"Stealth easing" and "targeted" stimuli; Huawei smackdowns; Karl Marx emojis

Happy Thursday, I hope you enjoyed last night’s special issue Engineers of the Soul: Ideology in Xi Jinping's China by John Garnaut. His 2017 speech has already sparked some interesting commentary, and provoking thought and questioning conventional wisdom is one the things we like to do here at Sinocism. I wholeheartedly agree with his conclusion:

The challenge for us is that Xi’s project of total ideological control does not stop at China’s borders. It is packaged to travel with Chinese students, tourists, migrants and especially money.  It flows through the channels of the Chinese language internet, pushes into all the world’s major media and cultural spaces and generally keeps pace with and even anticipates China’s increasingly global interests. 

In my opinion, if you’re in the business of intelligence, defence or international relations; or trade, economic policy or market regulation; or arts, higher education or preserving the integrity of our democratic system - in other words, just about any substantial policy question whatsoever - then you will need a working knowledge of Marxism-Leninism Mao Zedong Thought. And maybe, after the 19th Party Congress, you’ll need “Xi Jinping Thought” too. 

Today I am focused on the following:

  • The Chinese side has confirmed that Liu He is coming to DC for trade talks January 30-31;

  • Huawei is getting hammered overseas, with a new criminal investigation in the US, proposed US legislation that would “direct the President to impose denial orders banning the export of U.S. parts and components to Chinese telecommunications companies that are in violation of U.S. export control or sanctions laws” and 5G concerns in Germany, to name a few problems;

  • The nasty rhetoric out of Beijing is worsening, with the Foreign Ministry spokeswoman Hua Chunying saying Canadian Foreign Minister Freeland “doesn’t know what she’s talking about” and accusing US Vice President Pence of slandering China. What happened to politeness and respect for face?;

  • The easing and stimuli-by-another-name continue as officials again try to jawbone confidence in the economy. As I said the other day the economic data will tell us even less than normal in January and February as things wind down for the Lunar New Year in the first week of February but clearly things are ugly and the leadership is as concerned as they have been in a long time.

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The Essential Eight

1. "Stealth easing" and "targeted" stimuli

Beijing redoubles efforts to quell fears about state of the Chinese economy as bad news piles up | South China Morning Post:

The Chinese government organised two back-to-back press conferences in the last two days, with senior officials from six powerful ministries voicing confidence in the prospects of world’s second biggest economy and providing Beijing’s explanation on negative economic news such as the first year-on-year fall in car sales in nearly three decades and job market stress.

Xin Guobin, Vice Minister of Industry and Information Technology, told a media briefing on Wednesday that China’s industrial sector was actually performing “slightly better than expected” and that the recent economic slowdown was merely a “short-term fluctuation”.

On car sales, Xin said he was optimistic about 2019 as “new demand will be unleashed in China’s third and fourth-tier cities” as “old car models will be replaced”.

Local Governments Start Early Infrastructure Borrowing - Caixin:

Chinese local governments are rushing to borrow funds for a new wave of infrastructure spending as part of a Beijing-backed initiative to bolster the cooling economy by authorizing bond sales months ahead of the normal annual schedule.

The governments of Xinjiang Uyghur Autonomous Region and Henan province were the first provinces to begin issuing local government debt under 2019 allocations. Beijing at the end of last year authorized the sale of 1.39 trillion yuan ($203 billion) of local government debt starting this month rather than in the second or third quarter as usual.

`Stealth Easing' Spreads in China Property as Debt Risks Mount - Bloomberg:

Nationwide, officials have put so much effort into a campaign against property speculation -- one of President Xi Jinping’s signature policies -- that they may seem unlikely to start unwinding it now. However, a deepening economic slowdown could force just that at the end of the second quarter, according to Nomura economist Lu Ting.

China Quietly Cuts Borrowing Costs While Keeping Rates on Hold - Bloomberg:

“The PBOC is increasingly using liquidity management, instead of cuts to benchmark interest rates, to reduce interbank funding costs, guide bond yields lower and give banks a bigger profit margin so that they can offer cheaper loans to customers,” said Ding Shuang, chief economist of Greater China & North Asia at Standard Chartered Bank Ltd in Hong Kong.

