EU and China; Two meetings almost done; Xi's strength

The CPPCC has now concluded and the NPC will end Friday with the Premier’s press conference show. As I wrote yesterday this year’s Two Meetings are fairly drama-free, but the South China Morning Post says there is a “noticeable increase of dissenting voices:

A noticeable increase of dissenting voices – although still mild by nature – at this year’s parliamentary sessions is therefore interesting, even though President Xi Jinping faces no real challenge to his power.

Most of these voices are heard in relation to China’s foreign policy, with the country locked in a costly trade war with the United States and facing setbacks in its attempts to spread its influence around the world.

I am not sure there is actually a numerical increase in “dissenting voices”, and the Two Meetings are after all the most public annual demonstration of the PRC’s “consultative democracy”, but the key point is that Xi does not appear to face any challenge to his power.

The next big political meeting on the PRC political calendar is likely the Fourth Plenum, though no date has been set and I have been wrong recently about when it might be held. The fact that we have now gone more than a year since the Third Plenum is frequently cited as key evidence by the proponents of the “Xi is under pressure” meme.

I will bet instead that the fact that the Fourth Plenum has not yet convened is not because of dissent against or weakness of Xi but rather because he is no hurry to hold it. Remember, he convened a four-day meeting in January of all the key national and provincial cadres. That convening power, for that kind of a leadership meeting, is a sign of his power. And the theme of the meeting, that the Party is surrounded by domestic and external risks, also likely reinforced the idea that either the Party hangs together, under the leadership of Xi, or they will all hang separately.

Housekeeping note: I will be in Hawaii for the last two weeks of March, the newsletter will be on a normal schedule for most of that period though the daily timing may be a bit off.

Feel free to forward this newsletter to friends and colleagues you think would find it interesting. You my dear readers are always my best source of new subscriptions.


The Essential Eight

1. Rare earths now a strategic vulnerability for China?

China becomes world's biggest importer of rare earths: analysts | Reuters:

China has for years been the world’s biggest rare earths exporter, raising shipments overseas by 4 percent year-on-year to more than 53,000 tonnes in 2018, and its emergence as the top importer as well is a sudden and surprising development.

The country imported 41,400 tonnes of rare earth oxides and oxide equivalents in 2018, up 167 percent year-on-year, as a crackdown on illegal production reduced domestic output, according to a report by consultancy Adamas Intelligence. Shipments were primarily in the form of mineral and chemical concentrates from Myanmar and the United States, Adamas managing director Ryan Castilloux said...

In the case of at least seven key rare earths — including praseodymium, used in magnets, and yttrium, used in ceramics — China was a net importer in 2018 for the first time in more than 30 years, Castilloux told Reuters.

Comment: How things change, I am sure you all remember all the warnings about how China could use its rare earths control as a strategic weapon against the US and other countries.

2. EU considering new approach to China?

EU, in Major Shift, Moves to Confront China’s Growing Assertiveness - WSJ $$:

In a sharp shift from attitudes just two years ago, when China was seen as a potential partner in maintaining global rules and institutions following President Trump’s election, the EU’s executive arm labeled Beijing an “economic competitor” in critical fields such as the development of 5G networks and a “systemic rival” politically.

The assertions, made in a European Commission strategy paper that could stir unease among China’s allies in the bloc, put Brussels’ approach toward Beijing closer to the U.S. assessment of China as a major strategic rival. Under Mr. Trump, U.S.-China ties have been roiled by trade fights, tensions over North Korea and Beijing’s regional ambitions.

EU officials said European attitudes toward China had changed because of its failure to open its markets, its use of subsidies to create corporate champions, its actions in the South China Sea and its push for dominance in technology and telecommunications sectors.

The paper - European Commission contribution to the European Council -EU China – A strategic outlook

EU sets out 10-point plan to balance China economic ties | Reuters:

A German EU diplomat described the paper as a “comprehensive and courageous” stocktaking of relations with Beijing, highlighting a lack of reciprocity and growing protectionism and also broaching difficult issues, such as human rights.

If backed by EU leaders, the European Union would urge China to agree to reforms of World Trade Organization rules, notably regarding subsidies and forced technology transfer, and conclude a deal with the EU on investment rules by 2020

Brussels ramps up criticism of China’s investment strategy in EU | Financial Times $$:

In the policy document, Brussels also pledges measures in response to growing fears over security risks in using Chinese technology from companies such as Huawei in 5G mobile communication networks — concerns that both the company and Beijing say are groundless. Brussels plans to push for a common EU approach to 5G security risks, including information exchange, risk assessment and risk-management measures.

The document chides Beijing over its claims to most of the South China Sea and its failure to honour a 2016 UN court ruling against it. The paper nods to “China’s progress in economic and social rights”, but criticises crackdown on human rights lawyers and defenders as well as mass internment of Uighur Muslims in the western province of Xinjiang.

