DRC official: US has "strategic containment" as goal of trade war; China hacked Clinton's email server?; Party throws congress for returned overseas Chinese; Chives state 韭州; Family planning policy not ending?

Happy Wednesday

Among the interesting things today:

  • A long article on Page 7 of the Wednesday People's Daily that says one of the real reasons behind the US-China trade war is that America has decided it needs to keep China down;

  • President Trump tweeted a Daily Caller article that China had hacked Hillary Clinton's email server, the Chinese deny it, no other, more reputable new outlet seems to have confirmed the claim; 

  • The Party held the 10th National Congress of Returned Overseas Chinese and their Relatives in Beijing. 

Thanks for reading.

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The Essential Eight

1. US-China

Page seven of the 8.29 People's Daily has a piece by Long Guoqiang, Vice-President, Development Research Center of the State Council (DRC)--"Rationally understand the current US-China trade frictions -人民日报人民要论:理性认识当前的中美贸易摩擦--观点--人民网:"

Long starts by listing all the benefits of and agreements about US-China trade since the start of reform and opening, then he recites that standard line that blames all the frictions on the US, then asks why the US really started this round and what its real motivations are. He lists three reasons:

美方明知要付出如此代价,为何还要发动贸易战?美方发动贸易战的原因是复杂而深刻的,概括而言有以下三点:

1. "Interests extortion" i.e. using threats of a trade war to force China to open its markets 利益敲诈。通过贸易战或发动贸易战的威胁,迫使贸易伙伴开放市场、让渡经济利益,是美国的惯用伎俩,以往曾经对多个国家使用过

2. "strategic containment 战略遏制", says the trade war is part of a broader strategy to keep China down 贸易战不仅是美国获取更多经济利益的手段,也是美国遏制中国的重要手段。美国加征关税的500亿美元中国出口产品,主要针对的是《中国制造2025》中包含的高科技领域,反映了美国遏制中国技术追赶的意图。

3. 模式打压 (beat down the model", says the US wants to beat down the "China model" to preserve its global hegemony.

Here is the google translate version, so far have not seen an official English version - "rationally understand the current Sino-US trade friction"

Strategic containment. After the Second World War, the United States became the dominant country in the Western world. After the end of the Cold War, the United States became the world's only superpower with its technological, economic, military, and financial strengths far ahead of other countries. In order to maintain its world hegemony, the United States has been guarding against any possible catch-up. In the past, the Soviet Union and Japan had been hampered by the United States. With the rapid development of China's economy and the rise of comprehensive national strength, the United States has fully turned to its cognition and sentiment towards China, redefining Sino-US relations.The 2018 edition of the US National Defense Strategy Report states that "strategic competition between countries is now the primary issue of US national security" and defines China as a long-term "strategic competitor" of the United States. The report also stated that economic security is the foundation of national security and is national security. On August 13, 2018, the President of the United States signed the National Defense Authorization Act of 2019, which contains two important bills: the Export Control Reform Act and the Foreign Investment Risk Review Modernization Act, which further strengthens high-tech export restrictions. And prevent foreign companies from acquiring technology through investment. Therefore, the trade war is not only a means for the United States to obtain more economic benefits, but also an important means for the United States to contain China. The US$5 billion Chinese export product that imposes tariffs on the United States is mainly aimed at the high-tech field contained in "Made in China 2025", reflecting the US's intention to curb Chinese technology catching up.

Per my 8.19 note, it looks like the idea that the trade pressure is just one piece of a multi-dimensional strategy to “thwart China’s rise” is now the official view.

Morgan Stanley on US-China trade war: No 'major' hit to China economy - CNBC:

"We are not expecting any major growth correction because we think the potential impact from trade tariffs will be partially cushioned by the policy easing measures taken by the policy makers," Robin Xing, chief China economist at Morgan Stanley, told CNBC at the Morgan Stanley Technology, Media and Telecom Conference in Beijing.

US companies in China learn to live with trade tariffs | Financial Times $$:

For one senior US business executive, the rising influence within the administration of Robert Lighthizer, Mr Trump’s hardline trade representative, at the expense of more moderate voices, such as Treasury secretary Steven Mnuchin, has been a welcome development. “I feel better with Lighthizer having more power than Mnuchin,” the executive says. “Mnuchin is of the Paulson school and thankfully the Hank Paulson-Wang Qishan bromance days are finally gone.”..

Donald Trump ally John Thornton briefs China’s trade war negotiator Vice-Premier Liu He in Beijing | South China Morning Post:

One of US President Donald Trump’s allies was among the business heavyweights at a closed-door meeting in Beijing on Tuesday chaired by China’s point man on trade war talks, Vice-Premier Liu He, the South China Morning Post has learned.

John Thornton, chairman of the think tank the Brookings Institution and former president of investment bank Goldman Sachs, outlined some of Washington’s thinking on the escalating trade war at a meeting of the international advisory board of China’s sovereign wealth fund, China Investment Corporation (CIC).

