Politburo meeting; The "Fengqiao Experience" and modernizing governance; Technology decoupling
|Bill Bishop||Dec 9, 2019||5||1|
Friday’s Politburo meeting set the tone for the Central Economic Work Conference (The CEWC), and that tone appears to be consistent with what we have been hearing all year, that the leadership is OK with slowing growth, that while there are plenty of risks and challenges they are up to the task, and that there will be no large-scale stimulus. The CEWC should convene within the next ten days, so we should have a tad more clarity soon.
And in case there are any doubts about achieving certain goals, the meeting readout was clear:
"The year 2020 will be the year to finish building a moderately prosperous society in all respects, and it is also the final year for the 13th Five-Year Plan. China shall achieve its first centenary goal”.
We are starting to see what the modernization of governance that was the theme of the Fourth Plenum is going to look like for the Politics and Law system. Based on recent comments the Mao-era “Fengqiao Experience”, repackaged for the Xi Era as part of the “correct handling of contradictions among the people under the new circumstances”, will play a big role.
There are only six days until the next round of threatened US tariffs on Chinese goods kick in, and the weekend rumor mill was remarkably quiet about the status of the trade negotiations.
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The Essential Eight
1. Politburo meeting
The Political Bureau of the Communist Party of China (CPC) Central Committee held a meeting Friday to analyze and study the economic work for 2020 and make plans for improving conduct and building integrity as well as fighting corruption....
"The year 2020 will be the year to finish building a moderately prosperous society in all respects, and it is also the final year for the 13th Five-Year Plan. China shall achieve its first centenary goal," said the meeting.
It called for taking Xi Jinping Thought on Socialism with Chinese Characteristics for a New Era as a guide and working hard to ensure the tasks are well completed.
"The basic trend of steady long-term growth for China's economy remains unchanged at present and for a period to come," the meeting said, stressing transforming external pressure into motivation for deepening reform and furthering opening-up, and focusing on running China's own affairs well...
Stressing the policy framework of keeping macroeconomic policies stable and microeconomic policies flexible, and ensuring social policies cover people's basic needs and welfare of the disadvantaged, the meeting underscored preemptive, targeted and effective macroeconomic control and adoption of countercyclical adjustment tools.
And on the CCDI front:
The meeting called for the disciplinary inspection and supervision work to strengthen checks on and oversight over the exercise of power, comprehensively promote the system under which officials "don't dare to, are unable to and have no desire to commit acts of corruption," and train a competent and professional disciplinary inspection team to safeguard the realization of the first centenary goal.
At an earlier meeting of the Standing Committee of the Political Bureau of the CPC Central Committee, Xi was briefed on the CCDI's work in 2019 and preparations for the commission's upcoming fourth plenary session, scheduled for Jan. 13 to 15, 2020.
In an article on signals from the Politburo meeting, Securities Times says the timing, before the next tariff deadline with the US, "shows that policy priorities remain internal". Among other signals it claims to see:
"It is worth noting that following the meeting of the political bureau on July 30, 2019, this meeting once again emphasized "strengthening infrastructure construction", reflecting the important role of infrastructure in counter-cyclical adjustment policies next year.";
The meeting will focus on "enhancing scientific and technological strength and innovation capacity" next year, which means that policy support for the technology industry will only increase in 2020.
Page 1 People's Daily Monday follows the Politburo meeting with a piece extolling the economy's ability to steadily advance in the face of trials and hardships
Most economists expect the policy tone to emphasize quality growth over speed, with more flexible and targeted efforts that focus on ensuring an orderly economic deceleration and strike the right balance between maintaining stable growth and containing economic risks.
That policy stance was reflected on Friday in a statement by the Political Bureau of the Communist Party of China Central Committee. It said the basic trend of steady long-term growth for China's economy remains unchanged, and it emphasized the need to keep macroeconomic policies stable and microeconomic measures flexible.
As risks stemming from China's stock market have been largely eliminated, the nation will focus more on reforming its financial sector while expanding the capital markets' opening-up, an analyst said on Sunday.
The comment came after the Political Bureau of the Communist Party of China Central Committee meeting held on Friday, which analyzed and studied the economic work for next year.
Unlike last year, this year's meeting called for making important strides in reform and opening-up, and preventing systemic financial risks.
The economy could grow between 5% and 6% from 2020 to 2025, Liu Shijin, a policy adviser to the People’s Bank of China, said at a conference in Beijing, according to an article he posted on social media.
The China Academy of Social Sciences, in its annual "blue book" on the economy, says 2020 GDP growth will be around 6% and the official fiscal deficit may rise to around 3%, as part of more active fiscal policies.
CASS is not likely out of step with what will come out of the upcoming central Economic Work Conference
2. The "Fengqiao Experience" has a big role to play in modernizing governance
Central Politics and Law Commission Secretary General Chen Yixin gets his turn on People's Daily page 9 to give his views on the parts of the 4th Plenum decision relevant to his work-Chen Yixin: We will improve the effective mechanism for the correct handling of contradictions among the people under the new circumstances- 陈一新：完善正确处理新形势下人民内部矛盾有效机制--理论-人民网
In the great practice of socialist construction, reform and opening up, our party has created many valuable experience in correctly handling contradictions among the people, the most prominent of which is the "Fengqiao Experience". Over the past 50 years, "Fengqiao Experience" has been developing continuously and displaying the charm of the era. To improve the effective mechanism for correctly handling contradictions among the people under the new situation, we must adhere to and develop the "fengqiao experience", constantly endue it with the new connotation of The Times, and make it maintain its vitality and vitality forever
What is the "Fengqiao Experience"? From China Media Project in the 2013 article "Xi Jinping, Playing with Fire":
This “Fengqiao” does not refer to the Maple Bridge of Tang dynasty verse. Fengqiao, literally “Maple Bridge,” is a township in the city of Zhuji (诸暨市) in China’s Zhejiang province. Fifty years ago, Zhuji was a county, and Fengqiao was a district of that county.