China’s Housing Market Slowdown Deepens - Caixin

Prices of existing homes are a better reflection of market conditions as new-home prices and sales are subject to tighter regulation. December marked the fourth straight increase in the number of cities reporting a month-on-month drop — 22 of the 70 major cities monitored by the National Bureau of Statistics said prices declined, up from 17 in November and a significant jump from the two cities that showed a decrease in August. On a year-on year-basis, four cities reported a drop in December, up from three the previous month.

Nation to expand public investment - China Daily:

The premier made the statement during a meeting of the State Council, the Cabinet, on Tuesday to solicit opinions from economists and entrepreneurs on the draft of the Government Work Report, which he will deliver to the annual session of the National People's Congress in March.

Two economists and four entrepreneurs, such as Executive Chairman of Alibaba Group Jack Ma, spoke at the meeting, making suggestions on macroeconomic adjustment, equipment manufacturing and artificial intelligence. ( 李克强主持召开专家学者和企业界人士座谈会--时政--人民网)

State Council Development Research Center deputy head Long Guoqiang has a long piece in Thursday's People's Daily reiterating that China's economy will only up even more to the world - 中国开放的大门越开越大(人民要论) - 人民日报 》( 2019年01月17日 09 版- 隆国强:


China's Slowdown: More There than Meets the Eye | Center for Financial Economics - Bob Barbera and Yingyao Hu:

Using our revised measure of real income flows, and accepting official Chinese tallies of the gains for prices from 2007 to 2017, we estimate that net nominal income grew around 10.5% per year, in contrast to the 13.2% pace of gross domestic income. The 2017 debt-to-income ratio, using our income measure stood at 380% of GDP.

Moreover, the pace of debt growth over the past 10 years, has been 1.8 times faster than our estimate of the pace of nominal income growth. If that ratio holds true in 2018, then a rise of 6.5% for net income would put debt-to-income at 400%.

Thus Wolf’s worry about the arrival of a truly worrisome debt ratio, sometime “over the next decade,” seems mistimed. Using our measure of Chinese income streams, we would submit that China’s debt ratio is touching 400% just about now.

Question: Thoughts from any of my more economically savvy readers?

2. Huawei smackdowns

At what point does the concerted effort to stymie Huawei in major overseas markets trigger a response in Beijing against major Western tech firms operating in China?

Huawei Targeted in U.S. Criminal Probe for Alleged Theft of Trade Secrets - WSJ $$:

Federal prosecutors are pursuing a criminal investigation of China’s Huawei Technologies Co. for allegedly stealing trade secrets from U.S. business partners, including technology used by T-Mobile US Inc. to test smartphones, according to people familiar with the matter.

The investigation grew in part out of civil lawsuits against Huawei, including one in which a Seattle jury found Huawei liable for misappropriating robotic technology from T-Mobile’s Bellevue, Wash., lab, the people familiar with the matter said. The probe is at an advanced stage and could lead to an indictment soon, they said.

U.S. Adds Criminal Courts to Its Fight Against Chinese Theft of Trade Secrets - WSJ $$:

China said Thursday that it was concerned that a closed civil case was being reopened. “We have serious suspicions about the true motives behind it,” a Foreign Ministry spokeswoman said. “If they are politicizing this case, this does not comport with the rules on fair and free competition and breaches the spirit of the rule of law."

In the Huawei case, the jury didn’t award T-Mobile any damages in a claim of misappropriation of trade secrets and didn’t find Huawei’s alleged actions in that claim “willful or malicious”—an outcome that raises the risk that a criminal case on broadly similar terms may not deliver the verdict prosecutors want, attorneys say.

U.S. lawmakers introduce bipartisan bills targeting China's Huawei and ZTE | Reuters:

On Capitol Hill, Senator Tom Cotton and Representative Mike Gallagher, both Republicans, along with Senator Chris Van Hollen and Representative Ruben Gallego, both Democrats, introduced the bills which would require the president to ban the export of U.S. components to any Chinese telecommunications company that violates U.S. sanctions or export control laws...

The bills specifically cite ZTE and Huawei, both of which are viewed with suspicion in the United States because of fears that their switches and other gear could be used to spy on Americans. Both have also been accused of failing to respect U.S. sanctions on Iran.

Cotton, Van Hollen, Gallagher and Gallego Introduce Bill to Impose Denial Orders on Chinese Telecom Companies That Violate U.S. Sanctions | Tom Cotton | U.S. Senator for Arkansas:

"Chinese telecommunications firms like Huawei represent a growing threat to American national security. As state-directed enterprises, they ultimately report to the Chinese Communist Party and will be employed where and whenever possible to undermine American interests and those of our allies. This bipartisan legislation sets a simple standard: if a Chinese telecommunications firm is found to have violated U.S. sanctions moving forward, it will be subject to the same severe punishment originally imposed on ZTE," said Rep. Gallagher.

