Coal and winter heating; Complaints about the iron-ore price; US-China

With 34 days left in the Trump Administration have we passed the moment of maximum risk of Trump Administration moves against China?

The recent Hong Kong-related sanctions on the NPC vice-chairpersons were anti-climatic as they did not cross a Chinese “red line” and include the NPC Chairman, Standing Committee Member and Xi consigliere Li Zhanshu, and last week the Treasury department declined to impose any sanctions on financial institutions over Hong Kong.

We are into the holiday season here, people in the administration need to figure out their next jobs, and frankly President Trump seems to no longer care. As we have learned over the last four years the President can change on a tweet, but I will now guess that while there may still be some additional moves against China things between the US and China will be calmer over the next five weeks than I originally expected (famous last words?)

It looks like the campaign to buy time and space for Xi and the CCP by convincing Team Biden to reduce some of the current pressure on China is well underway. From my qualitative view the PRC relevant organs have toned down anti-American propaganda recently, and Foreign Minister Wang Yi is giving a virtual talk Friday evening New York time at the Asia Society.

Today’s Essential Eight:

  1. Qiushi explains why it ran Xi’s 2017 Davos speech

  2. Sanming, Fujian

  3. Hong Kong

  4. Huawei

  5. Xinjiang

  6. Australia-China

  7. US-China

  8. Heating shortages coming in some provinces?

Holiday schedule: I am planning to send a newsletter next Monday December 21 and then resume publishing Monday January 5, though if interesting things happen during that period I may send out a short newsletter. We are not going anywhere this year, and like all of us I need a mental break, but China only shuts down for a couple of days around the New Year.

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The Essential Eight

1. Qiushi explains why it ran Xi’s 2017 Davos speech

Qiushi published an editorial “The light of thought illuminates the world economic voyage” accompanying the reprint of Xi's 2017 Davos speech (discussed in yesterday’s newsletter). The “thought" here I am assuming refers to Xi's. -思想之光照亮世界经济航程 - 求是网

The light of thought is getting more and more dazzling in the headwind and against the current. Looking around today's world, the epidemic situation is intertwined with world encountering changes unseen in a century, and the trend of openness and accommodation is rolling forward. However, economic globalization is surging against the current, and protectionism and unilateralism continue to spread. How can the world economy, which is in a serious recession, recover as soon as possible? The world has turned its attention to China, seeking Chinese wisdom and Chinese solutions. In the special historical period when the world economy has entered a new crossroads, it is of great significance to revisit General Secretary Xi Jinping's historic speech, deeply comprehend his powerful ideological leading force and charisma, and further understand the general trend, grasp the law, strengthen the confidence of open cooperation, and promote the development of economic globalization in an open, inclusive, inclusive, balanced and win-win direction


Since the 18th National Congress of the Communist Party of China, General Secretary Xi Jinping has coordinated the two major domestic and international situations, presided over a series of meetings, conducted in-depth local investigations and investigations, attended a series of home diplomatic activities and multilateral summits, and systematically put forward the goals, directions and paths for in-depth implementation of the new round of opening-up strategy, leading China to deeply integrate with the world economy and international system and resonate with the world at the same frequency From building a "the belt and road initiative", building a free trade pilot zone, and promoting the construction of a free trade port with Chinese characteristics; From "Made in China" in Canton Fair, to "China Market" in Expo, to "China Service" in Service Trade Fair ... General Secretary Xi Jinping personally planned a series of high-level major strategic measures for opening up to the outside world, and took the lead and steered the Chinese ship to ride the wind and waves in the sea of economic globalization, providing a strong driving force for building an open world economy.


Comment: This piece does not mention “Xi Economic Thought” but it feels like we may be hearing a lot more about it soon. The audience for this reprint is domestic. Coming out of a remarkably successful year given the pandemic, and especially when compared with the messes in most of the major economies, the message is once again Xi is a visionary, he is leading the ship of China, not as the helmsman using the term 舵手 that Mao Zedong got, yet, but nonetheless it is Xi's wisdom, vision and leadership that has brought China to this point.

2. Sanming, Fujian

Page 1 People's Daily has the first of at least two articles praising Sanming, Fujian, and Xi's attention to it since was an official in Fujian, as an example of comprehensively implementing the "new development concept", and eradicating poverty while building up industry and protecting the environment. Sanming was important in the early days of the Communist Revolution. This article concludes with lines from the 1930 poem Mao wrote when he was there. Mao is never far away in Xi’s PRC.


"For more than 20 years, Sanming's economic and social development has made remarkable progress. The fundamental reason lies in consistently doing all the work in accordance with Comrade Xi Jinping's important entrustment and unswervingly implementing the new development concept in light of reality." Lin Xinglu, secretary of Sanming Municipal Party Committee, said, "When General Secretary Xi Jinping visited Fujian in November 2014, he proposed to' strive to build a new Fujian with a living mechanism, excellent industry, rich people and beautiful ecology'. We have been working towards this goal, picking up our sleeves and cheering. "

Focusing on the mechanism, industrial Excellence, people's wealth and ecological beauty, Sanming continues to push forward the "four efforts", and strives to do four articles: "Red Sanming", "Industrial Sanming", "Green Sanming" and "Civilized Sanming".

Sanming was the core area of the Central Soviet Area and one of the starting points of the Long March of the Central Red Army. Red accumulation is the most important spiritual resource in Sanming, and red genes have been passed down from generation to generation.

"Ninghua, Qingliu, Guihua --
What narrow paths, deep woods and slippery moss!
Whither are we bound today?
Straight to the foot of Wuyi Mountain.
To the mountain, the foot of the mountain,
Red flags stream in the wind in a blaze of glory. "

In 1930, Comrade Mao Zedong wrote "New Year's Day" in Sanming.

In the past, "the road was deep and the moss was slippery", but now, "the road is wide and the forest is lush and the grain is abundant". Under the guidance of the new development concept, the red flag of the wind exhibition remains the same, and the picturesque Sanming is more beautiful






Comment: Repeating from item 1, this piece does not mention “Xi Economic Thought” but it feels like we may be hearing a lot more about it soon

3. Hong Kong

Shenzhen officially charges Hong Kong 12 for illegally crossing border | Apple Daily

The Yantian People’s Procuratorate said in a statement on Wednesday that two of the defendants, Quinn Moon and Tang Kai-yin, were charged with organizing an illegal border crossing, an offense which carried a maximum penalty of seven years in jail.

