Hong Kong; US-China trade talks; Slight reprieve for Huawei

Today is the 98th Anniversary of the founding of the Chinese Communist Party and the 22nd anniversary of the handover of Hong Kong to the PRC. Protestors in Hong Kong decided to celebrate by storming Legco. A police operation is underway to clear the parliament building and the scenes are getting uglier and uglier. You can follow live updates here on the New York Times site.

The G20 meetings between President Trump and General Secretary Xi have led to an agreement to restart trade talks and a delay of the US in imposing new tariffs, though nothing that has come out publicly should give confidence that the two sides are any closer to resolving their differences. I am not sure this is really a cease-fire since the existing tariffs remain in place. It seems more like a political pause.

Trump’s statement that some of the restrictions on Huawei will come off need more clarification. From his remarks and the comments of other officials it sounds like this is not a full reprieve for Huawei and that components that help Huawei build its 5G equipment are still restricted. I expect we will have more clarity later this week.

Thanks for reading.

The Essential Eight

1. US-China trade talks

Trump to allow U.S. firms to sell technology to Huawei and promises farmers they would win from new talks, in wide-ranging news conference - The Washington Post

Trump said he and Xi dined together Friday and then met again for more than an hour on Saturday.

U.S.-China Trade Truce: Side-by-Side Comparison of Statements - Bloomberg

there remain some substantial differences, including on whether China agreed to make immediate purchases of U.S. farm goods [The Chinese readout makes no mention of ag purchases], and whether the freeze in new U.S. tariffs is permanent.

Xi, Trump agree to restart trade consultations, set tone for China-U.S. ties - Xinhua

After greeting each other with firm handshakes, the two leaders talked for more than one hour and agreed to jointly advance a China-U.S. relationship featuring coordination, cooperation and stability.

They also clinched a deal to restart economic and trade consultations between their countries on the basis of equality and mutual respect, injecting much-needed confidence into the global economy and markets.

The U.S. side said it will not add new tariffs on imports from China. The two countries' economic and trade negotiating teams will work on specific issues.

Larry Kudlow on "Face the Nation": Trump "not backing off" Huawei after reversal on U.S. restrictions - CBS News

Kudlow, the director of the National Economic Council, told "Face the Nation" that Mr. Trump and administration officials are as "cautious" and "concerned" as lawmakers about the potential national security threats Huawei poses to the U.S. 

"The president is not backing off on the national security concerns," he said Sunday. "We understand the huge risks regarding Huawei."..

"What's happening now is simply a loosening up for general merchandise, maybe some additional licenses from [the Department of] Commerce," he added. "It is not the last word. The last word is not going to come until the very end of the talks. This is a complicate matter."

Tump will face a bipartisan pushback on Capitol Hill over Huawei:

China warns of long road ahead for deal with U.S. after ice-breaking talks - Reuters

Taoran Notes, an influential WeChat account run by China’s Economic Daily, said the United States was now aware that China was not going to give in, and that tariffs on Chinese goods were increasingly unpopular back home.

“We’ve said it before - communication and friction between China and the United States is a long-term, difficult and complex thing. Fighting then talking, fighting then talking, is the normal state of affairs,” it said.

The Taoran Notes piece - 陶然笔记评中美元首会晤:时间 是解决问题的良药_新浪财经_新浪网


Xinhua continued its attacks against domestic critics who said China should make compromises in the trade war. The article, with the title “Be vigilant to those who throw the grenade backward”, said compromises wouldn’t work with the Americans, and anyone arguing this is either naïve or has “ulterior motive”.


Xinhua is also not very convinced that the US and China made a breakthrough. In a commentary it said the US must not have another about-face on trade with more threats of tariffs. The US must respect China’s core interests and take actions to show its sincerity in talks.

人民日报钟声:言则必行 行则将至--财经--人民网

People’s Daily Zhong Sheng said Trump said many nice things in the meeting with Xi, that he wants good relations with Xi and he has no hostility against China, but he must back up his words with actions.

Commentary: China-U.S. deal needs both to stay on track, stay sincere - Xinhua

Of course, the truce doesn't necessarily mean a deal is imminent. But after so many rounds of talks as well as tit-for-tat measures, the United States should know better than before about China's fundamental principles and stance, and both are now more experienced and better equipped to manage their divergences.

US Department of Agriculture reports surprise soybean deal with China just a day before Donald Trump-Xi Jinping G20 meeting | South China Morning Post

The 544,000-tonne order, reported on Friday by the US Department of Agriculture (USDA), is the biggest sale to the country since it booked 828,000 tonnes of the oilseed from US growers on April 1, before trade talks broke down.

2. Hong Kong

Video and Pictures: Hong Kong protesters occupy legislative chamber, after smashing windows, vandalising corridors | Hong Kong Free Press HKFP

Anti-extradition law demonstrators had been ramming doors and windows around the complex since Monday afternoon, despite warnings from police in riot gear that they may face arrest...

Protesters inside the legislature paint graffiti on the walls reading “[Chief Executive] Carrie Lam step down”, “the government forced us to revolt” and “anti-Chinese colonialism,” among other slogans...

Protesters eventually entered the main chamber of the building, where the Hong Kong emblem was spray painted black.

