Happy Wednesday. China is now on holiday for over a week. If there is enough to write about tomorrow I will do a newsletter, otherwise I may wait until next week for the next subscriber update.

The PRC embassy party last night was fun as they go but overall a bit depressing as we are clearly heading into one of the most difficult periods in US-China relations since normalization.

Yesterday's issue noted in item #5 that the bipartisan consensus among US foreign policy elites is that America's China policy has failed. The trigger for that item was The China Reckoning | Foreign Affairs by Kurt Campbell & Ely Ratner.

In 2007 James Mann wrote The China Fantasy, which in my 2011 post James Mann And His Prescient Book “The China Fantasy” I called "the most important and prescient American book on China of the 21st century" and said “Mann pissed off a lot of people, including me the first time I read it. In fact, he attacked the foreign policy and business elite (and specifically the Sinology elite) in such a way that many of them either ignored this book or did their best to discredit or downplay it.”

Jim is a Sinocism reader and he shared with me the following comments after reading the Campbell/Ratner piece, comments that are sure to generate more strong emotions:

1) the two central points of "The China Fantasy" in 2007 were the ones made 11 years later in this article-- that US hopes of changing China were wrong, and that the assumption that China could or wanted to be integrated into (our) international order was also wrong.
2) when China Fantasy came out, its argument was widely derided by the leading China hands in both parties (and I was treated as beyond the pale, basically ridden out of mainstream discussion).
3) Put this new Foreign Affairs piece together with Trump's recent National Security Strategy, and it means that the central argument of the China Fantasy has now, for the first time, become mainstream thinking in both major parties.
Which leaves two issues:
1) how much harm was done, how many jobs lost, over the 11 years it took these people to see that their assumptions were wrong?
2) would we even have Trump in the White House today, if people like Hillary Clinton and Kurt Campbell had come to these conclusions earlier, in time to adjust American policy years ago, before American workers, in states like Michigan, Pennsylvania and Wisconsin were left alienated and embittered?

Comments are always welcome, and where appropriate I am happy to include them in future issues of the newsletter.

Here's to wisdom, fortitude and peace in the Year of The Dog. We are all going to need them more than ever.

Thanks for reading.

The Essential Eight

1. US-China Trade Tensions, Wang Qishan Already Playing A Role

US trade move against China snared in legal concerns - FT $$:

The Trump administration’s largest anticipated trade move against China has become bogged down in an internal debate focused in large part on legal concerns, even as Beijing is stepping up a frantic lobbying campaign to avert confrontation...
Officials in Beijing have been frantically lobbying US diplomats to avert a trade war.
Over recent weeks Terry Branstad, the US ambassador to Beijing, has met privately with Chinese President Xi Jinping and Wang Qishan, the Communist party’s most trusted troubleshooter, according to four people familiar with the Sino-US discussions.
Mr Xi’s top economic adviser, Liu He, has requested a meeting with Mr Branstad that has been scheduled for Wednesday, the people added.
Late last week Yang Jiechi, China’s top diplomat, travelled to Washington for meetings with Mr Trump and his top advisers, leading Chinese state media to hail the discussions as a way to “iron out trade issues”.

I have been hearing for a while that various foreign diplomats and visitors have been directed to meet with Wang Qishan. My own sources give me very high confidence that Wang will become Vice President and have as part of his job overall responsibility for US-China relations.

Wang Qishan’s absence from the list of retired leaders visited for new year’s greetings is another clear sign he is not retired.-王岐山，不在老同志名单中

China's Best Weapon in a Trade War With Trump May Backfire - Bloomberg:

Any China soybean curbs would directly hit farmers in Midwestern U.S. states that President Donald Trump needs to win re-election in 2020. Yet they would also pose a big risk for Xi: His nation is the world’s largest pork producer and consumer, and higher costs for pig farmers could increase prices of meat for his nation’s 1.3 billion citizens.
Food prices have long been a politically sensitive issue for China’s ruling Communist Party, which rose to power in 1949 in the wake of economic mismanagement that led to hyperinflation. A surge in the cost of everything from pork to electronics in the late 1980s also stoked dissatisfaction in the run-up to the Tiananmen Square protests.

