People's Leader Xi; US-China trade; Hong Kong; Fentanyl; Scientific entanglement
And we are back, glad I was able to go to Alaska when nothing was going on…Kidding of course, though given the events of the last few days I am tempted to go hide out in the Tongass for a few years...
The US-China trade war, part of the overall intensifying US-China competition, ratcheted up further with tit for tat threats of increased tariffs. The stock markets were unhappy with the escalation and President Trump, just in time to goose stock market futures before the Monday open, said “China called last night our top trade people and said ‘Let’s get back to the table’”.
So far there is no confirmation from the Chinese side that such a call occurred, and at a press conference today Trump and US Treasury Secretary Mnuchin played up comments by Liu He Monday that “China is willing to resolve issues through consultation and cooperation with a calm attitude, while resolutely opposing the escalation of the trade war”.
But Liu's comments about the US-China trade issues sound no different from what he and other officials and propaganda outlets have been saying for months, so I am not sure why this is seen as a sign of softening from the Chinese side. And from the commentaries on the Monday CCTV Evening News there are no obvious signs of a change in China’s position.
Hong Kong had a fairly peaceful couple of weeks until this last weekend, when some demonstrations again turned violent and destructive. On Sunday Xinhua officially branded the protests as a “color revolution”. There are just 35 days until the celebration of the 70th anniversary of the founding of the PRC, and it is hard to imagine Beijing tolerating these protests through that event.
The media is focused on Hong Kong and the trade war but politically something else at least as interesting is also unfolding. Xi returned to the propaganda outlets last week with an inspection tour to Gansu, after “disappearing” for nearly three weeks while in Beidaihe. Last year there were all sorts of rumors swirling in July and August about challenges to Xi. This year the rumor mill has been remarkably quiet.
And on Sunday People’s Daily, in a top left page 1 article, reintroduced Xi as the “People’s Leader 人民的领袖 ren2min2 de ling3xiu4”. Mao Zedong was titled “Great Leader 伟大领袖 Wei3da2Ling3Xiu4” and Hua Guofeng was called “Wise Leader 英明领袖 Ying1Ming2Ling3Xiu4”, but I do not believe any leader since Hua has gotten the “Lingxiu” title. Until Xi.
The “Lingxui” title was first use for Xi in early 2018, sparking all sorts of concerns and speculations. Then it disappeared for over a year. The “core” appellation” for Xi went through a similar cycle of appearing then disappearing, though for a shorter period, then re-emerging as an official formulation used today. Might we be seeing the same evolution for “Lingxiu”, and could that be another sign of Xi’s power?
Thanks for reading.
The Essential Eight
1. “People’s Leader” Xi Jinping
The Sunday People’s Daily page 1 article, by “金宁 Jin Ning” -人民领袖爱人民--时政--人民网
The general secretary stepped forward and shook hands cordially. A pair of excited hands, two pairs of excited hands and countless pairs of excited hands came out. The general secretary took them one by one with his strong and warm hands. Tourists in the distance cheered enthusiastically. Xi jinping waved to them frequently, expressing his love for the people...
The moment of history, fixed a precious historical picture: the people love the people’s leader, the people’s leader loves the people...
From the small village of Liangjiahe in northern Shaanxi, one step at a time, he is familiar with the people. Whenever facing the masses, the general secretary always modestly said, I am the servant of the people
I wrote about the use of “People’s Leader” to describe Xi early last year, when it first appeared:
Friday was our first chance to see a People’s Daily and CCTV co-produced 5-minute video “人民领袖 renmin lingxiu” about Xi Jinping as the People’s “leader”. As Chongqing Party School Professor Su Wei told the Global Times in January:
"The word lingxiu means more than just a leader. It is often bestowed to a leader who enjoys the highest prestige, who is the most capable and who is widely recognized by the entire Party”
The January 14 People’s Daily page 1 article 紧紧抓住大有可为的历史机遇期 or "Tightly grasping the very promising period of historical opportunity", signed by the pseudonym “Xuanyan 宣言," or “manifesto”, referred to Xi Jinping as “lingxiu”, which, according to the same Global Times article cited above, was the “first time for People's Daily to refer to Xi as lingxiu.”
During his Gansu inspection tour last week some of the people who saw him at the memorial for the West Route Army, were heard shouting "long live the general secretary 总书记万岁!". The destruction of the West Route Army was a key blow for Zhang Guotao in his struggle with Mao Zedong, so Xi's visit has sparked all sorts of speculation about whether this is Xi sending a signal about a final victory in a power struggle...I don't know, but it seems nothing in Chinese politics can ever be explained without at least one good conspiracy theory.
Here is a video of some of the shouts of "long live the General Secretary". As Ho Pin points out in the video, it is interesting that it was "long live the General Secretary" and not "long live the Chairman" or “long live Chairman Xi":
What are the chances these people just happened to be there when Xi arrived, rather than being hand-picked and choreographed?