Comment: This is sure to provoke a harsher backlash from the government and perhaps some Hong Kong residents

Hong Kong protests live updates: Protesters storm parliament on anniversary of return to China - The Washington Post

The mostly young demonstrators smashed metal shutters, broke windows and ripped down metal fencing around the Legislative Council, eventually forcing their way into the building where riot police tried to push them back with tear gas. Meanwhile, a massive peaceful march shut down the city’s main thoroughfares — the latest in a string of acts of civil discontent that have rocked the Asian financial hub in recent weeks...

Hospitals and police have not confirmed the number of injuries from the clashes. Police said in a statement that protesters earlier Monday had pelted officers with objects containing an “unknown liquid,” which made their skin swollen and itchy. Thirteen officers were treated at hospital and discharged.

Hong Kong celebrates 22nd anniversary of return to motherland with various activities - Xinhua

In her speech at the reception, HKSAR Chief Executive Carrie Lam said that Hong Kong remained stable and prosperous during the past 22 years despite some ups and downs. "Backed by the motherland and open to the world, Hong Kong has continued to leverage its unique advantages under 'one country, two systems'."

China’s public security ministry warns its bureaus to be on guard against ‘political risks’ caused by influence of protest-hit Hong Kong | South China Morning Post

According to internal document, mainland authorities held video conference as tens of thousands of protesters surrounded Hong Kong’s legislature

US suppression was the greatest external factor affecting China’s ‘political security’, it said, highlighting message from public security vice-minister

Hongkongers identifying as 'Chinese' at record low; under 10% of youth 'proud' to be citizens - poll | Hong Kong Free Press HKFP

The Public Opinion Programme at the University of Hong Kong (HKUPOP) interviewed 1,015 residents by random telephone survey between June 17 and 20, in the wake of a record “two million” person march calling for a complete withdrawal of the city’s controversial extradition bill.

China censors Taiwan's Golden Melody Awards after presenter encourages Hong Kong protesters - ABC News (Australian Broadcasting Corporation)

Taiwan's Golden Melody Awards, which were livestreamed to millions of people across Asia on Saturday, was censored on Chinese live-streaming sites when presenter Jen Chiang-da said: "Hong Kong, add oil!"

Hong Kong used as ‘pawn’ in China relations, says labour minister in angry reaction to US State Department’s ‘unfair’ assessment of city’s human trafficking record | South China Morning Post

Hong Kong’s labour chief has said that “unfair” American criticism of its human trafficking record showed that the United States continued to use the city as a “pawn” in dealings with mainland China.

Why Many in China Oppose Hong Kong’s Protests - The New York Times - Li Yuan

It isn’t a surprise that many people in China oppose the protests against a proposed law that would allow Hong Kong to extradite criminal suspects to mainland China. They see only the news that Beijing’s censors let them see.

What is surprising is that many Chinese people who know the full story share that opinion...

That attitude even among the elite suggests more conflict ahead between Hong Kong and the mainland. It also casts further doubt on the possibility that as China becomes more middle class, its people will inevitably demand more individual rights, forcing the Communist Party to ease its control over society or even democratize.

Did Hong Kong Police Abuse Protesters? What Videos Show - The New York Times 

“This is basically an essay on how not to police a protest movement,” said Dr. Rohini Haar of Physicians for Human Rights, an advocacy organization. “Beating of unarmed protesters who are not posing any active threat” is a violation of law enforcement principles prescribed by the United Nations, she said.

Opinion | A Hong Kong Protester’s Tactic: Get the Police to Hit You - The New York Times OpEd by Fred Chan Ho-fai

An important idea that has been circulating in online forums is now firmly planted in my mind. It is called the Marginal Violence Theory (暴力邊緣論), and it holds that protesters should not actively use or advocate violence, but instead use the most aggressive nonviolent actions possible to push the police and the government to their limits.

3. US policy towards China

How Mike Pompeo became Trump’s China hawk - The Washington Post

Increasingly, Pompeo has been speaking out about China’s malign activities, while privately asking his staff to produce an overarching analysis of the motivations behind the Chinese Communist Party’s conduct and strategies to respond...

“We are trying to create an intellectually persuasive argument about China being the number one challenge to the United States,” a senior State Department official told me.

The project, led by State Policy Planning Director Kiron Skinner and Miles Yu, a U.S. Naval Academy history professor, faced criticism after Skinner described the U.S.-China competition as “a fight with a really different civilization and ideology” in April. Critics of the Trump administration’s China approach seized upon those remarks, as did the Chinese government...

Pompeo’s State Department has concluded that decades of engagement-focused U.S. policy have failed, and now the United States and its partners must change course and respond to the Chinese government’s strategy and behavior...

“We fundamentally erred by underestimating and misunderstanding China’s true intention, which is to create a Chinese Communist Party-dominated world order to replace the world order created by the U.S. and its allies,” the official said. “It’s not a clash of civilizations, it’s a clash of political systems.”

Comment: These efforts are another outgrowth of the 2017 National Security Strategy and its reframing of the official view towards the PRC, That document, and remember there is much more we never see as it is classified, was also a marching order to the US government bureaucracy to craft new and tougher policies towards China. 

Experts think Trump policy on China counterproductive: draft letter - Reuters

“Although we are very deeply troubled by Beijing’s recent behavior, we also believe that many U.S. actions are contributing to the downward spiral in relations,” said the draft of the open letter to Trump and Congress signed by some 80 experts.

“U.S. efforts to treat China as an enemy and decouple it from the global economy will damage America’s international role and reputation and undermine the economic interests of all nations,” it said. “The U.S. fear that Beijing will replace the U.S. as the global leader is exaggerated.”