U.S. Department of Commerce Issues Affirmative Preliminary Antidumping Duty Determination on Cast Iron Soil Pipe Fittings from the People's Republic of China | Department of Commerce:

“Though politics plays no role in antidumping investigations, President Trump made it clear that we will vigorously enforce our trade laws and provide U.S. industry relief from unfair trade practices,” said Secretary Ross. “Today’s decision allows U.S. producers of cast iron soil pipe fittings to receive relief from the market-distorting effects of potential dumping while we continue our investigation.”
The Commerce Department preliminarily determined that exporters from China have sold cast iron soil pipe fittings in the United States at 68.37 to 109.95 percent less than fair value.

2. The US Government's Increased Focus On The "China Threat"

The FBI director says Chinese society as a whole is a threat to the US - BI:

Speaking before the Senate Intelligence Committee alongside the heads of other US intelligence agencies, Wray told Senators that China is using a host of methods to undermine American military, economic, cultural, and informational power across the globe that rely on more than just China's state institutions.
"One of the things we're trying to do is view the China threat as not just a whole of government threat, but a whole of society threat on their end," Wray said, "and I think it's going to take a whole-of-society response by us."
Director of National Intelligence Dan Coats expressed a similar sentiment after Sen. Marco Rubio asked him about China's plans to overtake the US as the world's supreme world power.
"There is no question that what you have just articulated is what's happening with China," Coats said. "They're doing it in a very smart way; they're doing it in a very effective way; they are looking beyond their own region."
Coats said multiple agencies are conducting "intensive studies" to understand the ways China is looking to carry out its global agenda.

(2) Marco Rubio: China’s plan is to replace US global power. 13 Feb 2018 - YouTube

FBI Director’s Shock Claim: Chinese Students Are a Potential Threat - DailyBeast:

“The use of non-traditional collectors, especially in the academic setting—whether it’s professors, scientists, students—we see in almost every field office that the FBI has around the country,” he said. “It’s not just in major cities. It’s in small ones as well, it’s across basically every discipline. And I think the level of naivete on the part of the academic sector about this creates its own issues.”
What’s more, Wray added, the Bureau is actively investigating some Chinese government-backed groups that facilitate dialogues between Chinese and American academics. It was a rare revelation of active FBI investigations—one that drew pointed criticism from Asian-American advocacy and student groups...
“We do share concerns about the Confucius Institutes,” Wray said. “We’ve been watching that development for a while. It’s just one of many tools that they take advantage of. We have seen some decrease recently in their own enthusiasm and commitment to that particular program, but it is something that we’re watching warily and in certain instances have developed appropriate investigations into them.”

China using ‘tentacles’ to erode US security, senator warns, urging passage of bill boosting scrutiny of deals | South China Morning Post:

“Some of our adversaries, most notably China, have altered the strategic landscape and [are] not playing by the same set of rules,” Senator John Cornyn, the second-most senior Republican, said on the Senate floor.
“China has weaponised investment in an attempt to vacuum up our advanced technologies and simultaneously undermine our defence industrial base...
If passed, FIRRMA would give CFIUS the authority to review all “non-passive” investments by foreign entities. Currently CFIUS only reviews transactions that give foreign parties majority control of a US company that develops, sells or licenses advanced technologies with potential military applications.
CFIUS would also be able to suspend pending transactions and impose new conditions, retroactively, on completed transactions.

Cornyn's comments about CFIUS and the bill he is co-sponsoring FIRNMA on Youtube.

China's Hauwei: Top US intelligence chiefs caution Americans away - CNBC:

The directors of the CIA, FBI, NSA and several other intelligence agencies express their distrust of Apple-rival Huawei and fellow Chinese telecom company ZTE.
During a hearing, the intelligence chiefs commended American telecom companies for their measured resistance to the Chinese companies

China has "no idea why" United States feels "sense of insecurity" with "unparalleled" military after cyber threat report - AP:

Beijing has no idea why the U.S. harbors such a "feeling of insecurity," a Chinese spokesman said Wednesday, responding to an American government report singling out China as among the countries posing the greatest cyber threats. The U.S. remains the world's top major power, with "unparalleled" military strength, foreign ministry spokesman Geng Shuang told reporters at a regularly scheduled news briefing.

3. Demonization of Sun Zhengcai Kicks Into High Gear

What are the odds of a death sentence for Sun, and any chance Xi believes Sun has links to Guo Wengui?