"Huawei and ZTE's actions to systematically undermine U.S. and allied cybersecurity show that Beijing does not wish to be part of the rules based system, but rather to break it. I am pleased to have Senators Cotton and Van Hollen join with me and Representative Gallagher to show that attacking the United States, its allies, and the international norms that are the basis for China's own progress will result in severe penalties," said Rep. Gallego.

Germany considering ways to exclude Huawei from 5G auction: report | Reuters:

Handelsblatt, citing government sources, said government officials were discussing setting security standards that Huawei could not achieve, effectively blocking its participation. Changes to the German telecommunications law were also under consideration as a last resort, the paper said.

Oxford University suspends donor ties with Chinese tech giant Huawei as national security fears mount | South China Morning Post:

In an email sent to its computer science doctoral students, the university said the Committee to Review Donations – part of the university’s Council Secretariat – made the decision last week.

“The [committee] met last week and have decided to suspend Huawei as an approved gift donor/research sponsor,” it said.

“This decision will be revisited by the committee in 3-6 months and does not impact existing donations or research projects which have already been agreed and signed, and are in progress.”

Huawei solar gear could threaten US grid, warn lawmakers | Financial Times $$:

Huawei’s sales of solar equipment in the US threaten the entire American electricity grid, members of Congress have warned, in the latest rift between US politicians and the Chinese company.

Both Democrats and Republicans have said that Huawei solar equipment could be hacked to allow a third party to slow or even interrupt US electricity supplies.

Intense anxiety of US leads to witch hunt of Huawei: China Daily editorial:

The US politicians may believe that a lie repeated a thousand times will be accepted as truth. But they should know that they will only shame themselves when Huawei proves innocent of all their allegations.

China accuses US of suppressing its high-tech companies | The Guardian:

“The real intent of the United States is to employ its state apparatus in every conceivable way to suppress and block out China’s high-tech companies,” said Hua Chunying, a spokeswoman for the foreign affairs ministry, at a regular news briefing on Thursday.

She said the reported investigation would be not only “a violation of free and fair business competition but a violation rule of law.”

The state-run Global Times called the latest pressure on Huawei a form of “technological McCarthyism” aimed at politicising and blocking Chinese businesses. Hu Xijin, the editor of the paper, said he believed US attitudes toward China had reached a level of “hysteria”.

Global Times on tech "McCarthyism 麦卡锡主义" against Huawei - 社评:迫害华为是高科技领域的麦卡锡主义_评论_环球网 

3. Canada-China

Canada Feud Damaging China's Reputation, Trudeau Envoy Says - Bloomberg:

Canada is navigating what Foreign Minister Chrystia Freeland described Wednesday as a “difficult moment” with China..

Freeland said Canada was arguing that China represents a “way of behaving which is a threat to all countries.”..

Chinese foreign ministry spokeswoman Hua Chunying on Thursday said Freeland “doesn’t know what she’s talking about.” “If the Canadian side made such remarks, the Canadian side’s reputation and image will be damaged,” Hua said.

Chinese police prevent Canadian woman from returning home on connecting flight through Beijing | The Star:

Chinese police boarded a plane in Beijing and refused to allow a Canadian woman, daughter of a jailed Chinese pro-democracy activist [Wang Bingzhang], to transit through Beijing airport en route from South Korea to Toronto.

Last week, Chinese authorities had denied Ti-Anna Wang entry into China to visit her father despite having issued her a visa, and forced her, her husband and baby daughter to board a flight to South Korea.

Canada summons Chinese ambassador over interrogation of Michael Kovrig | South China Morning Post:

As tensions between the two governments continued to intensify, officials in Ottawa on January 10 summoned China’s ambassador to Canada Lu Shaye to argue that Beijing must deport Kovrig or request a waiver of his diplomatic immunity, a move Ottawa would not agree to, according to a report published on Wednesday evening by The Globe and Mail.

4. North Korea

Some reports suggest a Trump-Kim summit may happen next month, in Asia. Will Xi and Trump use the summit as an excuse to have another face-to-face meeting?