This August 23 article from the People's Daily app 习近平甘肃行的4个难忘瞬间 on "four unforgettable flashes" during Xi's Gansu visit also used the term “People’s leader”:
The term has appeared in several places in the last week, as professor Jean Christopher Mittelstaedt noted on Twitter:
And Liu He is right next to him
But not everyone in the propaganda apparatus seems pleased. Last Thursday was the 115th anniversary of the birth of Deng Xiaoping. Two People's Daily Wechat accounts republished the article "Deng Xiaoping abolished lifetime tenure for leadership positions". It was quickly deleted. Was it a rogue editor, someone who had learned of what may be a coming campaign for Xi as "The People's Leader" and was lodging a protest?
At issue was a post made to “People’s Reading” (人民阅读) and “People’s Daily Press” (人民日报出版社), both official WeChat public accounts operated by the People’s Daily, the flagship newspaper of the Chinese Communist Party. That post, called “Deng Xiaoping Abolishes the Lifelong Tenure System for Leaders” (邓小平废除领导职务终身制), dealt with the now very sensitive issue of term limits for national leaders.
And if you want more history on what was happening early last year see Declarations for Xi Jinping | China Media Project - January 2018
2. Hong Kong
A Sunday Xinhua commentary on the recent symposium on Deng's speeches on Hong Kong says the protests are a color revolution 颜色革命.
To safeguard and consolidate the constitutional order of the Special Administrative Region is to safeguard the sovereignty, security and development interests of the country and maintain Hong Kong's prosperity and stability. In the recent chaos in Hong Kong, there have been serious illegal acts such as violent attacks on the SAR government and the central government offices stationed in Hong Kong, defacing the national flag, national emblem and regional emblem, attacks on international aviation hubs and important public transport systems, and even the "restoration of Hong Kong, the revolution of the times" and slogans such as "Hong Kong Independence". This is no longer an ordinary demonstration, but a "color revolution" aimed at fundamentally destroying the constitutional order of the Special Administrative Region. This must not be tolerated and must be punished according to law.
The commentary also mentions Deng's comment that “if there is turmoil in Hong Kong the central government must intervene 如果发生动乱，中央政府就要加以干预”
Central government advisers on Hong Kong affairs on Saturday said that Beijing had the right to intervene to resolve the crisis in the city and that mobilising PLA troops to do so would not bring an end to the “one country, two systems” agreement.
The remarks were made at a seminar attended by 40 advisers and political heavyweights in Shenzhen, which borders Hong Kong. It was organised by the Chinese Association of Hong Kong and Macau Studies, a semi-official mainland think tank.
Those attending the seminar studied speeches on the city given by former leader Deng Xiaoping
Nineteen politicians and power brokers gather at Government House to brainstorm ways to end city’s protest crisis
Sources say at least half of the guests urged Lam to respond to demands to withdraw extradition bill and launch public inquiry
Hong Kong police officers on Sunday drew pistols on protesters who were charging them with sticks, and one fired a warning shot into the air after another officer fell, as a weekend of violent clashes brought an end to nearly two weeks of restraint.
The police on Sunday fired rounds of tear gas and plastic bullets at protesters who threw bricks and firebombs. They also used water cannon trucks for the first time since protests began in June.
While pro-West media agencies in Hong Kong and others condemned the police brutality when officers pulled their guns Sunday, more internet users urged biased media to depict the entire story and cease misleading the public.
Around 10:00 pm, after clashes between police and protesters in Tsuen Wan, protesters chased police officers along Sha Tsui Road. A video obtained by the Global Times revealed black-clad protesters attacking police officers with batons, sticks, and umbrellas.
Surrounded by protesters, riot police retreated while some journalists covered for the protesters just as they've done since the demonstrations started months ago. Authorities arrived to disperse the crowds at Yeung Uk and Tsing Tsuen roads, which were illegally occupied by violent protesters, who still threw petrol bombs at the police and slashed passersby with knives.
At a seminar to commemorate the 115th anniversary of the birthday of late Chinese leader Deng Xiaoping, senior officials and top experts said that further violence and chaos in the Hong Kong Special Administrative Region (SAR) could not only jeopardize the city's future but also the country's sovereignty, and that the central government might step in if necessary.
"The soldiers stationed in Hong Kong are not strawmen meant to just stay in the garrison, they are an important part of the 'one country, two systems,'" Maria Tam Wai-chu, deputy director of the Hong Kong SAR Basic Law Committee of the Standing Committee of the National People's Congress, said at the seminar in Shenzhen, South China's Guangdong Province.
Some demonstrators also took down the national flag at the Kwai Chung Sports Ground, where the rally took place, and trampled on it, challenging the authority of the country and breaching the National Flag and National Emblem Ordinance, the government of the Hong Kong Special Administrative Region (HKSAR) said in a statement.