‘Vast sums linked’ to corruption case of fallen Chinese high-flyer Sun Zhengcai | South China Morning Post:

The government has not given exact details the crimes Sun is suspected of, but senior officials have been giving closed-doors briefings about his case, including in the northeastern province of Jilin, where Sun was party chief from 2009 until late 2012.
In a meeting overseen by Jilin’s present party boss, Bayin Chaolu, officials were told they had to learn the lessons from and deeply reflect on Sun’s crimes, the official Jilin Daily reported.
“The enormity of the sums involved in Sun Zhengcai’s case and the seriousness of the crimes have rarely been seen since the founding of new China,” the report said, referring to the 1949 revolution which brought the Communist Party to power.

吉林省委：孙政才“十个必须”条条触犯“七个有之”样样皆占_政经频道_财新网:

会议指出，孙政才案涉及金额之大、犯罪性质之严重是新中国成立以来少有的，是“十个必须”条条触犯，“七个有之”样样皆占，腐化堕落、触犯刑律的腐败典型，是党的十八大后仍然不收敛、不收手、问题严重突出、群众反映强烈、占据重要岗位的腐败典型，严重损害党的形象和法律尊严，给党和人民事业造成巨大损失，必须予以严惩。对孙政才案依法提起公诉，果断及时正确、深得党心民心，充分彰显了以习近平同志为核心的党中央全面从严治党永不停歇、将反腐败斗争进行到底的坚强意志和坚定决心；充分彰显了党中央坚决维护和捍卫党纪国法权威的鲜明态度和强大定力；充分彰显了党中央深入清除党内毒瘤，不断把我们党建设成为始终走在时代前列、人民衷心拥护、勇于自我革命、经得起各种风浪考验、朝气蓬勃的马克思主义政党的政治勇气和责任担当。

4. What exactly is Lu Wei's Political Problem?

China’s ‘tyrannical’ former internet tsar Lu Wei accused of trading power for sex in long list of corruption charges | South China Morning Post:

Beijing-based political commentator Zhang Lifan said the announcement focused on failings of personal character.
“The wording ... was harsher than before. It is very unusual. Previously, such [CCDI] statements would detail specific offences,” Zhang said. “He might have done something to deceive the top leadership, leading to their great fury.
“The sentiment could be directly citing the instructions of some top leaders.”

In the rumors department, there is a belief in some overseas Chinese media circles at least that Lu benefited from Wen Jiabao's patronage over the years…

China’s "shameless" former internet czar Lu Wei was expelled from the Communist Party and investigated for corruption — Quartz:

Investigations found that Lu Wei severely violated the party’s political discipline and rules, and covertly refused to implement the party’s policies while appearing to be obedient. He was defiant of rules, acted wantonly, and made irresponsible comments on the central leadership. He obstructed the central leadership’s discipline inspections. With inflated ambition, he abused public resources for personal purposes, and unscrupulously sought personal influence. With evil conduct, he framed others anonymously and formed “small cliques.” He severely violated the central leadership’s eight-point regulations and discipline in relation with the public. He frequented private clubs, sought privileges waywardly, and acted arbitrarily and tyrannically. He violated organizational discipline, failing to speak the truth during investigations. He violated anti-graft discipline, trading power for personal gains. He violated work discipline, selectively implementing the central leadership’s cyberspace management strategy. He traded power for sex and was shameless. He took advantage of his post to seek profits for others and accepted a huge amount of property. He is suspected of bribery-taking.
As a top-level official of the party, Lu Wei has lost all his ideals and beliefs and has forgotten the party spirit and principles. He has betrayed each and every important political requirement and major discipline for party members. He is a typical two-faced person. He showed no signs of restraint after the party’s 18th congress. His wrongdoings are of a grave nature and resulted in a strong public outcry. He is a good example of having both political and economic wrongdoings. His case is extremely bad and particularly serious.

No tiger has been executed so far in Xi's corruption crackdown. Will that change, especially since Qincheng is running out of space?

Xi Jinping’s anti-graft drive has caught so many officials that Beijing’s elite prison is running out of cells | South China Morning Post:

It looks like being a particularly grim Lunar New Year in the “tigers’ cage” this week. The notorious Qincheng maximum security prison houses many disgraced senior Communist Party officials – including fallen security chief Zhou Yongkang, former Chongqing boss Bo Xilai, ex-presidential aide Ling Jihua and Guo Boxiong, who was once a top general.
Normally, some of those prisoners who are aged over 60 can look forward to a Lunar New Year meal with a few family members, but a source close to the jail told the South China Morning Post that this year, the celebration has been cancelled.
The source said the prison was packed to the gills with inmates – a product of President Xi Jinping’s ferocious anti-corruption drive that has netted more than 1.3 million officials at various levels, from the elite “tigers” to the ordinary “flies” – and there was not enough room to accommodate the annual family gatherings during the most important Chinese festival of the year.