Eight other members of the group were charged with crossing the border unlawfully, which could result in a fine and imprisonment of up to a year. The two remaining defendants were underage and would face a closed-door hearing, the prosecutors added.

The formal charges came nearly four months after the group was first arrested. The 12 were trying to head to Taiwan from Hong Kong on Aug. 23

First batch of officials swear allegiance to SAR - RTHK

All 12 under secretaries and 14 political assistants have sworn allegiance to the SAR and the Basic Law, setting the stage for the city's 180,000 civil servants to follow suit.

The oath-taking ceremony was held at the Central Government Offices on Wednesday and witnessed by Chief Executive Carrie Lam.

The officials sang the national anthem and read out the oath, holding up their right hand.

Politically appointed officials in Hong Kong swear to uphold Basic Law, swear allegiance to HKSAR - Xinhua

"The taking of the oath to uphold the Basic Law and bear allegiance to the HKSAR by the under secretaries and political assistants is of great significance. They made a solemn promise on their responsibilities, genuinely showing to the community their loyalty and commitment to the Basic Law and the HKSAR and thereby boosting the confidence of the public in the politically appointed officials," a government spokesman said.

Further to the taking of the oath by politically appointed officials, the Civil Service Bureau (CSB) issued a circular in October requiring all civil servants joining the HKSAR government on or after July 1 this year to take an oath or sign a declaration as one of the conditions for appointment.

China's authoritarian language is taking over Hong Kong — Quartz

To try to quantify the anecdotal impression that officials are speaking in a different voice in parallel with a deepening crackdown, Quartz collected and analyzed the past decade’s press statements from the Hong Kong government...

Broadly, the newly strident rhetoric appears to be aimed at several goals: reinforcing China’s absolute national sovereignty; refuting criticisms and justifying the government’s own actions; exerting control over civil society; and redefining concepts like human rights to align them with CCP ideology.

Comment: As rumors swirl about Carrie Lam’s political future. Does anyone in Hong or Beijing like her, or has she alienated everyone?

Why pro-establishment camp abruptly makes an onslaught on Carrie Lam|Lau Sai-leung | Apple Daily

A featured story by the Sing Tao Daily is the latest one. Lam was going to report on her work in Beijing, but was told at the last minute her trip to Beijing had been called off. The Sing Tao Daily cited an informant pointing out there are three possible reasons why Lam’s trip was canceled at the eleventh hour: the top leaders are too busy to meet her; in light of a plethora of anti-epidemic affairs to tackle, there is nothing to deliberate on at the meeting; with the risk of infection in Hong Kong is higher than the mainland, they would rather adjourn the meeting if nothing necessary. In short, she was cold-shouldered. Turning out at the 40th anniversary of the establishment of the Shenzhen Special Economic Zone last time, she had already been seated in a corner, which everybody was abuzz about. 2021 is the year of the race for the post of chief executive. Is it the case that there have been some contenders that can’t wait?

Beijing shunning Carrie Lam is 'pure speculation' - RTHK

This time last year and the year before, Lam was already in the capital for her annual duty visit, while in 2017, the trip had already been completed.

But this year there's been no word on when the visit is to take place, sparking speculation that Beijing isn't happy with the way Lam has handled the pandemic situation in Hong Kong.

4. Huawei

Govt sets up ‘trusted source’ bar for phone companies to shield them from attacks - india news - Hindustan Times

Phone companies in India can only use telecom equipment certified by a top security panel to have come from a “trust source”, the Union Cabinet decided at its meeting chaired by Prime Minister Narendra Modi on Wednesday. The certificate will be issued by a security panel headed by Deputy National Security Advisor Rajender Khanna who reports to NSA Ajit Doval. A former chief of India’s external intelligence agency, Research and Analysis Wing, Khanna heads the technologies section in the National Security Council Secretariat, people familiar with the matter said...

The move comes against the backdrop of concerns expressed in India and abroad over mobile companies using equipment manufactured by the China-headquartered Huawei that has been accused by the United States of spying for Beijing. One official said the new security directive owed its origin to a presentation made way back in July by India’s lead intelligence agency on the risks posed by Chinese companies across different sectors.

Huawei Gets Conditional Green Light in Germany as Government Approves Security Bill - WSJ $$

The German government on Wednesday moved to allow the use of Huawei’s technology in 5G mobile networks in exchange for assurances by the Chinese vendor about the safety of its gear, in a rebuke to the Trump administration.

The bill, which still requires parliamentary approval, marks a setback for the outgoing U.S. administration, which has long lobbied European allies to reject Huawei’s technology...

Under the bill, networking-equipment vendors would have to give assurances that their gear is safe to use, making them financially liable for any breach. The legislation would also require vendors and operators to give German security agencies far-reaching technical and legal means to monitor the network’s integrity.

German politician and Member of the European Parliament Reinhard Bütikofer pushed back on this WSJ story on Twitter, so Huawei should probably not be popping the Moutai just yet:

Meanwhile at Huawei Denmark:

5. Xinjiang

Alibaba's Software Can Find Uighur Faces, It Told China Clients - The New York Times

Alibaba’s website for its cloud computing business showed how clients could use its software to detect the faces of Uighurs and other ethnic minorities within images and videos, according to pages on the site that were discovered by the surveillance industry publication IPVM and shared with The New York Times. The feature was built into Alibaba software that helps web platforms monitor digital content for material related to terrorism, pornography and other red-flag categories, the website said.

The discovery could thrust one of the world’s most valuable internet companies into the storm of international condemnation surrounding China’s treatment of its Muslim minorities...

After The Times asked Alibaba about the tool this week, the company edited its website to remove the references to Uighur and minority faces.

“The ethnicity mention refers to a feature/function that was used within a testing environment during an exploration of our technical capability,” an Alibaba Cloud representative said in a written statement. “It was never used outside the testing environment.”

