Hong Kong; US-China trade; Propaganda vitriol for second open letter; China Intranet; Mekong River
I am fasting for a routine medical procedure so am not even going to try to write anything cogent up here. There is some commentary below.
Thanks for reading.
The Essential Eight
1. Hong Kong
The march organizer said he would appeal, and some protesters have signaled that they will go ahead with the event whether it is approved or not, a sign that police opposition and increasingly strident denunciations from Chinese officials and local leaders are doing little to curb the demonstrations.
The march was planned for Saturday in the town of Yuen Long, where thugs believed to be connected with organized crime groups attacked people in and around a train station.
Among the themes that have been quite dominant in posts about Hong Kong appearing in WeChat public accounts since July 1 are the following: 1) The protests have been infiltrated and to a large extent orchestrated by “Western countries,” and in particular by the United States; 2) Hong Kong’s political and social system is powerless to achieve order (implying the need for intervention from Beijing); 3) the failure of Hong Kong police to establish order owes in large part to insufficient powers and excessive court intervention; 4) protesters in Hong Kong are violent and irrational; 5) the fundamental failure of Hong Kong to recognize and accept its identity as a Chinese territory is an urgent threat to sovereignty, and a lingering legacy of colonialism and foreign contagion...
Given its context in a highly controlled information environment in which the Party line is supreme, we might also consider a neologism like “junk propaganda” to refer to content that is thinly and selectively sourced in order to emphasize the sensational and appeal to emotions, but which at the same time serves to consolidate “mainstream” Party messaging.
If you want to go deeper Initium has a long look at how mainland media is reporting on Hong Kong
Global Times denounces the pro-democracy activists in Hong Kong as modern era traitors of China [现代汉奸] who work with hostile western countries trying to use democracy as excuse to stop China’s rise.
Addressing a group of business and professional executives on Thursday, HKEX chief executive Charles Li Xiaojia said the PLA was “supposed to be here to ... point [at] outside enemies. It’s not supposed to help Hong Kong to deal with our own problems.”
Hundreds of Hong Kong civil servants and government employees have anonymously aired their frustrations against the city’s administration and the police’s handling of the recent unrest, with some threatening industrial action if their demands are not met by mid-August.
Civil servants from at least 44 departments, including non-frontline officers from the police force, the justice department and judiciary, issued two petitions.
Individually, the portraits and text may tell a simple story about daily life or address larger issues such as universal suffrage or inequality, but as a whole I hope they tell a nuanced story about Hong Kong and its people. The current political situation in Hong Kong has affected the direction of the project
U.S. Representative James McGovern (D-MA) and U.S. Senator Marco Rubio (R-FL), the Chair and Cochair respectively of the bipartisan and bicameral Congressional-Executive Commission on China (CECC) today issued a joint statement urging the Administration to condemn the threat to deploy the People’s Liberation Army in Hong Kong.
Marco Rubio, an anti-China US senator, alleged that "Communist Party of China used organized crime groups to attack protestors in Hong Kong" and that "they are violating everything they agreed in Hong Kong handover". The spokesperson of the Office of the Commissioner of the Foreign Ministry in the HKSAR sternly denounced the remarks as absolute nonsense, and condemned such hysterical smears of and attacks on China out of ulterior motives.
2. US-China trade
There is little reason for optimism for any significant breakthroughs next week. There is also no real pressure on the Chinese side to get something done before whatever happens at Beidaihe in August happens.
The 12th round of China-U.S. high-level economic and trade consultations will be held on July 30-31 in Shanghai, the Ministry of Commerce said Thursday.
Clete Willems, who until April was deputy director of Trump’s National Economic Council and worked on the China talks, said bringing Zhong on board may actually not be a bad sign for a final agreement.
“There may be short-term disruption as the two sides adjust to the change in lineup, but ultimately his inclusion will be helpful by ensuring buy-in across China’s political spectrum,” said Willems, who is now a partner at Akin Gump.
Even though Zhong wasn’t in all the small group meetings that Lighthizer and Mnuchin led with Liu, his deputy, Wang Shouwen, was heavily engaged in the talks and Zhong himself was involved at the periphery.
China’s purchases of agricultural products from the United States have “no direct link” to the agreement to resume face-to-face trade talks next week in Shanghai, but rather reflects commercial decisions by individual Chinese buyers, the Ministry of Commerce said on Thursday.