5. The Year Of The Dog May Be A Nightmare For Many Local Officials

Based on what I am hearing expect the new campaign against organized crime and "protective umbrellas" to be quite intense, and to result in the arrests of many local "flies".

Uprooting "protective umbrellas" key to battling organized crime: CCDI - Xinhua:

China's graft busters have asked for more efforts in the investigation and punishment of "protective umbrellas" -- officials who shelter criminal organizations by concealing their crimes and shielding them from punishment -- in a campaign against organized crime.
According to a guideline released by the Communist Party of China (CPC) Central Commission for Discipline Inspection (CCDI) and made public Tuesday, discipline agencies should dig into each of the cases involving "protective umbrellas" to uproot them and corrupt officials.

中央纪委印发《关于在扫黑除恶专项斗争中强化监督执纪问责的意见

6. Catholicism's China Schism?

China’s Catholics Rue Church’s Slide as Powers Debate Control - The New York Times-Ian Johnson:

The Vatican has already asked Guo Xijin, the underground bishop in Mindong, to yield his leadership of an estimated 70,000 Catholics to a government-appointed cleric who commands about 10,000 followers — a huge concession to Beijing.
Bishop Guo, 59, who has been a priest in Mindong since 1984, said in an interview that he was willing to accede if it helped heal the long split between the underground and government churches.
But he added that it would not address larger problems that are diminishing Catholicism here. “The main problem is believers’ educational level and spiritual foundation,” he said. “They have belief, but there is no depth to it.”...
Mindong’s problems reflect a larger trend. According to surveys of the official and underground churches by Anthony Lam, a researcher with the Holy Spirit Study Center in Hong Kong, the total number of Catholics in China peaked around 2005 at 12 million and has since declined to 10 million.
That makes Catholicism the smallest major religious group in China, and the only one that is shrinking — even as other faiths, especially Buddhism and Protestantism, have grown rapidly amid a nationwide religious revival.

I assume many of you have read Ian's excellent book on Chinese religion-The Souls of China: The Return of Religion After Mao If not you might want to add it to your China reading list.

Pope’s Deal With Beijing Is ‘Putting Wolves Before Your Flock,’ Cardinal Says - WSJ:

Cardinal Zen calls a Vatican plan to recognize seven bishops appointed by Beijing a betrayal to Chinese Catholics who have refused to recognize the authority of government-backed church organizations and faced persecution for their participation in “underground” communities loyal to the pope.
“You are telling them, ‘You are stupid for being loyal for so many years. Now surrender,’” Cardinal Zen said in an interview in the Hong Kong seminary he joined seven decades ago.

7. Unclear How Xi Thought And The People's Leader Can Fix Beijing's Water Crisis

Beijing sees longest dry spell in 47 yrs - Xinhua:

Beijing recorded 115 consecutive days without "effective precipitation" as of Wednesday, its longest dry spell in 47 years.
The Chinese capital has not seen precipitation of 0.1 mm or more on any of the past 115 days, according to Beijing's climate observatory.
The previous longest dry spell was between October 1970 and February 1971, when the city experienced a 114-day rainless streak.

8. Lunar New Year News

Xi calls for hard work in new era - Xinhua:

President Xi Jinping encouraged Chinese people to work hard in the new era during his Spring Festival speech on Wednesday.
"The new era belongs to those who work hard," and happiness can only be earned by filling one's life with endeavors, said Xi, also general secretary of the Communist Party of China (CPC) Central Committee and chairman of the Central Military Commission.
"There will be difficulties in our endeavor, but battling them will also purify our souls and strengthen our faith," said Xi.
Xi stressed that the great endeavor of upholding and developing socialism with Chinese characteristics will take generations, even dozens of generations, of hard work.
Those fighting in these efforts will be richest in spirit, and will have the most profound understanding of happiness, according to Xi.