Comment: Over 100 signatories now I believe. The five drafters of the letter are Michael Swaine, Taylor Fravel, Stapleton Roy, Ezra Vogel and Susan Thornton. I was not asked to sign the letter but have seen a draft. 

I doubt it will have much influence either inside the Trump Administration or on Capitol Hill. I was disappointed that in the draft I have seen there is no specific mention of Xinjiang and its re-education camp archipelago. I am also deeply skeptical of this claim:

“Washington's adversarial stance toward Beijing weakens the influence of those voices in favor of assertive nationalists. With the right balance of competition and cooperation, American actions can strengthen those Chinese leaders who want China to play a constructive role in world affairs".

Trump-Xi Truce at G-20 Should Lead to Broader U.S.-China Deal - Bloomberg Editorial

A productive, albeit guarded, relationship between the U.S. and China is still possible and would be of inestimable value. It’s no exaggeration to say that global stability and prosperity depend on it. The president and his advisers ought to pause and reflect on what’s at stake. So should those members of both parties in Congress who are lending him actual or tacit support in this new spirit of confrontation.

Rethinking US-China competition: Next generation perspectives - Brookings

In spring 2019, Brookings Vice President and Director of Foreign Policy Bruce Jones convened four Brookings scholars and affiliates—Tarun Chhabra, Rush Doshi, Ryan Hass, and Mira Rapp-Hooper—to probe how the rising generation of foreign policy scholars think about the evolving debate around China and the future of the U.S.-China relationship.

Senate backs massive defense bill, targets China, sets Iran vote - Reuters

Among other provisions, the Senate NDAA requires detailed reporting from the Department of Defense to prevent transfers of sensitive technology to China or Russia, as well as reports on access to the Arctic. It also requires tighter screening of scholars seeking visas to the United States.

Poll: Majority of Americans See US and China as Rivals | The Diplomat

For the first time in a survey conducted on the question since 2006, a majority of U.S. respondents have said that they see the United States and China as “mostly rivals.” The Chicago Council on Global Affairs, a U.S. think tank, released the results of polling it conducted in February 2019 on the question, finding that 63 percent of all respondents rated the two powers as rivals.

Can the US-China crisis be stabilized? - Brookings - Paul Gewirtz

the crisis in U.S.-China relations now exists in virtually every part of the relationship. Even more troubling and dangerous, there is a growing sense in each country’s government that the other is a pervasive adversary...

the genuine enmity that is developing is very much in the government-to-government relationship, with much more nuanced and even constructive thinking about the relationship widely held among people of all walks of life within each country. But the latter voices in the United States, numerous and respected voices, are often marginalized—and very regrettably the media in the United States largely focus on the harshest, loudest voices and often wrongly suggest that they reflect a new U.S. consensus.

The New Normal - The Future of US-China relations with David Shambaugh by Rules Based Audio by the Lowy Institute

In the first episode of Rules Based Audio, powered by the Lowy Institute, host Kelsey Munro talks to Professor David Shambaugh from George Washington University about the shift to full-spectrum competition between the US and China, and what it means for the rest of the world.

The Failures of the ‘Failure of Engagement’ with China - by Alastair Iain Johnston - The Washington Quarterly (PDF)

Today’s dominant narrative about the failure of engagement with China is ahistorical and simplistic. The existing caricature of engagement policies risks narrowing the imaginable range of U.S.-China cooperation and intensifying the future U.S.-China security dilemma.

4. Researchers in the US and China ties

NIH probe of foreign ties has led to undisclosed firings—and refunds from institutions | Science | AAAS

A senior NIH official tells ScienceInsider that universities have fired more scientists—and refunded more grant money—as a result of the effort than has been publicly known...

He says the agency’s concerns were initially sparked by reports that scientists were violating the confidentiality of NIH’s peer-review process, in which thousands of volunteer reviewers rate tens of thousands of grant proposals every year. In mid-2016 [During the Obama Administration], he says, NIH received a report from the HHS Office of Inspector General that a Federal Bureau of Investigation (FBI) probe had uncovered an MD Anderson researcher sharing proposals he had been asked to review with several other people...

Over the next 2 years, he says, NIH grant managers would find numerous examples of NIH-funded scientists at U.S. universities who were publishing papers that listed a foreign institution—often in China—as their primary affiliation and cited foreign funding sources in the fine print. But the scientists hadn’t reported those affiliations and grants to their institutions or to NIH, as required...

“We found one person with a $5 million startup package from a Chinese university that wasn’t disclosed to anybody, not to his American university, and not to us,” Lauer asserts. “This is not subtle. It’s not an, ‘Oops, I forgot to list it on a form.’ We’re talking about really, really egregious stuff.”

Those absent without leave scientists were not just stiffing their home institutions, Lauer points out. They were also fleecing NIH and, by extension, U.S. taxpayers...

Lauer says he hasn’t done a thorough analysis of the 180 cases in which NIH believes scientists have withheld information about their foreign ties. But a few things stand out.

“Most of the scientists are well-funded, meaning they have multiple NIH grants,” he says. “Most are ethnically Chinese, although some of our more serious cases are not ethnically Chinese.”..

“Thousand Talents is not a threat [to the United States],” he says. “It’s not the specific conduct we are focusing on, it’s the failure to disclose it.”

