Death blow for Huawei?; Getting back to normal after Beidaihe; Xi on Marxist political economy

Thanks to everyone who participated in last Friday’s open thread. We had another great discussion, and I am so thankful we have such a smart and civil community in which we can discuss issues related to China. Those spaces are constricting just about everywhere else.

The top leadership looks to be resuming normal schedules after Beidaihe, and roughly in line with the timelines of recent years. Premier Li Keqiang chaired a State Council Executive Committee earlier today, and Wang Huning attended a session of the All-China Youth Federation and a congress of the All-China Students' Federation in Beijing.

In 2019 Li Keqiang reappeared to chair a State Council executive meeting on August 16, and reports of other Standing Committee members holding meetings followed over the next several days. Xi did not reappear in a photo on the front page of People’s Daily until August 23, in a report on his inspection tour of Gansu.

In 2018 Li Keqiang reappeared to chair a State Council executive meeting on August 16, and reports of other Standing Committee members holding meetings followed over the next several days. Xi did not reappear in a photo on the front page of People’s Daily until August 20, in a report on his meeting on Party construction with the central military commission.

I would not get too worked up yet about any claims that somehow the Beidaihe “meeting” went long. If Xi does not emerge in person by the weekend, then that would be a bit more intriguing, but I expect we will see him again soon.

The latest issue of Qiushi leads with a speech on Marxist political economy that Xi gave to a Politburo study session in 2015. Among many interesting points, Xi cites Thomas Piketty’s Capital in the Twenty-First Century when saying that the widening wealth gap in the West again shows that Marxism is not outdated at all. Xi also said that Marxist economic theory suggests China should continue to consolidate the state-owned sector of the economy, narrow the wealth gap, and continue reform and opening up. From the Xinhua English summary:

As the fundamental standpoint of Marxist political economy, the philosophy that development is for the people should be upheld when deploying economic work, formulating economic policies and promoting economic development, the article points out.

The mainstay status of public ownership and the leading role of the state-owned economy must not be altered, it adds.

The article also stresses upholding the basic policy of opening up and urges efforts to develop an open economy of higher standards, take an active part in global economic governance and promote the development of global economic order based on the principles of equality, justice and win-win cooperation. 

It sure appears that Xi might actually be a true believer in sinified Marxism.

Xi’s comments from five years ago make it seem like those attempts to negotiate “structural reforms” and changes to the State-owned enterprises by the US and the EU were always destined to be futile.

Why are the relevant organs publishing this speech only now, five years after he gave it? I am not sure, it may be that it makes him look prescient given the current state of the world, and that it in some ways it supports the “dual circulation” theory he is now pushing?

The PRC diplomats from the shuttered Houston Consulate returned to China over the weekend. Foreign Minister Wang Yi greeted the arriving the flight:

王毅迎接!驻休斯敦总领事馆全体馆员归国,获集体三等功

According to a CGTN summary of his remarks Wang said:

…the incident made it clear that anti-China forces in the U.S. have been seeking by all means to sabotage bilateral ties and deliberately disrupt China's development. 

Nevertheless, Wang said dialogue and non-confrontation is still the mainstream opinion among the public in both countries, expressing his confidence that China-U.S. relations will be reborn after the current difficulties. 

Here is the full Chinese text of his speech - 驻休斯敦总领事馆是一个坚强、团结、有力的优秀集体.

The relative restraint that Beijing has shown toward US actions over the last several weeks is noteworthy. One theory I have heard is that Xi et al are trying to avoid what they may see as a Trump Administration trap to provoke a response from Beijing that would make it even harder for a possible Biden Administration to take a materially softer line towards the PRC.

The dynamic is interesting as if the Trump Administration believes they have more space to push hard on China because they believe Xi and team are willing to absorb more than usual because of a possible change in US administrations, we should to expect to see more “tough on China” measures. Would that raise the risk of a miscalculation?

For all the talk of relative restraint, the US moves today to further cut Huawei off from buying US semiconductors (see item 1 below) may finally push Xi et al to respond with more robust measures. This latest announcement, designed to close any remaining loopholes, is much closer to a terminal blow than anything the Trump team has done so far.

One industry insider just described the new measures to me as:

the Death Star of Export Control regulations.

They basically re-engineered export controls to read like an economic sanction run by Treasury because [Treasury Secretary] Mnuchin refuses to add them.

Remember, even if Trump loses November 3rd, the Trump Administration will still be making policy towards China until 11:59 AM on January 20, 2021. A lot can happen in 157 days.

Thanks for reading.


The Essential Eight

1. Tougher US restrictions on Huawei

Commerce Department Further Restricts Huawei Access to U.S. Technology and Adds Another 38 Affiliates to the Entity List | U.S. Department of Commerce

The Bureau of Industry and Security (BIS) in the Department of Commerce (Commerce) today further restricted access by Huawei Technologies (Huawei) and its non-U.S. affiliates on the Entity List to items produced domestically and abroad from U.S. technology and software. In addition, BIS added another 38 Huawei affiliates to the Entity List, which imposes a license requirement for all items subject to the Export Administration Regulations (EAR) and modified four existing Huawei Entity List entries. BIS also imposed license requirements on any transaction involving items subject to Commerce export control jurisdiction where a party on the Entity List is involved, such as when Huawei (or other Entity List entities) acts as a purchaser, intermediate, or end user. These actions, effective immediately, prevent Huawei’s attempts to circumvent U.S. export controls to obtain electronic components developed or produced using U.S. technology.

In May 2020, BIS amended the longstanding foreign-produced direct product (FDP) rule to target Huawei’s acquisition of semiconductors that are the direct product of certain U.S. software and technology. Today’s amendment further refines the FDP rule by applying the control to transactions: 1) where U.S. software or technology is the basis for a foreign-produced item that will be incorporated into, or will be used in the “production” or “development” of any “part,” “component,” or “equipment” produced, purchased, or ordered by any Huawei entity on the Entity List; or 2) when any Huawei entity on the Entity List is a party to such a transaction, such as a “purchaser,” “intermediate consignee,” “ultimate consignee,” or “end-user.”

Comment: The FDP should strike fear in the boardrooms of every PRC tech firm.

The United States Further Restricts Huawei Access to U.S. Technology - United States Department of State

The Department of State strongly supports the Commerce Department’s expansion today of its Foreign Direct Product Rule, which will prevent Huawei from circumventing U.S. law through alternative chip production and provision of off-the-shelf (OTS) chips produced with tools acquired from the United States. This measure follows the more limited expansion of the Foreign Direct Product Rule in May, which Huawei has continuously tried to evade.

The Commerce Department also added 38 Huawei affiliates to its Entity List, which identifies foreign parties prohibited from receiving certain sensitive technologies and allowed Huawei’s Temporary General License (TGL) to expire. The United States has provided ample time for affected companies and persons – primarily Huawei customers – to identify and shift to other sources of equipment, software, and technology and wind-down their operations. Now that time is up.

We will not tolerate efforts by the CCP to undermine the privacy of our citizens, our businesses’ intellectual property, or the integrity of next-generation networks worldwide.

U.S. tightening restrictions on Huawei access to technology, chips - Reuters

The U.S. Commerce Department actions, first reported by Reuters, will expand restrictions announced in May aimed at preventing the Chinese telecommunications giant from obtaining semiconductors without a special license - including chips made by foreign firms that have been developed or produced with U.S. software or technology.

The administration will also add 38 Huawei affiliates in 21 countries to the U.S. government’s economic blacklist, the sources said, raising the total to 152 affiliates since Huawei was first added in May 2019.

Commerce Secretary Wilbur Ross told Fox Business the restrictions on Huawei-designed chips imposed in May “led them to do some evasive measures. They were going through third parties,” Ross said. “The new rule makes it clear that any use of American software or American fabrication equipment is banned and requires a license.”

US plays 'final card' to block supply to Huawei, forces China to retaliate: analyst - Global Times

A source close to the government said in May that China was ready to retaliate against the US by targeting US firms like Apple, Qualcomm and Boeing, if the US government moves to cut off chip supplies to Huawei.

The US Department of Commerce announced that it would expand existing restrictions by preventing Huawei from acquiring chips made outside the US but developed or produced with US software or technology. It also added another 38 Huawei affiliates in 21 countries to its Entity List.

Under the amendment to restrictions imposed in May, Huawei is barred from purchasing foreign made chips "to the same degree as comparable US chips," the department said in a statement.

Following an earlier decision to allow a temporary general license to expire on Thursday, the new rule on Monday marks another escalation in the US' clampdown campaign against the Chinese company.

The new rule could pose serious challenges for Huawei, as the company could be cut off from all foreign chip suppliers, Chinese analysts noted.

US cuts off Huawei lifelines to foreign chips - Nikkei Asian Review

Mobile chip developer MediaTek, image sensor provider Sony, sensor supplier STMicroelectronics, as well as key memory chipmakers Samsung Electronics, SK Hynix, Kioxia, Nanya Tech and many Asian, European and domestic Chinese chip developers may all have to abide by the rules if their chip development involves U.S. software and technologies, legal experts and market watchers said...