Amid Trade War, Americans' Views of China Worsen | Pew Research Center

The new survey by Pew Research Center, conducted May 14 to June 15, 2018, among 1,500 adults, also finds that young people typically have more positive attitudes toward China. About half of 18- to 29-year-olds (49%) express a favorable view of China, compared with only 37% of those ages 30 to 49 and 34% of people 50 and older. Younger people are also much less concerned than older generations about cyberattacks and job losses to China.

Lawmakers Push to Sanction Chinese Officials Over Xinjiang Camps - WSJ $$

In a letter sent Wednesday to Secretary of State Mike Pompeo and Treasury Secretary Steven Mnuchin, Florida Republican Sen. Marco Rubio and 16 other members of Congress from both parties called for the sanctions on seven Chinese officials and two businesses that make surveillance equipment. 

The letter, which was reviewed by The Wall Street Journal, cites the Communist Party boss of Xinjiang, the western region where Chinese authorities have over the past year vastly expanded an internment program that initially targeted religious extremists but now includes broad numbers of Uighurs, a largely Muslim ethnic group.

Beijing rejects Trump's claims that China is behind fentanyl crisis - CNN:

Yu Haibin, a senior official with China's National Narcotics Control Commission, said in a press briefing Wednesday that Trump's comments were "unacceptable" and "irresponsible."

Trump tweeted last week that it was "outrageous" that China-produced fentanyl, a cheap and deadly synthetic opioid at least 50 times stronger than heroin, continued to "pour into the US" through international mail.

Yu said the Chinese government found Trump's tweet "completely unacceptable."

"The United States has no proof that most fentanyl in the country comes from China," he said. "It's highly irresponsible to draw such a conclusion based on some individual cases."


2. PLAN ready to challenge the US Navy in the Pacific-NYT

The center of the front page of the print edition of the August 29 New York Times.

With Ships and Missiles, China Is Ready to Challenge U.S. Navy in Pacific - The New York Times 

While China lags in projecting firepower on a global scale, it can now challenge American military supremacy in the places that matter most to it: the waters around Taiwan and in the disputed South China Sea...

“China is now capable of controlling the South China Sea in all scenarios short of war with the United States,” the new commander of the United States Indo-Pacific Command, Adm. Philip S. Davidson, acknowledged in written remarks submitted during his Senate confirmation process in March...

China’s naval expansion began in 2000 but accelerated sharply after Mr. Xi took command in 2013...

Last year, China counted 317 warships and submarines in active service, compared with 283 in the United States Navy, which has been essentially unrivaled in the open seas since the collapse of the Soviet Union in 1991.

Unlike the Soviet Union, which drained its coffers during the Cold War arms race, military spending in China is a manageable percentage of a growing economy. Beijing’s defense budget now ranks second only to the United States: $228 billion to $610 billion, according to estimates by the Stockholm International Peace Research Institute...

“Competition is the American way of seeing it,” said Li Jie, an analyst with the Chinese Naval Research Institute in Beijing. “China is simply protecting its rights and its interests in the Pacific.”


3. Trump says China hacked Clinton's email server

In late-night tweet, Donald Trump blames China for hacking Hillary Clinton’s emails | South China Morning Post:

“Hillary Clinton’s Emails, many of which are Classified Information, got hacked by China. Next move better be by the FBI & DOJ or, after all of their other missteps (Comey, McCabe, Strzok, Page, Ohr, FISA, Dirty Dossier etc.), their credibility will be forever gone!” he tweeted a little after midnight on Wednesday.

The original Daily Caller article - China Hacked Hillary Clinton’s Private Email Server: 

A Chinese-owned company operating in the Washington, D.C., area hacked Hillary Clinton’s private server throughout her term as secretary of state and obtained nearly all her emails, two sources briefed on the matter told The Daily Caller News Foundation.

The Chinese firm obtained Clinton’s emails in real time as she sent and received communications and documents through her personal server, according to the sources, who said the hacking was conducted as part of an intelligence operation.

The Chinese wrote code that was embedded in the server, which was kept in Clinton’s residence in upstate New York. The code generated an instant “courtesy copy” for nearly all of her emails and forwarded them to the Chinese company, according to the sources.

China denies Trump's claim it hacked Clinton's emails - ABC News:

"We are firmly opposed to all forms of cyberattacks and espionage," foreign ministry spokeswoman Hua Chunying said at a regular briefing Wednesday. She said China is a staunch defender of cybersecurity.


4. 10th National Congress of returned overseas Chinese and their relatives

Top leaders attend congress of returned overseas Chinese - Xinhua:

About 3,000 people attended the opening ceremony of the 10th National Congress of Returned Overseas Chinese and their Relatives in Beijing Wednesday.

Chinese leaders Xi Jinping, Li Keqiang, Li Zhanshu, Wang Yang, Wang Huning, Han Zheng and Wang Qishan attended the ceremony.