The illegal and violent acts are appalling and they are pushing Hong Kong to a very dangerous edge. The government strongly condemns the violence, it said.
"Simon has returned to Hong Kong; thanks you everyone for your support!" read a post on a Facebook page set up following his disappearance and authorized by his family. "Simon and his family wish to have some time to rest and recover ... We will explain more later."
the strategy undermines the extensive and expensive campaign by Huawei and China to convince the world that the telecoms group is independent from government interference. For if the Communist Party can influence who will run Cathay Pacific or sit on the board of an Indonesian tycoon’s investment vehicle, who would believe that it doesn’t have significant sway over a Chinese company that is crucial to the nation’s technological and economic development?
What has scared employees most is a Telegram channel with almost 13,000 members that claims it is collecting information on protesters to pass along to China’s Ministry of State Security, according to the group’s description. Set up in July, the group has since changed its focus from protesters in general to specifically tracking airline and aviation staff, posting photos of them in their uniforms alongside social media posts in which they express support for the movement.
This is the new reality for multinational businesses that have long grappled with a thorny question on China: What’s the price of access to Asia’s biggest economy? Beijing’s response to the protests, most notably its clampdown on Cathay Pacific Airways Ltd. this month, has provided one answer: compliance with the Communist Party’s worldview, from senior management on down.
for Xi and his country, a massacre reminiscent of Tiananmen would be almost incalculably costly. He faces a wobbly economy at home, and Hong Kong is a mammoth financial hub, a currency exchange and a source of foreign capital, with a stock market larger than London’s. A crackdown would also undermine Xi’s larger mission: to convince the world that China is a credible contender for global leadership in the age of Trump. On Xi’s political calendar, he has upcoming reasons for avoiding a calamity, including a triumphant celebration, set for October 1st, to mark the seventieth anniversary of the People’s Republic, and, in January, elections in Taiwan, another territory that China would like to see reunified. Bloodshed in Hong Kong would shatter the prospects, however slim, of healing the rift with Taiwan, which Xi has declared “can’t be passed on for generations.”
"Of course, for those evil manipulators behind this turmoil in Hong Kong and those who are poisoning our young people in Hong Kong, the motherland will not spare them, and we will make them pay a heavy price for what they have done and what they are doing right now, so that their loss outweighs their gain," Wang Zhenmin, former director of the Legal Affairs Department of the central government's liaison office in Hong Kong said at a symposium held in Shenzhen, South China's Guangdong Province.
That China has put much so much energy into demonizing a 71-year-old man is a measure of Mr. Lai’s singular status as the one prominent businessman in Hong Kong who openly supports antigovernment protests, routinely denounces the Communist Party leader Xi Jinping as a “dictator” and refuses to follow fellow tycoons in paying at least token obeisance to Beijing.
Xinhua goes after Jimmy Lai again, says he is inciting subversion - 时评：中国土地上岂容黎智英公然叫嚣颠覆国家-新华网
3. US-China, trade war and so much more
“China called last night our top trade people and said ‘Let’s get back to the table’, so we’ll be getting back to the table, and I think they want to do something,” he said.
In Beijing, Foreign Ministry spokesman Geng Shuang said he had not heard that a phone call between the two sides had taken place.
However, China’s Commerce Ministry typically releases statements on trade calls, not the Foreign Ministry.
Liu said China is firmly opposed to trade protectionism and technology blockades, adding that the country is working on protecting the integrity of the industrial chain. He said that China is willing to resolve issues through consultation and cooperation with a calm attitude, while resolutely opposing the escalation of the trade war, since it is not in the interests of China, the U.S. or the world.
Liu's comments in Chinese 刘鹤：中国欢迎世界各国包括美国企业在华投资经营:
Monday CCTV Evening News "International Sharp Commentary "China Will Calmly and Reasonably Counter Trade Bullying" -【国际锐评】中国将冷静理性反制贸易霸凌_CCTV
Monday CCTV Evening News reports that the Tuesday People's Daily will run a Zhong Sheng commentary "Don't Misjudge China's Determination and Ability to Take Countermeasures" against the US - 人民日报钟声文章：不要误判中国坚决反制的意志能力_CCTV
Sources briefed on Trump's thinking tell Axios' Jonathan Swan that the president wanted to go harder against China on Friday. Trump's initial impulse was to immediately move on all the tariffs and ratchet them up dramatically.
The resumption of the hefty tax on automobiles made in the U.S. came along with the new tariffs on $75 billion of U.S. imports announced by China on Friday. Tariffs on U.S. soybeans, crude oil, beef and other products will be raised by 5% to 10%, effective in September and December. China said the tariffs, which will affect more than 5,000 product lines, are a response to Trump administration’s plan to impose new tariffs on $300 billion of Chinese imports.
U.S. President Donald Trump, in a further escalation of the conflict late Friday, responded to the Chinese tariffs hikes by raising the U.S. tariffs on $250 billion of Chinese imports from 25% to 30% as of October 15, and on the remaining $300 billion of Chinese products to 15% from 10%, effective on September 1 and December 15 for different products.