After Italy, Malta says it's looking at China's Belt and Road plan - CNBC:

Malta, a small country in the Mediterranean that's part of the European Union, has indicated there's a possibility that it could join China's Belt and Road Initiative. In an exclusive interview, Edward Scicluna, the country's finance minister, said that "certain prejudices" should not come in the way of good business.

3. "China's threat to America's national security"

America’s Undersea Battle With China for Control of the Global Internet Grid - WSJ:

While the U.S. wages a high-profile campaign to exclude China’s Huawei Technologies Co. from next-generation mobile networks over fears of espionage, the company is embedding itself into undersea cable networks that ferry nearly all of the world’s internet data.

About 380 active submarine cables—bundles of fiber-optic lines that travel oceans on the seabed—carry about 95% of intercontinental voice and data traffic, making them critical for the economies and national security of most countries.

Current and former security officials in the U.S. and allied governments now worry that these cables are increasingly vulnerable to espionage or attack and say the involvement of Huawei potentially enhances China’s capabilities...

At least one U.S. submarine can hack into seabed cables, defense experts said. In 2013, former National Security Agency contractor Edward Snowden alleged that Britain and the U.S. monitored submarine cable data.

The U.S. and its allies now fear such tactics could be used against them. ..

Huawei Marine, based in the Chinese port of Tianjin, was formed in a 2008 venture with Global Marine Systems, a British company with ships to handle undersea cables.

United States Attorney Lydon Hosts Discussion on China’s Threat to America’s National Security | USAO-SC | Department of Justice:

United States Attorney Sherri A. Lydon announced today that she hosted a discussion entitled, “China’s Threat to Our National Security: An Economic and Private Sector Perspective.” The discussion featured William R. Evanina, Director of the National Counterintelligence and Security Center (NCSC) in Washington, DC; Douglas Hemminghaus, Assistant Special Agent in Charge of National Security and Cyber in the Federal Bureau of Investigation’s Columbia field office; and David P. Burns, Principal Deputy Assistant Attorney General in the Department of Justice’s National Security Division. In this first-of-its-kind meeting, NCSC and the Justice Department briefed members of the legal and business communities, heads of chambers of commerce, academics, and legislators about China’s threats to our nation’s economic prosperity.

More than 90% of the Department of Justice’s cases alleging economic espionage over the past seven years involved China. Over two-thirds of the Department’s cases involving thefts of trade secrets are connected to China.

Navy, Industry Partners Are ‘Under Cyber Siege’ by Chinese Hackers, Review Asserts - WSJ $$:

The assessment, delivered to Navy Secretary Richard Spencer last week and reviewed by The Wall Street Journal, depicts a branch of the armed forces under relentless cyberattack by foreign adversaries and struggling in its response to the scale and sophistication of the problem...

The review presented the threat posed by China in particularly stark terms, arguing that its cyber espionage operations against the U.S. military, its suppliers and the private sector in general have shifted power dynamics between the world’s two biggest economies.

China has “derived an incalculable near- and long-term military advantage from it [the hacking], thereby altering the calculus of global power,” the report said

Top U.S. Universities Shun Cash From Huawei Under Trump Pressure - Bloomberg:

Princeton University, Stanford University, Ohio State University and the University of California at Berkeley all say they are cutting or reducing ties to Huawei. The company gave $10.6 million in gifts and contracts to nine U.S. schools for technology and communications programs from 2012 to 2018, according to the Education Department.

“More and more of our universities have cut their ties,” said Tobin Smith, vice president at the Association of American Universities that represents 62 research institutions. In September, the FBI held “a major summit” with university presidents in Washington, Smith said.

Huawei’s charm offensive won’t work - The Washington Post:

“Huawei has made a great deal of money by pulling the wool over the eyes of many western nations,” Rep. Jim Banks (R-Ind.) told me. “I have no doubt that much of this money will be funneled back into PR campaigns to distort the facts.”

Today, Banks introduced legislation that seeks to prevent entities from adversary countries, including China, from using research partnerships with U.S. colleges and universities to steal sensitive technology and information. Huawei has research partnerships with more than 50 American universities.

4. Xinjiang

Muslim Detention Camps Are Like ‘Boarding Schools,’ Chinese Official Says - The New York Times:

“Some voices internationally have said Xinjiang has concentration camps or re-education camps. These claims are pure lies,” Mr. Zakir said at the gathering of Xinjiang delegates of the Communist Party-controlled legislature, the National People’s Congress, which was opened to journalists.

“In fact, our centers are like boarding schools where the students eat and live for free,” Mr. Zakir said, using their official name, “educational training centers.”