In 1963, the work team of the provincial Party committee of Zhejiang summarized the methods employed in Fengqiao in a document called, “Experiences in Struggling Against the Enemy During the Socialist Education Movement in Fengqiao District, Zhuji County” (诸暨县枫桥区社会主义教育运动中开展对敌斗争的经验). During the National People’s Congress in 1963, the minister of public security, Xie Fuzhi (谢富治), gave a speech called, “Relying on the Strength of the Masses, Strengthening the People’s Democratic Dictatorship, Transforming the Majority of ‘Reactionary Elements’ into New People” (依靠群众力量，加强人民民主专政，把绝大多数“四类分子”改造成新人). Xie’s speech made specific mention of the example provided by Fengqiao.
Then, on November 20, 1963, Mao Zedong added his written instructions to the Xie Fuzhi speech, in which he said: “The example of Zhuji raised here is a good one — various regions should follow this example, expanding the work through pilot programs.”
And there was this back in February, from the 2.18.19 newsletter:
It looks like Tongzhou district government in Beijing has been experimenting a grassroots management scheme since 2012 that basically appoints cops to be deputy secretary of party committee in the local communities and villages within their jurisdiction. Beijing public security bureau just released a regulation yesterday that says party community of all the city's villages and communities 社区（村）will have cops as deputy party secretary by July this year. And recent reports have dubbed this experiment as a great innovation of the Fengqiao Experience...
essentially what this system is doing is to greatly expand cops and the public security system's power to exert control in the civil society. One of these cops even said that (in a positive way) in the report in the first link
Guo Shengkun, member of the political bureau of the communist party of China (CPC) central committee and secretary of the political and legal affairs commission of the CPC central committee, chaired a symposium on political and legal work on Monday to study the general thinking and key work of political and legal work next year...
We should strengthen our bottom line thinking, carry forward the spirit of struggle, and resolutely safeguard China's political security and overall social stability. We should adhere to and develop the "Fengqiao Experience" in the new era, take the modernization of municipal social governance as the starting point, adhere to and improve the social governance system of co-construction, co-governance and sharing, and strive to build a higher level of "safe China".
Chen Yixin comments at the same symposium from the Wechat account of the Central Politics and Law Commission - 陈一新：谋划明年工作思路要找准助推“中国之治”着力点 - 中央政法委长安剑
"There are many conflicts and risks at the grassroots level, and the lack of resources to prevent and resolve conflicts and risks in a coordinated way is a difficult problem in the current infrastructure construction at the grassroots level. We need to focus on building the foundation at the community level as a long-term strategy and a strategy to consolidate the foundation, adhere to the development of the "Fengqiao Experience", accelerate the modernization of social governance at the community level, truly shift the focus, strength and resources downward, consolidate the foundation at the community level, and strive to ensure that "small issues don't leave the village, big things don't leave the township, and no conflicts are passed on to higher authorities [I take this to mean crack down even harder on petitioning]". The focus should be on how to promote and strengthen the construction of local comprehensive governance centers at all levels, improve the system of political and legal committees in towns and townships (sub-districts), improve the system of social governance in urban and rural communities, improve the control measures of basic elements, and improve the modernization level of social governance at the community level.
Reading Chen's piece with the ones last week on the "Modernization of municipal social governance 市域社会治理现代化" work conference and I think we are starting to get a picture of how more control is coming, as part of the ever intensifying efforts to harden the system against "risks" and social dissatisfaction. Those efforts include many positive steps to improve people's lives, but they also include even more invasive and empowered security services.
Mao without the crazy, but with much better technology and capabilities?
At a news conference in Beijing on Monday, Shohrat Zakir, the chairman of the Xinjiang government, dismissed the congressional bill as “crude meddling in China’s internal affairs.”
He sought to foil the criticism by saying that the facilities — which Beijing calls vocational training centers — were now holding only people who were there voluntarily. Others who were previously in the facilities had “graduated,” he said, providing no specifics and declining to say whether they had been released.
He would not say how many people were currently or previously held. Uighurs and Kazakhs abroad have said they have seen no evidence of large-scale releases.
Trainees who used to be influenced by extremism have all graduated from the vocational education and training centers in Xinjiang, a senior official with Northwest China's Xinjiang Uyghur Autonomous Region told reporters in Beijing on Monday.
"Xinjiang's training centers now offer regular vocational training to officials, farmers & herdsmen and the public who are willing to gain certain skills," said Shohrat Zakir, chairman of Xinjiang regional government.
Hua Chunying asks the Western reporters at her press conference who has watched the two new propadocumentaries on Xinjiang. No one says they have. I have watched them, lots of interesting new footage
Chinese state media has sought to justify the country’s crackdown in Xinjiang with the release of two new documentaries on terrorism in the far western region.
The English-language programmes were produced by CGTN television, the international arm of state broadcaster CCTV
Comment: And the propaganda types seem to have figured out how to push them up to near the top of Youtube search results for “Xinjiang”.
Monday CCTV Evening News finds experts from Russia, UAE, Syria, The UK Communist Party and Malaysia to criticize the US Uighur Act
A Dutch newspaper, De Volkskrant, first reported on Ms. Abdulaheb’s role in the dissemination of that second set of documents, based on interviews with her and her ex-husband, Jasur Abibula. Both are Dutch citizens who have lived in the Netherlands since 2009, and they have a 6-year-old daughter and an 8-year-old son.