Following the rule tightening in May, Huawei has been seeking alternatives to its own in-house chip designs, eyeing MediaTek, the world's second-largest mobile chip developer and a key Samsung, Oppo, and Xiaomi supplier. Huawei has also had its eye on Chinese local mobile chip developer UNISOC Communications. All were seen as potential suppliers of core processor chips for future smartphones. The Chinese company also did not give up testing Qualcomm's mobile chips on its future smartphones in hopes that the U.S. might later grant licenses, sources told the Nikkei Asian Review.

SIA Statement on Export Control Rule Changes - Semiconductor Industry Association

“We are still reviewing the rule, but these broad restrictions on commercial chip sales will bring significant disruption to the U.S. semiconductor industry. We are surprised and concerned by the administration’s sudden shift from its prior support of a more narrow approach intended to achieve stated national security goals while limiting harm to U.S. companies. We reiterate our view that sales of non-sensitive, commercial products to China drive semiconductor research and innovation here in the U.S., which is critical to America’s economic strength and national security.”

Trump administration piles more restrictions on Huawei - POLITICO

Monday’s Commerce Department news release also noted that a temporary general license has now expired. That had allowed some limited exchanges between Huawei and U.S. companies, such as rural telecom companies that still use Huawei gear.

China urges Canada to immediately release Meng Wanzhou - Xinhua

"China's position on the Meng Wanzhou case is consistent and clear," Zhao said. "The evidence that has been made public reveals clearly that the United States and Canada have abused their bilateral extradition treaty and arbitrarily took compulsory measures against a Chinese citizen, which severely violates the legitimate rights and interests of the Chinese citizen," Zhao said.

He said that the intention of the United States is to oppress Huawei and other Chinese high-tech firms, and Canada is its accomplice. "This is a serious political incident. This is not only China's view, but also a conclusion shared by the rest of the international community including insightful people in the U.S. and Canada."

China decries US-Israel deal to exclude country from 5G networks - The Jerusalem Post

Chen Weihua, a journalist for the Chinese state media outlet the China Daily, called the deal "scandalous and ungrateful."

"Chinese cities like Shanghai provided a safe haven to some 30,000 Jews fleeing Nazi Europe in WWII, but now Israel returns the favor by being a US poodle against China in 5G," tweeted Weihua on Saturday.

Israel is close to joining the US State Department’s “Clean Network,” announced earlier this month


2. Xi on Marxist political economy

Xi's article on Marxist political economy in contemporary China to be published - Xinhua

In the face of an extremely complex economic situation at home and abroad as well as varied economic phenomena, studying the basic tenets and methodology of Marxist political economy is conducive to mastering a scientific approach for analysis of the economy. It further helps to grasp the laws governing social and economic development and improve the capability of managing a socialist market economy, the article notes.

As the fundamental standpoint of Marxist political economy, the philosophy that development is for the people should be upheld when deploying economic work, formulating economic policies and promoting economic development, the article points out.

The mainstay status of public ownership and the leading role of the state-owned economy must not be altered, it adds.

The article also stresses upholding the basic policy of opening up and urges efforts to develop an open economy of higher standards, take an active part in global economic governance and promote the development of global economic order based on the principles of equality, justice and win-win cooperation.

The full text of Xi's speech at the 11.23.2015 Politburo Study Session. This article includes the the video from the CCTV Evening News report on it - 习近平:不断开拓当代中国马克思主义政治经济学新境界-新华网

Some excerpts:

Maintaining and improving the basic socialist economic system. Marxist political economy holds that ownership of the means of production is the core of production relations and determines the basic nature and direction of development of society. Since the reform and opening up of China, the Party has summed up its positive and negative experiences, established the basic economic system of the primary stage of socialism, emphasized that public ownership should be the mainstay and that a variety of ownership systems should develop together, and made it clear that both the publicly owned economy and the non-publicly owned economy are important components of the socialist market economy and an important basis for China's economic and social development. We must unswervingly consolidate and develop the publicly owned economy, unswervingly encourage, support and guide the development of the non-publicly owned economy, and promote the complementary, mutually reinforcing and common development of the various ownership systems. At the same time, we must also be very clear that our basic economic system is an important pillar of the socialist system with Chinese characteristics and the foundation of the socialist market economic system, and that the main position of public ownership and the dominant role of the State-owned economy must not be shaken. This is the institutional guarantee that all ethnic groups in China will be able to share the fruits of development, and it is also an important guarantee for consolidating the Party's ruling position and upholding China's socialist system.

坚持和完善社会主义基本经济制度。马克思主义政治经济学认为,生产资料所有制是生产关系的核心,决定着社会的基本性质和发展方向。改革开放以来,我们党总结正反两方面经验,确立了社会主义初级阶段的基本经济制度,强调坚持公有制为主体、多种所有制经济共同发展,明确公有制经济和非公有制经济都是社会主义市场经济的重要组成部分,都是我国经济社会发展的重要基础。我们要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,推动各种所有制取长补短、相互促进、共同发展。同时,我们也要十分明确,我国基本经济制度是中国特色社会主义制度的重要支柱,也是社会主义市场经济体制的根基,公有制主体地位不能动摇,国有经济主导作用不能动摇。这是保证我国各族人民共享发展成果的制度性保证,也是巩固党的执政地位、坚持我国社会主义制度的重要保证。...

We will adhere to the basic national policy of opening up to the outside world. Marxist political economy holds that human society will eventually move from the history of each nation to that of the world. At present, our country has unprecedentedly close ties with the world, and the impact of our economy on the world economy and the impact of the world economy on our economy are unprecedented. Under the conditions of deepening economic globalization, it is impossible for us to engage in construction behind closed doors; instead, we should be good at coordinating the two major situations at home and abroad, and make good use of the two markets and resources at home and abroad. We should follow the trend of China's deep integration into the world economy, develop a higher-level open economy, actively participate in global economic governance, and promote the development of an equitable and fair international economic order with win-win cooperation. At the same time, we should resolutely safeguard China's development interests, actively guard against various risks and ensure national economic security. There are many theoretical and practical issues in this regard that require in-depth study.

坚持对外开放基本国策。马克思主义政治经济学认为,人类社会最终将从各民族的历史走向世界历史。现在,我国同世界的联系空前紧密,我国经济对世界经济的影响、世界经济对我国经济的影响都是前所未有的。在经济全球化深入发展的条件下,我们不可能关起门来搞建设,而是要善于统筹国内国际两个大局,利用好国际国内两个市场、两种资源。要顺应我国经济深度融入世界经济的趋势,发展更高层次的开放型经济,积极参与全球经济治理,促进国际经济秩序朝着平等公正、合作共赢的方向发展。同时,我们要坚决维护我国发展利益,积极防范各种风险,确保国家经济安全。这其中有很多理论和实践问题需要深入研究。


3. Guo Shuqing on risks in the financial system

China must guard against rebound in shadow lending: regulator - CGTN

In recent years, China has clamped down on shadow banking, concerned about the hidden risks in the high volume of complex and potentially risky loans in the sector. But as a weakening economy puts pressure on businesses and individuals, authorities fear shadow lending and illegal loans might surge.

After the outbreak of the new coronavirus this year, high-risk banks with complex structures may stage a comeback, Guo Shuqing, chairman of the China Banking and Insurance Regulatory Commission, wrote in an article published in the Qiushi Journal, a flagship magazine of the Communist Party of China Central Committee.

"A slight relaxation of regulations may lead to a full resurgence and all previous efforts would go to waste," Guo wrote.

Due to COVID-19, leverage is expected to rebound significantly in the Chinese economy this year and bad debts of financial institutions may rise substantially, he warned...

Outside of China, external factors could also threaten financial security, Guo said.

Current international cooperation is not ideal, and the U.S. entity list imposed on some companies including Chinese firms has added uncertainty to the global economic recovery and disrupted financial stability and security, he said.

China’s Banking Watchdog Warns Fed Easing Risks Financial Crisis - Bloomberg

“In an international monetary system dominated by the U.S. dollar, the unprecedented, unlimited quantitative easing policy of the U.S. actually consumes the creditworthiness of the dollar and erodes the foundation of global financial stability, said China Banking Regulatory Commission Chairman Guo Shuqing.

“The world may once again be pushed to the verge of a global financial crisis,” he wrote in an article published in the Communist Party’s Qiushi magazine on Sunday.

For China’s financial sector, “after the Black Swan of the virus pandemic, asset quality will inevitably deteriorate,” Guo said.

Guo's Qiushi article - 郭树清《求是》撰文:房地产泡沫是威胁金融安全的最大“灰犀牛” _中国经济网——国家经济门户

China’s Peer-to-Peer Lending Purge Leaves $115 Billion in Losses - Bloomberg

China’s multi-year clampdown on its peer-to-peer lending industry has whittled the number to just 29 platforms, down from about 6,000 at its peak, according to the nation’s top banking regulator.