“We shouldn’t focus too much on indigenous innovation that is fully under our control. We need to build up a global value chain, not a Chinese one,” according to a memo published by the Institute of International and Strategic Studies at Peking University in Beijing.
“We can’t develop China’s hi-tech industry with the mindset that developed China’s first nuclear bomb and satellite [in 1960s].”..
The scholars, who made their suggestions at a symposium held last month, included Wang Jisi, an expert on US affairs and a professor at Peking University; Wang Zhile, a veteran government researcher on foreign trade; Liu Yadong, the editor-in-chief of Science and Technology Daily, the official newspaper of the Ministry of Science and Technology; Zhu Qichao, director of the Centre for National Security and Strategic Studies at the National University of Defence Technology; Fang Xingdong, the founder of Chinalabs.com, a cyberspace think tank; and Zha Daojiong, an international relations professor at Peking University.
I doubt Xi will listen to them
3. Propaganda organs take on US “hawks” and second open letter
The second open letter, Stay the Course on China: An Open Letter to President Trump, is getting a much different propaganda treatment than the first one, which was generally lauded in official outlets. It is strange that the PRC propaganda organs are giving so much attention to this letter given it did not get much pickup in mainstream American media. The vitriol and breadth of the propaganda attacks on the letter may garner it more attention back in the US.
People’s Daily Zhong Sheng condemned the second letter in the Thursday paper. The commentary said the authors of the letter “are full of zero-sum mentalities and extremely outdated ideas” and “trying to drag the US foreign relations back to the days of cold war or even medieval time.” Zhong Sheng says these people “obviously do not represent the mainstream of the public” and will never succeed in their goal.
CCTV Evening News Thursday reports on the Zhong Sheng condemnation of the second letter
CCTV Evening News Thursday "International Sharp Commentary" also attacks the second open letter
CCTV Evening News Thursday cited experts in saying that the US putting Chinese companies on the “entity list” and seeking to contain China’s rise violates China’s rights to pursue development and pursue happiness. It said this is an “action of hegemon” and the US has no rights to do so. Report starts with a condemnation of the second open letter
A commentary by Xinhua's "Xinshiping" condemns the second open letter, says the hawks in DC who advocated for a “decoupling” of US and China are ignorant about the fact that the trade with China has benefited US tremendously.
Zhu Feng of Nanjing University takes to Global Times to criticize the second open letter, US hawks and Gordon Chang and Michael Pillsbury in particular for being obsessed with US hegemony and trying to start a cold war
Researchers from China’s Academy of Social Science wrote in Guangming Daily explaining what McCarthyism is and how the revival of McCarthyism in the United States is threatening the world. It again attacked the US for being a hypocrite for using democracy and human rights as only tools to protect its hegemony.
The University of Pittsburgh, California Institute of Technology and Johns Hopkins University recently joined 12 other leading schools – including Yale, Columbia and Stanford – to issue statements supporting Chinese-American scientists.
4. More on engagement and a new US strategy towards China
Did U.S. policymakers in the 1990s and 2000s really believe that expanding trade with China would make that country’s government more humane and democratic over time? Some of America’s top China watchers have recently argued that the answer is no - that U.S. officials never took the trade-leads-to-democracy argument seriously. These scholars deserve credit for re-assessing the conventional wisdom. But their argument ultimately fails to persuade, and understanding why is important for getting America’s China policy right today.
The standard narrative within the U.S. policy community runs like this: After the Cold War, Washington emphasized economic and diplomatic engagement with Beijing. That strategy was meant to integrate China into the liberal international order and instill habits of economic freedom that would lead to a desire for greater political freedom. The strategy failed, however, as the Communist Party modernized the country economically while ruthlessly suppressing dissent. Rather than becoming a satisfied democracy, China became an aggressive autocracy. It was empowered by an engagement policy that made it richer but not freer...
The fact that things didn’t work out this way doesn’t mean that engagement was a naïve policy to begin with...
The problem with the policy, rather, was that it persisted well after its limitations came into view.