FBI Urges Universities To Monitor Some Chinese Students And Scholars In The U.S. : NPR

Since last year, FBI officials have visited at least 10 members of the Association of American Universities, a group of 62 research universities, with an unclassified list of Chinese research institutions and companies...

"We are being asked what processes are in place to know what labs they are working at or what information they are being exposed to," Fred Cate, vice president of research at Indiana University, tells NPR. "It's not a question of just looking for suspicious behavior — it's actually really targeting specific countries and the people from those countries."

‘We want more Chinese students’: Donald Trump says US looking for new ways to keep scholars in the country | South China Morning Post

He said his administration was looking for a new way – a “smart person’s waiver” – to allow successful overseas university students to remain in the United States more easily after graduation.

“So they can not only stay but maybe they have access to a green card. We want to keep these people here,” Trump said.

5. Economy

China’s Manufacturing Shrinks for First Time in Four Months: Caixin Survey - Caixin Global 

The Caixin China General Manufacturing Purchasing Managers’ Index (PMI), which gives an independent snapshot of the manufacturing sector’s operating conditions, dipped to 49.4 in June from 50.2 in May, indicating a marginal deterioration. It’s the lowest reading since January for the sector, which accounts for about 30% of China’s gross domestic product...

China’s official manufacturing PMI, released by the National Bureau of Statistics on Sunday, stood at 49.4 in June, unchanged from the month before. The Caixin manufacturing PMI, sponsored by Caixin and compiled by data analytics firm IHS Markit Ltd., focuses on light industry, while the official one focuses on heavy industry. The geographic distributions of the companies covered in the two surveys are also different

China Focus: China opens more sectors to foreign investment with new negative lists - Xinhua

The two lists, one for the piloted free trade zones (FTZ) and one for the rest of the country, contain fewer access-limiting measures. Pilot FTZs now have 37 listed items for foreign investors, down from 45, while non-FTZ areas are required to implement 40 items instead of 48.

They will go into effect on July 30, and market access restrictions not on the negative lists will be fully lifted before the end of this year, said an official with the NDRC.

《鼓励外商投资产业目录(2019年版)》 2019年第27号令

China releases new industry catalogue encouraging foreign investment - Xinhua

The catalogue includes an industry catalogue for encouraging foreign investment nationwide and a catalogue of advantageous industries for foreign investment in the country's central, western and northeastern regions...

Over 80 percent of the newly-added or revised items of the nationwide catalogue point to the manufacturing industry. Foreign investment is more encouraged in sectors such as high-end manufacturing, intelligent manufacturing, and green manufacturing.

New items have been added to encourage foreign investment in 5G core components, etching machines for integrated circuits, chip packaging equipment, and cloud computing equipment.

Besides, new entries have been added for artificial intelligence, clean production, carbon capture and circular economy.

Beijing’s move to keep tax break on purchases of new-energy vehicles to support troubled auto sector, help biggest players 

A move by Beijing to keep a sales tax break on environmentally friendly cars to help the sputtering auto sector will boost the fortunes of top domestic EV manufacturers as well as the popular Tesla from the US over smaller players, analysts say.

Beijing had been widely expected to scrap the sales tax break, but the Ministry of Finance announced on Friday it is extending it. A change had been expected to go into effect Monday, but buyers battery-powered and plug-in hybrid cars will still be exempt from the 10 per cent sales tax until the end of 2020.

6. Half of Chinese pigs dead due to ASF?

Swine fever toll in China may be twice as high as reported, industry insiders say - Reuters

As many as half of China’s breeding pigs have either died from African swine fever or been slaughtered because of the spreading disease, twice as many as officially acknowledged, according to the estimates of four people who supply large farms...

Losses are not only from infected pigs dying or being culled, but also farmers sending pigs to market early when the disease is discovered nearby, farmers and industry insiders have told Reuters, which analysts say has kept a lid on pork prices in recent months.

However, prices began rising substantially this month and China’s agricultural ministry has said they could surge by 70 percent in coming months as a result of the outbreak. Pork accounts for more than 60% of Chinese meat consumption.

Dim Sums: Rural China Economics and Policy: Pig Insurance Fraud Uncovered in Sichuan

It is unclear why these articles were inserted in news media this month. Are ASF claims overwhelming insurance companies, or are increased claims revealing extensive fraud? Are farmers complaining about unpaid claims, or are officials trying to reassure farmers that government-subsidized insurance is a safety net for them? We can only guess, for now.

7. Xinjiang

China’s Vanishing Muslims: Undercover In The Most Dystopian Place In The World - Vice

VICE News’ Isobel Yeung posed as a tourist to gain unprecedented access to China’s western Xinjiang region, which has been nearly unreachable by journalists.

She and our crew experienced China’s Orwellian surveillance and harassment first-hand during their time in Xinjiang, and captured chilling hidden-camera footage of eight Uighur men detained by police in the middle of the night. We spoke with members of the Uighur community about their experience in these camps, and about China’s attempts to silence their history and lifestyle under the cover of darkness.

Comment: Chilling report, sparked lots of debate and anger on Twitter about the ethics of the journalists posing as travel bloggers and putting people at risk in Xinjiang. 

阔步走向长治久安 ——第二次中央新疆工作座谈会召开5周年综述 新疆日报

Xinjiang Daily looks back at the 2nd Xinjiang work Conference on the 5th anniversary of its convening in Beijing.