On behalf of the Communist Party of China (CPC) Central Committee, Zhao Leji delivered a speech at the event, expressing congratulations to the congress and extending greetings to returned overseas Chinese and their relatives, Chinese people living abroad and workers with the All-China Federation of Returned Overseas Chinese (AFROC)...

He also called on returned overseas Chinese, their relatives and Chinese people living overseas to keep firmly in mind the hopes of the Party and the people, uphold the greater national interests, promote Chinese culture and make new contributions to the Chinese Dream of national rejuvenation and the building of a community with a shared future for humanity.

Top 6:30 of the Wednesday CCTV Evening News on the meeting..Why did Zhao Leji  give the speech and not Wang Yang, who I thought had United Front oversight?--第十次全国归侨侨眷代表大会在京开幕 习近平李克强栗战书汪洋王沪宁韩正王岐山到会祝贺 赵乐际代表党中央致词_CCTV:

赵乐际表示,习近平总书记关于侨务工作的重要论述,为做好新时代党的侨务工作提供了根本遵循。实现党的十九大提出的决胜全面建成小康社会、开启全面建设社会主义现代化国家新征程的宏伟蓝图,是全党全国人民的共同目标,也是海内外中华儿女的共同使命。希望广大归侨侨眷和海外侨胞牢记党和人民嘱托,传播好中国声音,助力祖国发展,维护中华民族大义,弘扬中华文化,为实现中华民族伟大复兴的中国梦、推动构建人类命运共同体作出新的贡献。

And then people wonder why foreign governments are suspicious of CCP efforts to use Overseas Chinese communities...

The Party committee of the All-China Federation of Returned Overseas Chinese has an essay in the latest Qiushi on learning from Xi's comments on work related to the Chinese diaspora--新时代侨联工作改革创新的根本遵循


5. Chives state 韭州

The Story of Chinese Chives – Elephant Room

They are fast-growing, drought-tolerant, and extremely vital; even after a long freeze, the plant will die only to return again come springtime. Thanks to nutrients stored inside the stem, after the top leafs are being cut away, the plant will keep growing and blooming into the next harvest.

In 2018, the Chinese people have come to learn one fact: we are all, in essence, chives.

The Chinese public first used the terms “chives “and “chive-harvesting” a couple of years ago, nicknaming the victims who were trapped in the loop of speculative investments...

Over the past few months, the term “chives” was elevated to a new level. Today, the Chinese people are not only acknowledging themselves as chives, but also mocking the nation as a “Chives State 韭州” . It looks like we’ve finally come to accept the fact: in a country where legislation lacks transparency and power over-concentrated, every Chinese citizen is a root of Chives in the end of the day...

Half way through writing this article, we noticed that the term “chives state 韭州” is already being censored. “I bet chives is the next keyword to vanish from the Chinese internet!” A friend posted on her WeChat today.

Caixin Explains: Why So Many Chinese Investors Are Green and Leafy - Caixin Global:

Turnover on the volatile Chinese stock market is driven by hordes of individual retail investors, known as “scattered” investors (散户sǎnhù). Over 99% of investor accounts on the Shanghai Stock Exchange were held by individuals, as opposed to institutions or companies, according to 2017 statistics. Institutional investors, (or 大户 dàhù), are the ones who actually hold the majority of shares, however. (See our chart for details)

These mom-and-pop investors are also known, often self-deprecatingly, as chives (韭菜, jiǔcài). Just as chives will sprout again and again after their stems are chopped and stuffed into dumplings, groups of sanhu will keep throwing cash into the markets to try to get back all the money they lost the last time.


6. Superpower with Chinese characteristics

What Does a Chinese Superpower Look Like? Nothing Like the U.S. - Bloomberg 

What struck Wang Wen about Antarctica, beyond the brutality of the December cold, was the scale of U.S. operations in such an inhospitable environment and the American flag fluttering by the sign that marks the geographic South Pole. Observing the academic mission of hundreds of U.S. scientists in a region rich in resource potential, he was determined that China must catch up.

The report Wang wrote this summer for the Chongyang Institute for Financial Studies at Renmin University of China in Beijing, where he’s executive dean, reflects China’s growing dilemma as it muscles its way into an international system it didn’t create...

All of this, according to Wang Wen, is to fundamentally misunderstand China by trying to fit it into western experience. He cites the doom-laden warnings of Chinese over-leverage and over-planning that have proved wrong for decades.

“Our country has entered a very interesting phase that the Western social sciences can’t explain,” said Wang, singling out conventional economics as especially inept. “If you use Western theory, you cannot understand China’s foreign policy.”

The Chongyang report - China`s Antarctic Strategy in the New Era ——Thinking and Suggestions Based on Field Research 

Wang Wen is a very interesting, rising player in China's foreign policy think tank world.


7. Income tax cuts planned

Chinese lawmakers deliberate revisions to income tax law - Xinhua:

According to a draft amendment to the law, the minimum threshold for the personal income tax exemption is expected to be raised from 3,500 yuan (about 512 U.S. dollars) to 5,000 yuan per month or 60,000 yuan per year.