He indicated that the camps could eventually be phased out, but did not say how long that might take

Xinjiang vocational centers 'effective' against extremism - China Daily:

"We strictly prohibit anyone from treating trainees poorly, and their personal freedom is well protected. Also, their traditional customs are well respected," Shohrat said during the session, which was open to domestic and foreign media.

Activist Accused of Inciting Hatred Helped Kazakhs Flee China’s Camps - The New York Times:

For six days a week, every week, in a crowded office in Kazakhstan’s largest city, Serikzhan Bilash had been ringmaster of one of the most influential efforts detailing China’s internment of Muslim minorities...

The police detained him early Sunday in Almaty, the city in southeastern Kazakhstan where his organization is, and flew him to the capital, Astana, where he was placed under house arrest. He is under investigation on accusations of “inciting ethnic hatred,” said his lawyer, Aiman Umarova. A conviction carries a punishment of up to 10 years in prison...

Mr. Bilash’s case has raised questions about China’s efforts to silence critics of its policies in Xinjiang. In the months before his detention, he warned that the Chinese authorities were trying to use their influence in Kazakhstan to silence his group.

5. Money and Chinese interests in the US

The Cindy Yang case keeps getting more interesting. 

Trump-Linked Massage Parlor Owner Hawked ‘Golden Visas’ – Talking Points Memo:

TPM found that Yang, through a Florida-based company called GY US Investments LLC, was also using proximity to Trump and his properties to peddle so-called investor visas. Under the EB-5 visa program, foreign citizens can get a conditional two-year U.S. green card in exchange for making certain investments..

Yang’s company’s website listed a few examples of properties that foreigners can invest in as part of an “investment immigration project.”

The first is described as “high-end luxury real estate” and features a photo of the Palm Beach home of billionaire Jeffrey Lurie, whose Philadelphia Eagles faced off against Kraft’s New England Patriots in the Super Bowl last year.

Republican Donor Cindy Yang Linked to Chinese Influence Machine – Foreign Policy:

In 2016, Yang served as a vice president of the newly founded Florida chapter of the China Council for the Promotion of Peaceful National Reunification, a Beijing-based organization under the direct oversight of the United Front Work Department. The nominal purpose of the organization is to ensure the so-called reunification of Taiwan and China; in practice, chapters often function as a political action group receiving broad direction from the mainland. Branches exist in more than 70 countries around the world and in more than 30 U.S. cities. (When asked, individual chapters typically claim to be independent, despite being listed on the website of the Beijing-based council.) Yang has been active in numerous other organizations that the United Front has sought to co-opt, including hometown groups such as the Northeast Florida Hometown Association, of which Yang is a member.

Lists of branch officers often read like a who’s who of prominent local members of the Chinese community. That’s not a coincidence. The Chinese Communist Party often uses peaceful reunification societies as foreign outposts to identify, assess, and reward influential members of the Chinese diaspora who are willing to promote party objectives within their communities...

To be sure, there is no evidence that Yang has ties to the Chinese intelligence apparatus, nor that she had any particular political end goal in mind. But it’s clear she served as a connector between rich Chinese entrepreneurs and the U.S. political system, and that she was willing to publicly align herself with the Chinese Communist Party and one of its primary political influence mechanisms.

Meanwhile a different contribution case with a China connection may be heating up - DOJ Probes Whether Fugitive Financier Supplied Donation to Trump Re-Election Effort - WSJ 

The Justice Department has sent out multiple subpoenas to people allegedly connected to Mr. Low’s efforts to get the investigation dropped and to extradite Mr. Guo Wengui, seeking any connections they had to elected officials or people close to them, the people familiar with the matter said...

The investigation into Mr. Davis’s donations to Trump Victory came out of the Justice Department’s probe of 1MDB, say the people familiar with the matter...

Mr. Davis’s wife, Nickie Lum Davis, the co-owner of LNS Capital, is described in U.S. court filings by the Justice Department made public in November as a “longtime political fundraiser” who helped Mr. Low in his efforts to persuade the Trump administration to drop its 1MDB investigation and extradite Mr. Guo, the Chinese businessman.

Her parents, Nora and Eugene Lum, pleaded guilty in the 1990s to illegal campaign financing for Democrats during the Clinton era.

6. Residential Surveillance at a Designated Location and the detained Canadians

Peter Dahlin, detained for 23 days in 2016, draws on his experiences in MSS detention and “Residential Surveillance at a Designated Location” (RSDL) to describe what Canadians Michael Kovrig and Michael Spavor, both detained for over 100 days in response to the detention of former Huawei CFO Meng Wanzhou, may be going through.

The detained Canadians: Brace yourselves, China’s 'disappearances' are coming to the west | Hong Kong Free Press HKFP:

As someone who has been taken by China’s Ministry of State Security – the same organ that took both Michaels using RSDL – I can, unfortunately, shed some light on it.