Brainwashing, Police Guards and Coercive Internment: Evidence from Chinese Government Documents about the Nature and Extent of Xinjiang’s “Vocational Training Internment Camps” | Adrian Zenz,

Based on the government’s own statements, this article seeks to decisively refute these propaganda claims. Official documents and related media reports that are not designed for international audiences paint a very different picture of these “centers” – a picture that confirms the growing body of first-hand witness accounts.

自治区庆祝中国共产党成立98周年暨表彰大会隆重召开-天山网 - 新疆新闻门户

Chen Quanguo’s speech in Urumqi celebrating CCP’s founding anniversary, urging officials to “maintain strategic focus” and “steadfastly” implementing policy given by the party central in safeguarding social stability in Xinjiang.

In Beijing speech, Mujahid speaks of ‘false news’ on Xinjiang | Free Malaysia Today

After riling up netizens with his apparent endorsement of China’s defence of detention camps in the Xinjiang province, Minister in the Prime Minister’s Department Mujahid Yusof Rawa appears to be questioning reports about Beijing’s policies against Muslims, saying they could be “false news”.

“False news in China about Muslims being oppressed could trigger a wave of sympathy to the oppressed and affect relationships,” Mujahid said in a speech he delivered at the Beijing Foreign Studies University yesterday.

8. Wang Quanzhang gets a visit from his family

Chinese human rights lawyer Wang Quanzhang ‘is a changed man’, says wife after first meeting in four years | South China Morning Post

The wife and son of the Chinese human rights lawyer Wang Quanzhang were finally allowed to see him on Friday – for the first time since he was detained four years ago under a sweeping crackdown.

Li Wenzu, who was finally allowed into the prison’s reception area at 2pm, walked out an hour later in tears, although their six-year-old son Wang Guangwei rejoiced in the fact that he had finally seen his father after a four-year separation.

Translation of a post his wife wrote after seeing him. Awful - Imprisoned Rights Lawyer Wang Quanzhang Gets First Family Visit in Four Years | 高大伟 David Cowhig's Translation Blog

 Quanzhang seemed to calm down a bit. He picked up a paper in front of him and said, “There is something I have to explain to you. I was afraid that I wouldn’t remember it so I wrote it down on paper.”

I listened intently to hear what he was about to tell me. Quanzhang began to speak rapidly, “I am worried about you… You shouldn’t be doing this. I think that it was becase Bian Xiaohui asked to see her husband in prison that she was detained. I am worried about you. Don’t do anything…”..

Then he turned and left. I watched my eyes full of tears as his back receded some ten or so meters away. My tears flowed again. Four years. Astonishingly, he resembled nothing more than a well-programmed but rather dull wooden man. He didn’t even look back at his own wife and child.

Business, Economy and Trade

China’s Central Bank Releases Draft Rules for Defaulted Bond Trading The short document (link in Chinese), released by the People’s Bank of China (PBOC) on Friday, sketches out definitions, information disclosure requirements and risk-avoidance measures investors should take. The draft rules are open for comment until July 13.

Chinese tourism hit by trade war and renminbi depreciation | Financial Times $$ “Middle-class travellers will choose cheaper travel options,” said Peter Liao, who operates a travel agency in Shanghai specialising in European trips. “The exchange rate is a factor. It is getting difficult for tour operators to fill up their more expensive packages.”

Chinese envoy says Syngenta takeover was a bad deal: report - Reuters Beijing’s ambassador to Switzerland said ChemChina’s $43 billion takeover of seed and agrochemicals firm Syngenta was a mistake, adding he would have tried to stop the 2017 deal had he been in Bern at the time, a newspaper reported in an interview on Saturday.

There is no problem with small business lending in China | Andrew Batson's Blog In effect, small-business lending is being treated as an urgent national emergency: apparently China’s financial system is systematically failing to deliver what is needed for a healthy economy. Yet it is impossible to see any evidence of this emergency in the data presented in a white paper on the topic published by the People’s Bank of China this week.

HSBC tells China it is not to blame for Huawei arrest | Financial Times $$ HSBC has launched a lobbying effort to convince the Chinese government that it is not responsible for the arrest of Huawei’s finance director, as the bank tries to distance itself from the diplomatic row over China’s top telecoms equipment maker.

China's Central Bank Pushes Banks to Curb Mortgages - Caixin The PBOC provided verbal guidance to state-owned banks, joint stock banks and other commercial lenders, the people said, asking not to be identified as they’re not authorized to speak publicly. Banks received the guidance early this month, according to two of the people.

Politics and Law

CPC members exceed 90 million - Xinhua The CPC had 90.59 million members with 4.61 million primary-level Party organizations as of the end of 2018, the department said in a report ahead of the founding anniversary of the CPC on July 1. The membership and Party organizations increased by 1.03 million and 39,000 from 2017 respectively, data from the report shows.

2018年中国共产党党内统计公报--时政--人民网 more stats on Party membership...The party now has 4.61 million party cells, including 1.59 million in private companies

Xinhua Headlines-Xi Focus: Decoding success of Communist Party of China - Xinhua  The faith in and commitment to Marxism is an identification that the CPC will never abandon. Unlike what is described in "China collapse theory," China is doing the opposite with rising composite national strength and improved living standards. It has been proved in practice that only being guided by Marxism, and steadily forging ahead on the road of socialism with Chinese characteristics, can China achieve positive solutions and results...Understanding the consequences of ossification in thinking, the CPC has been advancing the theoretical explorations and adapting Marxism to a Chinese context.