“I could declare a national emergency, I think when they steal and take out and intellectual property theft anywhere from $300 billion to $500 billion a year and when we have a total lost of almost a trillion dollars a year for many years,” Trump said, adding that he had no plan right now to call for a national emergency.
August 24 Taoran Notes on China's response to latest round of tariff escalations, says it is restrained and targeted to protect Chinese consumers and firms as much as possible, notes how tariffs have dropped for goods from other countries while increasing on US ones, reiterates if the US wants to talk sincerely China will talk, if it wants to fight China will fight
Asked on CBS’ “Face the Nation” program if he expected retaliation, Kudlow said: “I do not. I think his was an action to respond to their action. So I doubt whether they’re going to take another step. I have not heard their official response yet. We’ll have to wait and see.”
China’s said it is ready to take more steps to protect its interests if the United States moves ahead in enacting new tariffs.
China’s foreign ministry said on Monday that it is resolutely opposed to new U.S. tariffs and said the two countries issues should be resolved via talks.
Shipments totalled 447 tonnes last month, data from the General Administration of Customs showed. That compared to 414 tonnes in June and 356 tonnes in July 2018.
China’s redeployment of a government-owned survey vessel, together with armed escorts, into waters offshore Vietnam near Vanguard Bank on August 13, is an escalation by Beijing in its efforts to intimidate other claimants out of developing resources in the South China Sea (SCS)...
U.S. companies are world leaders in the exploration and extraction of hydrocarbon resources, including offshore and in the South China Sea. The United States therefore strongly opposes any efforts by China to threaten or coerce partner countries into withholding cooperation with non-Chinese firms, or otherwise harassing their cooperative activities.
Taiwan’s defence ministry said in a statement that the transport landing ship sailed through the Taiwan Strait in a south-to-north direction, adding that the military has been keeping close watch on the situation so the Taiwanese public should rest assured. The passage of a US Navy vessel through the strait was the seventh of this year, and the first since the US government officially notified Congress on Tuesday of the proposed sale of the F16 fighter jets to Taiwan.
The company, Motor Sich, is one of the world’s foremost manufacturers of helicopter and airplane engines, and for years has supplied engines for the bulk of the Russian military-helicopter fleet. A sale to a group of companies, including Beijing Skyrizon Aviation, controlled by Chinese businessman Wang Jing, is pending.
Staffers at the National Security Council and the U.S. Embassy in Kiev are working to schedule a meeting between Mr. Bolton and the aerospace firm’s chief executive next week in Kiev, where Mr. Bolton plans to attend a security conference, a senior administration official said.
Chinese express delivery experts are urging the country's companies to set up an independent global network for express deliveries as soon as possible after US-based FedEx fell into disgrace in China.
Instead of creating troubles out of nothing and arrogantly finding faults of others, these Americans should take a good look at themselves.
According to statistics from Good Jobs First, a U.S. watchdog on corporate subsidies, since the 1980s, U.S. governments at different levels have given $178.1 billion in subsidies to domestic enterprises through 80,337 projects. In particular, the Boeing Company alone has received $14.5 billion of allocated subsidies from the federal and state/local governments since 2000.
Senators Marco Rubio, a Republican, and Jeanne Shaheen, a Democrat, told Michael Kennedy, chairman of the Federal Retirement Thrift Investment Board, in a letter that his fund is supporting Chinese state-owned companies with “the paychecks of members of the US Armed Services and other federal government employees”.
Comment: The war on fentanyl and opioid abuse is politically important for Trump and he thought he had a promise at Osaka from Xi to help, so this is also playing into his anger towards China
Zheng created and maintained numerous websites to advertise and sell illegal drugs in more than 35 languages. The Zheng DTO touted its ability to create custom-ordered drugs and avoid detection from customs and law enforcement officials when shipping the drugs through express mail and the U.S. Postal Service.
Chinese state media on Friday hit back at claims by U.S. officials that China was failing to crack down on the flow of fentanyl and fentanyl-related substances into the United States, saying that responsibility for opioid abuse lay with users.
Chinese drug traffickers had some advice for American buyers of fentanyl: Let us ship it to you by regular mail. It might be slower than FedEx or UPS, but the opioid is much more likely to reach its destination through the U.S. Postal Service...
These cyber drug dealers wrote their U.S.-based customers — in emails later uncovered by federal investigators — that private delivery companies electronically tracked packages...
Fifteen percent of all packages from China are still not electronically tracked..
Trump weighed in on the issue Friday, tweeting that he was “ordering all carriers,” including the Postal Service, “to SEARCH FOR & REFUSE all deliveries of Fentanyl from China (or anywhere else!).”
Speaking at a daily news briefing, Chinese Foreign Ministry spokesman Geng Shuang said the government was playing a positive role is tackling the global drugs issue, and outlined the steps China had taken to control it.