The crackdown, which is likely to be completed at the end of this year, has left investors with more than 800 billion yuan ($115 billion) in unpaid debt from failed platforms, Guo Shuqing, chairman of the China Banking Regulatory Commission, said on China Central Television on Friday. Regulators, together with the police, will try their best to recoup the money, he said.


4. US-China

U.S.-China trade deal review postponed as China ramps up farm, energy purchases - Reuters

The officials were expected to hold a videoconference on Saturday, the six-month anniversary of the trade deal’s Feb. 15 entry into force as the coronavirus pandemic began spreading globally.

One source familiar with the talks said the delay was related to a conference of senior Communist Party leaders at the seaside town of Beidaihe on China’s northeast coast. The postponement did not reflect any substantive problem with the trade deal, the source said, adding: “The new date has not been finalized yet.”..

Another source familiar with the plans said that U.S. officials wanted more time to allow China to increase purchases of U.S. goods agreed in the deal, to improve the political optics of the review.

AP FACT CHECK: Trump hails under-performing China trade deal

TRUMP, on China’s adherence to the trade deal his administration negotiated with Beijing: “They are living – they’re more than living ... up to it. ... Because they know I’m very angry at them.” — “Fox & Friends” interview Monday.

“脱钩”是误判大势的逆动(钟声)

——正确看待和妥善处理中美关系① 《 人民日报 》( 2020年08月17日   第 03 版)

The first in a new series People’s Daily Zhong Sheng commentaries on properly understanding and handling the US-CHina relationship. This one slams the US efforts to decouple and to force others to decouple from Chinese economy. Citing Kissinger, Foreign Affairs, and the Peterson Institute for International Economics, it said the US attempt is “extremely absurd” and it is against the interests of both countries.

China Tones Down 'Hotheaded' Nationalism as Relations With U.S. Sink - The New York Times

The campaign for restraint also appears to be aimed, in part, at signaling to Mr. Trump’s Democratic challenger, former Vice President Joseph R. Biden Jr., and others in the United States that China still sees a friendly path forward...

Despite the softer tone, China’s underlying view that the United States is a strategic and ideological rival bent on suppressing its rise has not changed.

[视频]电视剧《跨过鸭绿江》今天开机_CCTV节目官网-CCTV-1_央视网(cctv.com)

CCTV said it has started filming a new TV series about the Korean war. It said the series, Going Across the Yalu River, will fully demonstrate how China “showed no fear to the great power and hegemony at a time of poverty and weakness.”

国际锐评丨妄图复活冷战的蓬佩奥又在欧洲碰个灰头土脸_新浪财经_新浪网

CCTV commentary said Pompeo’s efforts to revive cold war was not well received at all by the European countries, and the world should unite against this “sinner of history” and “a few radical saboteurs” like Pompeo.

Chinese diplomat calls for efforts to stabilize China-U.S. relations - CGTN

Relations between China and the United States are at a crucial juncture, and efforts must be made to maintain and stabilize bilateral ties, Chinese Vice Foreign Minister Zheng Zeguang said on Thursday.

Zheng made the remarks during a dialogue via video link with a group of U.S. Congress members, including Ami Bera, chairman of the House Foreign Affairs Subcommittee on Asia, the Pacific and Nonproliferation, and Ted Yoho, who also sits on the subcommittee...

The United States should immediately stop slandering China and create conditions for the two countries to cooperate in the fight against the COVID-19 pandemic, he said, adding that China sincerely wishes the U.S. could defeat the coronavirus at an early date.

Lately, we can all feel the deteriorating external environment. In my personal judgement, a new cold war has taken shape between China and the United States; the United States has begun to impose a technological blockade on China; the list of United States entities targeting China is getting longer and longer; the United States has classified China as a strategic competitor; and competition is taking place in various fields, with the competition in the field of technology being relatively deeper and broader.

Transcript of Zheng's comments -外交部副部长郑泽光与美国国会议员举行视频对话,强调美方应停止负面言行,与中方共同推动两国关系回到正确轨道 — 中华人民共和国外交部

China awards ex-Houston consulate staff upon return - Global Times

Wang, at a brief but solemn ceremony at the Beijing Capital International Airport, said that in the face of the incident where the US violated the basic norms of international relations by asking China to close its Houston consulate, its staff kept their composure and safeguarded the country's core interests and the legitimate rights of Chinese institutions overseas in a time of adversity and great danger.

Party Chief Qi Yu of the Chinese Foreign Ministry conferred a Class III merit to the staff at the event.

Anti-China forces are using any possible way to undermine China-US relations and deliberately contain China's development, however, such plot is against the tide of history and is doomed to fail, said Wang Yi.

Thousands of Chinese netizens expressed their welcome and respect for the consulate staff on Sina Weibo, calling them heroes.

China's anti-Trump election meddling raises new alarm, as DNI calls country biggest threat | Fox News

“China poses a greater national security threat to the U.S. than any other nation – economically, militarily and technologically. That includes threats of election influence and interference,” Ratcliffe told Fox News in a statement.

U.S. Tries to Bolster Taiwan’s Status, Short of Recognizing Sovereignty - The New York Times

The administration is unlikely to try to station troops in Taiwan. But a port call is possible, as are visits by officers in uniform and training programs in Taiwan, U.S. officials say.

From the perspective of Taiwanese officials, bolstering economic ties is also critical. In her talk, Ms. Tsai called for the start of negotiations over a free-trade agreement.

Taiwan signs deal to get F-16 jets amid US-China tensions | TheHill

The purchase marks the first time since 1992 that advanced fighter jets have been sold to the island and is likely to spark reproach from China, which has repeatedly warned against selling advanced weaponry to an island it considers its own territory...

The sale, which the Pentagon announced Friday, was first floated a year ago and will be completed by late 2026. Ninety jets will potentially be sold as part of Friday’s announcement.

Commentary: Reviving McCarthyism is anachronistic - Xinhua

Recently a group of former statesmen and scholars from 48 countries initiated an online event themed "A new Cold War against China is against the interests of humanity." A joint statement named "No to the New Cold War" was issued in 14 languages, which epitomized a strong call for the U.S. side to stop forming an anti-China coalition and dividing the world.

The revival of McCarthyism will drag China and the United States into conflict and confrontation, and plunge the world into chaos and division again. China has no intention to replace the United States, nor will it be intimidated by the hostile words and acts of some U.S. politicians. The Chinese people will only rally more closely around the CPC and work together with other countries for a community with a shared future for mankind.

Chinese Embassy in Poland opposes Pompeo's erroneous claims on China - Xinhua

The Chinese Embassy in Poland on Sunday expressed its opposition to U.S. Secretary of State Mike Pompeo's erroneous claims on China during his visit to the European country.

Pompeo once again spread false information, attacked and slandered China for no reason, and tried to sow discord between China and Poland, the embassy's spokesperson said in a statement.

査道炯:我国国际发展环境的变局与挑战应对

Zha Daojiong of Peking University said in a public speech last week that the US will continue to seek decoupling from China in the coming years, and China should not engage in a tit-for-tat that will only accelerate the decoupling. He suggests China should adopt different industrial policies toward different kind of technologies, and he warned that China should continue to expand its foreign trade, and not to have the illusion that it can be self-sufficient with its domestic market.

‘Simulated enemy’ helps PLA drill for real combat capability - Global Times

US forces are increasing intelligence gathering of the military deployment of the People's Liberation Army (PLA) around potential battlefields, Chinese mainland military experts said on Monday, after Taiwan media reported a US B-1B bomber flied near the island on Sunday. Experts said that the Chinese military should also be prepared for a potential conflict.

US warplanes' frequent presence in the East and South China seas are adding uncertainty and danger in the region, but it doesn't mean the current situation could turn into another Taiwan Straits crisis as in 1995-96, because the US has no advantage in the region, and the Trump administration is incapable of planning a major military conflict with China, experts said.

How Journalism Helped China Open Up - Orville Schell - WSJ $$

The U.S. State Department may have finally gotten Beijing’s attention by threatening not to renew the visas (due to expire this past Friday) of more than 100 Chinese media representatives in the U.S. After failing to respond to a set of concrete U.S. proposals that called on Beijing to reinstate expelled American correspondents and allow local hires to return to work at U.S. bureaus in China, Chinese Ambassador Cui Tiankai finally showed up at the State Department this week to say that his government “was working on the problem.” As an “act of good faith,” U.S. officials say, the State Department has “rolled over” the Chinese media visas for another 90 days, putting the ball in Beijing’s court.

No Chinese journalist has received reply for their US visa extension: Chinese FM - Global Times

Chinese journalists have long submitted their visa extension applications to the US government, but no one has received any clear reply, Chinese Foreign Ministry spokesperson Zhao Lijian said at Monday’s media briefing.