Comment: When these features are discovered the playbook response seems to be that it was just a technical test and then to delete mentions of it from their website…The international ramifications of this for Alibaba and its top executives could be significant if they end up on any sanctions lists. And it may make things awkward for the NBA since Alibaba executive vice chairman Joe Tsai owns the Brooklyn Nets. Also, has Alibaba put as many technical resources into scanning its site for counterfeit products?

European Parliament resolution would seek sanctions on Chinese officials in Xinjiang | South China Morning Post

The European Parliament will urge European Union leaders to use new sanction powers to punish Xinjiang officials but stop short of invoking any claim of “genocide”, according to a draft resolution seen by the South China Morning Post.

The motion’s preparation comes shortly after the EU’s foreign policy chief, Josep Borrell, dodged questions whether he planned to introduce sanctions against those found to have suppressed the Uygur Muslim communities in China’s northwest.

Commentary: Time to stop fabricating "forced labor" lies on China's Xinjiang - Xinhua

Adrian Zenz should visit China's Xinjiang Uygur Autonomous Region and see for himself what is really happening there.

Once again, the so-called German scholar fabricated an absurd lie that hundreds of thousands of people in Xinjiang are forced to pick cotton in a report published by the Center for Global Policy in the United States.

As an anti-China figure, he must have an intentional misunderstanding about the term "forced labor."

As chief rabbi, I can no longer remain silent about the plight of the Uighurs | The Guardian 

At this very moment, an unfathomable mass atrocity is being perpetrated. Though the task is great, none of us are free to desist from it. As Nelson Mandela himself said: “It always seems impossible until it’s done.”

• Ephraim Mirvis is an Orthodox rabbi who serves as the chief rabbi of the United Hebrew Congregations of the Commonwealth

6. Australia-China

Australia to Challenge China at the WTO as Tensions Escalate - Bloomberg

Trade Minister Simon Birmingham said Wednesday that the government had advised counterparts in Beijing of its intention “to request formal consultations with China.” The dispute process could take years to be resolved, but the organization should recognize that the tariffs are “not underpinned by facts and evidence,” he said...

Birmingham didn’t rule out the possibility of raising further WTO challenges against China, saying that anti-dumping claims made by Beijing against the Australian wine industry that could push tariffs to over 200% had similar criteria to those made about barley, and that the government has the ability to respond.

Aussie WTO suit against China purely political: Global Times editorial

The problem with Australia is that it is the disrupter of China-Australia political relations, which is obvious to all. But it seems Canberra has taken destroying relations with Beijing in a high-profile manner as a chance to show its loyalty and commitment to strengthen the US-Australia alliance.

Australia has taken the lead in jeopardizing normal economic and trade exchanges with China, viewing bilateral cooperation through the lens of national security and ideology, and overthrowing the trade principles formed between the two for a long time.

China has exercised restraint. So far, Beijing has never used "national security" to obstruct cooperative projects between China and Australia which benefit Australia...

We want to advise Canberra: Please take it as a real trade dispute at the WTO, rather than make it a farce with its prime minister, members of parliament, and media all involved and discuss whether Australia should strike a counterattack on China through iron ore trade. Isn't it a lawsuit? China will respond in accordance with rules and settle it with Australia within rules.

Australia has stupidly turned itself to the frontline of China-West confrontation

Comment: By "China-West confrontation" they mean "China-US confrontation". The Biden Administration will need to move quickly and robustly to demonstrate to Australia that the US supports them.

Why China sees Australia as an obvious target for its punitive economics | South China Morning Post

From China’s perspective, Australia is the weakest link in the US-led “Quad” security bloc – also consisting of India and Japan. Amid growing fears about an expanding anti-China coalition in its backyard, Beijing has decided to act to prevent the emergence of an “Indo-Pacific Nato”. Australia is an obvious target, especially when China is already at loggerheads with India and Japan over long-running territorial disputes in the midst of its adversarial rivalry with the US.

China-Australia relations: miner Rio Tinto questioned by China steel association over ‘unreasonable’ iron ore prices | South China Morning Post

On Tuesday, China Iron & Steel Association (CISA), the domestic steel industry association, held a video conference with Rio, one of China’s biggest iron ore suppliers, days after an online meeting with rival miner BHP, and said the current ore price was “unreasonable”.

That price stood at about US$153 per tonne on Wednesday, after reaching nearly US$160 a tonne last week – about double the price at the start of the year.

CISA questioned whether miners had deliberately restricted supplies to send prices soaring.

Comment: CISA is reminding Australia of the leverage it has.

Fear of job losses rise in Australian agribusiness amid souring ties: AustCham China survey - Global Times

"Our members are fearful of significant job losses to come, particularly in the wine industry, as Chinese imports from Australia are curtailed," noted Nick Coyle, CEO of AustCham China.

7. US-China

Trump DNI Ratcliffe Stirs Dispute Over China 2020 Election Meddling Views - Bloomberg

President Donald Trump’s spy chief is considering holding up a report to Congress on foreign efforts to sway the Nov. 3 election, arguing that China should be cited more prominently for its attempts to influence American voters, according to people familiar with the matter.

The disagreement that’s dividing U.S. intelligence officials and analysts has prompted Director of National Intelligence John Ratcliffe to weigh withholding his certification of the report that’s supposed to be delivered to U.S. lawmakers on Friday, the people said.

Bob Iger, Jeffrey Katzenberg In the Mix for Biden Ambassadorship Roles | Hollywood Reporter

It appears that Bob Iger might have a future in public service after all. The Disney executive chairman, who once toyed with the idea of a 2020 presidential run, is at the top of President-elect Joe Biden’s wish list for a key ambassador post, namely China or the U.K., sources tell The Hollywood Reporter.

Comment: A key condition should be that he commits to wearing a Winnie the Pooh tie when presenting his credentials to Xi Jinping...Seriously, it would not be a great look for someone who has actively changed content globally to appease the CCP to be rewarded with the job as the American emissary in Beijing.