Xi's speech at key education campaign meeting to be published - Xinhua speech...at a key meeting on May 31 to launch a campaign themed "staying true to our founding mission" among all Party members...The fundamental task of conducting in-depth studies on and implementing the thought on socialism with Chinese characteristics for a new era, forging the political character of loyalty, integrity and a keen sense of responsibility, and uniting the Chinese people of all ethnic groups and leading them to strive together for the realization of the great dream should be firmly grasped, in order to make sure the campaign has its desired effect, Xi said. 在“不忘初心、牢记使命”主题教育工作会议上的讲话 - 求是网

吴英杰主持召开全区寺庙管理工作座谈会 Tibet party boss Wu Yingjie held a meeting on how to improve the works of “cadres stationed in the temples”, again urged tighter party control of the monks and the public, and “confidently reveal the reactionary nature of the 14th Dalai who seeks to create disaster and chao for Tibet and the religion.”

Xi urges sense of mission, dedication in learning from late village official - Xinhua i Jinping, general secretary of the Communist Party of China (CPC) Central Committee, has stressed a sense of mission and dedication among Party members, officials and young people, in an instruction honoring late village official Huang Wenxiu...After graduation from Beijing Normal University in 2016, Huang returned to her hometown Baise City in south China's Guangxi Zhuang Autonomous Region and served as an official with the publicity department of the Baise municipal committee of the CPC....Huang died in a rain-triggered flash flood at the age of 30 on June 17, 2019

E-books published for Party education campaign - Xinhua A total of 30 e-books on Xi Jinping Thought on Socialism with Chinese Characteristics for a New Era were launched on 14 leading online platforms Monday. They aim to help people advance their study of the ongoing Party education campaign themed "staying true to our founding mission."

Senior Executive at Major State-Owned Mining Company Under Investigation - Caixin Global Wang Pengyun, strategic planning director at the state-owned China Nonferrous Metal Mining Group (CNMC), has been placed under investigation for suspected “serious violations of discipline and law,

We Have Been Harmonised: Life in China’s Surveillance State by Kai Strittmatter – review - The Guardian We Have Been Harmonised is the most accessible and best informed account we have had to date of China’s transition from what scholars such as Rebecca MacKinnon used to call “networked authoritarianism” to what is now a form of networked totalitarianism

Internet regulator cracks down on music and audio-based social platforms · TechNode Among the apps removed from major Chinese Android app stores were NetEase Cloud Music, audio platform Lizhi FM and Ximalaya FM, and social app Soul. The apps still appear in app stores, but in place of their descriptions is a message: “According to related laws and regulations, this app is not available for download.”

NPCSC Grants Amnesty to Convicts to Mark 70th P.R.C. Founding Anniversary – NPC Observer Yesterday’s special amnesty decision marks the second time the NPCSC has exercised that authority during Xi’s tenure—and the ninth in the history of the People’s Republic. It last did so in August 2015, just days before the 70th anniversary of the end of World War II and the 1937–1945 Sino-Japanese War.

How the Humanities and Social Sciences Are Holding China Back – China Heritage Gong Renren (龔刃韌, 1954-), the author of the following essay, is a professor (retired) in the Law School of Peking University (see here for details) and the head of the Institute for Human Rights 人權研究院. On 21 June 2019, Professor Gong published an essay that is nothing less than an indictment of China’s academic culture, an accusation of mediocrity and a critique of a cowed and compliant intelligentsia. In his analysis of the ever-deepening crisis in the Chinese humanities and social sciences, Gong contrasts the failures of today with the achievements of the country’s universities during the turbulent and war-torn decades of the Republic of China.

Court in China's Chongqing Jails WeChat Foreign News Service Moderator - RFA Authorities in the southwestern megacity of Chongqing have jailed the moderator of a social media news chat group bringing verified news from overseas to a Chinese audience, RFA has learned. Liu Pengfei, who ran the Global Report news service on the popular social media app WeChat, among other platforms, was handed a two-year jail term by a district court in Chongqing, rights lawyer Shang Baojun said. "According to my understanding, the charge was 'picking quarrels and stirring up trouble'," Shang told RFA on Thursday. "But I haven't seen the judgment."

Foreign and Defense Affairs

U.S. presses Cambodia over possible Chinese military presence - Reuters A letter to the Cambodian defence minister, seen by Reuters, reflects concern in Washington about the Chinese military presence in Southeast Asia, where China is increasingly assertive over its contested claims in the South China Sea.

Navy eyes shipyard in Philippines as repair and maintenance facility - Stripes “The U.S. Navy is exploring the viability of Subic Bay Hanjin Shipyard for use as a potential repair and maintenance facility,” Cmdr. Nate Christensen, the fleet deputy public affairs officer, said in an email Wednesday.

Orientations for the Chinese Clergy, respecting their freedom of conscience - The Holy See The signing of the Provisional Agreement between the Holy See and the People’s Republic of China regarding the appointment of Bishops in September 2018 represented a new beginning in Chinese-Vatican relations and led to the initial important result of the full communion of all Chinese bishops with the Pope. However, not all issues were resolved: the Agreement represents only the first step of the process. Today, one of the difficulties concerns the request for all priests and bishops to register officially with the authorities, as required by Chinese law. Despite the commitment to finding a shared and acceptable solution, in many regions of the People’s Republic of China, priests are asked to subscribe to texts which are incompatible with the doctrine of the Catholic Church, creating struggles of conscience, when they are asked to accept the principle of independence, autonomy and self-management of the Church in China.