It also adds special expense deductions for items like caring for the elderly, children's education, continuing education, treatment for serious diseases, as well as housing loan interest and rent.

The revisions have lived up to the will of the people and are conducive to improving tax equity, thus enabling taxation to better play its role in adjusting income distribution, lawmaker Zhang Chunxian said during panel discussions...

The individual income tax was the third major contributor to China's total tax revenue, following value-added tax and enterprise income tax. In 2017, China collected individual income taxes worth nearly 1.2 trillion yuan, about 8.3 percent of the total tax revenue.

Question: But how much of this tax cut may be offset by an eventual property tax?


8. Maybe family planning policy not ending?

Removal of family planning in draft doesn't mean end of policy - China Daily:

Given the country's demographic situation, the decision has triggered widespread speculation as to whether it is meant to pave the way for the abolishment of the country's decades-old family planning policy.

However, legislators explained on Tuesday that there's a special law on family planning, so there's no need to include similar content in the marriage section while drafting the civil code.

Related regulations can still be found in the Population and Family Planning Law. As for whether the Population and Family Planning Law will be amended due to the changing demographic situation in the country requires further consideration, according to the Commission for Legislative Affairs of the NPC Standing Committee...

Jiang Yue, a law professor at Xiamen University, said the removal of family planning in the draft is meant to catch up with the pace of the nation's changes.

The Marriage Law was adopted more than three decades ago. But with the passage of time and amid societal changes, along with the progress of China's legislation, there's better understanding on the matter these days.

She added that birth-related content is not written into civil codes in more than 20 countries and regions, according to her research into the matter.


Business, Economy, Finance And Trade

Big Banks’ Profits Hold Up in Face of Tougher Regulations - Caixin Global Three of China’s top lenders reported that their first-half profits grew at least 5% year-on-year as their privileged access to cheap funding gave them an advantage over smaller competitors squeezed by a national deleveraging campaign. The banks’ accelerating profit growth shows that the country’s big state-owned banks have managed to weather the sweeping new asset management rules that have taken a toll on the rest of the industry.

China bank regulator says will push forward with deleveraging | Reuters In a statement on its website late Wednesday, the China Banking and Insurance Regulatory Commission (CBIRC) said that it will strengthen controls over internet finance and improve property lending practices to fend off a real estate bubble. The CBIRC also said it would speed up implementation of measures to further open banking and insurance sectors, though opening measures would be balanced with the need to control risks.

Beijing Targets Hidden Local Government Debt with Two New Directives - China Banking News Beijing recently launched the “State Council Opinions on Preventing and Resolving Local Government Hidden Debt Risk” (中共中央国务院关于防范化解地方政府隐性债务风险的意见) and the “Local Government Hidden Debt Accountability Measures” (地方政府隐性债务问责办法). Liu Kun (刘昆), China’s finance minister, said that the next step would be to firmly contain growth in hidden debt, monitor and spur the rectification of irregular conduct in relation to government investment funds, public-private partnerships (PPP) and government service procurements, as well as strictly ban all forms of illegal guarantees or covert fund-raising.

Brother can you spare a dime: China’s small firms can’t get loans even with the government’s push | South China Morning Post An employee at a state policy bank told the Post that, given the government initiative, the bank now makes special evaluations of the loan requests by SMEs. But loan officers prefer to lend to large companies rather than smaller firms, so that they can achieve their loan performance targets more quickly. “Lending to small companies is riskier since [small company] managers often transfer company assets to their personal accounts,” said the official, who declined to gave his name. “It also costs so much time to identify their risks, given low transparency.”

China’s Himin Solar chief confronts local government over debt | Financial Times $$ His February missive, which called out the top Communist party official in Dezhou by name, was unusual in China where private entrepreneurs strive to maintain a low profile. In response to his letter, local authorities said they would “solve” the problem, without giving details. It followed similar moves this year by wealthy property and construction entrepreneurs. Analysts said tightening liquidity in China was forcing companies to call in debts — even from local governments.

A new set of Chinese economic figures adds up to yet another headache for statisticians | South China Morning Post The latest concerns centre on areas such as profits from large industrial companies, retail sales, electricity consumption, coal output, and company revenues in cultural and related industries. One of the perplexing issues is that the NBS has often reported positive year-on-year growth rates in percentage terms, while growth in absolute yuan terms has been negative. This deviation, which barely happened in the past, has reinforced scepticism over the quality of the data and fuelled the suspicion that the NBS generates data outcomes that match the policy goals of the Chinese government leadership.

Electric Car Superstar Downsizes New York IPO - Caixin Global Nio’s latest target of raising as much as $1.52 billion is down from an initial goal of up to $1.8 billion, the company said in an updated filing to the U.S. securities regulator on Tuesday. It plans to issue about 160 million American depositary shares priced between $6.25 and $8.25, giving it a market value of up to $8.46 billion.