Practically speaking, Mr. Kovrig is right here; 39.809781″N, 116.383599″E. That’s right, a large, four-story compound not far from Beijing’s smaller southern airport, used by the Beijing branch of the Ministry of State Security. If the heavy curtains are ever lifted inside his light blue/grey-coloured suicide-padded cell, and if he focuses on a far right corner, he might see the field filled with old discarded busses, a bus graveyard. Listening to the flights coming in and out of the Nanyang airport he might be able to get his north/south bearings as well.

These little details, and the few things I saw through the blindfold I was wearing when taken in and out of the facility, made it possible for me to locate this secret prison after about a week of studying Google Maps and Google Earth shortly after my own release from the second or third floor of this facility.

When Michael was finally allowed to see his ambassador, it took place at a police station instead. Being taken there, Michael would have been blindfolded, starting in his cell, and then led by to the underground garage and put inside a cortege of cars. The blindfold would have come off just before entering the room where his consular staff was waiting for him.

7. Is Vietnam suppressing evidence about historical control of the Paracels?

Vietnam’s Communist Party Ousts Historian Who Criticized Its China Policy - The New York Times:

A prominent Vietnamese historian who criticized his government for not doing more to challenge Beijing’s territorial claims in the South China Sea has been ousted from Vietnam’s ruling Communist Party over comments he made on Facebook.

The political purge of Tran Duc Anh Son, an expert on Vietnam’s claims in the South China Sea, is a rare window into how the party handles dissent among its rank-and-file members. It may also underline the sensitivities around Vietnam’s handling of its relationship with China, its largest trading partner and former imperial occupier...

Chinese officials and scholars seek to justify Beijing’s claim to sovereignty over South China Sea waters that encircle the disputed Paracel and Spratly archipelagos by citing maps and other evidence from the 1940s and ’50s.

But Dr. Son and other Vietnamese historians argue that the Nguyen dynasty, which ruled present-day Vietnam from 1802 to 1945, wielded clear administrative control over the Paracels, decades before imperial or post-revolutionary China showed any interest in them...

“I’m always against the Chinese,” he told The New York Times during an interview in 2017. But he said at the time that Vietnam’s top leaders were “slaves” to Beijing who preferred to keep the old maps and other documents hidden.

“They always say to me, ‘Mr. Son, please keep calm,’” he said. “‘Don’t talk badly about China.’”

8. Bubbly coffee startup

Starbucks Struggles to Beat Hot Startup on Delivery in China - WSJ $$:

Unofficial outfits had been delivering Starbucks coffee previously, but in August 2018 Starbucks teamed up with, the food-delivery platform owned by Alibaba Group Holding Ltd. , to offer delivery from an initial 150 stores starting in September.

By then, the coffee giant had spent nearly two years developing special lids and packaging to protect drinks from spilling or cooling during the mad dash to customers in China.

Luckin, backed by venture capital and run by local managers, integrated delivery into the service at its bare-bones stores from the outset. Since its founding in October 2017, Luckin has raised $1 billion and opened 2,000 stores mainly offering delivery or pickup—many just feet away from a Starbucks cafe

Luckin Coffee chief taps banks for $200 million loan in exchange for IPO role: sources | Reuters:

Lu Zhengyao, also known as Charles Lu, Luckin’s non-executive chairman and angel investor, is asking to borrow the sum backed primarily by his Luckin shares, the people said.

While it is not uncommon for Chinese companies to raise loans from banks hoping for a mandate on an IPO, it is rare for executives or shareholders to request such personal financing, several people who have worked on IPOs told Reuters

Business, Economy, Finance And Trade

U.S.-China Trade Deal Is Getting Closer, Lighthizer Says - WSJ $$: “Our hope is we are in the final weeks of an agreement,” Mr. Lighthizer told the Senate Finance Committee. Both sides are seeking to resolve remaining issues before Chinese President Xi Jinping completes a European trip, which starts around March 21 and is set to include meetings in Italy, France and other countries, according to people close to the talks. That would allow Mr. Xi to tack on a stop at President Trump’s Mar-a-Lago estate in Florida in late March or early April to sign a trade pact, the people said.

China promises companies ‘we will keep your secrets’ with new foreign investment law | South China Morning Post Delegates to the National People’s Congress (NPC) in Beijing were presented with the new version on Tuesday, after last week’s version received a lukewarm response from foreign businesses and academics in China. Provisions have been added to the legislation which make clear that government employees must keep secret any confidential commercial information from foreign firms and must “not leak or give to others illegally”. The law, which is due to come into effect on January 1, 2020, will make it illegal for officials to misuse critical information or to provide it to local Chinese firms, on pain of administrative or even criminal punishment.