US satellites to track Chinese dams on Mekong river, as it likens ‘threat’ facing Southeast Asia to South China Sea | South China Morning Post

Threats to Southeast Asian unity on the Mekong are as “existential” as those in the South China Sea, according to the United States, which this week launched a project that will use satellites to track water levels at Chinese dams along the river.

David Stilwell, US Assistant Secretary of State for the Bureau of East Asian and Pacific Affairs, told members of the Association of Southeast Asian Nations (Asean) there was strength in taking a common position on the Mekong. He likened their predicament to the situation in the South China Sea, where Beijing has overlapping territorial claims with several of the bloc’s members. 

Sources of Chinese Conduct: A Debate - YouTube

the State Department’s Policy Planning Staff – an organization that Kennan founded and led – published an analysis of 21st-century Chinese conduct meant to provide the underpinnings for a new American approach to contending with Beijing’s growing might.

Did Kennan’s successors hit the mark on China? What is the nature of our competition with China? And what should we be aiming for? Join the Center for the National Interest for a debate between Peter Berkowitz and Elbridge Colby on the Policy Planning Staff’s bold new publication, moderated by Jacob Heilbrunn.

Minxin Pei | China’s Fateful Inward Turn: Beijing’s New Economic Strategy as Spelled Out by the Resolution of the CCP Central Committee’s 5th Plenum

The resolution of the 5th plenum mainly reiterates familiar policy statements on the state sector. Based on the order in which the policy statements are arranged, the document makes it abundantly clear that the state sector will be the primary force in implementing China’s new economic strategy. “The state-owned economy must be consolidated and developed unwaveringly, while the development of the non-state economy must be unwaveringly encouraged, supported, and guided. Reform of state-owned assets and enterprises must be deepened. State-owned capital and enterprises must be made stronger, better, and bigger…. The role of the state-owned economy as a strategic pillar must be exercised…. Mixed ownership reform of SOEs must be deepened (毫不动摇巩固和发展公有制经济,毫不动摇鼓励、支持、引导非公有制经济发展。深化国资国企改革,做强做优做大国有资本和国有企业…. 发挥国有经济战略支撑作用).[24]

​Taken together, the highly publicized resolution of the 5th plenum and Xi’s speeches on China’s new economic development framework should be treated as signals of the CCP’s resolve that it is now prepared to become involved in sustained geopolitical competition with the U.S. Based on its optimistic tone and forecast, these pronouncements are designed mainly to alleviate domestic concerns about China’s economic future in an unfavorable external world. While the top Chinese leaders have now set the overall direction of China’s future economic course, they have yet to formulate many critical policies to fulfill their aspirations and resolve the serious contradictions embedded in their new economic strategy.

8. Heating shortages coming in some provinces?

Yicai - Two Provinces Ration Power as Hard Winter Strains China’s Electricity Supply

Peak loads this winter are expected to exceed the maximum power supply that Hunan province can generate, said Chen Hao, spokesperson for the State Grid Hunan Electric Power. Based on the rising electricity consumption in the first 11 months of the year, Hunan is expected to run short of power this winter, regardless of the weather, he added.

The shortage in the provincial capital Changsha is even more severe due to a drop in coal supplies, lower water levels at reservoirs, decreased power input from outside regions and the inability of wind turbines to generate electricity effectively under freezing conditions, said Wu Donglin, spokesperson for Changsha Power Supply.

Yicai - Henan’s Coal Mines Roar Back to Life as Demand, Prices Soar

Soaring prices are making buyers anxious. “This customer paid CNY600 per ton for the coal and is in a hurry to get it before prices go up even further,” a truck driver from neighboring Shandong province told Yicai Global.

"Such a thing was unimaginable just a few months ago," the head of Zhengzhou Coal Industry’s Chaohua mine said. Coal prices have been low in recent years. The mine has not paid its workers since July due to sluggish sales in the first half, he said. Now the miners are all eager to work in anticipation of receiving their overdue salaries before the end of the year, he added.

The hike in the cost of coal is the result of insufficient supply being unable to meet a sudden spike in demand, an executive of Henan Anneng Industry, which mostly sells clean coal, told Yicai Global. Domestic output has been sluggish all year due to the low prices and imports have been cut.

Now that it is winter, and more coal is needed as fuel for heating, demand is surging, he said.


The full Yicai story on how hard it is to buy coal in Henan right now.

China's coal supply sufficient for winter heating: economic planner - Xinhua 

The supply-and-demand in the coal market is generally balanced with sufficient supply for this winter and spring next year, said Meng Wei, a spokesperson with the National Development and Reform Commission, at a press conference.

The demand for coal rose remarkably this winter due to lower temperatures and robust demand in the electricity, steel and construction materials sectors.

Business, Economy and Trade

China reduces items on the negative list for market access | Reuters The 2020 list of industries that are either restricted or prohibited has been cut to 123, according to a document released by the National Development and Reform Commission on Wednesday, compared with 131 sectors on the 2019 list. Among the changes, foreign companies are now allowed to explore for, and produce, oil and gas in China. The restriction on foreign firms seeking to carry out carbon emission assessment in China was also lifted. // Question: Will this help with the investment treaty negotiations with the EU? Only 14 days left to get that deal done in 2020

遭多家银行“炮轰”,河南最大国有粮食集团及母公司陷入债务危机_手机网易网 2 more Henan SOEs facing credit issues - Yuliang, Henan's largest foodstuffs SOE and its parent company are in trouble. After problems at Yuliang’s parent Everbright Bank called in their loans and then went to court to freeze their assets.

潜望丨永煤、华晨冲击波后续:超千亿信用债取消发行,债市将迎重新定价 _ 证券时报网 Securities Times reports that over 100B RMB in debt issuance was cancelled after the Yongmei and Huachen defaults

Consumer spending to get boost in 2021, experts say - China Daily Unlike the stimulus measures targeted at the property market in some previous economic cycles, the upcoming demand-side reform is supposed to roll out long-term mechanisms to expand the middle-income population, they said before a key economic meeting set to chart the course for next year. "Insufficient domestic demand is still one of the main problems for policymakers. To expand demand and consumption, ensuring employment and creating more jobs will continue to be the top priorities of China's economic policies next year," said Xu Hongcai, deputy director of the China Association of Policy Science's economic policy committee.

