May 4 and patriotism; Clash of civilizations?; Huawei

Happy International Workers Day!

Thanks for your patience and condolences over the last week, I am back in DC and looking forward. Given that China is on holiday through the weekend normal publishing will resume on Monday.

Thanks for reading.


1. The Party commemorates the May 4th Movement

Xi urges patriotism among youth, striving for brighter China - Xinhua

"As long as the banner of patriotism is being held high, the Chinese people can unleash great powers in the endeavors to transform China and the world," Xi said.

The essence of patriotism is having unified love for the country, the Party and socialism, Xi added, urging young Chinese to follow the instructions and guidance of the Party, and remain dedicated to the country and the people.

Young people are also urged to establish belief in Marxism, faith in socialism with Chinese characteristics, as well as confidence in the Chinese Dream of national rejuvenation...

"We should listen to young people's views on social issues and phenomena, as well as their opinions and advices on the work of the Party and the government," Xi said.

"Even if they express harsh or partial criticism, we should correct our mistakes when we have made any and guard against them when we have not," he added.

Xi called on the Party to address young people's concerns and asked the Communist Youth League of China to unite and lead the young people to strive for the national rejuvenation [Comment: now that Xi has brought the youth league to heel he, as expected, looks to be reshaping it as a organization dedicated to advancing his agenda]

Here is the nearly 17 minute report on the Tuesday CCTV Evening News on the gathering - 纪念五四运动100周年大会在京隆重举行 习近平发表重要讲话

To be snarky, the youth in the audience look like the kind of kids that would not be fun to have at a party. To be serious, be wary of underestimating how many believe in the patriotic and increasingly jingoistic propaganda and Xi's repeated claims that China is closer than it has ever been to National Rejuvenation, or of how many sycophants and opportunists there are in a country as large as China who see safety and opportunity in embracing the Party line. 

There is also no question that China is closer to National Rejuvenation than it has been at any time since the Opium Wars. Omnipresent propaganda based in kernels of truth married to efficient and ruthless security services can be very effective. 

Xi Praises a Student Protest in China. From 100 Years Ago. - The New York Times

The May 4, 1919, protest against Western colonialism had inflamed Chinese nationalism and helped spread a wave of ideas rejecting Chinese tradition and hierarchy. In a speech marking the centenary of the event, Mr. Xi extolled the patriotic image of May 4 while ignoring its anti-authority themes.

“History profoundly reveals that patriotism has flowed in the blood of the Chinese nation since ancient times,” Mr. Xi said in the Great Hall of the People, next to Tiananmen Square. “Those who are unpatriotic, who would even go so far as to cheat and betray the motherland, are a disgrace in the eyes of their own country and the whole world.”..

China’s Xi looks to stoke nationalism as Tiananmen anniversary approaches - The Washington Post

“The great historical significance of the May 4th Movement shows that student campaigns can be promising only when they are integrated into a story of national rejuvenation and when they receive the correct guidance,” Zheng Shiqu, professor of history at Beijing Normal University, wrote in a commentary in the People’s Daily [人民日报人民要论:激励广大青年为民族复兴不懈奋斗]


2. US-China trade

U.S., China Conclude Productive Trade Talks, but Sticking Points Remain - WSJ $$:

Other issues, particularly Beijing’s support for domestic companies, remain unresolved, leaving negotiators confronting a full agenda for meetings in Washington next week that are expected in part to focus on a draft agreement in Chinese and English. Chinese Vice Premier Liu He is leading more than 100 officials from over a dozen government agencies for the talks, in a sign Beijing thinks final details can be ironed out, these people said.

China deal close to done - POLITICO

In a sign a U.S.-China deal may be at hand, the two sides have agreed to a schedule for removing some of the tariffs, said one source familiar with the text of the agreement. The update comes as U.S. Trade Representative Robert Lighthizer and Treasury Secretary Steven Mnuchin continue talks this week in Beijing.

The plan would immediately remove the 10 percent tariff on a portion of the $200 billion worth of Chinese imports and schedules removal of the tariff from the rest of the items “quickly,” the source said, declining to offer a specific time period. The 25 percent tariff would likely stay in place until after the 2020 election, leaving it to a second-term Trump administration or a new president to deal with

Trump drops cyber theft demands in bid for swift trade deal with China | Financial Times $$

Mr Trump has softened his administration’s opening position on what it originally characterised as “Chinese government-conducted, sponsored, and tolerated cyber intrusions into US commercial networks”, according to several people briefed on the negotiations. The US is instead likely to accept a watered-down commitment from Beijing as an alternative.