Comment: I was told by the chief of staff of a former President about meetings he and the President had to convince lawmakers to not penalize China for human rights violations because, as he said he and the President argued, increasing trade with China would lead to liberalization and better behavior. "And obviously we were wrong" this person said, in 2015. So the idea that the top of the US government was not arguing that engagement would lead to liberalization is just bunk, though certainly some, but not all, of the China specialists inside the government had a more nuanced and sophisticated view.
My personal view on engagement is that it was the right approach at the time but was left to run on with too few benchmarks or guardrails and generally too casually elided ideology and the fundamental nature of the Chinese Communist Party. There is the risk of overshooting in the other direction now but there is also little question a massive course correction was needed. Perhaps now that most people have recognized there is a problem we can start formulating a cogent, credible and realistic strategy?
Every reigning power in history has trained a vigilant eye on potential challengers: anxiety inheres in pre-eminence. The essence of Huntington’s advice is to instrumentalise that sentiment in the service of national purposes, avoiding the twin temptations of complacence and fatalism. The US’s long-term competitiveness will be served neither by assuming that China is fated to collapse on account of its internal contradictions nor by presuming that it is destined to preside over a world order with Chinese characteristics. Sustainable strategy requires a measured disposition.
Third, speaking of the Trump administration, China hawks need to think this new Red scare policy all the way through to the end. If you genuinely believe that China is a peer equal to the United States, that means we are back to bipolarity. That implies attracting as many allies to the U.S. side as possible, and promoting the U.S. system of governance as a model to others. The Trump administration is, how you say, doing the exact opposite of that. So even if you are a hawk, that does not mean the current administration knows how to handle any of this.
The question is what could actually cause the U.S. to fight China. What if China invades and occupies Taiwan, a democratic U.S. partner and arms customer—would America actually risk World War III? The What if China forces its claim to the Senkaku Islands, which the U.S. considers to belong to Japan—does that fall within America’s treaty commitments to defend its ally?
There’s no guarantee a U.S. president, especially Trump, would resort to war in either case. But these are among the scenarios war-gamers at the Rand Corporation have studied to see if the United States could prevent China from claiming territory by force. It’s not clear the U.S. can.
5. Flextronics going on the unreliable entity list?
US original equipment manufacturer Flextronics which seized part of Huawei's property in China is likely to be put on China's unreliable entity list because such a practice has violated domestic laws, Chinese analysts said on Thursday.
Flextronics privately detained materials and equipment belonging to Huawei worth more than 700 million yuan ($102 million) for more than one month after the Trump administration put the Chinese company on a blacklist in May, a source close to the matter told the Global Times.
6. China’s Intranet
The original technology decoupling was made in Beijing.
The structure of the Chinese internet is unlike any other country, being similar to a gigantic intranet, according to research published by Oracle last week.
The country has very few connection points to the global internet, has zero foreign telcos operating within its borders, and Chinese-to-Chinese internet traffic never leaves the country.
All of these allow China to disconnect itself at will from the global internet and continue to operate, albeit with no connectivity to western services.
"Put plainly, in terms of resilience, China could effectively withdraw from the global public internet and maintain domestic connectivity (essentially having an intranet)," Oracle's Dave Allen said. "This means the rest of the world could be restricted from connecting into China, and vice versa for external connections for Chinese businesses/users."
7. Latest reform commission meeting
Reforms are happening…
The meeting reviewed and approved a series of official documents:
-- a plan on establishing a national science and technology ethics committee;
-- a guideline on strengthening protection of intellectual property rights (IPR);
-- a guideline on promoting the inheritance, innovation and development of traditional Chinese medicine (TCM);
-- a guideline on deepening reform of the management and maintenance of rural public infrastructure;
-- a plan on the construction of national culture parks for the Great Wall, the Beijing-Hangzhou Grand Canal and the Long March;
-- a guideline on coordination in setting limits in territorial spatial planning;
-- a guideline on accelerating the establishment of a comprehensive internet management system;
-- a plan for a pilot program for building regional medical centers;
-- a plan on promoting a national pilot program for the integration between industry and education;
-- a guideline on supporting Shenzhen in building a pilot demonstration area of socialism with Chinese characteristics;
-- a master plan on building a demonstration area for local economic and trade cooperation between China and the Shanghai Cooperation Organization (SCO).
8. China changing the Mekong River
Scientists and people living along the river fear the impact of the worst drought in years has been exacerbated by upstream dams raising the prospect of irreversible change on the river that supports one of Southeast Asia’s most important rice-growing regions.