North Korean spy chief’s visit to Washington shrouded in mystery - The Washington Post:

The South Korean press has been reporting since Tuesday that top North Korean official Kim Yong Chol is en route to Washington to deliver another letter to Trump from Kim Jong Un and to finalize details for the second Trump-Kim summit. Multiple official sources confirmed this to me, as well as South Korean reports that U.S. special envoy Stephen Beigun will travel to Stockholm for a planned meeting with North Korean Vice Foreign Minister Choe Son-Hui, who is attending an international conference there.

According to Yonhap News Agency, Kim and two other North Korean officials are already booked on a United Airlines flight from Beijing to Dulles International Airport on Thursday. CNN reported that they will begin their Washington meetings Friday.

China and South Korea vow to work together for peace on the peninsula | South China Morning Post:

Senior diplomats from the two countries sat down for denuclearisation talks in Seoul on Thursday, just as North Korea’s top negotiator headed to Washington – via Beijing.

China’s special representative for Korean peninsular affairs Kong Xuanyou met his counterpart Lee Do-hoon in the South Korean foreign ministry and promised to cooperate for the greater stability of the region.

“The Chinese side will communicate strategically with the South Korean side on Korean peninsula matters, and we will proceed together [with the South Koreans] for the progression of a diplomatic solution to the peninsula situation,” Kong said

North Korea’s KCTV released a documentary on Kim’s visit to China from January 7 to 10. Some colorful details including Xi and Kim's toast (red wine) at around 31:37 and Xi wearing glasses at around 32:08(2) KCTV HD: 조선로동당 위원장이시며 조선민주주의인민공화국 국무위원회 위원장이신 우리 당과 국가, 군대의 최고령도자 김정은동지께서 중화인민공화국을 방문하시였다 [KOREAN] - YouTube

5. Are any Chinese environmental testing data real?

How A Corrupt Testing System Left Pollution Unchecked in China - Caixin

Despite investing huge material and financial resources into China’s war on pollution, glaring falsifications and outright corruption persist in some of China’s fundamental environmental monitoring data.

Environmental testing and monitoring was privatized in 2015, and has since become an enormous and lucrative industry. The work — which includes monitoring water quality at sewage plants, toxic emissions by appliances and vehicles, and levels of different chemicals in the air and water — is now largely performed by for-profit private companies.

“From the environmental impact assessment of large-scale projects to the detection of formaldehyde in newly renovated houses, these things affect the public,” an environmental protection official who was not authorized to speak to the media told Caixin. “The current chaos is unbearable.”..

The legal representative of an environmental monitoring company in Shenzhen that was found guilty of fraud said it was only unlucky enough to get caught. The company had been doing the same thing as everyone else, the representative told Caixin on condition of anonymity. The person described attending a conference on testing and monitoring in Beijing six or seven years ago with more than 700 employees present. “What left the deepest impression was, one speaker asked if there were any laboratories that could say they had never faked data. Not a single person there could.”


6. Karl Marx emoji anyone?

Yes I know many (most?) of the intended audience may tune this out, but with enough propaganda things do sink in, and given the current state of the world the propagandists have an easier job than they did a decade ago...

Comic books to be used to popularize Karl Marx in China - Global Times 

From emojis, stage plays and animation to comic book, China is producing various products about Karl Marx, who is regarded as the millennium's greatest thinker, in a bid to popularize the political figure among Chinese teenagers.

The first comic book about Marx, Lingfengzhe (The Leader), was recently released and shows his family, love, friendship, theory and struggle. Using Marx's life, the book explains the Marxist theory in a simple and vivid way, according to Hangzhou-based Zhejiang Juvenile and Children's Publishing House, the publisher of the book.

Targeting teenagers, the comic book thoroughly relies on biographies, theory books, memoirs and classic books of the same era. It tells young readers that Marx is not only a great thinker as they learned in textbooks, but also a diligent, romantic and rebellious teenager like a normal teenager would behave, Wu Yunqin, the director of the cultural and creative department at the publishing house, also the editor of the comic book, told the Global Times on Thursday.

Chinese university lecturer makes it fun to solve real-world questions with Marxism - Global Times:

Yan Shuai is one of 13 lecturers for In-depth China, a popular public elective political course from the School of Marxism of Huazhong University of Science and Technology (HUST) in Wuhan in Central China's Hubei Province.

The class soon became the most popular course at the university after it was first offered in March 2018. "We have seen 1,600 students sign up for 200 seats," Yan told the Global Times.

Chinese college students have long been bored by the traditional way of teaching political classes.