China orders banks to boost financial support to small firms | Reuters Banks should work hard to achieve targets on increasing loans for small companies and keep the lending rates on a reasonable level, the China Banking and Insurance Regulatory Commission (CBIRC) said in a statement on its website. Big state-owned commercial banks should increase outstanding loans to smaller companies by more than 30 percent in 2019, the CBIRC said, adding that it would also increase its tolerance for non-performing loans at small companies.

China transfers US$4.7 billion of PICC shares to state pension fund, part of a programme to shift assets to make up for shortfall | South China Morning Post China’s Ministry of Finance has transferred a 6.8 per cent stake in the People’s Insurance Company of China (PICC) to the state pension fund, part of a pilot programme to transfer state assets to make up for the country’s pension shortfall amid an ageing population and debt pressure.

Smartphone shipments to China hit six-year low in February: market data | Reuters Shipments to the world’s biggest smartphone market totaled 14.5 million units, down 19.9 percent from a year ago, according to data from the China Academy of Information and Communications Technology, a government-affiliated research institute.

China Won’t Waver on Rules to Rein In Financial Risk, Official Says - Caixin Tough new rules to clean up the murky and risk-prone asset management industry were made more palatable for the industry last year, but financial institutions have continued to push for more flexibility. “All parties should not forget the original intent [of these rules] — to reduce and control financial risks,” Wang Jingwu, head of the People’s Bank of China’s (PBOC) Financial Stability Bureau, told Caixin on Monday. Regulators will remain “unwavering” in implementing the new rules, he added. “If regulators yield to pressure from financial institutions, then the rules’ effectiveness will be obliterated,” said Wang, whose department is responsible for guarding against systemic risks in the financial system.

Chinext trading volume more than double 2015 peak - YUAN TALKS | 元傳媒 The turnover of the Nasdaq-style Chinext board hit 212.6 billion yuan on Tuesday, close to the record high of 221 billion yuan registered in the stock market bull run in May 2015.

Shanghai's hotly-anticipated tech board draws defectors from rivals | Reuters Four companies, including Jiangsu Beiren Robot System Co and Jiangxi JDL Environmental Protection Co, have already decided to ditch Beijing’s New Third Board, and apply for a listing on Shanghai’s Science & Technology Innovation board, expected to be launched in months. Late on Tuesday, Certusnet Information and Technology Co became the latest defector, saying its shareholders will vote later this month to jump ship. More companies are expected to follow suit.

Shanghai’s High-Tech Board Tests Brokerages’ Market Mettle - Caixin brokerages, which sponsor IPOs, will still have to work within guidelines set by the regulators. They will have to provide an initial assessment of a company’s market value including the basis, method of calculation and conclusion of their valuation process, and then try to achieve that price by securing enough demand from investors, a process known as book building. If there’s a significant difference between the preliminary appraisal value and the final valuation resulting from book building, the company may have to scrap its listing. Failure to accurately measure the valuation of an IPO candidate could also affect the sponsor’s performance in the Shanghai Stock Exchange’s (SSE) internal assessment system.

三提风险仍涨停 人民网股价月翻3倍|股价_新浪财经_新浪网 People's Daily Online shares are up 337% since December 28

China's coastal province Shandong unveils bln-dollar infrastructure plan - Xinhua Transport authorities in east China's Shandong Province announced that it plans to invest 162.2 billion yuan (about 24.2 billion U.S. dollars) on roads, railways, ports and airports this year. The investment is aimed at building an integrated infrastructure network in the province, said Jiang Cheng, head of the provincial transport department. Last year, fixed asset investment in Shandong's transportation sector reached 160 billion yuan, among which 115.8 billion yuan was spent on roads, highways and waterways, up 28 percent year on year.

Foxconn Chief Accuses Microsoft of ‘Bullying’ Over Patent Lawsuit - Caixin Microsoft alleges Foxconn submitted an inaccurate royalties report in 2014, and issued no reports and paid no royalties for the past four years, Axios reported. But Hon Hai founder and Chief Executive Terry Gou responded in a defiant media briefing on Tuesday, claiming his company wouldn’t have to “pay a dime” because as a manufacturing contractor it was not subject to licensing fees for patents.

