More on Xi's Shanghai Field Trip, "State Visit+" For Trump, Fake News Tracker
|Bill Bishop||Nov 1, 2017|
Welcome to November...today's issue is a bit light on commentary, not feeling like I have anything particularly incisive to say today. Thanks for reading.
The Essential Eight
1. More On Xi And The PBSC's Field Trip To Shanghai
Comment: Another reminder that Party is everything and everywhere for Xi. The Tuesday CCTV Evening News report editing made it very clear that there is Xi and then there are the other 6 guys who work for him...Wonder how Jiang Zemin feels about this Shanghai trip...
Xi called on CPC members to implement the Red Boat spirit in the new era, which highlights pioneering work, persistence and dedication.
In an address at the end of Tuesday's tour, Xi called the Shanghai and Jiaxing sites "the places where the CPC's dream set sail" and "the root of the Party."
"Our Party was born here, our journey began here, and our rule of the country all dates back to here," Xi said.
At the Shanghai site Xi looked at the exhibits showing how China had been carved up and brutalized by foreign invaders and "sighed repeatedly" saying "how humiliating, how disgraceful. back then China was a fat sheep awaiting slaughter" 习近平总书记连连感叹：“多屈辱啊！多耻辱啊！那时的中国是待宰的肥羊。” - 十九大后总书记第一次离京，五个细节耐人寻味-新华网
梦想，从这里启航——记习近平总书记带领中共中央政治局常委赴上海瞻仰中共一大会址、赴浙江嘉兴瞻仰南湖红船--Xinhua with the propaganda readout of the Shanghai field trip
2. China Promises "State Visit+" For Trump
Comment: Will Beijing also ensure the biggest crowds ever for a visiting President? And will they let him sit on the imperial throne during the Forbidden City tour? When the Chinese want to flatter no one does it better, and they clearly have identified President Trump as someone susceptible to flattery...
Trump will receive a "State visit-plus" featuring a military honor guard, official talks, formal banquet and "special arrangements" during his first State visit to China next week, Cui Tiankai, Chinese Ambassador to the US, told reporters Monday.
Unhelpful Comments: Chief of Staff Kelly seems to undercut some of the President's tough rhetoric in this Fox News interview. Does Kelly’s apparent lack of interest in human rights in China mean the US has not been pushing Beijing to allow Liu Xia to leave with President Trump?
Kelly said that the United States would continue a productive relationship with China, despite their differences.
He noted that although it was difficult for Americans to imagine life in a communist country, it was not up to the United States to “pass judgment” on the foreign regime.
“I think working with people no matter who they are is better than not talking to them,” Kelly said. “They have a system of government that has apparently worked for the Chinese people.”
Military officials acknowledge that it is rare to have three of the U.S.’s 11 nuclear-powered aircraft carriers in one region of the world at the same time, but should not be taken as a sign of an impending military confrontation.
“It’s not that it’s a pure coincidence, but it doesn’t mean that we’re about to attack,” one official said.
Comment: So no photo-ps in Beijing of Ivanka and her kids
Treasury Secretary Steven Mnuchin, economic adviser Gary Cohn and Ivanka Trump will hold tax-reform events in crucial states and blue House districts held by Republicans and speak with national and regional media.
Bonnie Glaser, a China expert at the Center for Strategic and International Studies, was in Beijing last week.
“The Chinese are worried that his domestic problems will cause Trump to do something internationally that will bolster his domestic position and distract people from his problems at home,” she said.
3. Will the PRC-Beijing Thaw Narrow US Options For North Korea?
Speaking to parliament, Moon said there can be no military action on the Korean peninsula without the South’s consent, adding the government will continue working for peace on the peninsula...
China’s foreign ministry said Beijing and Seoul will continue to use diplomatic means to address the Korean peninsula issue, after a meeting in Beijing between Lee Do-hoon, South Korea’s representatives of stalled six-party nuclear talks, and his Chinese counterpart, Kong Xuanyou.
Lee Seong-hyon, a research fellow with China expertise at the Sejong Institute in South Korea, said China’s rapprochement was a sign that President Xi Jinping would play a more assertive role in the region following the closing of the recent Communist Party congress in Beijing.
“If it continues to alienate South Korea, South Korea will gravitate towards strengthening its alliance with the U.S., and the U.S. will use it to strengthen its trilateral partnership with Japan and South Korea, which China fears will eventually become a trilateral alliance,” Mr. Lee said.
Chinese President Xi Jinping was also angered that former South Korean president Park Geun-hye had sided with American interests over China, said Yun Sun, a senior associate with the East Asia Program at the Stimson Center..