Ms. Abdulaheb said in an hourlong interview in Mandarin Chinese with The Times that she had decided to speak out in the hopes that the publicity would dissuade the Chinese authorities from seeking to harm her or her family.
She said they already knew she had the documents, and she had told Dutch police officers about her situation. She added that the danger of her situation became evident after her husband returned from a trip to Dubai in mid-September during which Chinese security officers told him about the documents, interrogated him about Ms. Abdulaheb and tried to recruit him to spy on her.
‘You’ll end up in pieces in the black garbage bin in your front garden.’ Just one example of the kind of threats hurled at Asiye Abdulaheb. For months, this Dutch woman of Uyghur origin has been sitting on a bomb in the form of Chinese state secrets regarding the infamous camps in Xinjiang province. Thanks to her these documents became world news, but now Asiye is living in fear of retaliation. ‘I need protection.’
The problem is Abdulaheb thinks the more her identity is made known, the safer she will be. But this logic doesn't hold water and could endanger her, because as she gains greater recognition in the West, Western public opinion will be made to believe that the Chinese government wants to harm her. To some dark forces, it is tempting to threaten her personal safety and frame the Chinese government.
For the past year, Paul Mozur has been investigating the story of a son determined to free his mother from a repressive system of detention and surveillance in western China.
Today, we hear from the man’s mother for the first time.
Yang Jiechi, member of the Political Bureau of the Communist Party of China (CPC) Central Committee and director of the Office of the Foreign Affairs Commission of the CPC Central Committee, held a phone conversation with U.S. Secretary of State Mike Pompeo on Saturday.
Noting that the United States had allowed the so-called "Hong Kong Human Rights and Democracy Act of 2019" to become law and the House of Representatives of the U.S. Congress to pass the so-called "Uygur Human Rights Policy Act of 2019," Yang said U.S. officials have repeatedly made statements that distort and attack China's political system and internal and external policies.
By the numbers:
27.4% drop in the goods trade deficit in October.
23.1% year-over-year decline of U.S. imports from China.
2.8% year-over-year decline in U.S. exports to China.
What they're saying: "There’s little reason for the Trump administration to back away from tariffs as the pressure on China is working," analysts from S&P Global Market Intelligence note.
Total exports in November dropped 1.1% from a year ago, and to the U.S. they were down 23%, the customs administration said Sunday. That was the worst result for exports to the U.S. since February and the 12th straight monthly decline. Overall shipments had been expected to rise 0.8%, as retailers and companies stock up before the Christmas shopping season
“If you see a story breaking in either Bloomberg News or the Wall Street Journal, you really need to heavily discount that,” Navarro said in an interview with Breitbart News Editor-in-Chief Alex Marlow on SiriusXM’s Breitbart News Daily. “Those are the two main sources for Chinese propaganda.”
In his book "Powerful, Different, Equal: Overcoming the Misconceptions and Differences Between China and the U.S.," Peter Walker, senior partner emeritus at management consulting firm McKinsey & Company, draws on China's past to explain how the nation's painful history of being invaded by Western powers has shaped the Chinese people's emphasis on national sovereignty and dignity...
By concluding that the U.S. and Chinese social and economic models are grounded in their own unique histories and cultures, and that the so-called "China threat" is based on significant misunderstandings, Walker is correctly pinpointing that the current twists in bilateral ties are based on these issues.
As Walker puts it, the U.S.' understanding deficit mainly stems from Washington elites' lack of willingness to understand China.
China bought 8.28 million tons last month, the most since August, according to customs data released on Sunday. That’s up 34% from October and 54% from a year ago
"China and the United States are two countries with huge differences in political system, stage of development, history and culture. It is important to establish cognition on the basis of objectivity and rationality. Heine, the German poet, once said, "the only lamp that lights man is reason; the only stick that leads life astray is conscience." By analyzing the current difficulties in China-US relations, the world can see the lack of reason and conscience in the us. Some American politicians who are hostile to China's development are the culprits."
The condemnations of the US have eased in the propaganda over the last few days, as Professor Carl Minzer explains in a long Twitter thread. I will bet more a lull than a real shift.
According to a statement issued on Saturday night by the American Chamber of Commerce in Hong Kong (AmCham), its chairman Robert Grieves and president Tara Joseph were separately prevented from entering the former Portuguese colony as they travelled to the annual AmCham Macau Ball.
US objections have extended its attempt to contain China to a new area, but it has been slammed as absurd by some Chinese experts.
"It's totally legitimate and reasonable for China, a developing country, to enjoy the lending program. The US objection is absurd," Bai Ming, a research fellow at the Chinese Academy of International Trade and Economic Cooperation, told the Global Times on Saturday.
Trump's government is trying every means to attack China now, China should maintain calm and keep its own pace, Bai said.
“That’s my priority theater,” Esper said. “I’m not just looking at Afghanistan” but “all these places where I can free up troops” to bring them home or “compete with the Chinese, to reassure our allies and to conduct exercises and training.”..
“Our war-fighting advantages over strategic competitors are being challenged,” Esper said at the forum in Simi Valley, California. “China and Russia, today’s revisionist powers, are modernizing their militaries, while seeking veto power over the economic and security decisions of other nations.”
5. Technology decoupling
Beijing has ordered all government offices and public institutions to remove foreign computer equipment and software within three years, in a potential blow to the likes of HP, Dell and Microsoft.
The directive is the first publicly known instruction with specific targets given to Chinese buyers to switch to domestic technology vendors, and echoes efforts by the Trump administration to curb the use of Chinese technology in the US and its allies...