China Further Opens Financial Industry Amid U.S. Trade Talks - Bloomberg

China took another step in opening its $44 trillion financial sector to the world, announcing plans to remove limits on ownership in local banks and scrap size requirements for foreign firms that operate onshore.

Among the changes, overseas insurance groups will be allowed to set up units in the world’s second-biggest economy, the China Banking and Insurance Regulator said on Wednesday as high-level trade talks between China and the U.S. got underway in Beijing.

Comment: Nice timing, throwing bones to Wall Street to incentivize them further to lobby Trump to make a deal


3. US-China beyond trade

I don’t see anything but friction and competition ahead, no matter how hard both sides try to spin any possible trade deal.

If the U.S. and China Make a Trade Deal, Then What? | ChinaFile Conversation

Orville Schell - In sum, because our bilateral relations face far more than a friendly competition in need of a few minor adjustments to function smoothly, we’d be foolish not to recognize that behind the current dispute over tariffs lies two very different systems of governance, as insoluble as oil and water. Especially as the Chinese state becomes more interested in using its economy as a strategic tool in increasingly adversarial ways that have both a military and geopolitical dimension, it would be naïve to imagine that a trade deal will be anything more than an epiphenomenon.

Charles Edel - While a potential trade deal would be a start towards recalibrating the relationship, a much broader strategic reset is also necessary. But a new strategy towards China will not take shape until Washington can address questions beyond economics and trade. Political leaders must better explain why America is competing with China, in which domains, with what resources, and for how long the country is willing to sustain such a competition. Competition can be used as a spur to shore up American strengths. But doing so will take sustained popular support that will only come when the public understands the stakes.

U.S. Will Unveil New Indo-Pacific Strategy Next Month - USNI News

The Pentagon will unveil a new Indo-Pacific strategy at the Shangri-La Dialogue this May, Assistant Secretary of Defense for Indo-Pacific Security Affairs Randall Schriver told a media roundtable in Kuala Lumpur, Malaysia, last week.

Acting Secretary of Defense Patrick Shanahan’s speech at the Singapore event will focus on the new Indo-Pacific Strategy Report and articulation of the new U.S. Indo-Pacific strategy, Schriver said.

Special Report: China's vast fleet is tipping the balance in the Pacific - Reuters: 

“We thought China would be a great pushover for way too long, and so we let them start the naval arms race while we dawdled,” said James Holmes, a professor at the U.S. Naval War College and a former U.S. Navy surface warfare officer.

China’s Xinjiang an ‘enormous risk’ for US business, Pompeo warns | South China Morning Post

“We watch the massive human rights violations in Xinjiang where over a million people are being held in a humanitarian crisis that is the scale of what took place in the 1930s,” he said on Tuesday, as he received an award from the Business Executives for National Security group.

“And we see American businesses and their technology being used to help facilitate that activity from the Chinese government. It’s something worthy of thinking about.”

And just in case the business community gets excited about a possible trade deal, this awful case is a good reminder of the perils of the PRC legal system - The Dui Hua Foundation-Chinese Court Sentences American Mark Swidan to Death with Two-Year Reprieve

After spending nearly six and a half years in a Chinese detention center without having been convicted of a crime, 44-year-old American businessman Mark Swidan has been found guilty of trafficking and manufacturing drugs and sentenced to death, suspended for two years...

“At the hour of Mark Swidan’s sentencing, American Treasury Secretary Mnuchin and Trade Representative Lighthizer were in Beijing to discuss a deal to end the trade war between the United States and China,” noted John Kamm, Dui Hua’s executive director. “Both countries agree that the ultimate success of any agreement to end the trade war depends on enforcement in a system based on judicial transparency and due process. The Swidan family was never told why the judgment was repeatedly extended, a violation of a basic norm of transparency. Mr. Swidan’s rights to a fair trial and due process have been seriously abused. This is a sad day for justice in China.”

Mr. Swidan’s sentence is believed to be the first time an American citizen has been sentenced to death, suspended for two years, by a Chinese court.