Text of Xi's speech-习近平：在2018年春节团拜会上的讲话

CCTV Evening News video of his speech - 中共中央国务院举行春节团拜会习近平发表重要讲话

人民日报评论员:奋斗是幸福的

The CCTV spring festival gala program has been released. In a quick scan I see 2 songs about "The New Era", Jackie Chan will sing “China”, Wang Fei & Na Ying have a return duet 20 years after this performance of 相约1998 (on Youtube if you want to get nostalgic about China in an earlier Era...) on the 1998 CCTV show , and "龙的传人 Descendants of the Dragon" will be sung by singers from the Mainland, Hong Kong, Macao and Taiwan, and the final song is “I love you China”-狗年春晚节目单来啦！快来看看哪个节目你最期待

High-speed trains keep the Spring Festival moving - People's Daily Online:

This year, more than 60 percent of Chinese have chosen high-speed trains to get them home for the Spring Festival, Chinanews.com reported on Feb. 13....
A person with China Railway disclosed that more than 5,600 high-speed trains will serve every day during the Spring Festival travel rush, accounting for 65 percent of the total number....

PLA lends brain and brawn for China’s New Year travel rush | Asia Times:

State broadcaster China Central Television reported that during the peak of online transactions in early February hundreds of millions of migrant workers turned to the rail operator’s booking platform, 12306.com, to get tickets for their exodus back home in rural China.
The system saw some 150 billion hits per day and sold on average 11 million tickets on a daily basis – 700 transactions per second, which would fill an eight-car bullet train. Around 3 billion trips are expected for this year’s chunyun.
To cope with the staggering traffic from desktops and mobile phones – as passengers check schedules and compare fares before buying seats – the CRC sought help from the country’s military. They did not want soldiers to man ticketing offices or answer inquiries, but, to construct an online ticketing system that can handle an astronomical amount of visits and remain virtually infallible, while backed by racks of military-grade servers.

WeChat Pay Announces "Spring Festival Shake" to Win Hongbao War | the Beijinger:

From Feb 14 to 20, WeChat users can use WeChat to pay over RMB 2 (USD 0.3) at the offline sites where WeChat Pay is aligned with. Users have three chances a day to participate in lucky draws to win two kinds of red envelopes: free purchase (免单 miǎn dān) or up to RMB 200 (USD 31.6) in red envelopes (到店红包 dào diàn hóngbāo) that user can use in offline stores using WeChat pay.
During the “Spring Festival Shake” event launching today, Feb 14, WeChat will also hand out different daily digital blessing eggs (祝福彩蛋 zhùfú cǎidàn) to users

Business, Economy, Finance And Trade

Local Government Bond Issuance Expected to Remain Around 4 Trillion Yuan in 2018 - China Banking News Analysts expect heavy regulatory pressure to keep local government bond issuance at around 4 trillion yuan this year, roughly on par with the 2017 level.The latest data from the Ministry of Commerce indicates that last year a total of 4.3581 trillion yuan in local government bonds were issued throughout China, of which 2.3619 trillion yuan were standard bonds and 1.9962 trillion yuan were special bonds.

China asks US to refrain from unfair trade measures - People's Daily Online China on Tuesday urged the United States to exercise trade restriction measures with restraint and abide by multilateral trading rules to contribute a positive impetus to the global economy, the Ministry of Commerce said. The ministry's comments came after the US Department of Commerce launched trade remedy investigation on imports of large diameter welded pipe products from China, South Korea, Greece, India and Canada on Monday. The move triggered concerns in several countries about the rampant use of trade protectionism measures by the US.

Republicans Challenge Trump on Steel, Aluminum Tariffs - Bloomberg Trump’s meeting with the four Democrats and 15 Republicans led off with discussion of his administration’s investigation of steel and aluminum imports. Commerce Secretary Wilbur Ross submitted his department’s final reports on the metals to Trump in January, and the president has until mid-April to decide on any potential action, which could include tariffs. Trump said that “many countries” including China are “dumping” imports of the metals on the U.S. market, hurting domestic production.

Tesla’s China Dream Threatened by Standoff Over Shanghai Factory - Bloomberg More than seven months after Tesla said it was working with Shanghai's government to explore assembling cars, an agreement hasn't been finalized because the two sides disagree on the ownership structure for a proposed factory, according to people with direct knowledge of the situation. China's central government says the plant must be a joint venture with local partners, while Tesla wants to own the factory completely, the people said, asking not to be identified because the negotiations are confidential. Currently, all foreign automakers must partner with Chinese companies in order to manufacture locally.

China's Hottest Stock Is Suddenly Back in Short-Sellers' Sights - Bloomberg Short interest in China Evergrande Group tripled in the wake of an HK$18 billion ($2.3 billion) convertible bond issue at the end of January, surging from an almost five-year low.