Analysts at China Securities, a broker, estimate that 20m to 30m pieces of hardware will need to be swapped out as a result of the Chinese directive, with large-scale replacement beginning next year. They added that the substitutions would take place at a pace of 30 per cent in 2020, 50 per cent in 2021 and 20 per cent the year after, earning the policy the nickname “3-5-2”.
Question: Does this include financial institutions, or are those separate? Because de-Americanizing the IT stack in that industry is coming too. China wants to decouple in technology, just at its own pace, and in while in some key areas it is not yet ready its capabilities are getting “good enough” in more and more areas.
The United States and its allies enjoy a competitive advantage in the production of artificial intelligence chips necessary for leading AI research and implementation. This memo identifies chokepoints for limiting China’s access to key chipmaking equipment....
CSET has identified photolithography equipment as a key constraint in China’s ability to manufacture leading edge chips with feature sizes of 45 nanometers and below. Essential photolithography equipment is sold only by companies in the Netherlands and Japan, with related research and development in the United States. Coordinated export controls applied by these three countries on photolithography equipment— most importantly, steppers—could preserve U.S. and allied technological advantages and make China dependent for the near- to mid-range on imports of U.S. and allied chips for high-end AI applications.
6. Another near LGFV bond default
A state-owned infrastructure company in the northern Chinese city of Hohhot has failed to repay interest on a 1 billion yuan ($142.1 million) bond, Caixin has learned, marking another potential default by a Chinese local government financing vehicle (LGFV).
The bond issuer, Hohhot Economic and Technological Development Zone Investment Development Group Co. Ltd., failed to repay interest on a private placement note on Friday..
The failed payment comes as a surprise to many market participants who invested in bonds issued by LGFVs, as they were seen as a safe option with repayments implicitly guaranteed by local government..
If the Hohhot LGFV fails to make the interest payment within a grace period of 10 days, it will cause a default, according to the 2016 bond issuance prospectus seen by Caixin...
Pan Gongsheng, a deputy governor of China’s central bank, said in an interview with Caixin in August that defaults are beneficial to long-term development of the bond market.
In the past, many investors believed that bonds could not default and thus invested in bonds regardless of their ratings, Pan said. However, now that the implicit guarantee — that investments will be bailed out if they sour — is broken, the pricing mechanism in the bond market can be corrected to truly reflect credit risks, he said.
Question: Will the government blink and find a way to avoid an outright default? Sounds like it.
21st Century Business Herald with more details on the Hohhot bond problem - 深度｜为什么是呼经开？ - 21财经
Xinjiang Production Construction 6th Shi State-owned Assets Management, a cotton trader owned by the local government, missed interest and principal on a 500 million yuan, before making good on the delayed repayment a few days later.
Analysts at Guotai Junan and Guosheng Securities expect the Hohhot LGFV to resolve the crisis with help from local authorities, as Beijing can’t afford to let any bond default by opaque government entities to set off a time bomb in China’s creaky financial system
7. Books burned
Comment: This is not good but I do not think this a sign of a broader "Cultural Revolution 2.0" or Qin Dynasty Era "burning of books and burying of Confucian scholars 焚书坑儒". More likely this is a local library and government doing something stupid. Not good either, but perhaps a bit less bad.
According to a report on the county government website of Zhenyuan, Gansu province, the library did a “thorough clean-up” of its donated books and destroyed all “illegal publications and religious publications, especially books, pictorial publications and visual content that showed leanings”.
The report from October 22 was spotted by a Chinese social media user and widely circulated online over the weekend but has now been deleted...
A commentary in state-run Beijing Times meanwhile called burning books a “savage” act and not a move that protected society.
“How books and other publications are treated, at any point in time, is a test of society’s attitude to knowledge and civilisation, and it cannot be random and savage,” it said.
The commentary, which called for an investigation, has since been removed.
In October, a week before the books were destroyed, the Ministry of Education called for all primary and secondary schools around the country to check their libraries and dispose of any illegal titles.
The MoE order - 关于开展全国中小学图书馆图书审查清理专项行动的通知
Zhang Lifan, a historian in Beijing, said the online outrage reflected anxieties among educated Chinese about the chill settling over their country.
“Frustrations have been building the last seven years over growing repression of intellectuals and freedom of speech,” Zhang said, referring indirectly to the administration of Chinese leader Xi Jinping. “The popular anger reflected something that’s long-standing.”
The Zhenyuan incident stemmed from the current climate in which local officials believe they can gain political points for dramatically culling books, Zhang added.
The ministry of education directive orders the removal of books and other reading material that endanger national security, harm social stability or national honour. Books that promote superstition, illegal religious activities, or “incorrect global outlook and values” should also be culled.
Books deemed “improper” for students as well as those that are outdated and “of no value” should be taken out of circulation and stored at a different location.
8. Hong Kong
The mostly peaceful, family-filled rally contrasted with months of growing tension and violence between democracy activists and police leading up to district council elections two weeks ago in which pro-Beijing candidates were routed.
While estimates of Sunday’s crowd size ranged from the organizers’ 800,000 people to the police’s 183,000 people, it was clearly the biggest protest in months and among the largest since the pro-democracy movement started on June 9.
Hong Kong’s new police commissioner told top Beijing officials on Saturday that his force would handle the ongoing anti-government protests with both “hard and soft” tactics – being tough on violence but flexible on minor offences.
Chris Tang Ping-keung made the remarks after he and his deputy met Zhang Xiaoming, the director of the Hong Kong and Macau Affairs Office under the State Council. Tang was on the second day of his first official visit to Beijing since taking office last month.