China urged the US to stop the political suppression of Chinese media and journalists, and said it will be compelled to respond if the US continues going their wrong way.

Coronavirus disrupts Chinese students’ plans for a U.S. education - Washington Post

The pandemic has forced Haila, Jingchu and many other Chinese students to rethink dreams of a U.S. diploma.

Avoiding a new Cold War between the US and China - Jeff Bader


5. TikTok

Trump Orders ByteDance to Divest TikTok, Destroy US User Data in 90 Days- PingWest

A ByteDance representative told PingWest in unofficial verbal communication that from the company's point of view the two Orders are separate. Essentially, The company's understanding is that last week's EO is based on the International Emergency Economic Powers Act, with the aim to ban TikTok, and the new EO is a CFIUS one, specifically ordering ByteDance to divest TikTok within 90 days. Today's new EO does not override the previous one...

To ByteDance, the good news part about the new Order is that it provided clearer instructions on selling or spinning off TikTok.

The bad news part, however, is that according to the language of the Order, ByteDance could be required to fully divest all TikTok assets, tangible and intangible, located anywhere around the world. Industry insiders had previously analyzed that ByteDance would still want to remain as a minority shareholder of the new TikTok.

Order Regarding the Acquisition of Musical.ly by ByteDance Ltd | The White House

Comment: What leverage does Bytedance have left with potential acquirers to force them to bid anything more than a firesale price? Reworking TikTik’s tech stack to make it compliant with US government demands is gong to be a very non-trivial project.

Breaking Off TikTok Will Be Hard to Do — The Information - July 29

All of ByteDance’s more than two dozen apps use technology developed by the Chinese parent company’s engineers, mostly based in Beijing. Internally, employees refer to the shared software infrastructure that is available to all of the company’s products as zhongtai, or “central platform.”

Even though TikTok says it already stores user data outside China, ByteDance’s China-based engineers and researchers provide the software code that underlies the app, current and former employees said...

TikTok continues to tap Chinese talent, however. As of this week, ByteDance’s recruitment website in Chinese has postings for Beijing-based TikTok jobs, such as a senior software engineer position responsible for the app’s content recommendation system, as well as a product manager for its search function.

Even the postings for some TikTok positions related to specific overseas markets, such as a data operations manager for the Middle East and a senior operations strategy manager for Latin America, are based in Beijing.

Trump signals he has more Chinese companies in his sights | Financial Times $$

Asked whether he was contemplating punitive action against more Chinese companies, such as the ecommerce giant Alibaba, Mr Trump replied: “We’re looking at other things, yes we are.”

The White House did not provide any explanation about the comment.

Trump looked at banning further Chinese apps in addition to TikTok: Meadows - Reuters

U.S. President Donald Trump has looked at banning additional Chinese-owned companies following his decision to ban the short-video app TikTok, White House Chief of Staff Mark Meadows said on Monday.

Tencent hires its first lobbyist - POLITICO

Tencent hired Roberto Gonzalez, a former Treasury Department deputy general counsel during the Obama administration who’s now a partner at Paul, Weiss, Rifkind, Wharton & Garrison, the day after the administration announced new restrictions on the company earlier this month, according to a newly filed disclosure.

Comment: I expect he arrived too late / 他来晚了

Truss leads China hawks trying to derail TikTok's London HQ plan | The Guardian

A last-ditch attempt to prevent the UK government from endorsing TikTok’s plans to locate its headquarters in London is being mounted by China hawks who accuse the app’s parent company of cooperating with authorities in Xinjiang province.

Downing Street is keen to encourage TikTok to move from Beijing to London, but faces a rearguard action led by the trade secretary, Liz Truss, who is anxious about some of the demands being made by the business.

TikTok’s owner, ByteDance, wants a public statement of support from a senior minister that it will be welcome in the long term so that it does not face what happened to Huawei

Ep. 72: What makes TikTok tick: A dialogue with Eugene Wei - Pandaily

Episode 72 of Tech Buzz China features product expert Eugene Wei in conversation with our co-host Rui Ma on the timely topic of TikTok and the mechanics of what makes the app so successful. Tune in to learn why Rui calls TikTok an “algorithmic entertainment platform” and why Eugene terms TikTok’s algorithm the “Sorting Hat.” You’ll also learn why the app was well situated in coming out of China, and what the future ownership and trajectory of TikTok in the U.S. might be.

Tearing Up TikTok - The Wire China $$

“This is going to be the first of many,” says Gary Rieschel, a founding managing partner at Qiming Venture Partners, which for a time held a stake in ByteDance through its investment in Musical.ly. “You cannot have a nation of China’s size and ambition, with hard-working people and technological skill and not end up creating companies that are among the best companies in their category. And so TikTok is just an example of what we’re going to be seeing a lot more of; and we’re going to have to find a way to deal with it.


6. Internationalizing the RMB

Will most foreign investors trust the RMB if they do not trust there is a rule of law in the PRC, or that capital controls are not going anywhere and could always tighten overnight?

China Wants to Make the Yuan Easier to Use in Cross-Border Trade, Investment-Caixin

The People’s Bank of China (PBOC) said it will insist on a market-oriented method to facilitate trade and investment and further expand access to foreign investors who use the yuan to invest in Chinese bonds and stocks, according to its latest annual RMB Internationalization Report, which was released Friday...

The yuan’s share of the foreign exchange market rose to 4.3% last year, up 0.3 percentage points from 2016, the report said. The currency ranked fifth globally as a payment currency, but was only used for 1.76% of payments. By comparison, China accounts for more than 10% of the world’s goods trade.

Last year, banks handled 19.67 trillion yuan ($2.83 trillion) in cross-border yuan payments and receipts on behalf of clients, up 24.1%, the report said. The amount was a record high, though growth slowed from 2018’s 46.3% increase

The report - 2020年人民币国际化报告

PBOC: Yuan Plays Positive Role in Global Monetary System - Caixin

Last year, the yuan reserves were the fifth largest in the International Monetary Fund’s Currency Composition of the Official Foreign Exchange Reserves, with a market share of 1.95%, 0.88 percentage points higher than that of 2016 when the yuan officially joined the Special Drawing Rights currency basket. The market share of the yuan in foreign exchange trading was 4.3%, 0.3 percentage points higher than that of 2016. According to latest statistics, the yuan ranked fifth as a payment currency globally, with a market share of 1.76%.

China and Russia ditch dollar in move towards ‘financial alliance’ | Nikkei Asian Review

In the first quarter of 2020, the dollar’s share of trade between Russia and China fell below 50 per cent for the first time on record, according to recent data from Russia’s Central Bank and Federal Customs Service.

The greenback was used for only 46 per cent of settlements between the two countries. At the same time, the euro made up an all-time high of 30 per cent, while their national currencies accounted for 24 per cent, also a new high...

Alexey Maslov, director of the Institute of Far Eastern Studies at the Russian Academy of Sciences, told the Nikkei Asian Review that the Russia-China “de-dollarisation” was approaching a “breakthrough moment” that could elevate their relationship to a de facto alliance.


7. WSJ on the failure of China’s CDC

China’s CDC, Built to Stop Pandemics, Stumbled When It Mattered Most - WSJ $$

Before going to bed, George Gao, the head of the Chinese Center for Disease Control and Prevention, typically completes his 10,000 steps for the day and then checks the news online.

When he scanned his feed on Dec. 30, he was stunned. Two leaked local-government notices warned about cases of unexplained pneumonia in the Chinese megacity of Wuhan. It was the first he’d heard of the outbreak, according to people close to him.

The 58-year-old virologist called the head of Wuhan’s disease-control office, who confirmed the outbreak and revealed to Dr. Gao’s growing alarm that it had been going on since at least Dec. 1, with 25 suspected cases so far, the people close to him said.

This wasn’t how things were supposed to work...

“I can very confidently say there won’t be another ‘SARS incident,’ ” Dr. Gao said in a speech last year. “Because our country’s infectious-disease surveillance network is very well-established, when a virus comes, we can stop it.”

Former China CDC Official Proposes Big Data-Powered Disease Warning System

Yang Weizhong and co-authors from local CDC branches and universities suggested building a “smart” early warning mechanism which incorporates data from a wider variety of sources in a paper (link in Chinese) published in the Chinese Journal of Epidemiology in July...

The scheme comes following remarks by President Xi Jinping at a June symposium attended by health experts including Yang, where Xi called for efforts to strengthen early-stage monitoring and warning for epidemics as a pressing task in improving the public health system.

Beijing art exhibition celebrates China's Covid-19 response - CNN

A triumphant art show celebrating the "great spirit of the Chinese people" in fighting Covid-19 opened this month at the country's National Museum, near Tiananmen Square in the center of Beijing.

Through a collection of almost 180 artworks, including sculptures, watercolors and dramatic oil paintings of heroic doctors, the exhibition aims to document the initial coronavirus outbreak in Wuhan and its aftermath.