A Chinese promise to release more dam water to ease the crisis has only raised worries over the extent to which the river’s natural cycles - and the communities that have depended on it for generations - have been forever disrupted.
“Now China is completely in control of the water,” said Premrudee Deoruong of Laos Dam Investment Monitor, an environmental group.
“From now on, the concern is that the water will be controlled by the dam builders.”
Business, Economy and Trade
China Bank of Jinzhou says in talks with possible investors, renewing contagion worry - Reuters The statement on the bank’s website triggered fresh jitters about the health of smaller banks in China’s northeast, after regulators took over Inner Mongolia-based Baoshang Bank on May 24, rattling China’s interbank markets and sending some firms’ borrowing costs spiking.
Toyota to invest $600 million in China's Didi and a new joint venture - Reuters Toyota Motor said on Thursday it will invest $600 million in Chinese ride-hailing giant Didi Chuxing and a new joint venture to expand collaboration with the firm in China. The Japanese carmaker said the new joint venture would include Toyota’s Chinese partnership with Guangzhou Automobile Group, and would see the companies combining services and technologies.
Yicai Global - State Firm to Dump 135,500 Didi Chuxing Shares A state-owned entity is planning to offload 135,700 shares of troubled Didi Chuxing, China's largest car-hailing firm, for a discounted price, according to the Daily Economic News. The offer, which involves an overseas transfer, values Didi Chuxing at USD47.5 billion, according to the Shanghai United Assets and Equity Exchange
Fund managers make fast exits in China's new STAR Market, retail investors pile in - Reuters Retail investors did most of the buying, accounting for more than 90% of such transactions, while institutional investors, including fund houses and insurers, accounted for most of the sellers.
Yicai Global - China's Tax Cuts Have Saved Individuals USD58.2 Billion Since October The tax intake from individuals fell 30.6 percent to CNY563.9 billion in the first half of this year from the same period in 2018, according to new figures from the State Tax Administration. It was the steepest decline among all categories. The tax base also shrank to 115 million people from 200 million because the lower tax band was raised.
Waste management becoming big business - China Daily Dealing with waste is big business as 200 billion yuan ($29 billion) in investment will be needed if the current trash-sorting program in Shanghai is to be implemented across China, according to a recent report by Orient Securities.
China to deepen pilot regional financial reform - Xinhua The Wednesday [State Council Executive] meeting urged employing multiple tools in a coordinated way as required by macro policy to effectively bring down real interest rates, support the development of small-and medium-sized banks, lower financing costs for businesses, especially for micro, small and private firms. Local governments shall fulfill their due responsibilities while averting financial risks.
China to further ease firms' fee burden - Xinhua More efforts will be made to eliminate illegal fee charging to ensure the effectiveness of policies cutting taxes and fees, according to a statement released after a State Council executive meeting chaired by Premier Li Keqiang. The meeting decided to further strengthen the responsibilities of government at all levels, especially local governments, and has made it clear that it will conduct a comprehensive investigation into illegal fee charging.
Who Cancels Lunch With Warren Buffett? A Chinese Tycoon Did, but Why? - The New York Times Within hours, Mr. Sun was using Twitter and Chinese social media to dispute the report. He said on his Chinese social media account that rumors about illegal fund-raising were inaccurate and that the report was “completely untrue.” “I am safe,” he added. He then broadcast a live stream video of himself from an office in San Francisco, pointing out the Bay Bridge behind him.
Politics and Law
Top legislator stresses effective education campaign - Xinhua Li Zhanshu, a member of the Standing Committee of the Political Bureau of the CPC Central Committee and chairman of the Standing Committee of the National People's Congress, made the remarks during an inspection tour in central China's Hunan Province from Tuesday to Thursday. During the tour, Li visited a historical site where late Chinese leader Mao Zedong and other past revolutionaries had studied, worked and engaged in revolutionary activities.
Top political advisor stresses right approach to ethnic affairs with Chinese characteristics - Xinhua China's top political advisor Wang Yang on Thursday stressed resolute adherence to the right approach with Chinese characteristics to handle the country's ethnic affairs, to further motivate people of all ethnic groups to work hard together. Wang, a member of the Standing Committee of the Political Bureau of the Communist Party of China Central Committee and chairman of the Chinese People's Political Consultative Conference National Committee, made the remarks at a symposium on the innovation and development of the country's work on ethnic affairs.