The United States consumes 80 percent of the world’s opioids despite having only five percent of the population, Geng said.
5. Promotion may signal upgraded battle plan for global social media
Recently updated records on the foreign ministry’s website indicate that Zhao Lijian 赵立坚 , who left his position as deputy chief of mission in Islamabad earlier this month, now serves as deputy director general of the ministry’s information department.
In his new role, Zhao serves directly beneath the department’s newly appointed director general, Hua Chunying, and alongside fellow deputies Geng Shuang and Yu Dunhai.
Worth revisiting this, noted in the July 15 newsletter:
China’s foreign ministry spokesman Hua Chunying wrote in Study Times on how to do better in the PR work for the CCP, saying the government should engage in “sincere and open communication” with the outside world, and also be more aggressive in responding to criticisms and setting agenda. It is interesting that she said the government should “explore and promote the development of media integration and make foray into overseas social media”. This coincides with the ministry’s new Tiktok account and Ambo Cui’s new Twitter account. Zaobao reported last week that Hua will soon become the new head of the Foreign Ministry information department.
Here is Zhao's Twitter account
The recent mild pushback on PRC propaganda and disinformation efforts on Twitter, Facebook and Youtube may have an impact on the efforts to improve China’s discourse power on global social media, but unless more restrictions come on the effect should be slight. And they still have TikTok and, for the global Chinese diaspora, Wechat, which is out of reach for regulators outside of China.
6. Scientific Entanglement
“I predict China will go black in two to three years — we won’t be able to read anything,” said Jonathan Dowling, a physics professor at Louisiana State University who spends part of the year as a visiting faculty member at USTC in Shanghai...
Pan has credited Edward Snowden for motivating China’s quantum research. The former National Security Agency contractor’s revelations about NSA eavesdropping led China to pour money into developing more secure communications, Pan has said in published interviews.
Barry Sanders, a Canadian physicist from the University of Calgary, spends two to three months a year as a visiting professor at the USTC labs in Shanghai. He got the job through China’s “Thousand Talents” program, which recruits Western scientists for teaching and research stints, and offers incentives to persuade Chinese researchers to return home from overseas.
The participating Chinese researchers also see great opportunities in multidimensional quantum teleportation. "The basics for the next-generation quantum network systems is built on our foundational research today", says Jian-Wei Pan from the University of Science and Technology of China. Pan recently held a lecture in Vienna at the invitation of the University of Vienna and the Academy.
Feng “Franklin” Tao, 47, of Lawrence, Kansas, an associate professor at KU’s Center for Environmentally Beneficial Catalysis (CEBC), is charged with one count of wire fraud and three counts of program fraud..
The indictment alleges that in May 2018 Tao signed a five-year contract with Fuzhou University in China that designated him as a Changjiang Scholar Distinguished Professor. The contract required him to be a full time employee of the Chinese university...
Kansas Board of Regents’ policy requires staff to file an annual conflict of interest report. In Tao’s reports to KU, he falsely claimed to have no conflicts of interest. The indictment alleges that he fraudulently received more than $37,000 in salary paid for by the Department of Energy and the National Science Foundation.
Koala AI Technology is one of the many Chinese artificial intelligence start-ups riding a wave of Chinese government demand for surveillance technology. But unlike its competitors, Koala AI may have benefited from connections with Australian universities and Australian government funding. The company is led by scientists who worked and studied in Australia before relocating to China through Chinese government talent-recruitment schemes.
In 2011, Heng Tao Shen became one of the University of Queensland’s youngest-ever professors at age 34. Three years later he was recruited through the Chinese government’s Thousand Talents Plan to work at the University of Electronic Science and Technology of China (UESTC), where he became head of its School of Computer Science and Engineering and was given a laboratory and research team to lead. He founded Koala AI a year later, in 2015.
We, the undersigned, are leaders in U.S. academic and industrial biomedical research and drug development. We are concerned that recent actions by government agencies and universities with respect to Chinese scientists in the U.S. could threaten U.S. leadership in biomedical science.
Recently, some scientists from China, or American-born of Chinese heritage, have been summarily dismissed from their university positions, creating a climate of fear and uncertainty in our biomedical communities.
Looking forward to this forthcoming book
7. A documentary to watch
The story begins with a 2008 prologue in which General Motors shutters its Moraine, Ohio, plant, chucking 2,400 union workers out of work and into years of desperate struggle. Then, in 2015, comes hope. The Chinese company Fuyao, which makes glass for automobiles, decides to reopen the plant and hire 1,000 locals. Led by its self-made billionaire owner, Chairman Cao Dewang, Fuyao brings along 200 experienced Chinese employees to oversee production.
