Trade deal politics; Huawei's communications offensive; AmCham survey; Electric vehicles

Happy Tuesday, my commentary is embedded in the Essential Eight entries below.

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The Essential Eight

1. US-China trade

Mar-a-Lago summit a priority for Chinese officials as trade talks continue | South China Morning Post:

Beijing has told its officials to make preparations for a Mar-a-Lago summit between Donald Trump and Xi Jinping their top priority.

Beijing has accepted Washington’s choice of the US president’s private resort in Florida as the venue and preliminary preparations are under way although many details, including the exact date, are still under discussion, a source said...

China’s lead negotiator Liu He has returned to Beijing, leaving some members of the Chinese delegation behind to work with the US negotiating team to clear any remaining blocks to the summit and prepare something for the two leaders to sign.

Three people with knowledge of the talks said the remaining delegates would be in Washington for a few more days to try and iron out a framework for a deal to resolve the stickier issues.

The politics of any trade deal will be quite messy in DC, especially as the timing of any agreement moves closer to the 2020 US election season-Trump Touts Progress With China, but Pressure Grows for a Tough Deal - The New York Times:

Mr. Trump’s optimism has cheered Wall Street and business lobbyists, who have been pushing for a quick end to the trade war. But Democrats and even some Republicans are not so sanguine.

Top Democrats, in an effort to outflank Mr. Trump on China, are warning loudly that the Chinese may simply be dangling false promises in hopes of getting the president to end a trade war that is hurting American farmers and damaging the Chinese economy. Some Republicans fear that Mr. Trump may settle for a deal that simply reduces the trade deficit between the two countries and potentially offers relief to a Chinese telecommunication giant, Huawei, which is facing criminal charges in the United States...

In some cases, newly empowered Democrats have become an asset to the administration’s China hawks, Mr. Lighthizer and Peter Navarro, who have been pressing Mr. Trump not to cut a modest deal and roll back tariffs to please Wall Street.

Remember Navarro's comments at CSIS last November

This is a very different view that DOD and other elements of this government have than the Wall Street and the – Wall Street bankers and the globalist elites. Let’s think about this now. Consider the shuttle diplomacy that’s now going on by a self-appointed group of Wall Street bankers and hedge fund managers between the U.S. and China. As part of a Chinese government influence operation, these globalist billionaires are putting a full-court press on the White House in advance of the G-20 in Argentina. The mission of these unregistered foreign agents – that’s what they are; they’re unregistered foreign agents – is to pressure this president into some kind of deal...

And here’s the most important point. When these unpaid foreign agents engage in this kind of diplomacy – so-called diplomacy – all they do is weaken this president and his negotiating position. No good can come of this. If there is a deal – if and when there is a deal – it will be on President Donald J. Trump’s terms, not Wall Street terms. But if Wall Street is involved and continues to insinuate itself into these negotiations, there will be a stench – a stench around any deal that’s consummated because it will have the imprimatur of Goldman Sachs and Wall Street. So I would urge these unpaid foreign agents to stand down on this issue. No good can come of it. If they want to do good, then spend their billions in Dayton, Ohio, in the factory towns of America, where we need a rebirth of our manufacturing base and an end to the opioid crisis, which they helped create by offshoring our production.

February 25, 2019 CPA Statement: President Trump should Stay Strong on China - CPA:

“Fundamental change is needed. China must stop the dozens of acts and practices it uses to steal and otherwise wrongly acquire critical technology from our government and private companies. Our bilateral trade relationship must be rebalanced across a broad array of industries beyond commodities and semiconductors. China must quickly and convincingly shift from excessive reliance on the US consumer market for its growth to greater reliance on domestic consumption.

“Enforcement mechanisms must be clear, strong, and quick. China must agree not to retaliate if enforcement of any agreement occurs.

“We urge President Trump to continue focusing on the long term national interests of the American people and resist short-term pressure from Wall Street.”

CPA is chaired by staunch and now apparently concerned Trump supporter Dan DiMicco.

As I have written several times I think the biggest risk to a trade deal that the markets now assume is inevitable is that the Chinese have become too confident that they have Trump's number and are ignoring the growing bipartisan pressures in DC for an agreement that does address the deeper structural issues. 

2. AmCham report 

Growth Continues Amid Heightened Uncertainty - Press Center | AmCham China:

The overall outlook has shifted from cautious optimism to cautious pessimism, as many longstanding concerns – especially inconsistent regulations and uneven enforcement – persist, even as new challenges – namely bilateral US-China tensions – take center stage. Furthermore, the survey results suggest that the full impact of the tariffs has yet to be felt, with some companies maintaining a "wait and see" attitude...

The survey also found:

65% of members said trade tensions are influencing their longer-term business strategies, and nearly a quarter are delaying additional China investments;

50% of members are optimistic that steps will be taken to open markets further for foreign companies in China – the highest level since members were first asked about it in late 2016;

32% of respondents expect their investment to slow in 2019, compared with 26% a year ago;

52% of R&I and 30% of Technology & other R&D-intensive members indicated they are adjusting their supply chains by “seeking to source components and/or assembly” outside of China or the US.

The full report 

U.S. business lobby says most firms favor tariffs while China trade talks underway | Reuters:

A top U.S. business lobby in China said on Tuesday that a majority of its member companies favored the United States retaining tariffs on Chinese goods while Washington and Beijing try to hammer out a deal to end a months-long trade war.