Bear Market Forces Real Estate Titan to Put Backdoor Listing on Hold - Caixin Global Hong Kong-listed China Evergrande Group announced in late 2016 it would carry out a so-called backdoor listing on the mainland, where valuations are usually higher than in Hong Kong, by injecting almost all of the property assets held by its unit Hengda Real Estate Group Co. Ltd. into the Shenzhen-listed Shenzhen Special Economic Zone Real Estate & Properties Group Co. Ltd.

Restaurant operator Yum China rejects $17.6 billion Hillhouse-led offer: sources | Reuters Fast-food chain operator Yum China Holdings Inc (YUMC.N) has rejected a $17.6 billion buyout offer from a consortium led by Chinese investment firm Hillhouse Capital Group, quashing what would have been one of Asia’s biggest deals this year, people with direct knowledge of the matter said.

Prague Approves Citic’s Takeover of Embattled Conglomerate’s Czech Assets - Caixin Global Prague has given the green light to China’s state-owned Citic Group Corp. to take over the Czech assets of CEFC China Energy Co. Ltd., Citic Chairman Chang Zhenming said.

GM’s Electric Dream in China Suddenly Looks Underpowered - WSJ $$ GM was set to enter production next month on its plug-in hybrid Buick Velite 6, a local variant of the Volt, with a pure-electric version due to follow early next year. That launch schedule has now been postponed, with internal tests showing the battery, supplied by A123 Systems, didn’t meet GM’s own quality standards, according to a person familiar with the situation. EV batteries are complex components that can’t easily be switched, spelling lengthy delays in getting the Velite 6 into production.

China exporting alumina again as soaring prices upend market | Reuters Contracts to export over 140,000 tonnes of alumina from China were signed in July amid a favorable price arbitrage, according to consultancy CRU. That’s almost three times as much as was exported all of last year, Chinese customs data shows. China, the world’s top aluminum producer, has rarely exported significant volumes of alumina. That changed in April when U.S. sanctions on Rusal compounded an outage at Norsk Hydro’s Alunorte plant in Brazil, deepening a global shortage of the white powder.

How a Banker’s Message to a Client Spelled Trouble for UBS - WSJ $$ An individual at the bank sent a message to ZhongAn Online P & C Insurance Co., a company whose backers include the founders of Chinese internet giants Alibaba Group Holding Ltd. BABA +0.00% and Tencent Holdings Ltd. TCEHY -0.19% The message revealed the identity of an investor who bought shares during ZhongAn’s September 2017 IPO and quickly sold them for a profit, the people said.

Chinese State Rail Operator Forms Cargo Venture With SF Holding - Bloomberg The pact with SF is part of China’s efforts to let railways account for a larger share of cargo transportation to combat road-traffic pollution, and would help the rail operator meet a goal of increasing cargo shipments by 30 percent by 2020. It is China Railway’s second tieup with a private firm following the sale of a stake in a unit offering wi-fi on bullet trains to Tencent Holdings Ltd. and Geely Automobile Holdings Ltd. in June

深圳稳租金大招:限价租赁房“一年一调”,年租金涨幅不超5%_区域_宏观频道首页_财经网 Shenzhen caps annual rent increases at 5%

 

Politics, Law And Ideology

RFA-China Raids Maoist Websites, Detains Editors Who Supported Jasic Labor Movement Authorities in the Chinese capital have raided two leftist websites in the wake of a Maoist-supported labor movement in the southern province of Guangdong, detaining at least eight members of staff, RFA has learned. Chen Hongtao, editor-in-chief of the Red Reference website confirmed to RFA that their offices in Beijing's Fangshan district had been raided at around the same time that some 50 supporters of the labor movement at Jasic Technology in Guangdong's Shenzhen city were bundled onto buses and held in detention.

Paintings of President Xi soar in popularity - Global Times Wang is among the first of a growing number of Chinese artists who combine art and politics by painting pictures of the president. The genre, which includes smaller portraits and large-scale group paintings, has been increasing in popularity in recent years, and has been exhibited in national museums, appeared in magazines and spread widely on social media.  //  Never underestimate the number of sycophants and opportunists

Xi Jinping's Thought on Socialism with Chinese Characteristics for a New era|习近平新时代中国特色社会主义思想 Meet the instructor Angang Hu Dean of the Institute of Contemporary China Studies Tsinghua University

Exoneration Arrives Too Late for Hebei Family - Caixin Global Liao’s parents were freed after they completed their prison terms in 2004. Huang repeatedly attempted to persuade court officials to reopen her son’s case, but for years it looked as if Liao was going to spend the rest of his life in prison. Then, in August 2009, China’s Supreme People’s Court requested that the Tangshan intermediate court revisit Liao’s case. Liao was released from custody, pending investigation, in April 2010, but didn’t hear more about his case from the authorities, until 2016. Finally, on Aug. 9, all three members of the Liao family were exonerated by the intermediate court in Tangshan, which said that it could not prove the blood used as evidence of Liao’s guilt 19 years ago was from the victims. The court also said it could not rule out that Liao’s father had been tortured during his interrogation in 1999. But justice arrived too late for Liao’s parents. His father died in December 2010 at the age of 55, and his mother died at age 61, days before the exoneration.