China is keen to restart relations with South Korea under Moon, said Sun, as he has signaled that he is seeking an independent policy and is open to talks with North Korea, a long-standing ally of Beijing. “When the relationship with President Park was beyond repair for China, Moon gives China new hope,” Sun wrote.
“Thanks to today’s announcement, a thawing season will come earlier than expected,” Han Jae-jin, an economist at Hyundai Research Institute, said on Tuesday. He had projected 8.5 trillion won ($7.6 billion) worth of damage to businesses ranging from tourism, entertainment and cosmetics to cars and retail due to the fallout from Thaad -- which stands for Terminal High Altitude Area Defense system.
着眼中韩双方共同利益（钟声）--观点--人民网-People's Daily commentator "Zhong Sheng" on the thawing in the PRC-ROK relationship
4. Zhao Kezhi Takes Over the Ministry of Public Security
Comment: You guessed it, a member of Team Xi...
Zhao Kezhi, 63 who has worked closely with two of Xi’s trusted aides, has became the party secretary at the Ministry of Public Security, according to a ministry statement.
Zhao’s predecessor Guo Shengkun – who remains public security minister – was announced as the party’s domestic security chief on Tuesday....
Zhao worked in Guizhou under Li Zhanshu
Guo Shengkun, also a new member of the 25-member Politburo, will succeed Meng Jianzhu as party secretary of the Political and Legal Affairs Commission of the Central Committee, state news agency Xinhua reported. Guo for the first time presided over a commission meeting on Tuesday in Beijing.
以习近平新时代中国特色社会主义思想为指导奋力开创新时代政法事业新局面--法制网--Guo Shengkun's comments at his first publicized appearance in his new post
5. Xi Is Serious About Poverty Alleviation But Goal May Be Too Ambitious
Nearly seven decades after the Chinese Communist Party rose to power on a promise of prosperity for all, President Xi Jinping has vowed to fulfill the Communists’ original intent, staking his legacy on an ambitious plan to complete the eradication of rural poverty by 2020.
The plan targets the more than 43 million people who still live on the equivalent of less than 95 cents a day, the poverty line set by the Chinese government. Five years ago, about 100 million people lived below that line, according to official statistics.
Millions of Chinese workers have poured into urban centers as their economy booms. But opportunity has come with costs for their children, home alone in rural areas without parental care. Nearly 9 million so-called “left-behind” children see their parents only a few times a year. Special correspondent Max Duncan reports in partnership with the Pulitzer Center on Crisis Reporting
6. CCP Cyberczars Disturbingly Prescient About Fake News And Internet Subversion By Hostile Foreign Forces?
Comment: Beijing is having fun with the revelations of Russian manipulation of Facebook, Twitter and Google around the 2016 elections, and feeling very vindicated and prescient about their efforts to protect PRC cyberspace from subversive hostile foreign forces.
China, on the other hand, has made positive moves, such as its regulations for WeChat and Weibo, which instills greater discipline while at the same time providing greater freedom. Despite critiques from the West, the development of Chinese social media is more stable, which has far less impact on China's politics than those in the US. The Chinese government, in turn, can better build consensus and resolve social problems, rather than falling into a messy situation where the government's capacity for decision-making and execution are frittered away.
China’s cyberspace authority said it will create a database of online news practitioners, a blacklist of “fake news” platforms and a mechanism for users to report fake articles, in Beijing’s ongoing bid to crack down on online rumors.
The statement from the Office of the Central Leading Group for Cyberspace Affairs, dated Monday, did not say when the initiatives would take effect.
In its latest regulation, released yesterday, the CAC, now the country’s most powerful information control body, directly under a central leading group chaired by President Xi Jinping, seems to be mandating brakes for any new internet information product or application — a requirement that could put the government in the room with product innovators.
7. Bullying Rail Operator Shows Pitfalls of Public-Private Partnerships
The project, signed last month, was part of a bigger program that Beijing hopes will see private-sector companies help finance big public infrastructure projects like railroad development in a bid to lighten the government’s debt burden.
A consortium of eight private companies led by Fosun Group took a 51% stake in that 41 billion yuan ($6.17 billion) project in coastal Zhejiang province. China Railway Corp. (CRC), the nation’s rail operator, took 15%, and the Zhejiang government held the remaining 34%.
But now CRC is throwing its weight around to try to gain control over the project, citing issues such as its own ability to guarantee project safety, several sources with knowledge of the situation told Caixin.
8. Rural Land Reform
Separation of the ownership rights, contract rights and management rights of rural land will allow farmers to retain the contract right over their allotted land and only transfer the management right if they choose to lease the land to others, mortgage it to banks or invest it in a cooperative in exchange for shares. The law, enacted in 2003, has failed to keep up with reality as industrialization and urbanization have required faster and smoother circulation of key resources, particularly land.