Rights Lawyer Fights Decision to Revoke License - Caixin Chinese rights lawyer Li Jinxing, who made his name fighting to overturn wrongful convictions, is now fighting an official decision to revoke his legal license due to “improper remarks on the internet.” Li filed an appeal on Wednesday against a decision by Shandong province authorities to take away his license to practice law over his online criticism of China’s judiciary system.
Baidu Is Said to Probe Search Results That Mocked Xi Policy - Bloomberg The search engine, like all internet companies in the country, typically censors content to eliminate politically sensitive topics. But on Tuesday afternoon, people who hunted on Baidu for Xi’s “Four Greats” -- a policy doctrine attributed to the Chinese leader -- found results that featured a video explaining the local phrase for “tooting one’s own horn.”
Foreign and Defense Affairs
Confucius Institute contract revelations see universities facing foreign influence probe Following the publication of the documents, Education Minister Dan Tehan warned universities about academic standards and autonomy and said the government was investigating the Confucius Institute arrangements following the introduction of the foreign influence transparency scheme.
Chinese consulate in Australia praises patriotic students for counter-protest against separatists - Global Times China's Consulate-General in Brisbane, Australia, on Thursday issued a statement praising Chinese students, including those from the Hong Kong Special Administrative Region, at the Australian University of Queensland (UQ) who staged a voluntary patriotic rally in response to two consecutive anti-China and secessionist protests held at the university campus on Wednesday afternoon.
Russia and China defy US with delivery of anti-aircraft missile systems to Chinese military | South China Morning Post Russia has been proceeding with delivery of its S-400 anti-aircraft missile systems to China, despite the arms deal between the two countries falling foul of US sanctions. Russian state news agency Tass said on Wednesday that Russia had begun delivering a second regiment set of S-400 surface-to-air missile systems to China by sea
部分退役军人和其他优抚对象抚恤补助标准再次提高 China said it will slightly increase the payments to retired PLA soldiers who are injured on duty, and to the martyrs’ families.
重磅！中央军委后勤保障部部长换人_凤凰网资讯 Gao Jin, the youngest active General, is the new head of the Logistic Support Department of the Central Military Commission
Kenya says it supports Chinese tech giant Huawei regardless of US policy | South China Morning Post ‘We will pick what is best for us,’ IT Minister Joseph Mucheru says. Goal is to ‘make sure we get value for money for our citizens’, he says
Malaysia Restarts Rail Project With China After Cost Cut - Bloomberg Malaysia restarted the China-linked East Coast Rail Link project on Thursday after downsizing building costs by a third to lighten the government’s debt burden.
iSpace becomes China’s first privately owned firm to put a rocket into orbit | South China Morning Post Designed and built by i-Space, and measuring about 20 metres (66 feet) in length, the Hyperbola-1 took off at 1pm from the Jiuquan Satellite Launch Centre in the Inner Mongolia autonomous region, and just minutes later deployed the two satellites it was carrying into near-Earth orbits.
Innovation in the New Era of Chinese Military Power | The Diplomat - Elsa Kania The PLA is concentrating on adapting to and leveraging the Revolution in Military Affairs (RMA, 军事革命) that is believed to be underway. This latest national defense white paper builds upon themes from the 2015 “China’s Military Strategy,” which had highlighted that the global RMA is “proceeding to a new stage.” At that time, China expressed concern about major military powers “speeding up their military transformation,” seemingly alluding to the U.S. Third Offset Strategy, which had been launched in late 2014 and received intense attention among Chinese military strategists. The “revolutionary changes in military technologies and the form of war” were believed to present “new and severe challenges to China’s military security,” and these concerns have only intensified since 2015 as such trends continue and accelerate.
Hong Kong and Macao
Hong Kong gov't orders pro-Beijing newspaper to remove giant sign on building following complaints | Hong Kong Free Press HKFP A Hong Kong government department has ordered a Wan Chai building to remove an outdoor signboard belonging to Chinese state-owned newspaper Ta Kung Pao within 30 days, following complaints
U.S. warship sails through Taiwan Strait, stirs tensions with China - Reuters A Chinese Foreign Ministry spokeswoman in Beijing said China had “expressed deep concerns to the U.S. side” over its latest action in the strait separating China from Taiwan...The warship sent to the 112-mile-wide (180-km) Taiwan Strait was identified as the Antietam.