Debt-Laden HNA’s Credit Assessment Cut by S&P - Bloomberg Debt-laden Chinese conglomerate HNA Group Co. had its credit assessment cut for the second time in less than three months by S&P Global Ratings, which cited significant debt maturities amid deteriorating liquidity. Separately, some HNA directors and top executives have purchased offshore dollar bonds guaranteed by the group, according to an emailed statement Wednesday that didn’t disclose the amount. The company is in a "very healthy" financial position, it said.

China's central bank says has cut leverage, but will continue to fight risks - Reuters “The overall level of leverage is still high, especially the debt pressure on state-owned enterprises is still large,” the People’s Bank of China said in its fourth-quarter monetary policy implementation report. “We will fight a tough battle against major financial risks and safeguard the bottom line of systemic financial risks.”

China's Dalian Wanda sells 17 percent stake in Spain's Atletico Madrid - Reuters Dalian Wanda Group has sold a 17 percent stake in Atletico Madrid, the Spanish soccer club said on Wednesday, the latest step in the Chinese conglomerate’s strategy to reduce debt. The sale to Israeli billionaire Idan Ofer for an undisclosed sum adds to deals worth about $16 billion that Wanda has announced since last year.

Govt tightens oversight of insurers' overseas financing - China Daily China's insurance and foreign exchange regulators issued a notice this week requiring that the value of insurers' overseas financing guaranteed by their onshore assets must not exceed 20 percent of their total net assets at the end of the previous quarter.

Politics, Law And Ideology

The Xi Jinping Faction Dominates Regional Appointments After the 19th Party Congress - Jamestown What is perhaps even more significant is that after the 19th Party Congress, the “core leader” and zuigaotongshuai (最高统帅; “supreme commander”) has been filling top regional posts—the party secretaries, governors and mayors of important provinces and cities—with members of the so-called Xi Jinping Faction. Reshuffles have also taken place at the vice-governor level or equivalent in almost all of China’s 31 major administrative districts (China News Service, January 7). The Xi Faction refers mainly to Xi’s subordinates, associates and followers when he served in Fujian (1985-2002), Zhejiang (2002-2007) and Shanghai (2007). Sub-sets of the Faction consist of cadres who have worked in his home province of Shaanxi, as well as graduates of Tsinghua University, Xi’s alma mater. Shaanxi-related officials have gained Xi’s trust through taking good care of the many members of the Shaanxi-based Xi Clan (See China Brief, June 9, 2017). This will ensure that Xi will be spared the conundrum that has bedeviled generations of top leaders, namely “orders cannot go beyond the Zhongnanhai [party headquarters] to the rest of the country.”

中共中央党校 - 学习时报网_伟大思想理论因何伟大？ He Yiting answers the questions "Why is The great Xi Pinping thought theory great"? // 　　这一思想的重大政治意义，根本在于它对形成、确立、巩固习近平总书记党中央的核心、全党的核心地位提供了不可替代、不可或缺的思想保障和理论基础

Foreign and Military Affairs

The United Front Work Department in Action Abroad: A Profile of The Council for the Promotion of the Peaceful Reunification of China - Jamestown: Although the CPPRC has gathered greatest recent attention in Australia, chapters of the organization exist throughout the world, in countries as wide-ranging as the Philippines and Namibia (Qingnian Wang, May 1, 2017; People’s Daily Online, November 29, 2004). The group has emerged in recent years at the forefront of groups representing, or claiming to represent, ethnic Chinese communities abroad; and has also become one of the PRC’s primary institutions for organizing and mobilizing the international Chinese diaspora in support of PRC policies. The organization maintains numerous branches in the United States, including chapters in New York, San Francisco, and other major cities. The national headquarters branch in the United States is the National Association for China’s Peaceful Unification (NACPU), located in Washington, D.C...The CPPRC is only one example out of many synthetic civic groups managed by Beijing, which have long been employed by the ruling Chinese Communist Party to pose as nominally independent outlets that campaign in support of PRC policies. As the UFWD assumes an ever-more influential role in shaping the foreign policy narratives of the PRC, the Council for the Promotion of the Peaceful Reunification of China and other front organizations are likely to also assume a larger role as outlets for the propaganda themes of their parent organization.