The official trailer, watched it Friday, highly recommend, wonder if some of the fired US workers will have claims against the firm no given some of the candid comments from the Fuyao side
8. Shanghai education policy change stressing pre-school parents
The government’s latest move — made public on July 8 by China’s Cabinet, the State Council — requires private institutions that cover the compulsory education period of primary and middle school to select applicants at random whenever their number exceeds admission quotas, which is virtually always the case. Shanghai has said it will formulate specific local rules around the year’s end, but the policy change promises to make intake interviews a thing of the past — and extra classes irrelevant...
“I won’t want to leave my child’s admission to a lucky draw,” she tells Sixth Tone, with a tired look. Xu explains she got out of bed at 6 a.m. to drive her 5-year-old daughter some 30 kilometers to the training center — the family’s Sunday morning routine...
Xu feels conflicted about putting her daughter into cram schools. “On the one hand, I hope she can enjoy her childhood; on the other, I don’t want her to be left behind academically,” she says. “Can you imagine the anxiety when you learn kids of her age are able to recognize over 1,000 Chinese characters and read English stories on their own while your child knows none of that? They are peers, and eventually they’ll compete in high school and college entrance exams together.”
Business, Economy and Trade
China’s Companies Have Unseen Foreign Debt That’s Maturing Fast - Bloomberg The foreign debt built up by Chinese companies is about a third bigger than official data show, adding to the pressure on the country’s currency reserves as a wave of repayment obligations approaches in 2020. On top of the $2 trillion in liabilities to foreigners captured in official data, mainland Chinese firms have around another $650 billion in debts built up by subsidiaries overseas, according to Bloomberg calculations. About 70% of that debt is guaranteed by entities such as onshore parent companies and their subsidiaries, the data show. The amount of maturing debt will rise in coming quarters, with $63 billion due in the first half of 2020 alone
Offshore Yuan Tumbles to Record Low After Trade Levy Escalation - Bloomberg The offshore yuan slumped to the lowest level since it was created in 2010 as the trade war with the U.S. intensified with tit-for-tat tariffs.The currency fell as much as 0.86% to 7.1926 per dollar on Monday
Hedge Funds Wager China’s HNA Will Look After Foreign Investors - WSJ $$ One Hong Kong-based hedge-fund manager said he bought U.S. dollar bonds issued by HNA-backed Hong Kong Airlines two weeks before they matured in January, at less than 80% of face value. He quickly resold at 96%, as fears receded that investors wouldn’t be repaid. Unlike other struggling Chinese companies—which prioritize onshore lenders, or treat all creditors equally—“HNA seems to prefer paying back offshore debt,” he said.
China’s belt and road cargo to Europe under scrutiny as operator admits to moving empty containers | South China Morning Post The admission by the state-run China Railway – the sole operator of the lines – followed an investigation by the Chinese Business Journal, a newspaper supervised by the Chinese Academy of Social Sciences, which found that in one extreme case only one of 41 containers on a particular train actually carried goods.
Empty trains on the modern Silk Road: when Belt and Road interests don’t align – Panda Paw Dragon Claw China is sending empty freight trains to Europe through one of its key Belt and Road Initiative (BRI) projects: the China-Europe Railway Express. The bizarre phenomenon caught the attention of Depth Paper (等深线), a Chinese online news platform. In a rare move by a Chinese media outlet in today’s media environment, Depth Paper probed critically into one of the BRI’s most visible “connectivity” projects, uncovering the perverse incentives that are luring China’s local governments and companies to create huge “bubbles” of ostensibly flourishing rail routes that run tens of thousands of kilometers across the vast landmass of Eurasia.
Chinese provinces call for high-quality China-Europe freight train service - Xinhua The companies in southwest China's Chongqing Municipality and central and east China's provinces of Henan, Hubei, Zhejiang and Hunan called for strengthening cooperation, avoiding vicious competition, and promoting innovative development in the consensus, which was released at a summit on China-Europe freight train service held in Chongqing Saturday.
State Council approves new pilot FTZs - SCIO in Shandong, Jiangsu, Hebei, Yunnan and Heilongjiang provinces and Guangxi Zhuang autonomous region, according to a circular issued on Aug 26.
In Depth: China’s Long Debate Over Personal Bankruptcy System - Caixin Under Chinese law, individuals who provide personal guarantees for business-related borrowings retain liability even when their companies go bankrupt...There could still be a long way to go for China’s national personal bankruptcy system as the legislation has yet to be included on the agenda of the national legislative body. Some legal experts like Guangdong lawyer Xiao Shengfang have suggested a shortcut by amending the existing Enterprise Bankruptcy Law to include new articles regarding personal debt. Such a move may shorten the legislative procedure to three to five years, experts said.
Major Developer Probably Won’t Buy Any Land Until 2020 - Caixin Guangzhou R&F Properties Co. Ltd. Chairman Li Sze Lim said at a meeting Thursday following the release of interim results that the company will take a “more conservative” approach to investing in land, and it would only consider smaller, high-quality projects.