8. Strengthening ideological work

Strengthening the CCP’s “Ideological Work” | Center for Strategic and International Studies

The attached essay was written by Huang Xianghuai, a senior researcher at the CCP Central Party School, a key institution for developing and disseminating new ideological and political guidelines. This article focuses on “ideological work,” or the Party’s efforts to build and maintain a coherence of values and beliefs within the Party ranks in order to strengthen organizational integrity. Huang expounds with great directness some of the key messages the senior Party leadership aims to disseminate amongst lower-level cadres and government officials. In contrast to Beijing’s external messaging—which emphasizes peace and cooperation with the United States—internal discourse is imbued with a much darker view of China’s relationship with the outside world.

An excerpt:
Developing the socialist market economy helps to liberate and develop the society’s productive forces, strengthen the country’s overall national power, and increase the people’s living standards. It also helps to strengthen the people’s awareness of self-reliance, competition, and efficiency; their awareness of democracy and the rule of law; and their pioneering innovative spirit, further bringing out socialism’s superiority. It must be recognized, however, that markets have their own weaknesses and negative aspects, and that concepts such as the principle of equal exchange are inevitably reflected in and enter into the spiritual life of the people, even penetrating life within the Party. Socialism, collectivism, and patriotism are coming under new challenges. Money worship, hedonism, and extreme individualism have grown and spread to a certain extent. Behavioral phenomena such as moral failure, indecency, and vulgarity of all kinds repeatedly breach the minimum standards of public order and decency, generating negative effects on the promotion of the mainstream thinking, ethics, and values of the society.

Third, profound changes are taking place in the media situation and the public opinion ecosystem. With the rapid development of new media—international and domestic, online and offline, virtual and real, within the system and outside the system, etc.—the lines are becoming blurred, constituting an increasingly complex forum of public opinion characterized by its spontaneity, suddenness, openness, diversity, conflict, anonymity, unboundedness, uncontrollability. The dominant role of mainstream media has suffered a huge blow, and the internet frequently becomes a source and amplifier for fomenting negative public opinion and spreading false ideas, greatly increasing the difficulty of guiding public opinion and controlling content. The proper management and use of the internet is critical for firmly mastering news and public opinion in the New Situation. To firmly maintain internet ideology dominance is to protect the sovereignty and authority of the State.

Looking at what some other countries have encountered, new media played a role in the “Color Revolutions” that cannot be ignored. In the “Color Revolutions,” the mainstream media in those countries fundamentally lost the ability to lead. People found it hard to hear the authoritative voices of their governments, leaving the population’s thinking confused and disoriented. So-called “independent media” used a variety of means to vilify the ruling authorities and incite popular discontent.

Last, various hostile forces are tightening their pervasive containment of China. We shall insist on the leadership of the CCP, and insist on the socialist system. The closer we get to the goal of national rejuvenation, the closer we get to the center of the world stage, and the various kinds of pervasive containment facing China’s path, theory, system, and culture will not stop. Therefore, the task of protecting China’s ideological security and political security is a very heavy one.

中心组学习参考资料2018年第8期——重视和加强党的意识形态工作_中心组学习_中共宝应县委

The original essay, from August 2018 - 重视和加强党的意识形态工作 黄相怀


Business, Economy and Trade

Chinese premier stresses use of new fiscal funds, financial support for real economy - Xinhua Chinese Premier Li Keqiang on Monday stressed arrangements of the new fiscal funds to ensure that the funds would directly benefit businesses and people, so as to consolidate the foundation of the country's restorative growth. Li made the remarks while presiding over an executive meeting of the State Council. Li also urged efforts to strengthen the implementation of financial policies designed to support the real economy to help market entities relieve their strains and seek further development

Readout of the State Council executive meeting - 李克强主持召开国务院常务会议--新闻报道-人民网

倒闭231万家企业!新增近千万家!后疫情时代的报复性增长来了? Citing public corporate filings, an article viral on WeChat said more than 2.3 million Chinese companies have shut down this year. Jiangsu and Guangdong are the worst hit, with the number up 10.2% and 9% compared with last year.

China Traders Ready for Stock Limits to Double Next Week - Bloomberg Stocks on China’s Nasdaq-like ChiNext board will be allowed to rise or fall 20% as of next week when the first batch of listings under revamped rules start trading.

China Stocks Rally Near Two-Year High on PBOC’s Easing Signal - Bloomberg The Shanghai Composite Index climbed 2.3% to 3,438.80 at the close. Financials led the gains, with China Merchants Securities Co. and China Life Insurance Co. both jumping by the 10% daily limit. Monday morning, the People’s Bank of China added 700 billion yuan ($101 billion) of one-year funding via the medium-term lending facility in a sign it wants to ease monetary policy to help the economy recover from the coronavirus pandemic.

China Plans to Expand Digital Yuan Tests to Beijing, Hong Kong - Bloomberg A digital renminbi trial will start in some of the country’s most developed regions, the Commerce Ministry said in an announcement on Friday that didn’t provide a timeline. Tests will take place in the area of northern China encompassing Beijing, coastal city Tianjin and Hebei Province; the city cluster in the Yangtze River Delta region including Shanghai; and the Greater Bay Area in the Pearl River Delta Region including Shenzhen, Hong Kong and Macau.

China’s Recovery Loses Some Momentum as Retail Sales Disappoint Again - WSJ $$ China’s factories continued to lead the recovery last month, though the 4.8% expansion in industrial production from a year earlier, matching June’s increase, undershot economists’ expected 5.0% increase, according to data released Friday by the National Bureau of Statistics. Perhaps more worrying, China’s retail sales, a closely watched gauge of consumption, remained in negative territory in July, defying expectations for a second straight month of a return to pre-coronavirus levels

China sees accelerated growth in rail freight transport volume - People's Daily Online China's rail freight transport volume, an indicator of broad economic activity, reached 2 billion tons in the first seven months of this year, rising 4.3 percent year-on-year

Exclusive: China Eyes National Commodity Indexes as Demand Grows for Hedging Tools - Caixin The new entity will be set up in the Xiongan New Area, an economic zone some 100 kilometers (161 miles) southwest of Beijing that was set up in 2017 and is being touted as a northern equivalent of Shanghai or Shenzhen. The commission has sent out an internal notice to transfer employees to help set up the firm, a source close to the regulator said.

China produces record crude steel in July on strong demand - Reuters The world’s largest steel producer churned out 93.36 million tonnes of crude steel last month, 1.9% higher than the output seen in June and up 9.1% from July 2019, according to data from the National Bureau of Statistics (NBS)

Tesla locked in group buying dispute with Pinduoduo over discounted Model 3 cars | South China Morning Post E-commerce site Pinduoduo and car dealer Yiauto offered buyers subsidies to purchase Tesla Model 3 cars as part of a promotional campaign Tesla, upon finding out that one buyer’s purchase had gone through Pinduoduo, refused to deliver the order, saying its reselling terms were breached

人去哪儿了?北京年均净流出超10万,深广净流入超20万_中国政库_澎湃新闻-The Paper Renowned economist Ren Zeping and his team published a report on the population flows among different cities in China. It appears more people are leaving Beijing, Shanghai and moving to places like Guangzhou, Shenzhen and Hangzhou.

Cover Story: How China Prevented a Local Bank Crisis From Snowballing - Caixin Baoshang was 89% owned by Tomorrow Holding, a private conglomerate built by Xiao, who fled to Hong Kong to avoid Chinese mainland authorities’ corruption crackdown and was placed under investigation in January 2017. As a central piece of an extensive funding web controlled by Tomorrow, Baoshang was used as a piggy bank by its largest shareholder to misappropriate billions of dollars, leaving the bank with a financial black hole of 220 billion yuan ($32 billion) and severe credit risks to its customers, according to regulators...The takeovers signaled the final chapter of China’s years-long effort to dismantle risks of the troubled conglomerates. Financial regulators will gradually shift their focus from cracking down on risks to sustaining control of risks, people close to the regulators said. Mechanisms to monitor and dispose of financial risks have been set up over the years, they said.

China Evergrande Shares Slump as Virus, Discounts Slash Profit - Bloomberg The profit warning came after the developer pledged to remake itself as a leaner company back in April. It unveiled an aggressive target to reduce its total debt load by half, or about 400 billion yuan, in three years. However, the plan has been met with skepticism, especially after another round of share buybacks since May.

U.S. university insured Chinese student tuition against virus. Then COVID-19 hit - Reuters A Reuters review of emails between school officials and insurance brokers, and interviews with people familiar with the situation show the university may get a payout to cover lower tuition revenue this year, but it can no longer get pandemic, visa restriction, or sanctions coverage.

Chinese Cosmetics Startup Perfect Diary Aims to Double Valuation to $4 Billion — The Information $$ Perfect Diary, similar to Glossier in the U.S., is part of a trend of China’s homegrown consumer brands looking to displace traditional retailers and foreign brands. As Glossier promotes its products on Instagram, the Guangzhou-based startup is leveraging Chinese social networks such as WeChat and ByteDance’s Douyin video app, as well as e-commerce platforms such as Alibaba’s Tmall, to mount a challenge against more established foreign rivals such as Chanel or Estee Lauder.