4. Clash of civilizations?

State Department preparing for clash of civilizations with China - Washington Examiner

“This is a fight with a really different civilization and a different ideology and the United States hasn't had that before,” Kiron Skinner, the director of policy planning at the State Department, said Monday evening at a security forum in Washington, D.C.

Skinner is leading an effort to develop a concept of U.S.-China relations on the scale of what she called “Letter X” — the unsigned essay by George Kennan, who assessed “the sources of Soviet conduct” in 1947 and outlined the containment strategy that guided American strategists for the rest of the Cold War. China poses a unique challenge, she said, because the regime in Beijing isn’t a child of Western philosophy and history.

“The Soviet Union and that competition, in a way it was a fight within the Western family,” Skinner said, noting Karl Marx’s indebtedness to Western political ideas. “It’s the first time that we will have a great power competitor that is not Caucasian.”

Xi's article on exchanges and mutual learning between civilizations published - Xinhua

The article by Xi, also Chinese president and chairman of the Central Military Commission, was titled "Exchanges and Mutual Learning Between Civilizations Form an Important Drive for Progress of Human Civilization and World Peace and Development."

The article said different civilizations should be encouraged to respect each other and live in harmony so that exchanges and mutual learning between civilizations will become a bridge promoting friendship between people around the world, an engine driving the progress of human society and a bond cementing world peace...

The article called for a broad mind toward different civilizations and the need to draw wisdom and nourishment from them.

The article said the Chinese people will encourage creative shifts and innovative development of the Chinese civilization to let it join efforts with other rich and colorful civilizations to provide humanity with the right cultural guidance and strong motivation.

The article - 文明交流互鉴是推动人类文明进步和世界和平发展的重要动力

Comment: So it is not clear Xi would disagree with reported US State Department characterization of China as different civilization.


5. Canada-China

Trudeau’s strong message to the White House: Don’t do China deal while Canadians remain detained - The Globe and Mail

The Trudeau government is laying it on the line, you might say. Through its ambassador in Washington, it has delivered a message to the White House: Don’t sign a trade deal with China while Canadians are being held hostage in that country.

Envoy David MacNaughton has been blunt with top members of the Trump administration. What he has told them, he said in an interview, is “There’s no way you would do a trade deal with China if they had jailed two of your citizens. We’ve got two of our citizens in jail in China as a result of our actions on your behalf. You should be treating those people as if they are American citizens.”

Second Canadian sentenced to death in China for drug smuggling - CNN

A Canadian citizen has been sentenced to death in China for producing and trafficking a large amount of methamphetamine, a Chinese court announced Tuesday.

The verdict marks the second time a Canadian citizen has been sentenced to death on drug charges in China this year, amid escalating tensions between the two countries over the arrest of a Huawei executive.

Rising calls for China to get tough on Canada, as Ottawa escalates diplomatic spat - Global Times

There are growing calls in China for the government to take tough measures against Canada, as several senior Canadian officials said Ottawa might further escalate diplomatic tensions between the two countries over the case involving a Huawei executive.

Expressing anger toward Canadian officials in their handling of the case of Huawei CFO Meng Wanzhou, many took to social media platform Weibo to urge the Chinese government to take firm action that should inflict pain on the Canadian economy, including restricting imports of Canadian agricultural goods, pork, seafood and beyond.

This is the resistance to China’s influence in Canada, and this is their moment | The Star

Clive Hamilton is a professor of public ethics at Charles Sturt University in Canberra, Australia, who has been a harsh critic of attempts to influence his own country’s politics.

Hamilton told Star Vancouver his recent trip to Canada left him “quite worried about the capacity of Canada to extricate itself from the unwelcome and undemocratic influence of the Chinese Communist Party.”

He said it’s clear China has been “cultivating” friends in high places and penetrating Canadian institutions for some time. He’s worried agreements could be made by Canada’s biggest political parties to avoid the topic this year.


6. Huawei

Vodafone Found Hidden Backdoors in Huawei Equipment - Bloomberg

The documents chronicle a two-month period during which Vodafone’s Italian unit discovered the telnet service, demanded its removal by Huawei and received assurances from the supplier that the problem was fixed. After further testing, Vodafone found that the telnet service could still be launched...

Vodafone said Huawei then refused to fully remove the backdoor, citing a manufacturing requirement. Huawei said it needed the telnet service to configure device information and conduct tests including on wifi, and offered to disable the service after taking those steps, according to the document...