SMIC appoints former TSMC R&D head as executive director, highlighting need for pragmatism amid push for home-grown tech | South China Morning Post Chiang Shangyi, who spent nine years as head of research and development at Taiwan foundry giant TSMC before retiring in 2006, has been appointed executive director and vice-chairman of SMIC and a member of its strategic committee, according to a SMIC stock filing on Tuesday...Chiang, 74, previously led TSMC in setting milestones in semiconductor technology in the 0.25 micrometre to 16 nanometre nodes, transforming the company from a “technology follower to a technology leader,” the SMIC statement read. Chiang is entitled to an annual cash compensation of US$670,000 and other annual incentives. In June he resigned as chief executive of the cash-strapped Wuhan Hongxin Semiconductor Manufacturing Company (HSMC), telling the Post that his experience with the company was “a nightmare”.

Shares of China’s biggest chipmaker drop on reports co-CEO has quit | Financial Times $$ In what appeared to be a resignation letter circulated on Chinese social media, Mr Liang said SMIC’s decision to hire Chiang Shang-yi as vice-chairman had pushed him to quit. Mr Chiang was previously vice-president of research and development at Taiwan Semiconductor Manufacturing Corporation, the world’s most advanced chipmaker, whose technology SMIC aims to rival. “I was completely astonished and puzzled, because I had heard nothing about this beforehand. I deeply feel that I am no longer respected and trusted,” stated the letter. It added that SMIC’s chairman called Mr Liang a week ago to tell him about the hiring of Mr Chiang

Chipmaker Renesas extends China reach with FAW research lab - Nikkei Asia The partnership "will drive further development and innovation for China's automotive industry," Tomomitsu Maoka, chairman of Renesas Electronics China, said in a statement Wednesday. The lab opened Dec. 1 in Changchun. Renesas will contribute its high-performance automotive processors, an area the company is strong in, as well as system chips and software. The first fruits of the development tie-up will go into FAW's flagship Hongqi brand of vehicles.

Ex-Banking Official Accused at Trial of Taking Record Amount of Bribes - Caixin Song Jianji, a former deputy head of the now-defunct China Banking Regulatory Commission’s (CBRC) Inner Mongolian branch, stood trial Tuesday in the autonomous region’s capital Hohhot, according to a statement (link in Chinese) issued by a local court. Song is accused of taking bribes in exchange for help worth more than 229 million yuan ($35 million) between 1995 and 2017 when he worked at the regional branches of the central bank and the CBRC

“一带一路”税收征管合作机制会议取得15项最新成果 _ 证券时报网 A few days ago, a high-level video conference of the "the belt and road initiative" tax collection and management cooperation mechanism was held with the theme of "New Challenges, New Opportunities and New Development-Tax Information Development Plan under the Background of Global Epidemic". More than 200 representatives from tax bureaus of 16 countries (regions), deputy directors of tax bureaus of 10 countries (regions), relevant heads of tax bureaus of 21 countries (regions), senior officials of 9 international organizations and members of expert advisory committees attended the meeting. All parties exchanged ideas and issued joint statements around topics such as tax information development planning, and the meeting achieved 15 latest achievements. Wang Jun, Chairman of the Council of the "the belt and road initiative" Tax Collection Cooperation Mechanism and Director of the State Administration of Taxation of China, attended the meeting and delivered a speech.

Protest at China-backed nickel-smelting firm in Indonesia turns violent, with buildings and vehicles torched | South China Morning Post A demonstration by some 800 Indonesian workers looking for a pay rise from a Chinese-backed nickel firm on Sulawesi island turned violent on Monday, with buildings and heavy machinery torched after management failed to meet the protesters.

Goldman Sachs on how to invest in China in 2021 - CNBC China is a “once in a generation opportunity” for investors, according to a Goldman Sachs stocks expert. Luke Barrs, head of fundamental equity client portfolio management EMEA at the investment bank’s asset management division, spoke to CNBC about how to invest in China in 2021 despite its ongoing poor relations with the U.S.

Politics and Law

陈敏尔:坚决贯彻总体国家安全观 扎实有效做好安全稳定工作--新闻报道-人民网 Chen Miner: Resolutely implement the overall national security concept and do a solid and effective job in security and stability

Report on government websites and new media platforms inspection released - State Council 328 government websites were inspected, of which 91.8 percent are up to standard. The scores of Guangdong, Beijing, Hunan and three other provincial government websites rank highly. The Ministry of Water Resources, the National Development and Reform Commission, and the State Administration for Market Regulation are also given high scores. 728 government new media platforms were inspected, of which 91.9 percent are up to standard...Government websites and new media platforms have become important channels to achieve greater government transparency and improve governance capacity.

Ahead of Communist Party Centenary, Jilin Plans ‘Red Villages’ - SixthTone Jilin has been named a pilot province for the “red village” project, which aims to promote the core values of the Communist Party of China (CPC), local media reported Monday, citing a statement from the provincial finance department. The plan is part of a three-year project spearheaded by the Ministry of Finance and the CPC’s Organization Department. According to the statement, the central government has already earmarked funds to support building nine red villages in Jilin, though the amount hasn’t been disclosed. The purpose of such villages will be to “pass on red genes and promote revolutionary tradition.” They will also reportedly help locals “improve rural production and living facilities” and “create peaceful and beautiful homes.”

Henan court apologizes for curbing consumption of 9-year-old orphan - Global Times The court notice claimed that the wrongdoing was caused by individuals' poor execution, which has caused a negative impact on the society. The restrictions have since been lifted. The topic has attracted more than 1 million views on Weibo as of press time, with some appraising "the court's courage to make things right", as most netizens showed their sympathy toward the 9-year-old girl, who was an orphan, and questioned "what is the significance of the restrictions on consumption for a 9-year-old orphan."