Business, Economy, Finance And Trade
China’s Manufacturing Activity Cools Amid Pollution Crackdown - Caixin Global The official Manufacturing Purchasing Managers Index (PMI) fell to 51.6 in October from 52.4 the previous month, the weakest reading since July, a report released by the National Bureau of Statistics (NBS) showed. The production subindex fell to 53.4 from 54.7 in September, the weakest since January. A number above 50 indicates activity expanded, while anything below 50 signals it contracted.
Still in the Shadows - Caixin Global The initial purpose of setting up platforms like the BICARE was to strengthen regulators’ management of nonstandard credit assets by pursuing banks that don’t list loans on their books and hide such loans from regulators. But the exercise turned out to be a variation of the Whac-A-Mole arcade game, in which small animals take turns popping out of one of several holes and the player attempts to swat them with a mallet before they disappear back into their respective holes. // Comment: About that shadow banking crackdown...
Chinese Property Shopping Spree Fades as Beijing Hits the Brakes - WSJ Outbound capital from China into foreign properties and development sites reached a record $36.8 billion in 2016, according to data firm Real Capital Analytics. Volume for the first three quarters of this year was $19.7 billion. In the U.S. real-estate market, capital from China slowed to $5.1 billion in the same nine-month period, down from a total of $14.8 billion in 2016, said Real Capital. These are deals that are $10 million and greater.
CIC Avoids Beijing’s Wrath as It Keeps Buying Global Property - WSJ Officials at CIC, which has more than $200 billion of overseas assets, say the government’s tightened capital controls have had no impact on the fund’s ability to invest overseas—in property or any other investment—because that is the fund’s mandate. Indeed, CIC is the buyer in Europe’s biggest real-estate deal so far in 2017: the €12.25 billion ($14.22 billion) purchase of Logicor, one of the continent’s largest logistics companies, from Blackstone Group LP. That deal is expected to be closed later this year.
U.S. Investor Tries to Shake Up Sina, a Pillar of China’s Internet - The New York Times “The question is whether that board member would be able to do anything other than jump up and down at meetings,” said Paul Gillis, a professor at Peking University’s Guanghua School of Management.
China Approved More Companies to Sell Foreign Bonds, Sources Say - Bloomberg Some of the quotas from the National Development and Reform Commission expire in March instead of at year end, said the bankers who aren’t authorized to speak publicly and asked not to be identified. Officials at the NDRC weren’t immediately able to comment.
Imagination investors approve sale to China-backed fund - Reuters Imagination Technologies shareholders approved a 550 million pound ($730 million) cash takeover by China-backed Canyon Bridge on Tuesday, a day after the buyout firm’s founder was charged by U.S. authorities with insider trading
China Bond Bears Better Brace for Disappointment - Bloomberg There's little doubt that the evolving regulatory landscape could put further pressure on the bond market in the near term, but there's no reason to start panicking. The PBOC has successfully kept previous bond selloffs from developing into systematic risks, and there remains ample domestic and foreign capital on the sidelines.
Viral Article Accuses Government of Ousting Phone Company Boss - Sixth Tone Beijing-based business news outlet TMT Post published a lengthy investigative article on Monday that details ongoing tensions between the struggling Gongqing Cheng Cellon Communications Technology Co. Ltd., which counts Huawei and Motorola among its clients, and the government in Gongqing, a city of some 200,000 residents in eastern Jiangxi province.
Quick Take: Regulators Take Aim at Money Laundering in Real Estate - Caixin Global They said property developers, agents and banks have an obligation to perform due diligence on potential buyers, including the source of their funding and their intentions. One way to do that is to require homebuyers to use their own bank cards or accounts to pay for the properties and to refund them if they decide not to go ahead with the purchases.
Politics, Law And Ideology
武警部队指挥权将直属中央军委_凤凰资讯 Comment: People's Armed Police reforms progressing, to report solely to the Central Military Commission, no longer both the CMC and the State Council. Not that the PAP would ever listen to the Premier over Xi Jinping, but this looks to be another reminder of Xi's dominance of the sources of hard power in the Chinese system // -其次，官方消息稿有一段话非常重要，意味着武警部队在今后将由国务院、中央军委双重管理调整为军委管理，今后武警部队也不再是“军警不分”调整为“军是军”。
China pours millions into facial recognition start-up Face++ - FT $$ “Every prefecture’s municipal police department [of which China has 294] has invested at least Rmb100m each into their facial-recognition surveillance systems,” Mr Leng added.//Comment: Lots of potential profit in participating in the surveillance industrial complex
Academic publisher Springer Nature bows to Chinese censorship - FT $$ Research by the Financial Times shows the publisher has removed more than 1,000 articles from the websites of the Journal of Chinese Political Science and International Politics, two Springer journals, in the Chinese market. All of the articles in question contained keywords deemed politically sensitive by the Chinese authorities, including “Taiwan”, “Tibet” and “Cultural Revolution”.