But

Vodafone has defended Huawei against the U.S. onslaught, which has placed Europe—Huawei’s largest market outside China—in the middle of a trade battle between two superpowers. At stake is leadership in key areas, principally 5G technology that’s designed to support the internet of things and new applications in industries spanning automotive, energy to healthcare. Vodafone Chief Executive Officer Nick Read has joined peers in publicly opposing any bans on Huawei from 5G rollouts, warning of higher costs and delays.

This could be a bombshell but given Bloomberg's flub of the story a few months ago claiming Chinese hidden spy chips this latest report should be taken with a huge grain of salt. The reporter took to Twitter earlier today to defend the Vodafone report:

Huawei says alleged router 'backdoor' is standard network tool | The Guardian

Huawei said in a statement: “The story published by Bloomberg today is misleading. It refers to a maintenance and diagnostic function, common across the industry, as well as vulnerabilities, which were corrected over seven years ago. There is absolutely no truth in the suggestion that Huawei conceals backdoors in its equipment.”

A spokesman for Vodafone said: “The ‘backdoor’ that Bloomberg refers to is telnet, which is a protocol that is commonly used by many vendors in the industry for performing diagnostic functions. It would not have been accessible from the internet. Bloomberg is incorrect in saying that this ‘could have given Huawei unauthorised access to the carrier’s fixed-line network in Italy’.

The damage from Bloomberg’s earlier spy chip story is done, whether it was true or not. Or, perhaps the goal - pressure to decouple US supply chains from China - of the people who some think may have planted the story has been achieved? - Server maker Super Micro to ditch 'made-in-China' parts on spy fears - Nikkei Asian Review

Super Micro, the world's third-largest server maker by shipments after HP and Dell, has strongly denied allegations made last October that its Chinese made motherboards had been implanted with malignant chips to hack big tech customers such as Apple and Amazon. Independent testing showed no evidence of the claims made by Bloomberg Businessweek, the group has said.

Nevertheless, U.S. customers and especially government-related clients have asked Super Micro not to supply them with motherboards made in China because of security concerns, according to one company executive.

U.S. cyber official, British telcos to discuss Huawei in London meeting - Reuters

Security officials from British telecoms operators are to meet with the leading U.S. diplomat on cybersecurity in London on Tuesday to discuss the risks of equipment made by China’s Huawei, according to five people familiar with the matter. 

Comment: I believe the US sent someone more senior than just Robert Strayer, deputy assistant secretary for cyber at the U.S. State Department

The true cost of signing up with Huawei | Financial Times - Charles Parton

the formidably resourced Huawei propaganda machine wants to convince you that “if you don’t trade with Huawei, you don’t trade with China”. Now that is hysterical nonsense. Will China really not trade with the other Five Eyes countries, Japan, India? The CCP, already economically hard-pressed, knows that the resulting unemployment in China might lead to unrest directed against itself.

And remember: for all that the CCP likes to conduct doghouse diplomacy, in the two years of punishment after the 2010 meeting between Prime Minister David Cameron and the Dalai Lama, UK trade with China rose. So did Norway’s over the six years it spent in the kennel because of the award of the Nobel Prize to the dissident Liu Xiaobo. China needs others as much as others need China.

Huawei a touchstone for ties with China - Global Times

We pity the UK. Its independence has been heavily damaged. It has partly forsaken its sovereignty to a pledge to the US. The UK's independence now seems weaker than its former colony India...

On the Huawei issue, there are two types of countries: those that follow the US and boycott Huawei and those that do not. China's attitude toward these countries should be different. China should keep firmly in mind that Australia took the lead in boycotting Huawei.

‘Striding Across the Pacific’: Huawei’s Identity Problem - The New York Times

Huawei’s structure looks strikingly similar to the party’s. Each is run by a senior group of seven officials, with similarities even further down the line. It calls its management training program its Central Party School, which is the name of the Communist Party institution that trains promising cadres.

When it comes to team-building and loyalty-building, Mr. Ren turned to the party’s system of self-criticism, in which cadres confess to their misdeeds. Self-criticism sessions are called “democratic life meetings,” just like the party’s...

Huawei also routinely holds ceremonies for its executives, from the board down, to pledge integrity and honesty, much as the party does. Mr. Ren, a former military engineer, also infuses Huawei with a militant culture. He sometimes refers to major business deals as a “Battle for Triangle Hill,” a reference to a clash during the Korean War that included Chinese and American troops.