Gui Minhai’s last days in Thailand | Safeguard Defenders new details about this removal from Thailand back to China

Xi Focus: Collection of Xi's articles on adhering to overall law-based governance published - Xinhua A collection of articles by Xi Jinping, general secretary of the Communist Party of China (CPC) Central Committee, on adhering to overall law-based governance has been published by the Central Party Literature Press. The book, compiled by the Institute of Party History and Literature of the CPC Central Committee, is available nationwide. The book contains Xi's 54 articles, many of which were published for the first time.

Highlights of the Outline for Constructing a Rule of Law-Based Society - ChinaLaw Translate

China’s Draft Privacy Law Both Builds On and Complicates Its Data Governance - DigiChina The Chinese government in October released the long-awaited draft of its comprehensive privacy law, the Personal Information Protection Law (PIPL). DigiChina’s full English translation is here. As a whole, the draft PIPL largely follows mainstream global approaches to personal data protection, adopting many elements common to other privacy laws, such as notice-and-consent, individual rights, and a comprehensive set of data governance duties for personal information handlers. Notably, it also briefly addresses some still emerging topics in privacy law, such as algorithmic transparency and facial recognition. And it restricts processing of personal information that has already been made public, limiting further use of such data to the scope of use for which the data was originally made public. The draft PIPL is a crucial piece for China’s data governance legal regime, and although it is still subject to revision, it provides insight into the evolving process and potential future directions of Chinese regulation.

Foreign and Defense Affairs

Canada PM hopes for good news soon about fate of two detainees in China | Reuters Asked by Global News whether he thought there would be good news for the men’s families before the New Year, Trudeau replied: “I certainly hope so.”

Exclusive-Suspected Chinese hackers stole camera footage from African Union - memo | Reuters Acting on a tip from Japanese cyber researchers, the African Union’s (AU) technology staffers discovered that a group of suspected Chinese hackers had rigged a cluster of servers in the basement of an administrative annex to quietly siphon surveillance videos from across the AU’s sprawling campus in Addis Ababa, Ethiopia’s capital. The security breach was carried out by a Chinese hacking group nicknamed “Bronze President,” according to a five-page internal memo reviewed by Reuters. It said the affected cameras covered “AU offices, parking areas, corridors, and meeting rooms.”

China, AU break ground on landmark project to advance Africa's public health - Xinhua Construction of the China-aided Africa Centers for Disease Control and Prevention (Africa CDC) headquarters commenced on Monday in the Ethiopian capital Addis Ababa, in a landmark project that testifies to flourishing China-Africa cooperation. Senior officials from the African Union Commission (AUC) and the Africa CDC, representatives of African countries, diplomats from the Chinese mission to the AU and high-level dignitaries witnessed the groundbreaking ceremony of the project on the southern outskirts of Addis Ababa. The project, featuring modern offices, high-end laboratories and accessories, covers an area of 90,000-square-meter and is expected to be completed within 25 months...Once completed, the Africa CDC headquarters will be another landmark venue in Addis Ababa, where the China-aided AU headquarters, the tallest structure in Ethiopia so far, is located.

Proxy war - Sensing change in Washington, China is mustering allies at the UN | China | The Economist NEW YORK Gift this article When america withdrew from the un Human Rights Council in 2018, China expressed regret. No one bought it. The forum deals with a topic that is a huge potential embarrassment for China. The absence of the world’s most powerful democracy from its deliberations made it likelier that China’s abuses would escape censure. But with Joe Biden preparing to take over as America’s president, China fears trouble ahead. It is girding its loins in the council. Evidence of this can be detected in a shadowy feud over who should lead the Geneva-based body. It involves an attempt by China—backed by Russia and Saudi Arabia—to nobble the presumed front-runner for control of the presidency, the tiny Pacific island nation of Fiji, and manoeuvre a country more to its liking into that position.

The Taiwan ‘prize’ and the US-China rivalry in the Pacific | Politics News | Al Jazeera The uproar over the recent fisticuffs between Chinese and Taiwanese diplomats in Fiji may have subsided, with the Fijian police declaring the case closed, but the incident has left analysts in the Pacific concerned about what they called Beijing’s increasingly hostile tactics in the region. The altercation took place on October 8 when Chinese diplomats tried to gatecrash an event marking Taiwan’s national day. Violence ensued and a Taiwanese diplomat was hospitalised with a head injury.

宋涛参加中国-瓦努阿图执政党视频交流活动_国际新闻_大众网 On the 14th, Song Tao, head of the International Liaison Department of the CPC Central Committee, participated in the video exchange activity between the ruling party of China and Vanuatu, and exchanged views with the main leaders of the Waku Party, such as Chairman of Vanuatu Waku Party and Prime Minister Loughman, on deepening the exchange of experience in governing the country and promoting pragmatic cooperation.

一带一路智库合作联盟举办国际视频研讨会--国际--人民网 The "the belt and road initiative" think tank cooperation alliance, initiated by the International Liaison Department of the CPC Central Committee, held an international video seminar on "China's new development pattern and high-quality joint construction of' the belt and road initiative'" on the 14th. Song Tao, head of the International Liaison Department, and former Egyptian Prime Minister Sharaf, former Tanzanian Prime Minister Pinda, former Bosnian Prime Minister lagumdzija, former Australian Prime Minister Kevin Rudd, president of the Asia Society of America, former Thai National Assembly President Ponchin, and former Malaysian National Assembly Vice President Weng Shijie made keynote speeches.

Xinhua president calls on China, ROK think tanks, media to promote bilateral ties - Xinhua He Ping, president and editor-in-chief of Xinhua News Agency, on Wednesday called on think tanks and the media of China and the Republic of Korea (ROK) to deepen exchanges and cooperation in promoting China-ROK relations. He made the remarks while addressing a dialogue between think tanks and the media of the two countries via video links.

Debunking a New Chinese Talking Point Against U.S. Policy in the South China Sea - Lawfare “We see that the position of the U.S., to take no position on the territorial issues, has been derogated.” Some observers might dismiss this criticism as merely the views of one Chinese scholar sharing her personal opinion, but the public record suggests otherwise...this analysis will assume arguendo that the underlying premise of this new Chinese talking point is true and then briefly identify three implications of the talking point and quickly discredit each of those implications. Second, this analysis will focus on the core assertion of this new Chinese talking point and refute its substance. Ultimately, this analysis will show that this new Chinese talking point is false and should be dismissed as such because the U.S. has not, in fact, abandoned its position on sovereignty disputes in the South China Sea.