"Many knowledge points are introduced in a page or even a sentence in the book, but it's hard to clarify the relationship between these points and current affairs in a sentence or two," Yan told the Global Times.

"I found that students are very interested in what is happening in China, but they are bothered by the lack of a systematic and professional introduction to these events," said Yan.

7. 83 Fortune 500 firms disrespecting China's sovereignty

83 Fortune 500 firms have wrong listing of Taiwan, Hong Kong and Macao: research - Global Times:

A total of 83 foreign companies among the Fortune 500 companies listed in 2017 still show Taiwan, Hong Kong or Macao as not being integral to China on their websites, a report showed on Wednesday, drawing strong criticism from industry insiders who called on the firms to "respect China's sovereignty and territorial integrity."

The study, titled "Multinational companies' positions on the one-China principle," found that out of the 385 foreign firms in the 2017 list, 66 foreign companies, including Facebook and Nike, had listed Taiwan as independent from China on their domestic websites, while 53 foreign companies and two foreign firms also listed either Hong Kong and Macao separately from China. A total of 35 companies have listed both Hong Kong and Taiwan separately from China.

8. A book I want to read

Shan Weijian's Out of the Gobi traces 40 years of US-China ties — Quartz:

It was January 1979, shortly after China and the US established diplomatic relations, and just before vice premier Deng Xiaoping visited the US at the invitation of president Jimmy Carter. Shan Weijian, 25, had just graduated from a Beijing university following six years of manual labor on a farm in the Gobi Desert during the Cultural Revolution. He was earning about $32 a month as a faculty member at the Beijing Institute of Foreign Trade...

today is the chairman of PAG Asia Capital, a private-equity firm with assets under management of $30 billion....

Out of the Gobi: My Story of China and America

Business, Economy, Finance And Trade

EU competition chief urges higher defences against China threat | Financial Times $$  According to documents seen by the Financial Times, Margrethe Vestager warned fellow members of the European Commission on Tuesday that the bloc’s antitrust rules should not be ignored to allow the planned merger of France’s Alstom with Germany’s Siemens railway division, despite warnings from Paris and Berlin that the tie-up is needed to build a rival to Chinese trainmaker CRRC.

Bonds Backed by Home Loans Surged in 2018 - Caixin Chinese banks and financial institutions issued 584.3 billion yuan ($86.5 billion) of residential mortgage-backed securities (RMBS) in 2018, up 242% from the previous year, according to China Central Depository & Clearing Co. (CCDC), a state-owned operator of the national bond depository system. RMBS accounted for 63% of China’s total asset-backed securities (ABS) that had debt obligations as underlying assets last year, CCDC said in a report released Wednesday. ABS backed by other consumer loans also grew quickly last year, rising 75% from the previous year. But such products still accounted for just 3% of total debt-backed ABS issuances.

NPCSC Adds Special Session for Second Review of Foreign Investment Law – NPC Observer  Faced with two imperfect choices, the NPCSC has decided to take an unexpected third approach. It will convene for a special session from January 29 to 30 to conduct a second review of the draft Foreign Investment Law, the Council of Chairmen announced on Wednesday. At the end of the two-day session, the NPCSC will most certainly submit the Law to the NPC, which will then most certainly approve it at its annual session in March.

China’s New-Energy Vehicle Quotas Rattle European Automakers - Caixin Under the current auto policy issued in September 2017, foreign automakers have to ensure that new-energy vehicles, or NEVs, make up a specific proportion of the cars they produce. The requirement takes effect this month. The quota policy is widely seen as a more market-based way for the Chinese government to continue to promote new-energy vehicles — or those that run on electric, hybrid-electric and fuel-cell technologies. The government has also employed financial incentives to promote the industry, but the current subsidy program, which helped China become the world’s largest market for electric cars, will end in 2020.

More Officials Call for Crackdown on Financial Corruption - Caixin CBIRC Chairman Guo Shuqing called for the industry to learn from the case of Lai Xiaomin, the fallen head of one China’s largest bad-asset managers, according to the statement. Lai, the former head of Huarong Asset Management Co. Ltd., was arrested in November on a range of charges including embezzlement of public assets. In one of the highest-profile corruption cases of 2018, Lai reportedly had three metric tons of cash stashed at home and a 300 million yuan ($44.3 million) bank account under his mother’s name, Caixin earlier reported. // 银保监会召开全系统党风廉政建设暨纪检监察工作会议 

Central Banker Frowns on Outflow of ‘Panda Bond’ Proceeds - Caixin At the end of last year, the total amount of panda bonds issued reached nearly 200 billion yuan ($29.6 billion), said Pan Gongsheng, a deputy governor of the People’s Bank of China, the nation’s central bank. “We have some preference. If an institution issues panda bonds and then immediately transfers the proceeds abroad and changes them into U.S. dollars, I don’t think it makes much sense to the issuer,” he said Thursday at a bond forum in Beijing. “It doesn’t make much sense to China, either.”