Shipping Finance: China’s New Tool in Becoming a Global Maritime Power - Jamestown Entry into the shipping finance industry has very much been facilitated by market factors, including the retreat of Western banks, the abundance of Chinese capital and the fact that it had not been tied to existing shipping portfolios. However, a strategic sector like shipping inevitably falls under close government supervision. With a declining domestic shipbuilding industry, Chinese banks have been given clear directions to assist and subsidize. In January 2017, in a statement published by the Ministry of Industry and Information technology, six ministries expressed support to the shipping industry while they encouraged financial institutions to support the sector with loans and financing (miit.gov.cn, January 2017). Additionally, the China Banking Regulatory Commission (CBRC) has encouraged financial institutions to support the domestic shipbuilding industry and the export of domestically-built ships (Splash247, September 2017; Seatrade Maritime News, May 2017).

Hawkish US ambassador to Australia likely to roil ties with China - Global Times Harry Harris, commander of the US Pacific Command and a Japanese-American, was named US ambassador to Australia last Friday. Harris is known for his tough stance against China on the South China Sea issue....Being a hawkish Japanese-American admiral, his appointment to the ambassador's position will possibly play a crucial role in strengthening military cooperation among the US, Australia and Japan. He may influence the Australian government with his hawkish views.

China, Philippines talks silent on militarisation of South China Sea | South China Morning Post Beijing and Manila agree to pursue further joint efforts on oil and gas exploration in disputed waters but observers say they are likely to remain symbolic

Zambia to Seek Restructuring of Debt to China After IMF Warning - Bloomberg Quint Zambia’s cabinet approved plans to restructure the country’s loans from China after the International Monetary Fund said Africa’s second-biggest copper producer was at high risk of debt distress.

Philippines opposes China naming features on its continental shelf - Reuters Presidential spokesman Harry Roque said the issue would be raised with an international ocean mapping agency under the United Nations, which was responsible for assigning names on underwater features. “We object and do not recognize the Chinese names given to some undersea features in the Philippine Rise,” Roque told a regular media briefing,

Chinese couple face deportation after nearly 20 years in US | South China Morning Post Huang and Li entered New York from China without proper visas in 1999, according to the NBC news website. They moved to Connecticut in 2006 where they started a nail salon business. The couple have two sons, aged five and 15, who were born in the United States, making the children US citizens. The couple were ordered by immigration judges to leave the country five years ago but were granted stays, their lawyer, Erin O’Neil-Baker, was quoted as saying. Both applied for permanent residency but were turned down. The orders of removal were now being enforced.

Tibet sees jump in Chinese air force activity after Doklam standoff - ThePrint New Delhi: There has been a significant spurt in Chinese air force activities in Tibet since last year’s standoff between Indian and Chinese troops at Doklam. Air traffic at dual-use airports has gone up even as the Chinese air force has deployed combat assets permanently in the region. This is part of a pattern of China stepping up its military presence in the region in the aftermath of the bitter standoff with India in the tri-junction area near Bhutan. ThePrint had reported last month that Beijing has almost completely taken control of the northern side of the disputed plateau and deployed armoured vehicles and built seven helipads.

China’s air force gets a lift with pilot’s promotion to top military job | South China Morning Post General Yi Xiaoguang, a versatile pilot and former deputy chief of general staff of the now defunct General Staff Department, will take over the Central Theatre Command, according to a news website operated by a district government in Beijing. 军委联合参谋部原副参谋长乙晓光上将改任中部战区司令员

China’s Foreign Aid Beyond the Headlines – Fairbank Center for Chinese Studies, Harvard University – Medium Since late 2011, colleagues at AidData, Heidelberg University, and myself have been tracking aid and other types of state financing from China to other countries. The latest versions of the data and methodology were released in late 2017. Our dataset includes over 4,300 project commitments worth over $350 billion financed by China between 2000 and 2014. Projects are located in 139 countries across Africa, the Middle East, Asia and the Pacific, Latin America and the Caribbean, and Central and Eastern Europe. The dataset was created with the Tracking Underreported Financial Flows (TUFF) methodology. The data demonstrate the pitfalls of slapping singular labels on China’s international development footprint. As others have pointed out, much of China’s official financing is inherently more commercial than developmental. Similarly, our dataset reveals that most of China’s government financing to the developing world is not actually “foreign aid” as defined by Western donors. Less than 25% of China’s official financing resembles “Official Development Assistance” (ODA), or foreign aid in the strict sense.

Hong Kong, Macao

MGM Resorts opens $3.4 billion casino in Macau as revenues boom - Reuters MGM Cotai, which will more than triple the number of MGM’s hotel rooms in the former Portuguese colony to 1,972, marks a major expansion in non-gaming attractions amid uncertainty over the renewal process of its casino license that expires in two years.