Bomb disposal officers in Hong Kong defused two home-made devices containing 10kg of high explosives found in school grounds and which were designed to kill large numbers of people, police said late on Monday.
Some mainland universities have tightened enrollment requirements for Hong Kong students for the next academic year amid the city's ongoing social unrest, with several demanding a review of applicants replacing previous test-free policies and stressing "one country, two systems."
Universities including Tongji University in Shanghai and Fuzhou University in East China's Fujian Province clearly stated in their 2020 enrollment plan that Hong Kong applicants have to uphold the "one country, two systems" principle and the Basic Law.
The Great Cannon was the subject of intense research after it was used to disrupt access to the website Github.com in 2015. Little has been seen of the Great Cannon since 2015. However, we’ve recently observed new attacks, which are detailed below...
The Great Cannon is currently attempting to take the website LIHKG offline. LIHKG has been used to organize protests in Hong Kong. Using a simple script that uses data from UrlScan.io, we identified new attacks likely starting Monday November 25th, 2019.
Anthony Neoh, chairman of the Independent Police Complaints Council (IPCC), said the five-member panel, which his body appointed, had overstepped its function and might lack an understanding of the city.
The experts group, led by Denis O’Connor, the former British chief inspector of constabulary, said in November that the IPCC did not have the investigative capabilities to look into disturbances on such a scale, and should be empowered to subpoena documents and summon witnesses.
How sad it is to see our children beaten, humiliated, arrested and prosecuted. In the face of such injustice, several governments have spoken out, despite risks to their economic interests in China. But there has been a corner of resounding silence. In all these months of demonstrations, the Vatican has not uttered a word of criticism toward Beijing.
This is regrettable — but should not come as a surprise. The line followed by the Vatican in recent years when dealing with the threatening China giant has been appeasement at any cost.
While many local Catholics back the protest movement, church authorities have officially banned such expressions of support during Mass. They also barred clergy from openly supporting political parties in recent local elections.
A company linked to Hong Kong’s controversial justice secretary, Teresa Cheng, an architect of the now withdrawn extradition bill that has sparked anti-government protests, is being investigated by the city’s antitrust watchdog.
The announcement came just days after Ms Cheng returned to Hong Kong from London, where she had wanted to remain and resign from her government post until she was ordered home by Beijing, according to three people familiar with the situation.
Along the pipeline from Hong Kong to Taiwan, a clandestine network of sympathizers has sprung into action, quietly operating safe houses and orchestrating exits. Wealthy donors and aid groups are paying for airplane tickets. Volunteers are ferrying protesters to and from airports. Fishermen are selling boat rides for as much as $10,000 per person. Pastors are fixing smuggling routes..
Business, Economy and Trade
Xi Focus: CPC Central Committee holds symposium to solicit advice on economic work - Xinhua Xi Jinping, general secretary of the CPC Central Committee, presided over the symposium attended by leaders of eight non-Communist parties and the All-China Federation of Industry and Commerce, as well as personages without party affiliations, in Beijing on Wednesday.
China should ‘show strength’ and address US demands, says leading reformist Li Ruogu | South China Morning Post Li Ruogu, a former chairman of the Export-Import Bank of China, said this step would be key to de-escalating the trade war between the two sides – which has now dragged on for 17 months – saying: “A consensus is that further reforms and opening up are needed to tackle bilateral and domestic economic problems.”
Yicai Global - PBOC to Test China's Digital Currency in Shenzhen, Suzhou China's central bank, which is actively preparing to issue its own digital currency, will lead four major state-backed banks and telecom operators in piloting the cryptocurrency in the cities of Shenzhen and Suzhou, according to Caijing magazine 中国数字货币诞生前夜：央行试点，四大行赛马，能否领跑全球？ //The hype seems high for this
China Traders Suspect State Support Amid Odd Stretch of Calm - Bloomberg That everything should go quiet while markets elsewhere in the world swing on each new development in the trade war is especially surprising to China watchers. Some have started to question whether Beijing is acting to limit volatility in its markets, something authorities have a history of doing. While there’s no clear evidence of direct intervention in equities or the yuan, state media has recently come out in support of the stock market.
China’s Historic Car Slump Drags On as Sales Plunge in November - Bloomberg Sales of sedans, sport utility vehicles, minivans and multipurpose vehicles fell 4.2% from a year earlier to 1.97 million units, the China Passenger Car Association said Monday. The decline was the 17th in the past 18 months, with the only increase coming this June as dealers offered large discounts to clear inventory
黑龙江一民营医院副院长自杀未遂 疑遭浙江警方疲劳审讯 Not good for giving private entrepreneurs confidence. Caixin reports on the case of the deputy head of an Inner Mongolia hospital who attempted suicide after repeated mistreatment at the hands of Zhejiang police. The Zhejiang police got involved because of a dispute with one of the hospital's biggest shareholders, a Zhejiang firm
China's annual comprehensive growth was 2% in boom era: new UN index - Nikkei Asian Review When measured by conventional means, the country's gross domestic product per capita increased by an annual average of nearly 10% between 1990 to 2015. Using the Inclusive Wealth Index, which accounts for environmental and social assets, per capita comprehensive growth measured an average of 2% per year during that period.
Washington Presses World Bank To Lend Less To China Faster | China Bystander In one sense, the United States is kicking at an open door when it calls on the World Bank to reduce its lending to China. The Bank’s blueprint for that over the next five years lays out just such a course
Yicai Global - PBOC Starts Electronic Data Swap System for Letters of Credit The new system achieves online capital settlement using letters of credit by supporting direct inter-bank communication and solves the drawback of non-uniform business standards by providing banking institutions with a uniform standard to open and process letters. 人民银行清算中心：电子信用证信息交换系统上线
Chinese premier urges reform in oil, gas sector - Xinhua Li made the remarks in a written instruction to the establishment of the China Oil & Gas Piping Network Corporation Monday, a new centrally-administered state-owned enterprise (SOE)...By opening up both ends to promote the formation of a fair and competitive upstream resource supply and downstream sales market, the new SOE is expected to improve the efficiency of oil and gas resource allocation and better serve national strategies and the needs of the people, Li said.