China Issues 3-Year Fintech Development Plan - Caixin The plan aims to further boost the application of science and technology in the financial sector, realize the deep integration and coordinated development of technology and finance, and significantly increase the public’s satisfaction with digital financial products and services by 2021, the People’s Bank of China said.
China’s Central Bank Unveils New Mortgage Loan Policy - WSJ $$ In an attempt to control mortgage rates, the central bank also said Sunday that its branches would release mortgage-rate floors for local lenders based on property policies applied in different localities. That could give the central bank more sway in keeping mortgage rates from falling so far that they could stoke property bubbles.
Pangu Plaza: Billionaire's skyscraper sold online by Chinese court - CNN Style in 2016, authorities seized ownership of the skyscraper from a real estate company controlled by exiled Chinese billionaire Guo Wengui. A Beijing court then put the building up for auction on a website run by e-commerce giant, Alibaba.
China’s central bank sets new floors for mortgage rate in latest bid to curb speculation | South China Morning Post Rate for first-home buyers set at 4.85 per cent, while minimum for second-home buyers will be 5.45 per cent..The central bank said the move would not add to homeowners’ interest payments as it would apply only to new mortgages. The 28 trillion yuan (US$3.95 trillion) in outstanding mortgages remained unchanged.
Megvii Tests Appetite for AI Security in Hong Kong - Bloomberg The seven-year-old startup filed for a Hong Kong initial public offering on Sunday and is said to be targeting as much as $1 billion. The filing shed light on its stunning growth driven primarily by products that help government agencies and other clients improve public safety and optimize traffic management, which it labeled “city IoT solutions”.
Politics and Law
Xi highlights poverty relief, high-quality development, environmental protection | SCIO Calling Gansu a piece of "Red Land," Xi urged the province to use its revolutionary resources to strengthen Party building. He called for efforts to build a strong team of cadres, fight corruption, improve conduct, and resist the practices of formalities for formalities' sake and bureaucratism.
Former chief justice in E China province under investigation - China Daily Zhang Jian, former chief justice of Anhui Provincial Higher People's Court in East China has been put under investigation for suspected severe discipline and law violations, an official statement said Sunday.
China set to step up tear gas production as demand for crowd control weapons booms at home and abroad | South China Morning Post While mainland China does not currently supply the Hong Kong police force, analysts expect growing civil unrest and higher military spending to boost domestic and export markets
Vice Henan provincial governor under investigation - Xinhua Xu Guang, vice governor of central China's Henan Province, has been under investigation for suspected severe violations of discipline and law, the top anti-graft body said Saturday.
Xi urges Chinese air force to enhance capability to win - Xinhua Xi..made the remarks Thursday when inspecting an air force base in northwest China's Gansu Province. At the combat command center, Xi used a tele-conferencing facility to inspect the troops including personnel at a radar station on a plateau over 3,600 meters above sea level and a transport and rescue regiment. After listening to the work report of the base, Xi stressed the great significance of carrying out the Party education campaign themed "staying true to our founding mission" as the nation marks the 70th anniversary of the founding of the PRC...He also stressed the need to govern the military with strict discipline in every respect and make sure that the armed forces are highly centralized, unified, pure and solid, and that they stay secure and stable.
Foreign and Defense Affairs
Interpol rescinds arrest warrant for dissident Chinese judge living in Canada, calling it politically motivated | National Post Interpol ruled there is evidence to back up Xie Weidong’s contention that the prosecution was instituted for over his criticism of China's legal system
China’s thin-skinned online nationalists want to be both loved and feared by the West - Chaguan a sad truth about nationalist anger is that it can be manipulated and sincere at the same time. No party commissar told Stylist Zoe’s followers to choose the most extreme response in her poll, vowing that they would rather go naked than wear clothes from an anti-China brand, yet 770,000 of them did so. More sobering still, by definition those attacking foreign brands are unusually worldly, whether they hail from the aspiring middle classes or are members of China’s globe-trotting elites.
"Major power outside region" source of tensions in South China Sea, says ambassador - Xinhua A major power outside the region is trying to turn the South China Sea into an arena for major-power wrestling, which is the source of tensions in the region, said the head of Chinese mission to the European Union (EU) Thursday. In an article published on EUobserver, a European online newspaper, Ambassador Zhang Ming said China would not allow its territorial sovereignty and regional security to be undermined, nor would it allow any major power outside the region to muddy the waters.
Turkey’s Uighurs fear for future after China deportation | Financial Times $$ The last time Jennetgul Tursun spoke with her sister Zinnetgul, an ethnic Uighur held in a Turkish detention centre, Zinnetgul voiced fears she would be deported to China along with her two young daughters. Within two weeks, the family were handed over to the Chinese authorities, Jennetgul said, a case that has stoked alarm among the sizeable Uighur diaspora in Turkey that the country is no longer the haven it has been for decades.