U.S. Executives Who Left China Amid Pandemic Are Stuck Abroad—and May Never Return - WSJ $$ By mid-August, more than 1,000 U.S. businesspeople based in the financial hub of Shanghai, not counting family dependents, were stuck overseas, according to Mr. Gibbs. Thousands more Americans living in other parts of China have also been marooned abroad. Altogether around 250,000 foreign professionals normally based in China remain stranded outside the country, according to an estimate by the European Union Chamber of Commerce in China.

Politics and Law

Officials everywhere are leaning in to Xi’s calls to stop wasting food - 中央和国家机关工委向中央和国家机关干部职工发出公开信倡议 带头制止餐饮浪费 切实培养节约习惯 建设风清气正的政治机关Page 1 People's Daily Monday - The Central and State Organs Work Committee sends an open letter initiative to cadres and employees of central and state organs: Take the lead in stopping food waste and cultivating saving habits. Build a clean and honest political office

Ample supplies will ensure China's food security: experts - People's Daily Online China has abundant supplies to ensure the country's food security, an expert said Saturday after media reports conflated a campaign to end food waste, the coronavirus pandemic, international conflict and extreme weather with the potential for a food crisis. Huang Jikun, Director of the China Center for Agricultural Policy at Peking University, was quoted by China Science Daily as saying that China's food security can be fully guaranteed in the short term.

观察者网:辽宁倡议N-2点餐模式:10人聚会点8人菜As part of the “anti-food waste” campaign, a restaurant association in Liaoning urged its members to adopt the N-2 model, which means that if 10 customers are to dine together, they can only order food for eight people. 

新华:全国妇联倡议:制止餐饮浪费,崇尚勤俭节约The National Women’s Fwederation issued a statement urging housewives to stop food waste in the family.

新京报:长沙市直机关食堂规定剩菜“超125克罚1元”A government cafeteria in Changsha imposed small fine on those who have more than 125 grams of leftovers.

人民日报:河北创新举措,坚决制止餐饮浪费行为(厉行节约,反对浪费)People’s Daily reported that in Hebei, the government cafeterias have adopted all kind of measures to save food, for example, every day the chefs will do a survey of those who will eat lunch and then cook accordingly. Some others give prizes and fines to promote thrift.

Trending in China: Too Fat to Order That Dish? The Restaurant That Weighs You Before You Order - Caixin Following public uproar, the restaurant took to Weibo Saturday to defend its marketing campaign, which some commentators have called a malicious gimmick, apologizing for being “unable to contribute to the national food waste campaign as intended,” and regretting having “redirected public resources” toward the endeavor. The restaurant said it would continue to offer ordering by weight, and thanked the thousand-plus diners who had stepped up (on the scales) so far. The general manager of the chain insisted that data remained on individual diners’ phones and would not be stored by the company.

Say no to wasting food: Shanghai government - SHINE News The city government launched a campaign against food waste on Monday, after President Xi Jinping urged efforts to curb food waste throughout the country. Local guidelines have been issued which ask restaurants to indicate the amount of food and the recommended number of diners for each set of dishes on their menus and to offer food at smaller portions than standard. Good food waste management is also expected to factor in the government’s official recommendations of restaurants through various awards. Restaurants that do a good job could potentially pay less to the authorities for garbage sorting.

Top Party school’s retired professor Cai Xia expelled from Party for wrong political remarks, serious disciplinary violations - Global Times Cai, a retired professor from the Party School of the CPC Central Committee (Chinese Academy of Governance), made statements that had serious political problems and damaged the national reputation, leading to very serious consequences, it said. Cai’s remarks have seriously violated the Party's political and organizational discipline as well as the norms of conduct for personnel in public institutions, it said.

中央党校(国家行政学院)退休教师蔡霞严重违纪被处理_新浪新闻 Retired Central Party School professor Cai Xia clearly struck her nerve with her comments about Xi. She has been expelled from the Party and stripped of her retirement benefits. 中央党校(国家行政学院)退休教师蔡霞,发表有严重政治问题和损害国家声誉的言论,性质极其恶劣、情节极其严重,严重违反党的政治纪律、组织纪律,违反国家事业单位人员行为规范。经中央纪委国家监委驻中央组织部纪检监察组和中央党校(国家行政学院)机关纪委联合审查调查,依据《中国共产党纪律处分条例》和《事业单位工作人员处分暂行规定》的有关规定,中央党校(国家行政学院)校(院)务委员会决定,开除蔡霞的中国共产党党籍,取消其享受的相关退休待遇。

Translation: Former Party Professor Calls CCP a “Political Zombie” | China Digital Times (CDT) About 20 minutes of audio in which a retired Central Party School professor sternly criticizes the state of the Party under Xi Jinping, and declares the current system beyond repair, circulated widely online earlier this month. The recording is from an address given by Cai Xia, a legal scholar and longtime internal Party advocate for rights and the rule of law, to a private group online. [Update: CDT has learned that this address was given in mid-May.] Cai is currently outside China. CDT has determined the recording to be authentic. The speech has been translated in full by CDT.

制度优势是党和国家的最大优势(深入学习贯彻习近平新时代中国特色社会主义思想) ——深入学习《习近平谈治国理政》第三卷 曲青山 (作者为中共中央党史和文献研究院院长)Qu Qingshan, head of the CCP Party History and Documents Research Institute, wrote on page nine praising the new volume of Xi Jinping on Governance, and Xi’s efforts in the past years to perfect China’s socialism system, and to consolidate the CCP leadership.

More info on ShanghaiPRIDE shutdown: Team members asked to ‘have tea’ - SupChina according to an assistant to ShanghaiPRIDE’s leaders who wished to remain anonymous, at least three people on the core team had been invited to drink tea (喝茶 hē chá) with police — a euphemism for interrogation in China’s political language. Team members don’t feel safe anymore, as they get random house checks and questioned by cops. “That wasn’t a big deal before it started happening more and more often,” the assistant said. Worse yet, ShanghaiPRIDE leaders used to know which officials they were talking to. “Now they are not so sure.”

Why do Chinese people love the Communist Party of China so much? - People's Daily Online Recently, a few American politicians, out of ideological prejudice and a Cold War mentality, attempted to ‘separate’ the Communist Party of China (CPC) from the Chinese people for ‘precision attacks’ on the CPC or create antagonism and sow discord between the two. These politicians engage in such crazy acts in explicit ignorance and stupidity mainly because they have neither the knowledge nor the ability to understand the special relationship between the Chinese people and the CPC through weal and woe, glory and shame, life and death. This article is meant to help them make up the missed lesson about why the Chinese people love the CPC so much and save them the ridiculous delusions.

北京市密云区人大常委会副主任李光辉接受审查调查————执纪审查——中央纪委国家监委网站 Miyun, Beijing official under investigation. From 2004-10 he was a senior official in the districts land and housing bureau

习近平致信祝贺全国青联十三届全委会全国学联二十七大召开--新闻报道-人民网 王沪宁出席开幕会

Xi calls on youth to make new, greater contributions to undertakings of Party, country - Xinhua made the remarks in a congratulatory letter to a session of the All-China Youth Federation and a congress of the All-China Students' Federation, which opened in Beijing on Monday morning. On behalf of the CPC Central Committee, Xi extended congratulations on the opening of the meetings, and sincere greetings to young students and young people of all ethnic groups and all walks of life in China, as well as overseas Chinese youth.

The Anniversary That Never Was | China Media Project One of the privileges of being the “core” leader of the Chinese Communist Party is that history can be rewritten to place you right at the center. So it is this week with thinking on environmental policy in China. People’s Daily Online today features two articles on the so-called “two mountains theory,” or liangshanlun (两山论), the three-character phrase meant to stand for what elsewhere has been called “Xi Jinping Thought on Ecological Civilization” (习近平生态文明思想), essentially the top leader’s claim to China’s record on sustainable development.

Xi Focus: 15 years on, sustainability shines brighter with Xi's hallmark green development saying - Xinhua "Lucid waters and lush mountains are invaluable assets," the famous line put forward by President Xi Jinping in his earlier days as Communist Party chief of Zhejiang in 2005, has evolved into a guideline behind China's quest for a greener future through sustainable development. Fifteen years on, the visions of Xi, who is also general secretary of the Communist Party of China Central Committee and chairman of the Central Military Commission, about growing a rich trove of the "invaluable assets" have witnessed the positive change of landscape, as well as far-reaching harmonization of a huge economy and the bountiful nature.