Wave of Selling Hits Hong Kong Stocks as Some Plunge 70% - Bloomberg Jiayuan International Group Ltd., Sunshine 100 China Holdings Ltd. and Rentian Technology Holdings Ltd. fell over 75 percent in a matter of minutes and at least 10 companies were 20 percent lower or more by the close, wiping out HK$37.4 billion ($4.8 billion) in market value. Most of that came from Jiayuan, which lost HK$26.3 billion on record volume.

Overdoing it: the cost of China’s long-hours culture | Financial Times $$ A survey in Shanghai last year of patients with cardiovascular disease found a significant incidence of arrhythmia — an irregular heartbeat that can be a prelude to more serious disease — in patients aged 21 to 30. Sun Baogui, executive vice-chairman of the Chinese Heart Failure Society, says this finding was consistent with their reported lifestyle of long working hours and getting little sleep. Some 85 per cent of white-collar workers in China have to work overtime, with more than 45 per cent reporting overtime of more than 10 hours a week, according to a survey last year by job recruitment website Zhaopin

China’s Looming Crisis: A Shrinking Population - The New York Times Some experts believe the population has already started shrinking. In a recent paper, Dr. Yi and Su Jian, an economist at Peking University, argued that the population contracted in 2018, the first year it has done so since the famines of 1961 and 1962 induced by the Great Leap Forward, Mao’s industrialization campaign. The researchers said inaccurate census estimates had obscured the actual population and fertility rates. “It can be seen that 2018 is a historic turning point in China’s population,” Dr. Yi wrote in an email. “China’s population has begun to decline and is rapidly aging. Its economic vitality will keep waning.”

Politics, Law And Ideology

Xi Jinping inspects Tianjin - Xinhua Is Xi doing an inspection of progress in the Beijing-Tianjin-Hebei integration plan? 

习近平到天津考察 参观南开百年校史展览_网易新闻 pictures and a short video from Xi's inspection tour of Tianjin. Nankai University among his stops

Xi urges entrepreneurs to take 'historic opportunities' in Xiongan's construction - CGTN Xi said all kinds of enterprises and firms, state-owned or private, local or those from Beijing, should grasp the chance to make a new achievement. Xi also stressed that traffic needs to play the leading role in urban construction and economic development. He extended his greeting to railway builders who are still working hard in the cold winter and encouraged them to make greater contributions to the construction of the New Area.

China watchdog bans officials from close ties with liquor giant Moutai | Reuters The anti-graft watchdog in China’s southwestern Guizhou province on Thursday banned officials and their family members from taking part in operations or using their position to influence sales for liquor giant Kweichow Moutai Co Ltd.

Senior CPC official calls for healthy ideological, cultural environment - Xinhua A senior official of the Communist Party of China (CPC) on Thursday called for more efforts to create a healthy ideological and cultural environment for celebrating the 70th anniversary of the founding of the People's Republic of China. Huang Kunming, a member of the Political Bureau of the CPC Central Committee and head of the Publicity Department of the CPC Central Committee, made the remarks at a national teleconference on combating illegal publications and online pornography.

Tibet to link all villages by road in 2019 - Xinhua Southwest China's Tibet Autonomous Region aims to build and upgrade 4,500 km of rural roads to link all its townships and villages by the end of 2019, local authorities said Thursday. The move is expected to contribute to the ongoing poverty reduction campaign, especially in Tibet's one township and 12 villages that still lack access to roads, according to the regional department of transport.