 

Foreign and Military Affairs

Call for Rohingya Genocide Prosecution Lets China Rush to Myanmar’s Rescue - WSJ $$ “The Rohingya crisis really creates an opportunity” for China with Myanmar, said Yun Sun, an expert on Myanmar-China relations at the Washington-based Stimson Center. “Now’s the time to show them who their real friends are.” For the friendship, Beijing expects to secure access for its companies to a resource-rich neighbor on the Indian Ocean and a strategic partner in efforts to tamp down criticism of China’s more muscular exercise of power in the region. The U.S. and other Western nations accuse China and Russia of using their veto power in the U.N. Security Council to scuttle punitive action against Myanmar for a campaign of violence that since last year drove Rohingya to flee en mass.

PNG port plan stokes fears of China military build-up - The Australian Australian government officials, defence experts and Manus Island residents are concerned at the high level of Chinese foreign investment on Manus Island, a site long considered pivotal by ­defence strategists because of its sweeping command of the Pacific Ocean and the maritime ­approaches to Asia. The Australian can reveal that a plan by the PNG government to refurbish four ports across the country — Wewak, Kikori, Vanimo and Manus Island — has alarmed locals who fear Beijing is courting the Pacific island ­nations, particularly PNG, for strategic advantage

Reading the Tea Leaves in Canberra - The American Interest The recent political chaos, however, masks growing political cohesion on Australia’s China debate across the two major parties. For different reasons and with different political pressures, both the current government (a coalition led by the right-of-center Liberal Party) and the opposition (Labor) are converging on a similar set of national security decisions, even if the language they use to describe these decisions is vastly different. More importantly, the old contours of Australia’s national security debates are changing.

Diminished Pacific role threatens regional stability, critics warn Scott Morrison Concetta Fierravanti-Wells, who last week criticised the direction of the Coalition government under former prime minister Malcolm Turnbull and his foreign minister Julie Bishop, has also called for the Coalition to reverse cuts to the aid budget and increase its $1.3 billion spend in the region. During last week's leadership spill Senator Fierravanti-Wells dramatically quit Mr Turnbull's ministry and was subsequently relegated to the backbench by incoming Prime Minister Scott Morrison. The new ministry no longer includes a dedicated minister for the region

China ramps up charm offensive with Japan | Financial Times $$ Japan and China are set to discuss this week the revival of currency swap arrangements and a potential leaders’ summit, in the latest sign of warming relations between Tokyo and Beijing. Taro Aso, Japan’s finance minister, will travel to Beijing for talks with his Chinese counterpart, Liu Kun, as diplomatic contacts between the two largest powers in East Asia pick up pace.

Malaysia Shuts Out Chinese Infrastructure, Property Projects - Bloomberg The project claims to be a “new global cluster of commerce and culture,” and a “dream paradise for all mankind.”  However, in Malaysian political discourse, Forest City is just a gigantic Chinatown of 700,000 residents. Taking on the developer is part of Mahathir’s broader plan to redefine Malaysia’s relationship with Beijing, pulling Kuala Lumpur away from the client-state mindset introduced by his predecessor.

China is helping Afghanistan set up mountain brigade to fight terrorism | South China Morning Post China is helping Afghanistan to set up a mountain brigade in the country’s north to boost counterterrorism efforts, the Afghan embassy in Beijing said on Wednesday..But “there will be no Chinese military personnel of any kind on Afghan soil at any time”, the embassy said in a fax to the South China Morning Post...Sources close to the Chinese military earlier told the Post that China had funded and started building a training camp for Afghan troops in Afghanistan’s isolated Wakhan Corridor – a narrow strip of inhospitable and barely accessible land extending about 350km from the northern Afghan province of Badakhshan to China’s Muslim region of Xinjiang... One of the sources said that once the camp was completed, the People’s Liberation Army was likely to send troops there, but the embassy denied the claim, saying no Chinese military personnel would be stationed in Afghanistan  // Comment: What about trainers who have retired from the PLA, or been temporarily "separated" from the military?

World leaders ignore human rights in China, censored author Yan Lianke says | AFP The 60-year-old novelist told AFP that Beijing needs to face up to its human rights issues, but visiting politicians “don’t really care about these things now”. “The problem is they don’t seem to be talking about it as much as they used to,” he said ahead of his first British festival appearance at the Edinburgh International Book Festival on Monday. “They seem more about trade and money and agreements.”

Artificial Intelligence Is Now a Pentagon Priority. Will Silicon Valley Help? - The New York Times In a May memo to President Trump, Defense Secretary Jim Mattis implored him to create a national strategy for artificial intelligence. Mr. Mattis argued that the United States was not keeping pace with the ambitious plans of China and other countries.