Explainer: National Anthem Law, New Criminal Law Amendment, and Their Implications for Hong Kong – NPC Observer Here in this post, we answer a few of such questions on the National Anthem Law, the newest Criminal Law amendment, and their implications for Hong Kong.
61-Year Old Human Rights Lawyer Criminally Detained in Shenyang « China Change On the afternoon of October 31, lawyer Li Yuhan’s (李昱函) family revealed that she had been criminally detained by Shenyang Public Security Bureau. The charges against her are unclear....She is one of the two lawyers who have represented lawyer Wang Yu (王宇), the first human rights lawyer detained during the massive 709 Crackdown on human rights lawyers.
China to reduce the number of crimes under the death penalty - Global Times "The amendments to the Criminal Law should adapt to society. China has been removing the number of crimes under the death penalty and will continue to do so," Ruan Qilin, a professor at the China University of Political Science and Law, told the Global Times on Monday.
CPC national committee set up for lawyers - Xinhua A Communist Party of China (CPC) committee has been set up for lawyers across China, the All China Lawyers Association (ACLA). Approved by the Organization Department of the CPC, the decision was made by the Leading Party Members' Group of the Ministry of Justice, based on a guideline on Party building in social organizations.
“四新”彰显党的十九大思想灵魂和精髓要义（深入学习贯彻习近平新时代中国特色社会主义思想） Zhen Zhanping, vice president of the Central Party School and vice director of the Socialism with Chinese Characteristics Theoretical System Research center has a long piece on page 7 of the 11.1 People's Daily on the theoretical breakthroughs out of the 19th Party Congress
Chinese universities scramble to open centers to study President Xi Jinping Thought - The Washington Post The nation’s top academics may not take them very seriously: Peking University already has a center dedicated to Deng Xiaoping Theory, and it is arguably peripheral to the main academic work of the university. Nevertheless, the establishment of so many centers in such a short space of time symbolizes a significant shift in the political climate in which academics and students operate.
Foreign and Military Affairs
Leaked Slides Yield Clues to Chinese Navy's Ambitions - The Maritime Executive Potential modernization plans or ambitions of the People’s Liberation Army Navy (PLAN) were revealed in unprecedented detail by a former rear admiral in a university lecture, perhaps delivered within the last 2-3 years. The admiral, retired Rear Admiral Zhao Dengping, revealed key programs such as: a new medium-size nuclear attack submarine; a small nuclear auxiliary engine for conventional submarines; ship-based use of anti-ship ballistic missiles (ASBMs); next-generation destroyer capabilities; and goals for PLAN Air Force modernization. Collections of PowerPoint slides from Zhao’s lecture appeared on multiple Chinese military issue webpages on 21 and 22 August 2017, apparently from a Northwestern Polytechnical University lecture
In Xi’s new era, Chinese diplomacy will be a display of hard power | South China Morning Post Deng Yuwen says China’s communist leaders signalled at their 19th party congress that a muscular foreign policy, seen as vital for the country’s peaceful development, will guide decisions on core interests
Chinese, Russian PMs meet in Beijing on ties - Xinhua Medvedev is the first foreign leader to visit China after the 19th National Congress of the Communist Party of China (CPC). "This has shown the closeness and high level of China-Russia ties," Li said. China is ready to consolidate trust, expand cooperation and exchanges with Russia, to bring cooperation visions into reality through Prime Ministers' Rugular Meeting as well as other cooperation mechanisms, Li said.
Russia's Medvedev says the world shouldn’t be dominated by one currency - Reuters Russia is also working on its own national payment system, Medvedev told reporters in Beijing during a visit to China.
China’s biggest state-owned investment group, SDIC, reportedly had links to an illicit North Korean ship — Quartz Citing company registry information, HK01 found that Hongkong Complant—which bought the North Korean vessel in 2010—lists two Chinese citizens as its shareholders, Zhang Xiaofen (张晓汾) and Wang Junliang (王君良). Zhang and Wang’s emails as listed in the registration documents reportedly belong to Chinese state-owned company COMPLANT International Transportation Co., Ltd (COMTRANS).