Tech And Media

Unigroup Forges Deal for $9.5-Billion Chongqing Chip Plant - Caixin Global A group led by chip-making aspirant Tsinghua Unigroup will build a 60 billion-yuan ($9.5 billion) integrated circuit (IC) design and manufacturing facility in the interior city of Chongqing, the latest step in the company’s drive to become a world-class semiconductor maker. Unigroup, which is based at leading sciences school Tsinghua University in Beijing, will team up with the Chongqing municipal government and Sino IC Capital on the project, which has a registered capital of up to 100 billion yuan

How China’s Massive AI Plan Actually Works - MacroPolo Recognizing this, Beijing’s AI plan serves less as a “plan” and more as a “wish list” of technologies the central government would like to see built. It then incentivizes ambitious local officials to use all the tools at their disposal—subsidies, public contracts, and AI-friendly policies—to guide and aid the private sector in developing those technologies. To understand what I mean, let’s look at the plan itself and how it’s accelerating AI activity in cities across China.

Apple in talks for first order from Chinese chipmaker: Nikkei - Reuters Apple Inc is in talks to buy storage chips from Yangtze Memory Technologies, a move that would mark the iPhone maker’s first buy from a Chinese memory chipmaker, the Nikkei reported on Wednesday.

Society, Art, Sports, Culture And History

Leftover in China | ChinaFile Part critique of China’s paternalistic ideals, part playful portrait of the romantic travails of China’s trailblazing women and their well-meaning parents who are anxious to see their daughters snuggled into traditional wedlock, Leftover in China focuses on the lives of four individual women against a backdrop of colorful anecdotes, hundreds of interviews, and rigorous historical and demographic research to show how these “leftovers” are the linchpin to China’s future

Energy, Environment, Science And Health

China Raises Subsidies to Reward Longer Traveling Electric Cars - Bloomberg The central government incentive for electric cars that have a range of 400 kilometers (249 miles) and beyond on a single charge has been raised to 50,000 yuan ($7,900) from 44,000 yuan, the finance ministry said in a statement dated Tuesday. At the same time, vehicles have to be able to go at least 150 kilometers on a single charge to be eligible for incentives, up from 100 kilometers previously.

In Race for Blood Cancer Therapy, a Chinese Biotech Firm Surges 500% - Bloomberg Novartis AG and Gilead Sciences Inc. have already hit U.S. and European markets with CAR-T therapies, which involve extracting a patient’s immune system cells and modifying them to attack cancers. A string of Chinese firms are jumping in, highlighting the growing ambitions of the country’s pharmaceutical industry, which has long focused on cheap generic copies of branded drugs.

Flu Fears Spread in China Ahead of Lunar New Year Holiday - WSJ Chinese health authorities said the worst influenza season in recent years was straining the country’s resources and some experts warned that the Lunar New Year holiday, when hundreds of millions of Chinese go on the road, could make things worse. Adding to anxiety was a post on social-messaging platform WeChat over the weekend describing how a 60-year-old man died in a Beijing intensive-care unit after a three-week battle with influenza. The post, by the man’s son-in-law, detailed the family’s struggle to get access to treatment and medicine made scarce by the outbreak.//The post-流感下的北京中年

Hong Kong on alert after China confirms world’s first human case of H7N4 bird flu | South China Morning Post The centre said health authorities confirmed this month that a 68-year-old woman in Jiangsu province had been infected with H7N4 avian influenza after developing symptoms on December 25. The woman was admitted to hospital on New Year’s Day and was discharged on January 22.

Chinese research ship completes maritime mission in Antarctica - Xinhua The Antarctica mission was the fourth stage of Xiangyanghong's journey around the world, China's first maritime research expedition that integrates oceanic and polar research. Departing from east China's Qingdao last August, Xiangyanghong 01 will cover around 35,000 sea miles in its 260-day expedition, and is scheduled to return to Qingdao on May 15.

Beijing

Beijing intensifies security patrols - Xinhua Starting from 9 p.m. on Sunday, 200,000 security personnel went on patrol, focusing on public transportation venues, businesses open at night and other crowded areas, China Daily reported Wednesday. The members included Party members at district levels, security forces in communities and security guards. Starting Monday, a security force of 700,000 people, mainly volunteers, took on the job during daytime hours, focusing on shopping malls and markets where crowds gather, besides subways and bus stations.

The China Fantasy; The China Threat; US-Chin…

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