Czech President Milos Zeman says West’s allegations of espionage against Huawei are not supported by evidence | South China Morning Post

Xi said China was willing to work with the Czech Republic to take their partnership to a “new level” and he hoped Prague would play a constructive role in promoting relations between China and the rest of Europe.

Czech presidential office spokesman Jiri Ovcacek was quoted by local media as saying that Zeman maintained that “the campaign against Huawei was not based on evidence”.


7. BRI “debt trap” data

I missed all the fun around the BRI. I can’t say I was surprised by anything that came out of the forum, Beijing has been signaling for months that it was tweaking the BRI policies. BRI is here to stay, US opposition to it may have impacts on the margins but will fail to derail it, and it risks causing tensions with allies, a benefit Beijing appreciates, and appreciated in the US stupidity over the AIIB in the last administration.

However flawed the plans may be, China at least is offering a plan to countries who want infrastructure development and increased trade with the PRC. And the clean governance and anti-corruption talk from Xi is probably real when it comes to lower-level officials and executives involved in BRI deals, but when it comes to elite bribery I will bet that is a feature of the program to buy deals and influence, and one that is not going away any time soon. But didn’t the West bribe lots of foreign officials during the Cold War? It is a great way to win friends and influence people, though of course it is just awful when the other side does it…

Why China’s belt and road loans may not be the debt trap other countries fear | South China Morning Post

The Rhodium Group’s research looked at 40 cases of external debt renegotiation between 2007 and this year and found there was only one confirmed case of asset seizure – in Sri Lanka.

The conclusions, based on the studies of Chinese debt renegotiations with 24 countries in Asia, Africa and Latin America, challenge claims that the Belt and Road Initiative will leave countries with debts they cannot repay and force them to hand over assets or natural resources to Beijing.

New Data on the "Debt Trap" Question | Rhodium Group

Debt renegotiations and distress among borrowing countries are common. The sheer volume of debt renegotiations points to legitimate concerns about the sustainability of China’s outbound lending. More cases of distress are likely in a few years as many Chinese projects were launched from 2013 to 2016, along with the loans to finance them.

Asset seizures are a rare occurrence. Debt renegotiations usually involve a more balanced outcome between lender and borrower, ranging from extensions of loan terms and repayment deadlines to explicit refinancing, or partial or even total debt forgiveness (the most common outcome).

Despite its economic weight, China’s leverage in negotiations is limited. Many of the cases reviewed involved an outcome in the favor of the borrower, and especially so when host countries had access to alternative financing sources or relied on an external event (such as a change in leadership) to demand different terms.


8. Self-reliance 自力更生

Mao Redux: The Enduring Relevance of Self-Reliance in China - MacroPolo

But talk of a rapid revival of Maoism under Xi is off the mark. Xi is hardly the first head of the Chinese Communist Party (CCP) to be inspired by Mao Zedong Thought. In fact, self-reliance is a good case study of the abiding relevance of certain ideas in CCP thought.

While self-reliance was championed by Mao, it is a concept that has been supported by all subsequent leaders, even if its application has evolved over time. That’s because self-reliance fundamentally means that the CCP will retain ultimate control over China’s economic development—an enduring consensus that has heavily influenced policy across generations of leaders.

In many ways, Xi has built upon longstanding CCP principles that are larger than himself. Misinterpreting such concepts as merely “Xi issues” actually diminishes their importance as core “CCP issues” that would likely be pursued irrespective of who holds power in Zhongnanhai.


Business, Economy and Trade

Why Apple CEO Tim Cook believes sales in China won't suck anymore - Yahoo Finance Cook cited three reasons for the long sought after stabilization in China. First, Cook said Apple slashed the price on the iPhone in China to stimulate demand. Second, Cook credited the Chinese government’s stimulus efforts as helping to prop up demand for consumer goods. And lastly, changes to how Apple accepts iPhones for trade-ins and financing of new devices was well-received in the quarter.

In Depth: Private Placements Set for Comeback as Need for Cash Trumps Abuse - Caixin policymakers have been forced into a rethink after the changes were criticized by market participants and contributed to a destabilizing cash crunch among listed companies in 2017 and 2018 that fueled a stock market slump.