The west must face the challenge of Xi’s Leninist autocracy -FT $$ First, the west has to keep a margin of technological and economic superiority, without developing an unduly adversarial relationship with Mr Xi’s China. China is our partner. It is not our friend. Second and far more important, the west (fragile as it is today) has to recognise — and learn from — the fact that management of its economy and politics has been unsatisfactory for years, if not decades. The west let its financial system run aground in a huge financial crisis. It has persistently under-invested in its future. In important cases, notably the US, it has allowed a yawning gulf to emerge between economic winners and the losers. Not least, it has let lies and hatred consume its politics. // Comment: Good that Mr. Wolf does not suffer from complacency about China's rise being unlikely because the political and economic systems must surely collapse....It has felt for a while that we are near a tipping in Western countries towards a much clearer recognition of the challenge and threat from China, but so far coherent or coordinated policies are in short supply. Might that change?
Student slams Taiwan threat to fine those who join CPC - People's Daily Online Taiwan's "Mainland Affairs Council" announced on Monday that they deem that Taiwan students' joining the CPC violates a regulation in Taiwan, and it will impose fines on such students between NT$100,000 to NT$ 500,000.
Tech And Media
Tencent Book Unit Begins New Chapter With Massive IPO - Caixin Global Based on an incomplete survey of eight brokerages in Hong Kong, the retail offering portion of China Literature Ltd.’s Hong Kong IPO is likely oversubscribed about 420 times.
Alibaba Leads US$335M Series E Round In Chinese Used Car Transaction Platform Souche – China Money Network Alibaba Group Holding Ltd. has led a US$335 million series E round in Chinese used car online transaction platform Souche, with participation from Warburg Pincus, Primavera Capital and CMB International.
Society, Art, Sports, Culture And History
Questions Surrounding the Death of 14-Year-Old Russian Model in China | What's on Weibo The passing of a 14-year-old Russian model made headlines this week after media reports claim excessive hours and bad employment conditions contributed to the girl’s sudden death. The Chinese model agency that hired her denies allegations of her alleged “slave contract.”
Photographers of Racially Charged Wuhan Exhibit Apologize After Meeting With Beijing-Based Activist | the Beijinger Samantha Sibanda returned from Wuhan this past weekend with a triumph for her fellow African expats. The Beijing-based Zimbabwean activist and educator had flown there this past Saturday for what turned out to be a drawn-out, two-day, highly contentious meeting with photographers of an exhibit at the Hubei Provincial Museum in Wuhan (首都博物馆) that compared African people to animals, leading to a social media firestorm earlier this month. Sibanda accepted a written apology from those involved before returning to Beijing late Sunday, but that resolution didn't come easily.
Energy, Environment, Science And Health
Beijing to end burial of untreated household garbage - Xinhua Currently, Beijing can deal with 23,800 tonnes of household trash every day, and the amount is expected to climb to 30,000 tonnes by 2020, according to Beijing city management commission.
China's Beijing-Tianjin-Hebei to set up anti-pollution body: report - Reuters The smog-prone northern Chinese region of Beijing-Tianjin-Hebei will set up a joint environmental protection agency in an effort to coordinate the region’s war on pollution, the official China Securities Journal reported on Wednesday.今年底明年初产生省市县三级监察委
Agriculture And Rural Issues
Dim Sums: Rural China Economics and Policy: China Cuts Wheat Price for First Time China announced a reduction in its minimum price for wheat to RMB 2300 per metric ton for next year's (2018) crop. This is the first time the minimum price for wheat has been cut since the program was started in 2006. Authorities had raised the minimum price a cumulative 64 percent over 7 years from 2007 to 2014, then held it steady at 2360 per metric ton over the last four years. Minimum rice prices were cut for the first time in 2017.
New law creates investor buzz for China universities - FT $$ The law, enacted by China’s Standing Committee of the National People’s Congress last November, lets universities and high-schools establish themselves as for-profits for the first time. All providers operating in the K-9 space must continue to remain non-profit. This is the last major sector of China’s economy to be commercialised, following close on the heels of the health sector overhaul.
Food And Travel
Chongqing Standardizes Hot Pot - Sixth Tone On Thursday, the Chongqing Commerce Commission issued a set of guidelines that cover everything from ingredients to cooking temperature. The guidelines suggest that restaurants advise customers from outside Chongqing on the optimal dipping time to achieve the best flavor. They also include definitions for certain terms, such as the dipping sauce used to cool down ingredients after they are lifted from the soup.
Jobs And Events
China's Power: Up for Debate | Center for Strategic and International Studies Tuesday, November 14, 2017 9:00 am - 5:00 pm CSIS 2nd Floor Conference Room