Taiwan’s China Airlines apologizes for cigarette smuggling scandal | Taiwan News Two officers at the National Security Bureau (NSB) were alleged to have brought 9,800 cartons of cigarettes duty-free into the country using the president’s arrival as cover. Later investigations alleged that the practice had been going on at least since 2014, under President Ma Ying-jeou (馬英九).
Tech and Media
鸿蒙虚实 华为进退_封面_封面文章_《财经》杂志_杂志频道首页_财经网 - CAIJING Caijing cover story on Huawei in the wake of the US sanctions, the Hongmeng OS is not for smartphones and it is not ready.
Alibaba Chip Subsidiary Launches First Product Using Open-Source Architecture - Caixin Notably, the processor uses the RISC-V instruction set architecture (ISA)—key programming infrastructure that decides how a device functions. Developers are allowed to build their own products using the Berkeley-based open-source ISA, with few intellectual property restrictions. Open-source technologies are becoming an increasingly attractive option to Chinese companies that fear being blocked by foreign governments from dealing with major chip-designers like Arm Ltd.
Ministry Outlines Ultra HD Video’s Broad Application Prospects - Caixin A national development and action plan published in March estimates the scale of China’s ultra HD video industry to exceed 4 trillion yuan ($581 billion), with its users reaching 200 million people by 2022.
Short Video Platform Kuaishou to Invest $1.5b in Data Flows for Premium Content Creators- PingWest Short video platform Kuaishou will ramp up investments to provide data flows, of which the value could reach 10 billion yuan ($1.5 billion), for its 100,000 premium content creators in the next year, covering more than 20 fields such as games, fashion, sports and music.
Salesforce Announces Strategic Partnership with Alibaba - Salesforce Blog Alibaba will become the exclusive provider of Salesforce to customers in mainland China, Hong Kong, Macau, and Taiwan, and Salesforce will become the exclusive enterprise CRM product suite sold by Alibaba.
Beijing subway experimenting with facial recognition for fare payment - Global Times The Beijing subway system is experimenting with facial recognition for passengers to pay their fares, and the technology might be applied to the entire system once the database is accurate enough, according to a report by Beijing Youth Daily on Wednesday.
Lindsey Graham slams change to iconic bomber jacket for 'Top Gun: Maverick' | TheHill "That’s the power of Chinese money in the modern world that kind of sucks," Graham said in an interview with TMZ when asked about the Chinese company potentially putting pressure on Paramount Pictures to change the patches on the jacket.
Police Release Files on China Billionaire's Alleged Rape Case - Bloomberg Interview transcripts show the alleged victim at one point told police she wanted money. They concluded after an investigation it was unclear if a crime had actually taken place. According to the files, a police sergeant asked the student if she wanted authorities to investigate the billionaire. “No, I want it to go away,” she was cited as saying in one transcript, adding that she wanted an apology “and money.”
Society, Arts, Sports, Culture and History
China Focus: China issues white paper on protecting disabled persons' rights, interests over past 70 years - Xinhua The white paper, titled "Equality, Participation and Sharing: 70 Years of Protecting the Rights and Interests of Persons with Disabilities in the PRC," was released by the State Council Information Office. China now has around 85 million people with disabilities, according to the white paper.
Interview: Man City CEO pledges to play active role in Chinese football - Xinhua Manchester City CEO Ferran Soriano promised that the English Premier League champions will play an "active" part in the development of Chinese football. Soriano told Xinhua in a telephone interview from Hong Kong that despite the criticism leveled about City's week-long tour in southeast China, he has no worries about City's future expansion prospects in the country.
Julia Lovell: Translating China’s Past – China Channel Writer Jonathan Chatwin talked to her about her route into studying China, the relationship between translation and writing history, and how she approached the researching of the global stories in her new book Maoism.
Energy, Environment, Science and Health
China Reports World's Largest Network of Charging Facilities for Electric Vehicles- PingWest China has built the world's largest network of charging facilities for electric vehicles, as 1 million charging piles had been completed by the end of June, an official said Thursday.