Foreign and Military Affairs

 华春莹:彭斯污蔑中国言论是“国家诽谤行为”: 美国副总统彭斯16日在美国务院举办的驻外使节会议上声称,中国过去几年来经常无视国际法和国际规范,美国不会再对此视而不见。中国外交部发言人华春莹17日将彭斯的言论斥为“国家诽谤行为”,并表示美国最没有资格在规则的问题上对中国“指手画脚” // Hua Chunying accuses US Vice President Pence of slander for his comments Wednesday about China's disregard for international rules and norms -

Opinion | Germany’s China Problem - The New York Times According to analysts like Mikko Huotari, the deputy director of the Berlin-based Mercator Institute for China Studies, Chancellor Angela Merkel has long held a skeptical view of China’s political development. But it was not until about two years ago that the rest of the government came around to her way of thinking, and pushed the rest of the government to sign onto a new, multifaceted China strategy. This new approach begins with the premise that China is not just expanding its economy, but seeking to impose a global agenda that not only promotes its interests but also chips away at the rules-based, multinational order established after World War II. In response, Germany needs to be more active, perhaps even combative, in defending its interests.

Philippine defence chief urges review of US treaty amid South China Sea tensions | This Week In Asia | South China Morning Post Manila should review its defence agreement with Washington to clarify when the United States will come to its aid, as tensions in the South China Sea are the Philippines’ “most difficult” security challenge, its Defence Secretary Delfin Lorenzana said on Thursday. A former defence attaché to Washington, Lorenzana was speaking at the Foreign Correspondents Association in Manila where he sketched the main domestic and external security challenges the country was grappling with, such as its ongoing communist insurgency and violent extremism.

Philippines Should Take Over Shipyard to Keep It From Chinese, Officials Say - The New York Times The Philippine government should take control of the country’s largest shipyard, the defense secretary said on Thursday, after officials raised concerns that Chinese companies seeking to take it over would act as agents of Beijing, projecting China’s power deeper into the region.

Kyrgyz police disperse anti-Chinese rally | Reuters Protesters who gathered on the central square demanded curbs on work permits for Chinese citizens as well as a reduction of Kyrgyz debt to China and called for other measures to reduce the Chinese presence, including a ban on Kyrgyz-Chinese marriages.

4 big trends for China and Russia in 2019 - China-Russia Newsletter A special edition of The Report covering four big trends for China and Russia in 2019: The Economy/Energy Markets; Apprentice Season 3: The Moscow Project (and sanctions); The Ghosts of Authoritarian Political Interference Past, Present, and Yet-to-Come; and Central and South Asia.

China, Russia to strengthen cooperation in economic and social areas - Xinhua China's top political advisor Wang Yang on Thursday called for enhanced cooperation between China and Russia in economic and social areas. Wang, chairman of the National Committee of the Chinese People's Political Consultative Conference (CPPCC), China's top advisory body, made the remarks while meeting with Valerii Fadeev, chairman of the Russian Public Council. Noting that the year 2019 marks the 70th anniversary of the establishment of diplomatic ties between China and Russia, Wang said the bilateral comprehensive strategic partnership of coordination is at its best period in history under the strategic guidance of leaders of both countries, becoming a ballast stone of regional and international peace and stability

China is setting up a new model for world human rights - People's Daily Online - Lin Songtian, Chinese ambassador to South Africa Some people in the West accuse the Chinese government’s vocational training programs in Xinjiang as “racial segregation”, “religious persecution”, or “re-education camp”. Such attempt is clearly driven by ill intention or mere bias and prejudice. The vocational training schools established in Xinjiang offer free training opportunities for the local young people and assist them in finding jobs or starting a business. This is a major innovation by the Chinese government to tackle extremism and terrorism...Our news networks are filled with stories and images of atrocities happened in Iraq, Libya, and Syria. These countries with thousands years of history and once with great infrastructures have been reduced to rubbles. Countless homes were destroyed and many more people were displaced, being deprived of the most basic human rights of safety and basic living. These are exactly the consequences of the Western countries’ interference in others’ domestic affairs under the disguise of human rights.

CommonWealth Magazine - UMass Boston severs ties with Confucius Institute Katherine Newman, the interim chancellor at UMass Boston, declined to give a specific reason for the decision to part ways with the institute after 12 years on campus. She said concerns have been raised across the country about Confucius Institutes, and the decision was made to instead pursue negotiations with Renmin University in Beijing on ways to promote the study of Chinese language, culture, and history on campus.


Explaining China’s Latest Catch in Africa | The Diplomat However, while financial incentives certainly played a part, another set of factors have been largely unaccounted for in the current media and scholarly literature available, which helps explain the timing of the change from Taiwan to China: Burkina had been facing growing peer pressure from its neighbors in the context of regional cooperation and increasing security threats.