China stresses opinions by companies, associations in drafting regulations - Xinhua Chinese authorities are told to fully consider opinions raised by enterprises and industry associations when formulating administrative regulations and normative documents, according to a circular issued by the General Office of the State Council. The circular required authorities to fully listen to opinions of representative companies, industry associations, and legal associations, especially the opinions of private enterprises, labor-intensive enterprises, and small-and-medium-sized enterprises.国务院办公厅印发《关于在制定行政法规规章行政规范性文件过程中充分听取企业和行业协会商会意见的通知》 

China shifts from dollars to gold to stave off risks - Global Times Central banks around the world, including the People's Bank of China (PBC), have increased gold purchases in recent months to replace US dollar-denominated assets, a strategy that a Chinese analyst said Tuesday is due to the US diving creditability as a result of the "hegemon-like behavior" that's on the rise in the US. The PBC, the central bank, bought $179 million worth of gold in February, the fifth month in which China increased its holdings of gold in terms of value, according to the State Administration of Foreign Exchange.  As of the end of February, China's official reserve gold assets stood at $79.498 billion in value, compared with $79.319 billion as of the end of January.

藐视香港法庭无意悔改 俏江南创办人张兰被判监禁一年(附判决书)_政经频道_财新网 South Beauty founder Zhang Lan sentenced to a year in jail in Hong Kong for refusing to abide by court order or appear in court, stemming from 2014 dispute with shareholder CVC

China Will Fall Short of Ambitious Tax Cut Target, S&P Says - Bloomberg The government will likely only be able to cut taxes by 1.5 trillion yuan, about 25 percent short of its goal, S&P credit analysts led by Yutong Zou wrote in a note on Monday. That’s because while they government has cut companies’ contributions to the social security fund, authorities will be stepping up enforcement, they wrote.

Boeing Crash Isolates FAA as China Leads Push Against Max - Bloomberg "The FAA’s credibility is being tested," said Chad Ohlandt, a Rand Corp. senior engineer in Washington. "The Chinese want their regulatory agency to be considered a similar gold standard.”..As a regulator, recent events indicate China is on its way to attaining the level of authority enjoyed by the FAA and the European Union Aviation Safety Agency, giving the country global recognition for its ability to determine when an aircraft is safe to fly.

A Flurry of Ideas to Reverse China’s Declining Birthrate, but Will Beijing Listen? - The New York Times “The reason so many deputies are putting proposals forward is that the birthrate has declined for two consecutive years,” He Yafu, a demographer and the author of a book on the impact of China’s population controls who helped Ms. Huang write her proposal, said in a telephone interview. “The reasons to limit births no longer exist.”

China jobs, employment: survey shows fewer companies planning to hire - CNBC Hiring prospects have worsened in China, recruitment firm Manpower Group found in its latest survey released Tuesday. A net 6 percent of firms surveyed plan to increase hiring between April and June — the lowest since the third quarter of 2017, the data showed.

China tightens scrutiny over gray-market margin financing | Reuters The China Securities Regulatory Commission (CSRC) said on Wednesday that its subsidiary in eastern Zhejiang province last week held a meeting with local brokerages, flagging potential risks associated with illegal margin financing and banning them from doing any form of business that could facilitate such a business.

Politics, Law And Ideology

Wang Yang, top Chinese adviser, urges faith in Communist Party’s judgment in face of ‘unprecedented’ challenges | South China Morning Post China’s biggest political advisory body has been told to stick to the directives of the Communist Party to confront risks and tasks Beijing called “unprecedented”. “[We] should treat studying the political thoughts of Xi Jinping as the most important task of all, and consolidate the self-confidence in our political system,” Wang Yang, head of the China People’s Political Consultative Conference, said at the closing ceremony of the body’s annual session on Wednesday. “[We] must unite our thoughts and acts around the party’s key deployment and assessment.”

Top Chinese Court Reveals 819 Defendants Were Found Not Guilty Nationwide Last Year - Caixin In 2018, China’s courts retried and amended judgments in 1,821 cases, including 10 “major” miscarriages of justice, Zhou Qiang, president of the Supreme People’s Court, revealed in his work report to the country’s top legislature Tuesday. The state was ordered by judges to offer compensation in 15,000 cases, while 517 people charged by public prosecutors and 302 charged by private prosecutors were found not guilty, Zhou said. The Supreme People’s Court rarely releases such annual data

NPC deputies file 491 proposals, 8,000 suggestions at annual legislative session - Xinhua Deputies to the 13th National People's Congress (NPC) have filed 491 proposals and 8,000 items of suggestions to the secretariat of the legislative body's second annual session. The proposals can be grouped into five categories in terms of the issues concerned: reform and opening-up, people's well-being, ecological civilization and green development, state safety and social management, cultural development, according to Guo Zhenhua, an official with the secretariat.