China's top political advisor holds talks with Pakistani Senate Chairman - Xinhua Wang said the two sides should take the opportunity of the 70th anniversary of their establishment of diplomatic ties next year to maintain high-level contacts and advance anti-pandemic cooperation. He called for building the China-Pakistan Economic Corridor in a high-quality way, deepening economic, trade, and financial cooperation, and cementing people-to-people exchanges.

When You Live Next to an Autocracy - The Atlantic praise from the West for democratic progress cannot make up for uncomfortable geography. “Mongolia’s strong economic dependence on China is worrisome,” Oyunsuren Damdinsuren, a senior lecturer at the National University of Mongolia’s School of International Relations and Public Administration, told me. “If China decides not to buy Mongolian products, our economy will be paralyzed.” This power imbalance has helped fuel broad anti-Chinese sentiment among Mongolia’s population, aided by a history of “200 years of Manchu rule, 70 years of anti-China communist propaganda, and 30 years of China-bashing electoral campaigns,” Damdinsuren said.

China, Caribbean countries hold meeting on COVID-19 response - Xinhua Chinese Vice Foreign Minister Zheng Zeguang and Kenneth Darroux, foreign minister of the Commonwealth of Dominica, co-chaired the meeting. Zheng briefed his Caribbean counterparts on China's prevention and control of COVID-19 as well as the situation regarding its social and economic development. He commended the cooperation between the two sides on jointly fighting the pandemic and stressed that China will take more concrete measures to support the Caribbean countries on their COVID-19 response and economic recovery.

An Ignored Canary in an Unknown Coal Mine: The Caribbean’s Economic Engagement with China – The Diplomat While Beijing’s model as a supplier of investment and infrastructure in the Caribbean has been deeply problematic, its approach does respond to real demand side issues, i.e., the yawning gap Caribbean states confront in terms of how to fund infrastructure development. The Caribbean Development Bank (CDB) estimates that need to sit at around $20 billion, with similar numbers from the Inter-American Development Bank (IDB). It is also true, in light of the region’s relatively small size, that BRI could fund and Chinese state-owned enterprises (SOEs) could perhaps build all of it.

People's Warfare against COVID-19: Testing China’s Military Medical and Defense Mobilization Capabilities | Institute for the Study of War Significantly, the coronavirus pandemic constituted the first major test of China’s system for “national defense mobilization” (国防动员) since the latest reforms. This architecture constitutes a critical element of China’s capacity to respond to a crisis or conflict contingency and is intended to be coordinated with emergency response functions. Waging “people’s warfare” against the pandemic, China’s leaders sought to leverage and coordinate all available resources and capabilities, including military, reserve, and militia forces, as well as thousands of businesses nationwide. The relative sophistication of this effort hints at the capabilities that China could bring to bear in a future conflict scenario, and indeed, lessons learned from the study of this response, including its strengths and weaknesses, may inform reforms aimed to facilitate the transition from peacetime preparedness to a wartime footing in future conflict scenarios.

China's Influence on Conflict Dynamics in South Asia | United States Institute of Peace China’s expanding presence in South Asia is reshaping the region, and along the way exacerbating tensions in regional politics and U.S.-China relations from the Himalayan mountains to the Indian Ocean. As the United States works to fulfill its vision of a free and open Indo-Pacific region and to respond to a more assertive China, the final report from USIP’s bipartisan Senior Study Group (SSG) on China and South Asia serves as a road map for the next U.S. administration to advance the Indo portion of that vision.


US approves export of sonar system for Taiwan's domestic submarine | Taiwan News | 2020/12/16 The United States has approved an export license for a digital sonar system to be installed on Taiwan’s first indigenous submarine, Vice Defense Minister Chang Che-ping (張哲平) said Wednesday (Dec. 16).

Spokesperson blasts DPP's anti-mainland plot behind children's book ban - Xinhua The 20-page picture book tells a story from the perspective of a child whose father is a doctor working on the frontline to fight the virus when Wuhan was seriously hit by the COVID-19 epidemic, conveying the ideas of commitment, mutual support, love, and hope. However, the DPP authorities have ordered banning the book on the island, citing the violation of "rules for cross-Strait relations."

DPP politician's threat to destroy nuclear power plants on mainland exposes evil nature: spokesperson - Xinhua Such threat risked universal condemnation, and the following acquiescence by the DPP authorities in Taiwan to such insane remarks laid bare the evil nature of a tiny number of people on the island who are devoid of human conscience, said Zhu Fenglian, the spokesperson for the Taiwan Affairs Office of the State Council when commenting on the DPP member's clamor.

Tech and Media

Mike Pompeo’s Dad was a Hunanese Bandit and Other Real Fake News - SixthTone Had enough yet? How about this one? U.S. Secretary of State Mike Pompeo is Hunanese, his father was a renegade bandit and a landlord, and that’s why he hates China. Those are just some of the headlines and reports I’ve seen over the past couple months, scrolling through my parents’ social media posts, chat groups of secondary school classmates, microblogging platform Weibo, and Jinri Toutiao — China’s most popular news portal. A few were brought to my attention by my 9-year-old daughter.

Aiming for Higher Valuation, Didi Fights on Multiple Fronts- PingWest Leakers say that much of Didi's internal resources are being put onto community group buying. "The company only gave us two options, either to resign or apply for transfer to Chengxinyouxuan, without providing any compensation for layoffs," wrote an employee. "As the company plans to cut expenses, less important departments will be slimmed down, but the community group buying business is thriving," wrote another.

China Regulator Proposed to Impose Digital Data Tax on Technology Companies - PingWest Chinese government should consider imposing a digital tax on technology companies that hold large amount of user data, said Yao Qian, the director of technology supervision at China Securities Regulatory Commission. Speaking at forum hosted by Beijing News, Yao Qian said user data is precious resource like mineral mines, so the government should levy tax on it just like levying tax on natural resource.