China’s Liberal Hawk: Yan Xuetong’s Vision for Chinese Benevolent Dominance | The Diplomat Despite his reputation as a hardliner, being an alumnus of the research arm of China’s Ministry of State Security, and having served as an adviser for the state-run television channel CCTV, Yan Xuetong is not an apologist for the political system of the People’s Republic. While Yan has portrayed his new book in Chinese media outlets as an overview of what China’s leaders have done right, in Leadership and the Rise of Great Powers he issues a fundamental critique of the Communist Party’s governance.

Brazil's Bolsonaro Calls Off Xi Meeting Over Chinese Delay - Bloomberg Bolsonaro’s spokesman Otavio Rego Barros said the delegation had to pack its luggage and make sure it was on time for the flight on the presidential airplane. “The president decided to call off this bilateral meeting,” he said. “The meeting was much delayed already, we were waiting in the bilateral meeting room.”

Docs Show Navy Got 'UFO' Patent Granted By Warning Of Similar Chinese Tech Advances - The Drive the Chief Technical Officer (CTO) of the Naval Aviation Enterprise personally wrote a letter addressed to the examiner claiming that the U.S. needs the patent as the Chinese are already “investing significantly” in these aerospace technologies that sound eerily similar to the UFOs reported by Navy pilots in now well-known encounters. This raises the question, are the Chinese developing or even already flying craft leveraging similar advanced technology and is the Navy now scrambling to catch up?

America’s Monopoly Crisis Hits the Military | The American Conservative There’s no better example than China’s takeover of the rare earth metal industry, which is key to both defense and electronics. The issue has frequently made the front page during the recent trade war, but the seldom-discussed background to our dependence on China for rare earths is that, just like with telecom equipment, the United States used to be the world leader in the industry until the financial sector shipped the whole thing to China.

China pressured London police to arrest Tiananmen protester, says watchdog | The Guardian Police watchdog investigators then found evidence that the Met’s treatment of Shao, one of the last protesters in Tiananmen Square in 1989, was influenced by pressure from Beijing to ensure Xi was not “embarrassed” by protests during his visit. Following Chinese pressure, documents show UK government officials, understood to be from the Home Office, also made “unusual requests” to the police about managing the state visit, an intervention that one officer described as “unprecedented”.

Palace: Duterte fishing deal with Xi an 'informal agreement' | Inquirer Globalnation The agreement between President Rodrigo Duterte and Chinese President Xi Jinping to allow Chinese fishermen to trawl in the Philippines’ exclusive economic zone (EEZ) was only an “informal agreement,” Malacañang said Monday...The issue on the Philippines’ EEZ again became a hot issue after a Chinese trawler rammed a Filipino boat at Recto Bank in the West Philippine Sea last June 9.

Vladimir Putin says liberalism has ‘become obsolete’ | Financial Times $$ Turning to the US-China trade war and geopolitical tensions in the Gulf between the US and Iran, Mr Putin said the situation had become “explosive”. The problem, he said, stemmed from American unilateralism and the lack of rules underpinning world order. // Comment: Xi says the same thing

New Report Exposes China's Malign Influence and Corrosion of Democracy Worldwide | IRI “This report offers an unprecedented in-depth look at the Chinese Communist Party’s (CCP) influence tactics and their effect on democracies across the developing world,” said David Shullman, IRI Senior Advisor and the editor of the report.
The report, entitled "Chinese Malign Influence and the Corrosion of Democracy," brings together research by experts from 12 vulnerable democracies — Cambodia, Pakistan, Sri Lanka, Serbia, Ecuador, Zambia, Mongolia, Hungary, The Gambia, Myanmar, Malaysia and the Maldives — and provides local perspectives on how China is impacting the politics and economics of these countries...The BRIDGE initiative, funded by the National Endowment for Democracy, looks to addresses the challenge to democracy from authoritarian regimes such as China by increasing knowledge of the nature of authoritarian tactics and engaging stakeholders to develop and implement their own strategies to confront these tactics.

Iran approves visa-free travel for Chinese tourists - Xinhua


Chinese Cyber-Operatives Boosted Taiwan’s Insurgent Candidate – Foreign Policy Kaohsiung Mayor Han Kuo-yu is already eyeing a run for the presidency in 2020 and is seen as the godsend that Beijing has been waiting for: the emergence of a populist, pro-China candidate in Taiwan. But Han’s rise from obscurity to superstardom had a little help: a campaign of social media manipulation orchestrated by a mysterious, seemingly professional cybergroup from China. As Taiwan’s presidential elections approach, with Han as one of the front-runners for the opposition Kuomintang (KMT) party, just who is surreptitiously backing him—and why—is a matter of critical importance.