海南书记刘赐贵:拐卖儿童需判死刑,让他们家破人亡 Hainan Party Secretary Liu Cigui says child traffickers should be executed, their families ruined

Foreign and Military Affairs

Andrew S. Erickson and Ryan D. Martinson Discuss China’s Maritime Gray Zone Operations We usually prefer to use Chinese concepts when talking about Chinese behavior, and Chinese strategist do not generally use the term “gray zone.” But we think that the concept nicely captures the essence of the Chinese approach. We were inspired by the important work done by RAND analyst Michael Mazarr, who contributed a chapter to the volume. In his view, gray zone strategies have three primary characteristics. They seek to alter the status quo. They do so gradually. And they employ “unconventional” elements of state power. Today, a large proportion of Chinese-claimed maritime space is controlled or contested by other countries. This is the status quo that Beijing seeks to alter. Its campaign to assert control over these areas has progressed over a number of years. Clearly, then, Chinese leaders are in no rush to achieve their objectives. And while China’s Navy plays a very important role in this strategy, it is not the chief protagonist.

Beijing hits back at US Secretary of State Mike Pompeo’s ‘irresponsible’ South China Sea energy claims | South China Morning Post Ministry spokesman Lu Kang said in Beijing on Wednesday that Beijing had started consulting Southeast Asian nations about resolving disputes in the South China Sea, and called on non-claimant nations to keep out of the discussions. “Nations in the region are capable of resolving and managing the disputes in their own ways,” Lu said. “Nations outside the region should refrain from stirring up trouble and disrupting the harmonious situation.”

Indonesia Says Election Under Attack From China, Russia Hackers - Bloomberg As Indonesia prepares for simultaneous presidential and legislative polls on April 17, authorities are facing a wave of cyber incursions they say may be aimed at discrediting the polling process. The head of Indonesia’s General Elections Commission, Arief Budiman, said some of the attacks originated in Russia and China, and include attempts to “manipulate or modify” content as well as to create so-called ghost voters, or fake voter identities.

India China: Chinese materials find way into army bulletproof vests - Economic Times China may be standing in the way of a United Nations ban on terrorist leader Masood Azhar but its companies are getting a large chunk of the Rs 639-crore Indian Army order for new bulletproof jackets. Azhar heads the Pakistan-based Jaish-e-Mohammad terrorist group that’s responsible for numerous attacks in India, including the one in Pulwama on February 14 that led to heightened border tensions.

Xi stresses timely completion of military development goals - Xinhua The entire armed forces must clearly understand the importance and urgency of implementing the 13th Five-Year Plan for military development, firm up their resolve, intensify the sense of mission, forge ahead with a pioneering spirit, and go all out to carry out the plan so as to ensure that the set targets and tasks are fulfilled as scheduled, he said. Xi called on the whole army to adhere to the guidance of the thought on socialism with Chinese characteristics for a new era, fully implement the Party's thinking on strengthening the military for the new era and the military strategy for new conditions, concentrate on war preparedness, and intensify reform and innovation.

Major-country diplomacy shows China’s concerns over common development - People's Daily Online - Zhong Sheng China is also making efforts to create possibilities of and conditions for consensus expansion, playing a constructive role in promoting peace through talks. According to an investigation carried out in 133 countries and regions by American analytics and advisory company Gallup from March to December last year, international community has become more positive toward China. The public opinion exactly demonstrates the charm of China’s diplomacy in the new era. Holding high the banner of building a community with a shared future for mankind, China is standing on the right side of history, and is standing by the common interests of the majority of the countries in the world.

Netizens salute SOE air crash victims - Global Times Four employees of Chinese state-owned enterprises (SOEs) have lost their lives in the horrific crash of Ethiopian Airlines Flight ET302, casting a spotlight on the "main force role" of China's SOEs and their employees to Africa's development.

Chinese navy's crash announcement shows initiative and candor - China Military In recent years, with the continuous advancement of the PLA’s actual combat training, the probability of accidents and dangerous situations encountered by PLA officers and soldiers in training has also increased. It can be said like this, the higher intensity of actual combat training, the closer to actual combat, and the greater the security will risk. This means that accidents in fighter jet training are the cost that must be borne by actual combat training, which will occur in all military powers.

China offers help to Venezuela to restore power | Reuters Speaking in Beijing, Chinese Foreign Ministry Spokesman Lu Kang said China had noted reports that the power grid had gone down due to a hacking attack...“China hopes that the Venezuelan side can discover the reason for this issue as soon as possible and resume normal power supply and social order. China is willing to provide help and technical support to restore Venezuela’s power grid.”

燃爆!《中国军队一分钟》震撼来袭 _光明网 quite the new PLA propaganda video

UN is set to blacklist JeM's Azhar — but China hinders this - CNBC While JeM has been listed as a terror group since 2001, efforts to blacklist its leader have not been successful — February's proposal marks the Security Council's fourth attempt in 10 years. China, a permanent veto-wielding member of the Security Council and Pakistan's close ally, blocked the three previous attempts.

New US ambassador warns of China's 'payday loan diplomacy' - AP Arthur Culvahouse Jr. told reporters in Canberra that it was up to U.S. allies and Western liberal democracies to educate people about the dangers of such loans. U.S. Vice President Mike Pence previously warned of China deploying “debt traps” against developing Pacific nations. “I would use stronger language. I would use payday loan diplomacy,” Culvahouse said.

