specifies responsibilities of governments at all levels and firms, encourages public participation and features stronger government supervision. 中共中央办公厅 国务院办公厅印发《关于构建现代环境治理体系的指导意见》

Hubei Struggles to Handle a Mountain of Medical Waste - SixthTone Cities have specialized systems for disposing of medical waste, but they were quickly overwhelmed during the early stages of the epidemic. Before the outbreak began, Wuhan had one dedicated medical waste treatment facility with a processing capacity of 50 tons per day. By Jan. 24, however, the city was producing four times that amount.