Tencent placates Beijing with 'public interest' games for China - Nikkei Asia Developers earn relatively little for functional games designed to help people recognize social problems. But the market is growing as developers promote them amid their strained relations with the government.

How Alibaba Lost India: A Tale of Missed Opportunities and Bad Luck — The Information $$ The story of how Alibaba bungled what was once its most ambitious overseas expansion plan is a tale of missed opportunities and bad luck. Aside from its failure to strike partnership deals, Alibaba passed on investing in major Indian e-commerce startup Flipkart. Alibaba’s once-dominant mobile browser lost ground to Google in India, and a new government policy disrupted the digital wallet business of Paytm, an Indian startup in which Alibaba took a minority stake in 2015. To top it off, a deadly border clash between China and India in June triggered a wave of anti-China sentiment and moved the Indian government to ban Chinese apps, including Alibaba’s mobile browser.

Daring Fireball: I Suppose a Roman à Clef About a Design-Obsessed California Computer Maker With a Charismatic but Mercurial Founder Whose Youthful Arrogance Leads to His Ignominious Ouster and Exile, Only to Return a Decade Later to Not Only Save the Co But what major entertainment company is willing to portray China “in a negative light”?2 China has effectively foot-stomped and bribed its way into not being shown in movies for what it clearly is: a powerful, cruel, brutal Communist regime led by a thin-skinned dictator who does in fact quite resemble Winnie the Pooh. Which studios or streaming services would bankroll today’s equivalent of Charlie Chaplin’s classic The Great Dictator, with Xi Jinping in Hitler’s place as the deserving target of satiric mockery? Netflix — which doesn’t offer its service in China and has no dependence on theatrical box office revenue — maybe?..A “no showing phones getting damaged” rule, if true,3 makes Apple look as much in need of a pair of big boy pants as the leaders of China.

Society, Arts, Sports, Culture and History

Anger in China Over Abused Elderly Woman’s Rejected Divorce Plea - SixthTone According to domestic outlet The Cover, the woman, identified by the pseudonym Wang Hua, married her husband, surnamed Yang, in 1980, and has faced frequent verbal and physical abuse ever since. Wang endured the painful marriage for the sake of her three children, but now that they’re all grown and have started their own families, she decided it was finally time to take her husband — who opposes the divorce — to court. After reviewing the details, a district court in the city of Yan’an, in the northwestern Shaanxi province, rejected Wang’s case on Dec. 2, on the grounds that the couple’s 40-year relationship is “very hard to come by.”

Energy, Environment, Science and Health

Chinese spacecraft carrying rocks and soil from the moon returns safely | The Guardian The return module of the space probe known as Chang’e-5 landed in northern China’s Inner Mongolia region, Xinhua said, quoting the China National Space Administration.

COVID-19 flares up again in NE China's Dalian port after four loaders found to be silent carriers - Global Times Four asymptomatic COVID-19 patients working as loaders in an import cold-chain company have been found in Dalian, Northeast China's Liaoning Province, signaling a possible recurrence of the epidemic in the coastal city this winter. The four were found to be infected with the virus during a routine test on Tuesday. They work as loaders in Dalian Yidu cold-chain company, the local government announced late Tuesday.

New asymptomatic COVID-19 case detected in NE China's Heilongjiang - CGTN Heilongjiang Provincial Health Commission reported a new COVID-19 asymptomatic case involving a young kindergarten teacher in the border port of Suifenhe.  On Wednesday's announcement, local authorities said the 24-year-old female is a close contact of a previous confirmed local case. She tested positive on Tuesday during group quarantine and has been isolated for medical observation.

China to Get 100 Million Doses of Pfizer-BioNTech Vaccine - Caixin Fosun has been pushing to produce the vaccine in China, with CEO and Chairman Wu Yifang telling Caixin in August that the company was still exploring various possibilities, including working as a contract manufacturer for BioNTech or developing a full production line in China. No production deal has materialized, though an amendment released alongside the supply deal and also dated Tuesday left the door open for Fosun to manufacture the vaccine on the Chinese mainland in future. It referred to three stages of supply, with the first being importing vials, the second being importing bulk product to be assembled on the mainland, and the final being manufacturing of the vaccine on the mainland — though it said negotiations were ongoing.

Rules get tougher for international flights - SHINE News If five passengers on a flight test positive, flights will be suspended for two weeks, rather than the week in the previous policy, the Civil Aviation Administration of China (CAAC) said. The suspension will still last for four weeks if 10 passengers test positive. Feng Zhenglin, director of the CAAC, said preventing coronavirus cases would be a “quite tough” task throughout winter and spring next year.

Climate Experts Urge China to Hit Its Emissions Target Five Years Early - Caixin The experts made the call at the nonprofit Energy Foundation China’s online seminar on the country’s low carbon development during the 14th Five-Year Plan (FYP) period from 2021 to 2025. The director of Tsinghua University’s Institute of Low Carbon Economy, He Jiankun, proposed that China should try to reach peak carbon emissions by 2025. Zou Ji, president of the Beijing-based NGO, Energy Foundation China, agreed.

China Pushes ‘Sponge City’ Plan With First Rainwater Rights Sale - Caixin The deal, which took place Monday in the central city of Changsha, saw a rainwater usage company buy the rights from a local property conglomerate and sell them to an urban landscaping firm. The deal “marks our country’s entry into the practical stage of the marketization of ecological pricing for rainwater and other nonstandard water resources,” said a notice on the website of the China Water Exchange, the national water rights trading platform.

In Depth: What’s Holding Back Carbon Capture in China? - Caixin Global “There is no way for China to realize carbon neutrality (on schedule) without CCUS,” said Li Xiaochun, a professor at the Institute of Rock and Soil Mechanics at the Chinese Academy of Sciences (CAS).

Lessons from Wuhan | CBC News Early in 2020, the Chinese city of Wuhan became ground zero for the COVID-19 pandemic. While the rest of the world still struggles to contain the coronavirus, Wuhan has returned more or less to normal — but it is also forever changed. By Saša Petricic

Books and Literature

Best China Books of 2020 | Five Books Expert Recommendations Jeffrey Wasserstrom picks the best books of 2020 on China.