Chinese national accused of smuggling technology is nabbed at Honolulu airport | Honolulu Star-Advertiser A Chinese national was taken into custody Thursday at Daniel K. Inouye International Airport in Honolulu after he was caught in a government sting allegedly attempting to smuggle prohibited technology back to China, including a radiation-hardened programmable memory device designed for battle or space.
US ploy to charge Chinese scientists with espionage - Global Times Zhang Hao, a Chinese professor from Tianjin University (TJU) who was arrested in May 2015 by the US and charged with economic espionage, will stand trial on September 10, according to information obtained by the Global Times. An insider familiar with the case told the Global Times that Zhang's company ROFS Microsystem filed a lawsuit in Tianjin in September 2017 against Apple for intellectual property infringement. The suit came after ROFS found their patent technologies were being used in filter chips sold to Apple in 2016 by Avago Technologies, now combined into US chip maker Broadcom Inc.
Former NSW Labor boss seen with $100,000 cash in Aldi bag after meeting banned donor, Icac inquiry told | The Guardian Chinese billionaire Huang Xiangmo allegedly took cash to the former NSW Labor boss Jamie Clements at party headquarters
ASU closes Confucius Institute due to Defense Department objections - AZCentral ASU joins at least 15 other universities in closing its Confucius Institute in the past 18 months.
Averting Crisis: American strategy, military spending and collective defence in the Indo-Pacific — United States Studies Centre Chinese counter-intervention systems have undermined America’s ability to project power into the Indo-Pacific, raising the risk that China could use limited force to achieve a fait accompli victory before America can respond; and challenging US security guarantees in the process.
Xinjiang: Chairs Ask Whether World Bank Funding Possible "Crimes Against Humanity" | Congressional-Executive Commission on China U.S. Representative James McGovern (D-MA) and U.S. Senator Marco Rubio (R-FL), the Chair and Cochair respectively of the bipartisan and bicameral Congressional-Executive Commission on China (CECC), today released a letter to World Bank President David Malpass expressing concern and raising questions about a World Bank loan that funds technical and vocational training projects in the Xinjiang Uyghur Autonomous Region (XUAR).
Duterte Cuts Short China Trip A Day After Sharp Remarks Aimed At Xi - IBTimes Just one day after making some bold comments vowing to stand firm on a 2016 United Nations arbitration ruling that went in favor of the Philippines, President Rodrigo Duterte’s long-awaited visit to China has been shortened from five days to four.
Full Text: The Long-Lasting Unsolved Problem of Gun Violence in the United States Has Aggressively Trampled on Human Rights - Xinhua The China Society for Human Rights Studies on Saturday issued an article titled "The Long-Lasting Unsolved Problem of Gun Violence in the United States Has Aggressively Trampled on Human Rights."
China says U.S., Canada staged political farce on Huawei executive's detention - Xinhua Meng's case is a serious political incident, while the two Canadians, Michael John Kovrig and Spavor Michael Peter Todd, were arrested on suspicion of crimes against state security, Geng said.What the United States and Canada have done to Meng is true "arbitrary detention," he added, saying that out of pure political motivation, the two countries have abused the bilateral extradition treaty and severely violated a Chinese citizen's legitimate rights and interests.Geng called on other countries to be vigilant to avoid falling into the "American trap."
Kevin Rudd slams 'post-pubescent' Andrew Hastie for China 'hysteria' - Sydney Morning Herald Former prime minister Kevin Rudd has lashed members of the Liberal party for whipping up national "hysteria" over China, describing outspoken backbencher Andrew Hastie as "post-pubescent" and warning of a descent into "neo-McCarthyism".
Hong Kong and Macao
Meet Macau’s new chief executive Ho Iat-seng: a media-shy Beijing loyalist with deep mainland ties | South China Morning Post Despite keeping a low profile, his name had been floated numerous times over the past few years as a potential candidate for the top job
Society, Arts, Sports, Culture and History
Sidney Rittenberg, Idealistic American Aide to Mao Who Evolved to Counsel Capitalists, Dies at 98 - The New York Times “His compelling tale can perhaps best be understood as a story, writ small, of modern-day China itself,” the author Gary Rivlin wrote in The New York Times in 2004. “His metamorphosis from isolated expatriate to high-priced global go-between mirrors the country’s own shift — from a closed-door Communist state to a freewheeling moneymaking society, with a new class of entrepreneurs who dream the same dreams that dance in the heads of people in places like Silicon Valley.”
First Look: China's $26-Million Wavepool is Up and Running (And Barreling) - Surfline The effort the Chinese government is putting into surf development is unprecedented in the history of the sport,” says ISA’s Nik Zanella
Energy, Environment, Science and Health
China's water environment improving: report - Xinhua The report was made by an inspection team tasked with examining the enforcement of the water pollution prevention and control law, under the Standing Committee of the National People's Congress...According to the report, in 2018, 71 percent of the national surface water sections were of good quality and the water quality of major rivers, lakes and coastal waters was stable and good.