Chinese Banks Plan to Issue $77 Billion of Perpetual Bonds - Caixin Many Chinese banks are running low on capital after a national deleveraging campaign required them to set aside greater amounts of capital to hedge off-balance sheet assets. At the same time, banks have tapped considerable capital in disposing of bad loans.

Cosco Unit to Sell U.S. Long Beach Container Terminal - Caixin Global  The sale is part of Cosco’s agreement with the U.S. government to clear its $6.3 billion takeover of OOIL in 2017.

Yicai Global - China Lowers Firms' Social Insurance Costs to Spur Economic Growth The government has decreased urban workers' basic pension premiums to 16 percent from the earlier rate between 19 percent and 20 percent, following the cabinet's plan, state-backed Xinhua News Agency reported.  The rate cut can help companies to save around CNY190 billion (USD28.2 billion) each year, You Jun, vice minister of the Ministry of Human Resources and Social Security, wrote in the report.

Yicai Global - Chinese Mainland Stock Indexes End Month Lower for First Time This Year Throughout April, the Shanghai benchmark lost 0.4 percent, the Shenzhen core index fell 2.35 percent and the ChiNext index slumped 4.12 percent.

Editorial: Anti-Corruption in Finance Goes Hand-in-Hand With Market Development_财新英文_财新网 There are clear signs of anti-corruption efforts in the financial sector. Recently, there have been large-scale personnel changes to discipline inspection teams at major financial institutions and regulatory bodies. In addition, the discipline inspection groups at central financial enterprises are now assigned by the Central Committee for Discipline Inspection (CCDI) rather than being built-in

China closes online currency regulation loopholes to ease fears over foreign exchange transactions | South China Morning Post The State Administration of Foreign Exchange (SAFE) announced on Monday that it will require all the cross-border payment businesses, which mainly provide services for individuals and corporations using e-commerce platforms, to register with local authorities.

Boxed in: $1 billion of Iranian crude sits at China's Dalian port - Reuters Some 20 million barrels of Iranian oil sitting on China’s shores in the northeast port of Dalian for the past six months now appears stranded as the United States hardens its stance on importing crude from Tehran.

China to upskill workforce to expand employment - Xinhua China will finance vocational training with 100 billion yuan (about 14.8 billion U.S. dollars) from the country's unemployment insurance fund balance to upskill the workforce, according to an executive meeting of the State Council. The meeting presided over by Premier Li Keqiang Tuesday decided that a special capital account will be established to advance the task of vocational skills upgrading.

China’s ‘charming towns’ plan turns into a nightmare for investors, amid legal crackdown | South China Morning Post There are thought to be 3,800 individual investors exposed to JC Group’s collapse, and while no figure has been put on the expected total losses, the minimum threshold for these investments was set at 1 million yuan (US$148,480).


Politics and Law

Qinghai passes rule to promote ethnic unity - Global Times Spreading comments, collecting or producing information that is bad for ethnic unity or advocating religious extremism and sabotaging ethnic unity, inciting national separatism and damaging national security are not allowed, the Rule to Promote Ethnic Unity and Progress of Qinghai Province reads...Qinghai is not the first province to pass such a rule. Southwest China's Guizhou Province and Northwest China's Xinjiang Uyghur Autonomous Region implemented similar rules in 2015 and 2016 respectively.

Chinese Media Warn WeChat Group Admins: "You Can Be Arrested for What Happens in Your Group Chat" | What's on Weibo Chinese media are reminding group admins this week that managing a group chat is “not a joke.” Cautionary headlines read: “Who sets up a group is responsible for it! Many group leaders have already been detained.”

"Be as Good as Your Word": The Chinese Social Credit Song is Here | What's on Weibo “Be as Good as Your Word” is a pop song featuring young Chinese celebrities who sing about the importance of being ‘trustworthy.’ The new music video is part of a bigger initiative propagating China’s Social Credit System among the younger generation...

Vice-governor of China’s Sichuan province Peng Yuxing ‘taken away in corruption investigation’ | South China Morning Post In 2015 he was promoted to party chief of Mianyang, an important research and production base for the defence industry.// Comment: There is speculation in overseas media that this may actually be a national security case, not a simple corruption one


Foreign and Defense Affairs

US warns China on aggressive acts by fishing boats and coast guard | Financial Times $$ Admiral John Richardson, head of the US navy, said he told his Chinese counterpart, vice-admiral Shen Jinlong, in January that Washington would not treat the coast guard or maritime militia — fishing boats that work with the military — differently from the Chinese navy, because they were being used to advance Beijing’s military ambitions.