Tokyo's defense paper lashed for labeling Beijing a threat - CHina Daily The Japanese defense white paper has again listed China and other neighboring countries as threats, which aims to foster an "insecure" atmosphere so Tokyo can enhance its military capabilities, according to a Chinese expert. The Japanese Cabinet approved the annual defense white paper report on Tuesday, saying the current security environment surrounding Japan has become increasingly tense, with various challenges and destabilizing factors becoming more tangible and acute.

Z-20 helicopter to be deployed in Tibet, analysts predict - Global Times As new photos of China's in-development Z-20 utility helicopter trend on Chinese online military forums, analysts said on Wednesday that the helicopter would appear at a November air show and replace the imported UH-60 Blackhawk to be deployed in Tibet. Photos showing the Z-20 taking off and flying appeared on Chinese social media and military forums, Sina Military reported on Monday. The Z-20 is a newly developed 10-ton medium-lift utility helicopter, which will fill the gap between light and heavy helicopters, Song Zhongping, a military expert and TV commentator, told the Global Times on Wednesday.

Xi Jinping thought and China’s future foreign policy: | FIIA – Finnish Institute of International Affairs China’s global goal, the “community of a common destiny”, is a long way off, and its meaning remains undefined. It also contains inherent contradictions. First, Tianxia is ill-adapted to be a model for a global community because it cannot exist without a centre. While China is promoting state sovereignty on the one hand, it is promoting the right of big powers to have their own spheres of influence on the other.While the BRI, and its supporting institutions, such as the Asian Infrastructure Investment Bank, do not directly chal­lenge the existing “Western” system on a global scale, they signify an effort by China to make its neighbour­hood its own backyard. They are thus tools for “mul­tilateralism with Chinese characteristics”. Second, Tianxia thinking implies that different val­ue systems should coexist peacefully. At the same time, Tianxia should ideally be a community of values, and traditionally it was the centre’s right to define the val­ues. The BRI is not just about the economy or geopol­itics, it is also part of China’s ideological competition. As Xi Jinping said during the 19th CPC Congress, the Chinese model offers a new option for countries who want fast development while preserving their own independence.

 

Hong Kong, Macao

‘Mission impossible’ for China’s Greater Bay Area without flow of people, Hong Kong bourse chief Charles Li warns, saying facial recognition way forward | South China Morning Post Artificial intelligence technology could be used to boost the number of Hongkongers crossing the border to work in mainland China by calculating to the minute how long they spent there for tax purposes, the boss of the city’s stock exchange operator said on Wednesday.

Beijing put pressure on Peking University to stop Hong Kong human rights lawyers teaching course on mainland, barrister says | South China Morning Post City barristers had been teaching module on judicial review and a citizen’s fundamental personal rights since 2011, but course coordinator said pressure from above forced the change

Macau Sets Up Committee to Enforce 'National Security' Laws - RFA Authorities in Macau say the city will set up a committee to monitor "threats to national security" in the city, a former Portuguese enclave that reverted to Chinese rule in 1999. The function of the committee is to provide co-ordination for the government in protecting national sovereignty, security and development, the Macau Special Administrative Region government said in a statement. Meeting twice a year, the committee will also conduct studies and make policy suggestions, it said.

 

Taiwan

Beijing snooping into firms’ political ties - Taipei Times Democratic Progressive Party (DPP) lawmakers yesterday decried an alleged Chinese investigation into political donations made by Taiwanese businesses that operate in China, saying that the democratic value of transparency should not be used for political oppression.

Taiwan grateful to United Airlines for imaginative website solution to ‘one China’ rule | South China Morning Post Ticket bookers can now see “New Taiwan Dollar”, “Chinese Yuan”, “Hong Kong Dollar” listed among destination names such as “Australia”, “India” and “Japan” when looking for currency and payment options on the company’s official website...Taiwanese foreign ministry spokesman Li Hsien-chang thanked the airline for its “flexibility” in using currency names to obscure its position on “one China” or “Taiwan independence”.

 

Tech And Media

World’s Leading Human Rights Groups Tell Google to Cancel Its China Censorship Plan A coalition of 14 organizations — including Amnesty International, Human Rights Watch, Reporters Without Borders, Access Now, the Committee to Protect Journalists, the Electronic Frontier Foundation, the Center for Democracy and Technology, PEN International, and Human Rights in China — issued the demand Tuesday in an open letter addressed to the internet giant’s CEO, Sundar Pichai. The groups said the censored search engine represents “an alarming capitulation by Google on human rights” and could result in the company “directly contributing to, or [becoming] complicit in, human rights violations.”

WeChat rival receives RMB 150 million funding but also criticism for racy content · TechNode The announcement was made by Smartisan CEO Luo Yonghao on Weibo yesterday (August 28) after the platform had risen to become the most downloaded social iOS app in the Chinese App Store. The app—made by Smartisan-backed startup Kuairu (快如)—beat both its rival WeChat and the widely popular live streaming app Douyin (Tik Tok). However, the app’s rise might not continue to be as fast as a bullet. Some have already pointed out that it contains content that would not be permitted on WeChat, particularly as the government is cracking down on “vulgar” content.