Taiwanese president to go on ‘democracy mission’ to Caribbean allies, with stops in the United States | South China Morning Post Tsai will leave on July 11 for a 12-day visit in Haiti, St Kitts and Nevis, St Vincent and the Grenadines, and St Lucia, stopping in two US cities for two nights each on her way to Haiti and back from St Lucia. // Comment: New York and Denver sound the likeliest

Tech and Media

TikTok’s Videos Are Goofy. Its Strategy to Dominate Social Media Is Serious. - WSJ Sometime in 2018, executives at Snap Inc. realized their biggest advertiser was also a rising competitor. It was an addictive app featuring cat videos, pranks and people doing robot dances. The Chinese video-sharing app TikTok was splurging by spending nearly $1 billion on advertising for the year, according to a person familiar with the spending, helping turn it into the first ever Chinese consumer-tech company to break out big in the U.S. TikTok has also flooded Facebook Inc. and Instagram with ads, rattling the social-media giants by targeting their audiences on their own turf.

Memes Are the New Pop Stars: How TikTok Became the Future of the Music Industry - The Ringer TikTok—a Chinese-owned social network with an app that has been downloaded 950 million times—has minted a new class of trap-heavy rappers like Lil Nas X, Sueco the Child, and Supa Dupa Humble. Its apparent power as a marketing tool may very well shape a new genre of music and present a new set of challenges for traditional record labels.

Oracle, IBM Ditched as Top Chinese Startups Favor Home-Made Tech - Bloomberg Beijing-based PingCAP already counts more than 300 Chinese customers. Many, including food delivery giant Meituan, its bike-sharing service Mobike, video streaming site iQIYI Inc. and smartphone maker Xiaomi Corp. are migrating away from Oracle and IBM’s services toward PingCAP’s, encapsulating a nation’s resurgent desire to Buy China.

Why are millions of Chinese expats using VPNs to get back inside Beijing's Great Firewall? - ABC News (Australian Broadcasting Corporation) Among the three most popular is Transocks, which told the ABC it has almost 10 million devices connected worldwide — mostly international students and Chinese people living abroad — since it was set up just over two years ago.

Online Grocery Shopping, the Latest Battlefield for E-Commerce Giants- PingWest After getting everyone used to meal delivery in China, internet companies are going one step ahead, targeting those who still prefer to cook themselves: grocery delivery. The new trend, championed by nearly every Chinese tech giant you can think of, is growing 40% year-on-year and could be worth 194.78 billion RMB or roughly 28.3 billion U.S. dollar,  according to an iResearch report

Faces for cookware: data collection industry flourishes as China pursues AI ambitions - Reuters In a village in central China’s Henan province, amid barking dogs and wandering chickens, villagers gather along a dirt road to trade images of their faces for kettles, pots and tea cups...The project...is collecting material that could train AI software to distinguish between real facial features and still images.

Society, Arts, Sports, Culture and History

Saving China’s Dialects? There’s an App for That - SixthTone Despite decades of concerted government effort, tens of millions of Chinese, including Xu’s father, still speak little-to-no Standard Mandarin, instead communicating in one or more of the country’s thousands of distinct regional and local vernaculars. It’s Xu’s job to increase the accuracy of iFlytek’s input method — and the software’s potential scope — by using deep learning techniques to teach the program these dialects.

After Cancellations, Music Students Advised To Test in Shanghai - Sixth Tone Last Monday, the ABRSM, which offers certifications in a variety of musical instruments as well as music theory to students based around the world, published a short announcement on its website stating that, “In order to comply with the law enforcement demands of local government bodies, ABRSM exams will be suspended in some Chinese cities.” On Thursday, it specified that the four impacted cities are Kunming, Chengdu, and Chongqing in southwestern China and Wuhan in central China.

Will the next prime minister betray Hong Kong again? - Michael Sheridan - The Spectator We knew that her meeting with Deng in September 1982 was grim. ‘A tiny man who radiated power,’ says a British official who advised her. Deng dismissed the 19th-Century treaties granting Hong Kong Island and part of the Kowloon peninsula to Britain in perpetuity. She was shocked. Deng said he could take Hong Kong in an afternoon. He chain-smoked and spat. But I did not know that when Mrs Thatcher steadied and held her ground, the Chinese leader had private cause for doubt. Memoirs by Chinese officials and Communist Party histories – all laudatory of their own wisdom, of course – show that her firmness changed Deng’s political calculations.

Energy, Environment, Science and Health

Legislature's role in enforcing water pollution control law stressed - Xinhua China's top legislator on Sunday reiterated the role of people's congresses and their standing committees in implementing water pollution control law. Li Zhanshu, a member of the Standing Committee of the Political Bureau of the Communist Party of China Central Committee and chairman of the Standing Committee of the National People's Congress (NPC), presided over and delivered a speech at a meeting where reports on the enforcement of the water pollution control law were heard.

Shanghai begins new waste sorting era, as China eyes cleaner image | South China Morning Post The city’s ambitious waste and recycling rules took effect on Monday, aiming to emulate successes of comparable policies in Japan, Taiwan and California

Food and Travel

Go Bold at Da Long Yi Hot Pot | The New Yorker When Da Long Yi, a hot-pot chain reputed to be one of Chengdu’s finest, opened its first American outpost, in Manhattan’s Chinatown, in May, it led with the tagline “Let the world fall in love with Chengdu’s flavor!”

Rural and Agricultural Issues

Guidelines on rural industry revitalization released - Gov.cn The document calls for efforts to develop rural industries with unique local features, give full play to the decisive role of the market in allocating resources, conserve natural resources and protect the environment.

China finds armyworm in major corn producer Shandong: Beijing News - Reuters The pest, first detected in the southwestern province of Yunnan in early January, has spread to Shandong but has not damaged crops in the northern province, Beijing News reported