Yicai Global - China-Made Tesla Cars to Get Government Grants Each CNY355,800 (USD51,000) electric vehicle may receive a grant of up to CNY24,700 (USD3,550), the report said, citing a company staffer, after the government included the Model 3 in this year's list of recommended vehicles.
British GQ Removed China's President And Thailand's King From Its "Worst Dressed" List - Buzzfeed According to sources at Condé Nast, GQ’s parent company, the controversial world leaders had been removed after management got wind of who was on the list....On president Xi, GQ wrote: "It is not Hong Kong's courageous freedom fighters that Xi Jinping should have a problem with. It's his tailor. Xi gets totalitarian style cues from his hero, the mass murderer Chairman Mao, who enforced a dour and plain dress code for the Communist Party."
China pledges continuous efforts to tackle challenges facing WTO appellate body - Xinhua Spokesperson Hua Chunying's remarks came as the dispute settlement body of the WTO, particularly its Appellate Body, is facing a potential crisis. At least three judges are needed to hear an appeal. Since the terms of two of the three remaining judges will expire on Dec. 10 and the United States has blocked the nomination of new judges, the Appellate Body will be unable to hear new disputes after that date.
China Blacklist: Companies Pay $2,500 To Avoid It - Bloomberg Some foreign corporations are funneling resources into staying ahead of the system. Trivium China charges $2,500 an hour to explain social credit to clients and as much as $50,000 for an audit. Sinolytics, based in Berlin and Zurich, said it’s working with European and U.S. multinationals in automobiles, pharmaceuticals, chemicals, manufacturing and logistics. It wouldn’t elaborate.
Large European firms sidestepping ‘futile’ tariffs, not moving from China to US, survey suggests | South China Morning Post Large European companies operating in China had “effectively sidestepped” tariffs imposed by Washington and Beijing, the European Union Chamber of Commerce in China said in its latest survey on the tariffs on Monday.
China’s Capital Targets Prepaid Memberships After Customers Keep Getting Ripped Off - Caixin after the high profile collapse of a string of money-burning start-ups, Beijing’s city authorities are planning a clampdown on this “prepaid consumption.” They took it public in November when seven local government departments released draft guidelines on regulating prepaid services in their jurisdictions. // Comment: Not a new issue, we were burned on one in 2007 in Beijing, after that never bought prepaid deals
Politics and Law
易中天：大清之败，全因谎言与歌颂 Interesting article by Yi Zongtian on the Opium War, seems to be giving a message to today's leadership about the risks of the emperor only hearing lies and praise
Transgender Woman Sues Ex-Employer for Discrimination - Caixin Ma, 31, is the first transgender person to take an employer to court for alleged job discrimination since the country’s top court ruled in December 2018 that people could sue over violations of equal employment rights.
China issues plan on building national culture parks - Xinhua China has issued a plan on the construction of national culture parks for the Great Wall, the Beijing-Hangzhou Grand Canal and the Long March. China aims to complete the construction of the parks by 2023
Communist Party to reopen death in custody case after police officer claims he was scapegoat | South China Morning Post A Communist Party body in northern China is heading up an investigation into a police officer’s claim that a superior told him to take the fall for a suspect’s death in custody. The political and legal affairs committee of Qingyuan district in Baoding, Hebei province, announced on Friday that it would look into the allegation after a report by The Beijing News that day.
How the Supreme People’s Court guides the lower courts through cases in its publications (1) | Supreme People's Court Monitor The series Reference to Criminal Trial (刑事审判参考), edited by a team from the five SPC criminal divisions is invaluable to anyone wanting a detailed understanding of the issues in the criminal justice system, as seen by insiders (and approved for general distribution).
Dust and Spring in Beijing – China Heritage latest from Xu Zhangrun
Foreign and Defense Affairs
Xi Jinping set to make first state visit to Japan in April - Nikkei Asian Review Senior Chinese and Japanese officials discussed Friday a visit to Japan by China's President Xi Jinping in April, marking the first mention of a specific month for the high-profile trip. Chinese Vice President Wang Qishan met with Shigeru Kitamura, Japan's new national security chief, in Beijing's Zhongnanhai government district.
China maritime incursions near Japan-held islands hit record - Bloomberg Chinese government ships, including coast guard vessels, have entered what Japan considers its exclusive waters more than 1000 times this year, according to data from the Japan Coast Guard. That's on track for an 80 per cent increase over last year, and far more than any year since 2012, when China began making regular incursions around the islands.
Japanese island of Mageshima could become an unsinkable US aircraft carrier - CNN Japan's government announced this week that it's buying Mageshima Island, an uninhabited outcrop 21 miles (34 kilometers) from the southernmost Japanese main island of Kyushu. The island, most of which is owned by a privately held Tokyo development company, is uninhabited and hosts two intersecting unpaved runways that were abandoned under a previous development project.
Xi holds phone talks with European Council President Michel - Xinhua Xi stressed that China is willing to work with the EU to ensure the success of a series of important bilateral exchanges and agenda in 2020. He also pledged China's commitment to an alignment between the Belt and Road Initiative and the EU strategies on Eurasian connectivity, an early reaching of a bilateral investment agreement, the comprehensive and effective implementation of the Paris Agreement on climate change, as well as efforts to push the WTO reform towards a correct direction that benefits all parties.