US accuses China of enabling corruption and undermining national sovereignty in Latin America | South China Morning Post Kimberly Breier, assistant secretary of state for western hemisphere affairs at the US State Department, told an Americas Society event in Washington that China failed to meet the America’s standards for transparency, anti-corruption and debt sustainability.

Four Chinese scientists killed in Sri Lanka's suicide bombings - Times of India Four oceanic scientists were among the six Chinese nationals killed during the Easter Sunday bomb blasts in Sri Lanka, the Chinese Embassy in Colombo said. The deceased included Li Jian, 38, and Pan Wenliang, 35, who were senior engineers at the South China Sea Institute of Oceanology of the Chinese Academy of Sciences (SCSIO).

Chinese investment in Cambodia is bringing Phnom Penh closer to Beijing – and further from the EU | South China Morning Post Beijing’s pledge of US$90 million in support of Cambodia’s defence sector was among at least nine deals the Southeast Asian nation signed with China last week during the second Belt and Road Forum. The deals reaffirmed Phnom Penh’s close ties with the superpower, moving it further away from its major development partner, the European Union.

China Focus: Xi holds talks with Lao president to promote ties - Xinhua The two sides should also closely coordinate and cooperate within multilateral mechanisms such as the United Nations, East Asian cooperation and the Lancang-Mekong cooperation, said the Chinese president. // Cambodia and Laos are firmly in Beijing's pocket, and Myanmar looks not far behind

U.S. judge orders Chinese banks to hand over North Korea records - Reuters In a heavily redacted court opinion released by the U.S. Justice Department on Tuesday and dated March 18, Beryl Howell, Washington D.C.’s chief federal district judge, said the subpoenas were for records of dealings between a now-defunct Hong Kong-based front company and a North Korean state-run entity.

China: Determined to dominate cyberspace and AI - Bulletin of the Atomic Scientists The piece ends describing the Cyber Operational Resilience Alliance (CORA) to provide the public and private scale and collective strategic coherence required to ensure the future wellbeing and security of democracy in an overwhelmingly authoritarian, post-western, cybered world.

China plans to launch carrier rocket at sea - Xinhua The rocket has been named "CZ-11 WEY" under an agreement between the China Academy of Launch Vehicle Technology, China Space Foundation and a Chinese automobile producer. China's first seaborne rocket launch is scheduled for mid-2019 in the Yellow Sea, said Jin Xin, deputy chief commander of the rocket, at a press conference of the China Aerospace Science and Technology Corporation earlier this year.

Xi congratulates Naruhito on succession as Japan's new emperor - Xinhua In a congratulatory message, Xi said China and Japan are close neighbors with a long history of friendship. The two countries should make joint efforts to promote peace and development and work towards a bright future for bilateral ties, he added.

Palace: Bilateral talks best way to address South China Sea row | Philstar.com Malacañang believes holding bilateral talks is still the best option to resolve the South China Sea row even if China's aggressive actions in disputed areas persist after the creation of a bilateral mechanism intended to settle the dispute.  Presidential spokesman Salvador Panelo said no other party wants to intervene in the the long-standing dispute.

Pentagon to End Language Funding for Universities That Host Chinese Communist Party–Funded Confucius Institutes Last year, Congress passed a spending bill that ended Pentagon support for Chinese Flagship programs at colleges that also have Confucius Institutes, unless the Defense Department grants a waiver. But no waivers have been or will be granted to any of the 13 institutions that applied, the Pentagon confirmed to Newsweek.

The end of Chimerica: The passing of global economic consensus and the rise of US-China strategic technological competition | Australian Strategic Policy Institute | ASPI Chinese economic and trade malpractices over a long period of time are having profound distorting effects on the global economic system and US dissatisfaction is deepening and irreversible. Advanced economies such as the EU and Japan share identical concerns. There is little prospect of Australia ‘waiting out’ the US-China economic dispute. We can help shape and improve elements of a US-led collective effort to impose carrots and sticks on China to persuade the latter to play by the rules or sit and wait for a world which has already passed.