Tech And Media

ByteDance Can’t Outrun Beijing’s Shadow – Foreign Policy But at the end of the day, there is very little that these firms can do in a party-state environment. China’s national intelligence law, according to one interpretation, gives total authority to the government to compel firms—and with no independent judiciary, even extralegal pressure is very hard to resist. CCP regulators who can take massive bites out of market capitalization seemingly at will alone make keeping officials at home happy ByteDance’s first priority, regardless of reputational risks abroad.

China’s Tencent and Alibaba hit the brakes after dealmaking binge | Financial Times $$ Tencent and Alibaba, China’s biggest tech groups and two of the country’s most acquisitive buyers, have stepped on the brakes after a dealmaking binge that saw the duo mint an aggregate 243 investments last year.

China tests new-generation exascale supercomputer prototype - Xinhua The sample machine passed tests in July last year and is ready for application. It is a first-phase result in the research of exascale supercomputer capable of a quintillion calculations per second. The new supercomputer Tianhe-3 will be 200 times faster and have 100 times more storage capacity than the Tianhe-1 supercomputer, China's first petaflop supercomputer launched in 2010.

重庆:喷火清障无人机正式投用-科技新闻-中国科技网首页 a fire breathing drone in Chongqing

Famous Journalist Denies ‘Malicious Slander’ of Baidu - Caixin Baidu lodged the complaint Friday, after the journalist, Wang Zhian, wrote about several high-profile deaths resulting from misleading medical advertisements. Baidu was linked to one of those cases, in which a patient died after a web search led him to ineffective experimental treatment. Wang’s article, published Jan. 4 on his pubic WeChat account, focused on a recent incident involving Quanjian Group, which advertised spurious treatments that allegedly contributed to the death of a 4-year-old. Wang’s article then noted other examples of fraudulent medical treatments and misleading advertisements, and criticized China’s lack of regulation on the sector.

Society, Art, Sports, Culture And History

Dealmaking in Escort Bars Thrives in Pockets of Corporate Asia - Bloomberg Back in Shanghai, startup employee Yuan isn’t optimistic, as she continues to slog through entertainment sessions with guests and her male colleagues. “I don’t think this will ever change in China,” she said. “I don’t think #MeToo has had any significant impact in China. People are too busy making money to think about these matters.”

Liquor Company Puts Missing Kids’ Photos on ‘Baijiu’ Bottles - Sixth Tone Xiao Dufeng, the general manager of Chongqing Laoyuanzi Wine Co. Ltd., told the newspaper that he had thought of using his company’s products to share information about missing children after a friend’s child disappeared. Laoyuanzi reports annual sales of 5,100 tons of liquor and 160 million yuan ($24 million). Sixth Tone’s calls to the company went unanswered on Thursday.

The Chinese Communist Party’s Relationship with the Khmer Rouge in the 1970s: An Ideological Victory and a Strategic Failure | Wilson Center By utilizing untapped Chinese primary sources, including official documents, the biographies and memoirs of the CCP cadres involved in managing the relationship with the Khmer Rouge, and in particular the memoirs of former Huayun (Huaren Huaqiao Gemingyundong, or ethnic Chinese revolutionary movements) members in Cambodia, this paper argues that, under Mao, the CCP’s policies towards the Khmer Rouge were subordinate to Mao’s political needs and shaped primarily by his efforts to safeguard the Cultural Revolution. But in the end, Mao’s “ideological victory” translated into a strategic failure for China’s post-Mao leadership.

When Beijing wanted its own “Chinese Pope” - La Stampa Liu Guopeng, a member of the Chinese Academy of Social Sciences, tells how in the 1950s the authorities of the People’s Republic decided to create their own Pontiff. And he explains why, with the Agreement with the Holy See, the idea of a “national do-it-yourself Church” goes into the archives

Mainland Pressure — China's Underground Club Culture | MAEKAN I set off on a tour of 5 Chinese cities this October to try and get a sense of what’s going on in China’s clubs.

Energy, Environment, Science And Health

China unveils pilot "group-buying" plan to cut drug prices - Xinhua Details of the program was released by the General Office of the State Council Thursday. As a major reform of the current centralized procurement system, the program asks public hospitals in the pilot cities to purchase 60 to 70 percent of their total annual demand for certain medicines in order to get a lower price.

China unveils top 10 scientific communication achievements of 2018 - People's Daily Online impressive list, from landing on dark side of the moon to growing rice in the desert