CNAS Delivers Congressionally Mandated Study on U.S. Strategy in the Indo-Pacific to the Department of Defense | Center for a New American Security he Center for a New American Security (CNAS) today delivered an independent assessment—Rising to the China Challenge: Renewing American Competitiveness in the Indo-Pacific—to the Department of Defense. The study, which was mandated by the 2019 National Defense Authorization Act, takes a comprehensive approach to long-term competition with China. It offers principles for U.S. strategy in the Indo-Pacific and nearly 100 specific, actionable policy recommendations across seven critical vectors of American competitiveness
China is not interested in the competition of ideologies - Amb. Liu Xiaoming - Sunday Telegraph OpEd China is committed to the path of its own choice, will never export its development path, model or values, and is never interested in the competition of ideologies. For anyone with an open and inclusive mind, it is easy to find friends and partners all over the world instead of rivals or threats.
In response to Trump, China gets mean - POLITICO “The Chinese Communist Party sees itself as in a global information war,” said Bill Bishop, who helms the widely read Sinocism newsletter about China. “They feel like their international discourse power is significantly smaller than it should be.”
Chinese Foreign Minister Visits Myanmar to Speed Up Belt and Road Projects - The Irawaddy In Naypyitaw, China’s State Councilor Wang Yi told Myanmar’s State Counselor Daw Aung San Suu Kyi on Saturday that China was willing to work with Myanmar to promote the China-Myanmar Economic Corridor (CMEC) “from conceptual planning” to the construction of a “landmark project”.
China conducts double Kuaizhou-1A launch from Taiyuan - NASASpaceFlight.com China launched two orbital missions from the Taiyuan Satellite Launch Center within six hours of each other, orbiting a total of seven satellites. The launches, using mobile pads, saw two Kuaizhou-1A rockets heading into space on Saturday at 2:55 UTC and 8:52 UTC.
A general-turned peasant | Stories shared by Xi Jinping - Xinhua Video From battlefield to countryside, war hero Gan Zuchang turned himself into an ordinary peasant, spending 29 years in promoting rural development. Chinese President Xi Jinping highly commends Gan's spirit of fulfilling his utmost value to serve the people
China’s Central Role in Denmark’s Arctic Security Policies – The Diplomat American jitters about a growing Chinese economic presence in Greenland was said to be one major impetus for discussions about acquiring the country. These events have placed the Danish government of Prime Minister Mette Frederiksen in a difficult position, given that Copenhagen oversees Greenland’s foreign and defense policies, and has itself also been concerned about a potential Chinese challenge to Greenland’s economic sovereignty. This past week, the Danish Defense Intelligence Service (Forsvarets Efterretningstjeneste, or DDIS) further elucidated these concerns in its most recent risk assessment report , which included much discussion of China’s emerging Arctic strategies, including those with a direct impact on Greenland.
武警部队重磅调整，1人升中将、36人升少将 - 综合 - 新京报网 - Promotions in the PAP, political work department director Gao Wei 政治工作部主任高伟 is now a Lieutenant General, 36 others promoted to Major General.
China to reform military ranks promotion system - China Military China’ Central Military Commission recently issued a Notice on Adjusting the Policy Concerning the Promotion of Military Ranks of Officers at and above the Corps Level (hereinafter referred to as the “Notice”). This is an important measure taken by the Chinese military to promote its professionalized reform of military officers and advance its military human resources system. 先行调整军级以上军官军衔晋升有关政策
Chinese navy trains fighter pilots into aircraft carrier commanders - Global Times The Chinese People's Liberation Army (PLA) Navy is training jet fighter pilots to sail and command warships, a move that aims to create more capable commanding officers for aircraft carriers, according to military experts. Experienced pilots from carrier-borne aircraft units and advanced fighter jet units started learning warship combat and command at an undisclosed naval academy in late November, the PLA Daily reported on Monday.
Xi gives instructions on work related to veteran military officers - Xinhua Noting the important contributions of retired officers, Xi expressed the hope that they remain true to the original aspiration and keep the mission firmly in mind, calling on them to cherish the glorious history and preserve political integrity. Xi called for more efforts to respect and serve the retirees and continuously break new ground in the work related to veteran officers. 习近平对军队老干部工作作出重要指示 // an important constituency for stability
A new battleground - In the UN, China uses threats and cajolery to promote its worldview | China | The Economist $$ A struggle in October over China’s mass internment of Uighurs, a Muslim ethnic minority, suggests how intense the fight has become. It involved Britain taking an unusual leading role in condemning China’s human-rights record...There were threats and reprisals, too. Chinese diplomats are said to have told Austrian counterparts that if their country were to sign Britain’s statement, the Austrian government would not get land it wanted for a new embassy in Beijing. The Austrians signed anyway.. “I think they are overdoing it and I think at some stage people will start to resist,” says the Security Council diplomat. But some others at the un do not share that view. Smaller states in Africa and the Middle East, many of them dictatorships, resent America’s post-cold-war dominance of the un.
China’s Ban on U.S. Navy Port Visits to Hong Kong Doesn’t Actually Matter - War on the Rocks The U.S. Navy ended fleet freight routing in Hong Kong in 2017, meaning that there is no warehousing or cargo staging available to its ships visiting the port...For a number of reasons, not least of which is counterintelligence, Hong Kong is not used for major maintenance.
Swedish Prosecution Authority - Former Ambassador Anna Lindstedt Charged Sweden’s former ambassador to China has been indicted with arbitrariness during negotiations with a foreign power..The ambassador is suspected of having acted outside the bounds of the authority granted to her during a meeting on a consular matter regarding the Swedish citizen Gui Minhai who is currently imprisoned in China. At that meeting, the ambassador was in contact with persons representing the interests of the Chinese State.