Court Overturns Verdict Against Woman Who Reported Rural Pollution - Caixin Public prosecutors in Northwest China are expected to drop their case against a woman who was imprisoned for more than 600 days for “picking quarrels and provoking trouble,” a vaguely defined offense used to control threats to social stability, after she reported environmental and other violations in her hometown. A court in Shiquan, a county in Shaanxi province, on Friday permitted local prosecutors to withdraw the case against Li Sixia, a 57-year-old engineer based in the city of Xi’an, after a higher court reversed the original guilty verdict on appeal and ordered a retrial.

How Xi Jinping Dominates Elite Party Politics: A Case Study of Civil-Military Leadership Formation: The China Journal: Vol 84 All supreme CCP leaders encounter an inherent contradiction between maintaining a necessary level of power sharing (collective leadership) while ensuring their own effective control over overall Party politics. This article uses case studies of the formation of the Eighteenth and the Nineteenth Central Military Commissions, as well as of the Nineteenth Politburo Standing Committee, to decipher how Xi Jinping has handled the contradiction by establishing his personal domination while attaining a degree of subtle grouping balance in the CCP/PLA leadership. // Comment: This looks like an interesting article, do not have access to it though

NPCSC Seeks Public Comments on Draft Copyright Law Amendment, National Flag & Emblem Laws Amendments, NPC Organizational & Procedural Rules Amendments & Two Other Bills – NPC Observer

China’s facial-recognition surveillance secrets revealed in major leak - The Australian The Australian can reveal the Chinese Communist Party has installed facial-recognition software in residential buildings that are home to members of the Tujia and Miao tribes in Yuping Dong Autonomous County near the city of Tongren in the southwest province of Guizhou... The Chinese government’s facial-recognition database, called the Tongren City Security Facial Recognition System for Building Controls, was subject to a security breach by Chinese activists seeking to expose the invasive treatment of minorities. The activists leaked the real-time facial recognition data, while it was still operational and live-streaming, to an international group of cyber security analysts specialising in China.

Foreign and Defense Affairs

Chinese envoy urges UK to fix its policy deficits toward China - Global Times "We are saddened by the current difficulties and setbacks in China-UK relations, the responsibility for such a situation lies solely with the British side," Liu said, urging that while bilateral ties are at an important junction, the UK government should think about its attitude and policy toward China..."By holding a Cold War mentality and colonial mindset, they are unable to view China's development objectively and rationally; instead, they are engulfed in full anxiety and suspicion," Liu said..."Given the above-mentioned wrongdoings and deeds of the British side, China-UK ties have been severely damaged. I've been continuously notifying the UK that China is the UK's partner; not rival, not enemy," Liu said, noting that China's development is an opportunity, which is neither a challenge nor threat.

China continues to harass exiles on British soil, claim victims - The Telegraph China is suspected of orchestrating a sinister campaign to suppress prominent critics living in Britain from speaking out against the ruling Communist Party by harassing, intimidating, and surveilling them while they are in the UK, the Telegraph can reveal. Simon Cheng Man-kit, a former British consulate employee in Hong Kong who was tortured by Chinese secret police, said he had been followed at least three times in the last two weeks. Mr Cheng, who has been granted asylum in the UK, has been vocal about eroding freedoms in Hong Kong. A threatening email also arrived in Mr Cheng’s inbox this week. “Chinese agents will find you and bring you back,” read the subject line.

Harboring illegal separatists may add obstacles to China-UK ties: ambassador - Global Times Hong Kong secessionists fleeing to the UK and promoting the "parliament in exile" severely breach and blatantly defy Article 29 of the national security law for Hong Kong, warned legal experts, who said that those people, along with UK organizations or individuals who sponsored them, will face legal punishment no matter their whereabouts and face severe sanctions from China. China's ambassador to the UK also warned that harboring a so-called "parliament" in the UK will set new severe obstacles to bilateral ties. Hong Kong separatist Sunny Cheung is thought to have become the latest figure to flee to the UK and seek refuge with high-profile Hong Kong secessionist Nathan Law Kwun-chung,

How fake award for a tycoon left Oxford University open to Chinese influence | The Guardian An Oxford academic handed out a “meaningless” university qualification to a Hong Kong businessman with ties to the Chinese authorities at a high-profile ceremony in Shanghai last year, in the latest incident to raise concerns about Chinese influence on UK higher education. Alan Hudson awarded the title “Belt and Road Academician from Oxford University” to Chan King Wai, who is a member of an advisory body to China’s rubber-stamp parliament, at a ceremony attended by an official from the British consulate and dozens of other people.

Cambridge abuses its reputation following Pompeo's suit - Global Times - Hu Xijin I want to remind Cambridge University that most of its glory - just like that of the United Kingdom - belongs to the past. It, like the rest of the UK, is facing many potential crises. All of best universities in the world have developed reputations for relying on the prosperity of the countries and regions they are in. With the UK going downhill, Cambridge University should be vigilant to prevent factors that lead to decline - such as those that led to the fall of the British Empire. It should see the world with an open mind and cherish the respect it receives from people across the globe. It cannot abuse its reputation

Germany blocked Chinese metals takeover on military concerns - sources - Reuters The German government rejected a bid by China’s Vital Materials Co to buy PPM Pure Metals last month due to concerns about the target company’s sales to the German military, two sources with knowledge of the matter said

US’s tougher stance on South China Sea undermined by Philippines | Financial Times $$ the weak spot in the tougher US strategy is proving to be the shifting stance of the Philippines. This month, Delfin Lorenzana, Manila’s normally hawkish defence secretary, ruled the country out of participating in naval exercises in the South China Sea.

INTERVIEW/ John Mearsheimer: U.S.-China rift runs real risk of escalating into a nuclear war : The Asahi Shimbun Q: How do you evaluate the Trump administration's China policy? A: I think that Trump has wisely understood that it's important for the United States to contain China, not only militarily, but economically. Q: But the administration has failed to get a result. A: I think the problem with the Trump administration is that it has done a bad job dealing with allies like Japan and South Korea and the Philippines and Australia and Vietnam and so forth and so on. What we need here is American leadership to put together a cohesive Alliance structure that can contain China. And the Trump administration has treated America's allies with contempt.

China Seeks to Use Access to Covid-19 Vaccines for Diplomacy - WSJ $$ With China closing in on a coronavirus vaccine, Beijing’s top officials and some of its drugmakers have begun promising early access to countries of strategic interest as it seeks to shore up its global standing after a pandemic that has strained geopolitical ties.

Coronavirus vaccine: Chinese scientists plan joint trials with Russia despite doubts over ‘world-beating’ breakthrough | South China Morning Post The plan was announced by China’s top respiratory diseases expert Zhong Nanshan on Sunday during a symposium with Russian scientists. He did not specify which vaccine candidate would be tested or where the trials would take place.

Former CIA officer charged with spying for China - NBC News Court documents said 67-year-old Alexander Yuk Ching Ma of Honolulu was charged with violating U.S. espionage laws. Prosecutors said he joined the CIA in 1967 then served as a CIA officer until he retired from the agency in 1989. For part of that time he was assigned to work overseas in the East-Asia and Pacific region. Twelve years after he retired, prosecutors said Monday that Ma met with at least five officers of China's Ministry of State Security in a Hong Kong hotel room, where he "disclosed a substantial amount of highly classified national defense information," including facts about the CIA's internal organization, methods for communicating covertly, and the identities of CIA officers and human assets.

US Department of Justice - Former CIA Officer Arrested and Charged with Espionage

Silk Road Redux: Greece courts China money in crisis revival bid - Nikkei Asian Review "Chinese demand for Greek Golden Visas has not slackened, even though the number of approvals dropped this year," said Georg Chmiel, Executive Chairman of Juwai IQI, one of the top real estate networks in China and Southeast Asia. "We expect Greece to win a Chinese buyer's market share from countries such as the U.K. and Spain, which have had much less success in the fight against COVID-19."

China and Nepal Hold the 13th Round of Diplomatic Consultation On August 12, 2020, Vice Foreign Minister Luo Zhaohui held the 13th round of China-Nepal diplomatic consultation with Foreign Secretary Shanker Das Bairagi of Nepal via videolink, exchanging views on China-Nepal relations and international and regional issues of common concern.

In China, Only Positive News for Lukashenko | China Media Project How have Chinese state media reported the story of the two rallies? Not surprisingly, readers are told only about one rally – that in support of Lukashenko. The headline today reads: “Large-scale rallies held in Belarusian capital to support the government.”

Chinese Foreign Minister Wang Yi visits Tibet to ‘send message to India’ over border dispute | South China Morning Post Wang became the first senior central government official to visit the frontier area since the deadliest clash in over 50 years occurred on June 15 in the disputed Galwan Valley.