Yanxi Palace Puts Feminist Spin on Chinese Historical Drama - Pandaily In Chinese, white lotus refers to the pure-hearted and unblemished female character of novels and dramas. It is metaphoric, for “the lotus grows in mud yet is never contaminated by it.” Since the series began, heroine Wei Yingluo has been the topic of heated online discussion. Unlike the pure and innocent “white lotus” seen in previous film and TV series, she is resourceful, cunning, manipulative and dubbed “Sister Wei” by online fans. It is a reflection of the changing tastes of Chinese audiences over the years.

Episode 1 of 延禧攻略 Story of Yanxi Palace, all the episodes are on Youtube:

Inside Tencent’s Games Missteps — The Information $$ But PUBG also hasn’t received approval from the other agency in charge of regulating games, the Ministry of Culture, which has continued to authorize titles. “Fortnite,” another popular battle-royale game licensed by Tencent that comes from a U.S. developer—Epic Games, in which Tencent owns a stake—has this approval and is in limited testing in China. That suggests another factor—namely, the South Korean origin of PUBG—could be at play.

 

Society, Art, Sports, Culture And History

Denise Y. Ho, “Curating Revolution: Politics on Display in Mao’s China” (Cambridge UP, 2017) | Denise Y. Ho’s new book explores this premise in a masterful account of exhibitionary culture in the Mao period (1949-1976) and beyond. Curating Revolution: Politics on Display in Mao’s China (Cambridge University Press, 2017) argues that “curating revolution taught people how to take part in revolution,” and it develops that argument in a series of case studies that take readers into the local context of museums, revolutionary monuments, model neighborhoods, and more in Shanghai, while paying careful attention to the ways that the Shanghai case resonates with the larger scope of Maoist China as a whole. It’s a study that will be of interest to readers of Chinese history, museum studies, material cultures, and more. Enjoy!

Their Racing Pigeons Caught a Bullet Train. Then the Authorities Caught Up. - The New York Times When the race was held in the spring of last year, the Shanghai Pigeon Association took all the entrants from Shanghai to Shangqiu and released them. Most of the pigeons started flying back to Shanghai. But the four specially raised pigeons flew instead to their second home in Shangqiu. According to the court, the two men caught the birds there and then carried them on a bullet train back to Shanghai, concealed in milk cartons. (China prohibits live animals on bullet trains.)..The men had released the birds too soon, shattering records for the race.

'Human Flesh Search Engine' over Swimming Pool Conflict Turns Fatal: Female Doctor Commits Suicide after Becoming Target of Online Witch Hunt | What's on Weibo What started with an argument in a swimming pool on Monday, resulted in a suicide on Saturday. The trending story of a young female doctor from Deyang shows just how devastating it can be to suddenly be in the eye of a social media storm.

 

Energy, Environment, Science And Health

Grid management launched to monitor air pollution in Beijing-Tianjin-Hebei- China.org.cn China has rolled out a system known as "grid management" to monitor air pollution in the Beijing-Tianjin-Hebei region and the neighboring area, in a bid to carry out targeted pollution control, according to the Ministry of Ecology and Environment. The system covers 28 cities in the Beijing-Tianjin-Hebei region and the neighboring area, and divides the area into 3 by 3 kilometer square blocks, totaling 36,793. By applying satellite remote sensing technology and other weather statistical analysis, the system selects 3,600 blocks with high PM2.5 concentration levels as the key areas to monitor.

Wall Street Expats Angle for Piece of China’s Biotech Drug Boom - Bloomberg Bankers, ex-pharma officials buy rights to sell drugs in China as the government loosens regulations.

Pollution May Dim Thinking Skills, Study in China Suggests - The New York Times The latest study, by researchers based in China and the United States, analyzed how long-term exposure to air pollution affected performance on nationwide math and word-recognition tests by more than 25,000 people across 162 Chinese counties. It was published on Monday in Proceedings of the National Academy of Sciences...

The authors found that the cognitive impact of cumulative exposure among the test takers was especially pronounced among older men, and that the results were troubling in part because cognitive decline and impairment are risk factors for Alzheimer’s disease and other forms of dementia.

China tops world in alcohol-related deaths: medical report - Global Times China recorded 59,000 alcohol-related female deaths and 650,000 male deaths, both the highest in the world, according to Statista, an online market research and business intelligence portal, citing a Lancet report on alcohol-attributable deaths. India came second with 42,000 female deaths and 290,000 male deaths.

 

Beijing

Fish ponds cleared from water sources of Beijing's reservior - Xinhua Zhu Xicai, deputy head of the district government, appreciated the farm owners' sacrifice since most owners had started to dismantle facilities in the ponds before the government's subsidy policy was announced. He said the move was made after the government discovered that pollutants from the fish feed, medicine and wastewater generated from the businesses flowed into the reservoir, threatening the water safety.