Pentagon takes aim at China and Russia in proposed $750 billion budget  - The Washington Post The budget request showed some trade-offs the Pentagon would be expected to make to recalibrate the military bureaucracy toward China and Russia after more than a decade and a half spent focusing on wars in Iraq and Afghanistan. The Navy plans to retire one of its aircraft carriers early and invest in drone ships; the Army is looking to scale back investments in legacy helicopters and fighting vehicles and instead buy high-end versions; and the Air Force is dramatically increasing its investments in space.

Hong Kong, Macao

Pro-Beijing lawmaker Regina Ip questions necessity of public broadcaster RTHK's news dept. | Hong Kong Free Press HKFP “I doubt whether RTHK needs to do news, because so many radio stations are doing that. Maybe the English channel [should be kept], maybe you should hire people with better English?” she said.


Countering China's Efforts to Isolate Taiwan Diplomatically in Latin America and the Caribbean: The Role of Development Assistance and Disaster Relief | RAND How can Taiwan optimize its development assistance to Latin America and the Caribbean to ensure that it gets the maximum diplomatic value out of its generosity? What aid programs does Taiwan currently undertake in the region, and what does it get from its efforts? How does Taiwan's assistance fit with U.S. policy goals and giving in the region? Are there areas where adjustments could be made that would produce synergies between Taiwan and U.S. efforts while also reducing the temptation on the part of regional governments to de-recognize Taipei and switch ties to Beijing?

Tech And Media

Apple, WeChat Tussle Over How to Divvy Up Mini Program Revenue - Caixin Despite their convenience, mini programs pose a problem for Apple, which takes 30% of any IAP transacted via apps on its operating system, iOS. For example, Apple receives a cut when a user subscribes to a video streaming service or buys a sweet skin for his or her online game avatar. The problem is that iPhone users can’t conduct any IAPs through mini programs because since May 2018 WeChat has deactivated the function while it negotiates with Apple over how they should divide the revenue from mini programs. The negotiations are currently in a stalemate.

Casualties of trade war: Chinese in US denied licences to work with sensitive technologies | South China Morning Post Doug Jacobson, an international export-control lawyer in Washington, said that deemed export licences are reviewed “case by case”, and a decision of an approval or a denial depends on a person’s background, work experience and the nature of technology. Still, he noted, Chinese nationals are expected to “get extra scrutiny” amid the fractious trade relations between the US and China.

China tech giants elbow into fast-growing Tibet - Nikkei Asian Review On the tech companies' side, working in Tibet offers a chance to speed development with subsidies and other backing from a government eager to employ their latest technologies. It also helps reduce tax burdens, according to an official at one Chinese investment firm. Companies in the region enjoy a real tax rate of 9%, compared with the standard corporate tax rate of 25% for the rest of China.

China Gains on U.S. in Highly Cited AI Research - WSJ $$ The Allen Institute for Artificial Intelligence, a Seattle-based nonprofit that conducts research and engineering projects, found that China is drawing close to the U.S. in the number of its AI research papers that are among the top 10% most cited, a measure of the highest-impact research. About 47% of those papers came from the U.S. in 1982. Only 29% do now, while China’s share has risen to more than 26%, according to the study, set to publish Wednesday. China has for years eclipsed the U.S. in total number of papers published, regardless of citations.

Society, Art, Sports, Culture And History

Chinese swimmer Sun Yang's doping case heads to court - AP A doping case involving Chinese swimmer Sun Yang is going to the Court of Arbitration for Sport and could lead to a ban from competition, including the 2020 Tokyo Olympics. The World Anti-Doping Agency has appealed against a decision by swimming’s governing body to only give the three-time Olympic champion a warning in a case involving the destruction of a doping control sample, the court said Wednesday.


China’s Online Tutoring Industry to Get Supervision, Minister Says - Caixin The guidelines aim to regulate private tutoring centers that have expanded their curriculums online, Education Minister Chen Baosheng said Tuesday on the sidelines of the annual meeting of China’s legislature, the National People’s Congress. The cyber education space has been largely free of government supervision.

Student of Beijing's migrant school gets into Harvard - China Daily Duan Mengyu was accepted by the Ivy League school for its master's program in education policy, according to Beijing News. After spending three years at Dandelion School in the capital's Daxing district for lower secondary education, Duan enrolled at United World Colleges in the United Kingdom as an undergraduate in 2012. Established in 2005, the Dandelion School is a private nonprofit school dedicated to helping the offspring of migrant workers in Beijing. The president of the school, Zheng Hong, is a Harvard alumnus with a master's degree in public administratio