China Said to Maintain Australia Coal Go-Slow Until After Polls - Bloomberg China will maintain a slowdown in coal imports from Australia until Beijing has assessed government policy in Canberra after federal elections in May, according to people with knowledge of the plan. Chinese Customs in January told local officials to start controlling imports of Australian coal, without giving explicit instructions as to how or why.

Chinese influence in the Pacific Islands | Australian Strategic Policy Institute | ASPI This report finds that the concept of “soft power” is an overrated explanation for Chinese influence in the Pacific Islands.  The buzzword often disguises more than it reveals about Chinese influence in Australia’s nearest region. The author argues that “soft power” doesn’t explain China’s presence in the Pacific Islands region. Nor does it explain the extent of the PRC’s influence in the South Pacific.  China’s current influence in the Pacific Islands isn’t so much a consequence of its soft power but of its economic influence.”


Hong Kong and Macao

Hong Kong bookseller flees to Taiwan fearing extradition - AFP A Hong Kong bookseller who disappeared into Chinese custody for half a year said Friday he has fled to Taiwan after the financial hub announced plans to approve extraditions to the mainland.


Taiwan

Foxconn’s Gou Knows How to Play Local Governments off One Another_财新英文_财新网 Foxconn founder Terry Gou — who earlier this month announced plans to run in Taiwan’s next top leadership election — understands local politics very well and is shrewd in dealing with officials on the Chinese mainland. Any project involving his company Hon Hai Precision Industry Co. Ltd. — which trades as Foxconn — is usually too important an opportunity to pass up for local government officials hoping to attract investment and create manufacturing jobs that could be vital to their political career.

Chinese subsidies for Foxconn and Want Want spark outcry in Taiwan - Nikkei Asian Review Foxconn, the Taiwanese Apple supplier whose China-friendly founder is making a bid for the presidency, and media owner Want Want are among major companies from the island receiving hundreds of millions of dollars in subsidies from Beijing, raising questions about Chinese influence in the economy.


Tech and Media

China’s Tencent pitches vision of artificial intelligence ethics | Financial Times $$ In a rare interview, China’s most valuable publicly listed tech company said it favoured an approach to ethics that combined not only socially beneficial uses of AI for medical purposes or agriculture but also ensured a “social contract” between companies and users to govern the use of personal data.

WeChat blocks petition backing woman accusing tech mogul of rape - Inkstone A number of public WeChat accounts in China have been shut down after calling on people to join a petition in support of a University of Minnesota student who has accused a tech tycoon of rape. The accounts joined a campaign supporting the accuser after she filed a civil lawsuit against Richard Liu, the CEO of US-listed e-commerce giant JD.com, in a Minneapolis court last month. //Comment: Ugly, and Tencent owns a large stake in JD


Energy, Environment, Science and Health

Pristine Wilderness, China's Treasure | Rukor Hoh Xil is also “not an absolute no man’s land” even though China’s UNESCO nomination dossier repeatedly defines it as no-man’s land, and UNESCO’s IUCN team sent to the area to test China’s claims never spoke to a single nomad...All is explained, in an article reprinted from a 2009 exposé, of facts carefully concealed from UNESCO and IUCN. The villains are explicitly Hui, Chinese Muslims now classified as a minority ethnicity, whose mother tongue is standard Chinese, having no mother tongue of their own; in other words, Han Chinese who happen to be Muslim.

Hospital chiefs suspended over HPV vaccine scandal - Global Times Boao Yinfeng Healthcare International Hospital, a private hospital in Boao, Hainan Province was not certified to provide HPV vaccinations, which protect against certain forms of cancer. In addition, the vaccine is alleged to have been sourced from suspicious channels, which mean that the vaccine itself could be fake, according to a notice released by four Hainan authorities, including the Health Commission of Hainan and the provincial market and drug supervision bureaus.

China Building Hundreds Of Coal-Fired Power Plants Abroad : NPR Edward Cunningham, a specialist on China and its energy markets at Harvard University, tells NPR that China is building or planning more than 300 coal plants in places as widely spread as Turkey, Vietnam, Indonesia, Bangladesh, Egypt and the Philippines.


Education

Brill Severs Ties With Chinese Publisher - Inside Higher Ed Brill has terminated its relationship with the Beijing-based Higher Education Press to distribute four China-focused journals after scholars reported an entire article was removed from one of the journals by Chinese censors.