Chinese state broadcaster reveals details of new airborne weapon Tianlei 500 as tensions simmer with Taiwan | South China Morning Post Footage and new details of the Tianlei 500 – a 500kg precision-guided munitions dispenser and air-to-surface missile – featured in a defence programme on state broadcaster CCTV-7 on Friday. The dispenser has wings and a square cross-section to hold submunitions, which can also reduce its radar cross-section to boost its stealth capability and make it harder to intercept, according to the report. // 中国公开一新型武器 港媒:五角大楼规划者夜不能寐_网易新闻

How America Can Push Back Against China's Aggression - Foreign Affairs How to Push Back Against Beijing By Aaron L. Friedberg

Shanghai rankings distort the place of research in universities - Australian Financial Review The Shanghai rankings were designed to meet domestic educational needs in China and have distorted the way Australian universities spend precious dollars for higher education, according to sociologist and China watcher at Sydney University, Professor Salvatore Babones. "It's a bit ridiculous. We are recruiting hundreds of thousands of Chinese students to finance a research initiative where the main objective is to improve Australian rankings. "But Australian students will never get to interact with these highly cited researchers, they're research-only academics, they don't teach.

Trump’s Policies Are a Boon to the Super Rich. So Where Are All the Seven-Figure Checks? - The New York Times Mr. Adelson also had another concern: Some of America First’s ads have targeted China, and the Las Vegas Sands Corporation, which he runs, has significant holdings in Asia. He has told senior Republican officials that being too closely associated with the PAC could be bad for business, according to two people with knowledge of his comments.

US-China tensions feed into the geopolitics of monetary policy | Financial Times OpEd - David Lubin $$ the elephant in the room is the deteriorating US-China relationship. The politically hostile global environment in which China finds itself makes monetary conservatism a strategic necessity. China lacks a global currency and is a possible target of financial sanctions. With this in mind, Beijing has a strong incentive to maintain big economic buffers.

China’s Global Push: Is A Backlash Building? (Whole Program) - YouTube On Aug. 13, the Overseas Press Club of America and Gateway House, Mumbai, India, co-sponsored a unique global online conversation among China experts on three continents. As China pushes to expand its power around the world technologically, economically and strategically, signs of concern are mounting. India has taken particularly dramatic action, banning Chinese software applications from its market. What are the tools and tactics that President Xi Jinping’s government is using? How can they be countered?

Hong Kong and Macao

Hong Kong leader Carrie Lam cuts ties with University of Cambridge’s Wolfson College | South China Morning Post Hong Kong’s leader has rescinded her honorary fellowship from the University of Cambridge’s Wolfson College, severing ties from an institution she accuses of peddling groundless allegations about her. Carrie Lam Cheng Yuet-ngor issued the snub after the British college expressed concerns last month over her role in the national security law that Beijing imposed on Hong Kong in June.

Nathan Law: “We All Know that Danger Is Everywhere” - DER SPIEGEL In an interview, Nathan Law, one of the leaders of the democracy movement in Hong Kong, discusses the transformation of the special administrative region into a police state. He also talks about his new life in London and his hopes for German Chancellor Angela Merkel.

UK halts military training for Hong Kong police as relations with China decline | The Guardian Both the army and the RAF run limited drill instructor programmes for Hong Kong’s police force, its Government Flying Service and its Sea Cadet Corps, but these have now been put on hold, the Ministry of Defence told the Observer. The UK says the decision is being taken because of the Covid-19 crisis. But a spokesman confirmed the contracts will be reviewed when the pandemic is over.

历史大势不可挡(中国制度面对面(13)) ——“一国两制”重要制度为什么完全行得通?

澳大利亚警察盘问我哪儿搞来的中国国旗,我说拼多多 In an interview with Guancha, a Chinese student told her story of organizing an anti Hongkong protest last year in Sydney, and how she was interrogated and threatened by the Australian intelligence officials at a café

Taiwan

Taiwan’s ruling Democratic Progressive Party regains control of Kaohsiung with landslide victory | South China Morning Post Former Taiwanese vice-premier Chen Chi-mai won a landslide in Kaohsiung’s mayoral by-election on Saturday, recapturing the southern port city for the ruling Democratic Progressive Party after its surprise loss two years ago.

Taiwan to step up efforts to prevent Chinese spies settling - Reuters Taiwan will step up scrutiny of mainland Chinese citizens who are residents of Hong Kong and seek to move to the island to ensure they do not engage in spying or other illegal acts, the government said on Monday

Tech and Media

In-Depth: China Creates New Memory Chip Champ, but Will Customers Come? - Caixin Four years after its founding, ChangXin Memory Technologies Inc. had finally come of age by becoming China’s first-ever company to design and produce the chips that are a central component of most computing devices. The news was hailed as a significant development for both ChangXin and China’s semiconductor industry, which has suddenly gone into overdrive to become more self-sufficient in the face of increasingly stringent technology export restrictions from the West, led by a campaign from the U.S.

Text editor Notepad++ banned in China after ‘Stand with Hong Kong’ update - TechCrunch | TechCrunch The website of Notepad++ is banned in China as of Monday, “obviously due to” its release of editions named “Free Uyghur” and “Stand with Hong Kong,” the source code and text editor announced on Twitter.

Peter Chan's Volleyball Drama "Leap" to Hit China Over National Day - Variety Peter Chan’s hotly anticipated biographical sports drama “Leap” is set to hit China on Sept. 30, becoming the first of the Chinese New Year blockbusters canceled due to COVID-19 to set a theatrical outing.

Popular Settlement Sim Criticized for Glorifying Historical Villains - SixthTone In a patch last week, One Hundred Scenes of Jiangnan — a SimCity- or Animal Crossing-like game from Shanghai-based indie developer Coconut Island that’s also known by the English title Canal Towns — changed the names of several non-player characters after gamers complained historical villains had been lumped into the same category as the game’s top heroes.

Shenzhen Boasts World’s Biggest 5G Network - Caixin With a total of 46,480 stations for a population of around 13 million, Shenzhen is now the world’s No. 1 city in terms of 5G stations per person.

Yicai - China Electronics Releases Kylin V10 OS to Challenge Foreign Monopoly China Electronics, one of the country’s biggest electronics firms, has released its own operating system Kylin V10 to pave the way into the new fifth-generation mobile network era and as part of China’s drive to wean itself off US technology as trade tensions escalate, Xinhua News Agency reported today. Named after a Chinese mythical unicorn, the Kylin OS is compatible with the Android ecosystem and can be used on mobile phones, tablets, personal computers and other electronic devices. Its Kydroid software can transfer over three million Android applications to the new system

Tencent: The Ultimate Outsider - Not Boring by Packy McCormick Part I in a Two Part Series on the Biggest Company We Know the Least About

Chinese dronemaker DJI makes sweeping cuts in 'Long March' reforms - Reuters Chinese drone giant SZ DJI Technology Co Ltd has been making sweeping cuts to its global sales and marketing teams as it faces coronavirus headwinds and mounting political pressure in key markets, current and former staff told Reuters.

Society, Arts, Sports, Culture and History

Internet buzzwords added to Chinese dictionary - Xinhua Chinese internet buzzwords, such as "QR code" and "thumb-up," have been added to the latest edition of Xinhua Dictionary. Apart from the new words, the newly-launched 12th edition of the dictionary has also tracked on expanded definitions for old words.

Energy, Environment, Science and Health

How China’s Expanding Fishing Fleet Is Depleting the World’s Oceans - Yale E360 China is not only the world’s biggest seafood exporter, the country’s population also accounts for more than a third of all fish consumption worldwide. Having depleted the seas close to home, the Chinese fishing fleet has been sailing farther afield in recent years to exploit the waters of other countries, including those in West Africa and Latin America, where enforcement tends to be weaker as local governments lack the resources or inclination to police their waters

Chinese City to Halt Frozen Seafood, Meat Imports on Virus Worry - Bloomberg The Cold Chain Association of China’s southern coastal city of Guangzhou ordered all member companies to suspend imports of frozen meat and seafood from coronavirus-hit areas, the city’s Internet Information Office said on its official Weibo account, without specifying areas or countries.

Yicai - Another Covid-19 Case Emerges in Shenzhen, Source Yet To Be Confirmed Shenzhen confirmed a new local case of Covid-19 after nearly half a year last week. This has again raised doubts over the safety of imported frozen food. Monitoring and inspecting the whole process is difficult, and the source of the virus has not been confirmed yet due to the large number of food imports, a local grocery store worker told Yicai Global.

Education

Guideline sets rules for school reopenings in fall - China Daily The guideline said all teachers, students and staff from low-risk areas must present a green health code to be able to return to school. Those from medium-risk or high-risk areas will need to have a negative result in a nucleic acid test in the week before their return to campuses. College staff and students will not be required to wear masks on campuses. But students and staff entering campuses should have their body temperature checked and their health code scanned, the guideline said. Colleges and universities should step up checking, registration and management of food and parcel delivery workers entering campuses, and designate areas for the collection and delivery of parcels, it added.

Rural and Agricultural Issues

China’s chicken production surges, reducing appetite for imports as food safety fears grow amid coronavirus | Reuters China is expected to produce a record 14.85 million tonnes of chicken meat in 2020, a substantial increase over last year’s 18 per cent rise to 13.75 million tonnes