“一带一路”律师联盟成立 王俊峰当选首任主席|一带一路_新浪新闻 The Belt and Road International Lawyers Association established. Wang Junfeng 王俊峰, global chairman of King & Wood Mallesons, and also head of the All-China Lawyers Association and member of the CPPCC, is the inaugural chairman
Vietnam confronts China in the South China Sea | East Asia Forum Vietnam’s key conundrum is whether it should risk open conflict with China to defend its maritime sovereignty. Strategically, the situation is not too dismal for Hanoi. Its elongated mainland and improved defence capabilities, alongside its experience, makes Vietnam both capable and indomitable within ASEAN. Its multi-layered defence system can inflict substantial costs upon any unlawful operation near its coast. But any conflict would cause major disruptions to Vietnam’s development priorities and must remain a last resort.
Australia and Indonesia voice 'serious concerns' about South China Sea - Sydney Morning Herald Australia and Indonesia have jointly declared "serious concerns" about the state of the South China Sea, issuing a warning about China's militarisation of the contested waters and urging adherence to international law.
Taiwan poll shows Tsai reelection is 'all but a foregone conclusion' - Nikkei Asian Review Some 50.8% of respondents to an Apple Daily poll published on Monday said they would vote for the China-skeptic Tsai in the Jan. 11 election. Han came a distant second with 15.2%, his lowest since winning his party's primary, while People's First Party Chairman James Soong secured just 6.5% -- the same percentage as respondents who said they have not decided who to vote for.
Tech and Media
Huawei to roll out Harmony OS to more products next year, but not phones and tablets - Reuters The plans were first reported in the government-backed Shenzhen Special Zone Daily newspaper which cited comments made by Wang Chenglu, president of the Huawei consumer business group’s software division, at a store event held in the city of Shenzhen, where the firm has its headquarters.
Huawei's overseas retreat squeezes Chinese rivals - Nikkei Asian Review Washington's decision to block Huawei smartphones from using Google's mobile services has created some unexpected victims: By forcing the company to retreat from abroad, it has squeezed rival Chinese smartphone makers and reinforced Huawei's already dominant market position at home.
Facebook sues Chinese nationals for hacking accounts, spreading ads · TechNode Facebook is suing two Chinese nationals and a Hong Kong-based advertising agency for allegedly using the platform to deceive internet users into installing malware, allowing them to compromise “hundreds of thousands” of social media accounts to run ads for counterfeit goods.
Baidu Files the Most AI Patent Applications in China, Again - Caixin The search giant has filed a total of 5,712 AI-related patent applications as of October 2019, followed by Tencent with 4,115 patents and Microsoft with 3,978, it said on its public WeChat account last week. The announcement cited research conducted by the China Industrial Control Systems Cyber Emergency Response Team, which is affiliated with the Ministry of Industry and Information Technology.
Forking into China - Microsoft’s GitHub mulls expansion in China | The Economist $$ GitHub’s plans to expand in China have not been announced and are at an early stage. But public event listings show that the firm’s chief operating officer, Erica Brescia, has travelled to China repeatedly in recent months to meet Chinese coders...Sheng Wu, a software developer in Beijing who attended that event, says GitHub discussed the possibility of expanding its Chinese operations openly. Another attendee confirmed his account. There are other indicators
Society, Arts, Sports, Culture and History
Basketball player fined for ignoring Chinese national anthem - AP Nanjing Monkey Kings forward Guerschon Yabusele was given a warning and fined 10,000 yuan ($1,421) by the CBA for his infraction. Footage distributed online showed the French native with his head bowed while his Chinese and foreign teammates directed their gaze at the Chinese flag prior to the Dec. 6 game against Zhejiang
Shanghai School to Investigate Prof Accused of Sexual Harassment - SixthTone The Shanghai University of Finance and Economics, one of China’s top-ranking economics and business schools, said Friday night it is investigating sexual harassment allegations against one of its teachers amid an outcry from Chinese netizens. On Friday, a female master’s student at the school had come forward accusing Qian Fengsheng, an associate professor at the university’s School of Accountancy, of sexually harassing her both physically and through text messages.
Blockchain, Hardcore, Lemon Spirit... Here Are China's Words of the Year 2019 - Radii China It’s now an annual tradition that Chinese magazine 咬文嚼字 Yao Wen Jiao Zi (literally meaning “Biting Words”) releases a “Top Ten Popular Words / Phrases of the Year” list; it’s also regularly joined by a list by National Language Resources Monitoring and Research Center (NLRMRC) on key “internet slang terms”. The run-downs are usually a mixture of Party-pleasing political vocab and pop culture buzzwords — and 2019’s offerings (released on Monday 2 December) are no different.
Energy, Environment, Science and Health
96 Chinese Veterinary Researchers Infected With Brucellosis - SixthTone In a statement Friday, the Lanzhou Veterinary Research Institute, an affiliated institute of the Chinese Academy of Agricultural Sciences, said that the first few grad students from the institute’s foot-and-mouth disease prevention team tested positive for brucellosis antibodies on Nov. 28. The labs affected have been closed, the institute said, and national and local health authorities have assembled a team to investigate the outbreak.
PetroChina Plans 50% Fracking Surge Next Year - Caixin PetroChina Co. Ltd. is aiming to produce 12 billion cubic meters of shale gas next year and is predicting 7.8 billion to 8 billion cubic meters of output for 2019, company Vice President Li Luguang said at an energy conference Thursday.