One small example of shifting supply chains - How U.S. bike companies are steering around Trump's China tariffs | Reuters:

Like almost all U.S. bike makers, Kent has long relied on low-cost Chinese labor and parts, but Trump’s tariffs have so far inflated his costs by about $20 million annually...

The company now plans to make bike frames in Cambodia while continuing to buy about half the components it will attach to those frames from producers in China. The resulting bicycles can enter the United States tariff-free because of U.S. rules that generally allow products to be designated as made-in-Cambodia as long as 35 percent of their costs for parts and labor are derived from that country.

President Trump has fundamentally altered the US-China relationship and it will not return to the 2016-era status quo no matter what kind of trade deal is reached. US firms know they need to reduce reliance on PRC supply chains, and the PRC knows it must reduce reliance on the US for soft commodities and core technologies; the disastrous ZTE flip-flop for example was a massive strategic gift to Xi. Xi’s repeated exhortations last year to increase self-reliance and control core technologies is not just rhetoric, and while those goals are more aspirational than achievable in the near-term the Chinese government is significantly ramping up efforts to achieve them. There is no turning back.

3. Huawei's communications offensive

"Choose Huawei for greater security”, Says Huawei’s Guo Ping in keynote address at MWC 2019 - Huawei:

Huawei is the global leader in 5G. But we understand innovation is nothing without security.

And that brings me to my second topic.

Cyber security


Prism, prism on the wall.

Who’s the most trustworthy of them all?

It’s an important question to ask. And if you don’t understand this question, go ask Edward Snowden.

We can’t use prisms, crystal balls, or politics to manage cyber security. It's a challenge we all share.

And check out the slide onscreen as he made these comments:

Snowden is the gift that just keeps giving for Beijing…

Huawei "doesn't do bad things": Chairman Guo Ping - Xinhua:

"The U.S. security accusation on our 5G has no evidence -- nothing. ... So, for the best technology and greater security, choose Huawei. Please choose Huawei, thank you," he concluded.

Vincent Pang, president of Huawei's Western Europe region, also spoke to the press about the security issue, arguing that his company "hasn't had a single security incident in the 15 years we have been in Europe".

He said the Chinese government had "never" asked for Huawei to "install backdoors" into its technology, and stressed that the company knows that "the 5G rollout requires the highest levels of confidence, but it is a technical challenge, not a political one".

How Europe is resisting Trump on Huawei – Politico:

U.S. diplomats have spent months lobbying European allies to move against the Chinese telecoms giant, which they call a strategic risk and a potential tool for spying by Beijing.

But the full-court press is delivering mixed results with U.S. allies. EU leaders now openly dispute the need for a blanket ban on Huawei products. Instead they are pushing ahead with a series of midway network security measures that will ultimately preserve China's presence in broad swathes of European telecoms markets.

It's a classic "third way" approach — one that avoids alienating Beijing at a time when Trump himself has brokered deals with some Chinese companies amid a wider trade war, and even warned this week against "blocking out" advanced tech.

Key senators say administration should ban Huawei tech in US electric grid | TheHill:

In the letter sent Monday to Energy Secretary Rick Perry and Homeland Security Secretary Kirstjen Nielsen, the 11 senators said a ban should be considered to protect U.S. utilities and the power grid.

“We understand that Huawei, the world’s largest manufacturer of solar inverters, is attempting to access our domestic residential and commercial markets,” the letter states. “Congress recently acted to block Huawei from our telecommunications equipment market due to concerns with the company’s links to China’s intelligence services. We urge similar action to protect critical U.S. electrical systems and infrastructure.”

4. The Meng Wanzhou case

Comment: Interesting timing for this Reuters story given the growing concerns and chatter in DC that the Trump Administration is planning to drop the extradition case against the former Huawei CFO as part of the trade deal and to offer a face-saving gift to Xi. 

HSBC probe helped lead to U.S. charges against Huawei CFO | Reuters:

The HSBC probe of Huawei came in late 2016 and 2017 as the bank was trying to get the U.S. Department of Justice (DOJ) to dismiss criminal charges for the bank’s own misconduct involving U.S. sanctions.

The bank’s findings, which have not been made public, were given in a series of presentations in 2017 to the DOJ. The department used them to help bring its current criminal case against Huawei’s chief financial officer, Meng Wanzhou..

The HSBC documents contain new financial details about Huawei’s relationship with Skycom and the company that Huawei claims it sold Skycom to in 2007, Canicula Holdings Ltd. All three firms previously had bank accounts at HSBC, with the Skycom and Canicula accounts part of what the bank internally called the “Huawei Mastergroup.”

The HSBC probe found numerous ties between the three firms that suggested Huawei controlled both Skycom and Canicula long after the purported sale, the documents show. For example, Canicula’s address was “c/o Huawei Technologies.”

The probe also found that Huawei financed Canicula’s purchase of Skycom, lending Canicula about 14 million euros in a deal the documents show didn’t close until December 2009. Canicula repaid Huawei a year later using funds from Skycom.

After HSBC asked Huawei in 2013 to close the Skycom and Canicula accounts, Huawei employees assisted the bank. At Huawei’s request, the remaining funds in the Skycom account were transferred to a Huawei bank account, according to the documents.

The Wall Street Journal reported in December that HSBC had “flagged suspicious Huawei transactions to prosecutors”, but the above Reuters story has much more detail.

Did Deputy Attorney General Rosenstein hint at the rumored internal pressures over the Meng case in remarks Monday in DC? - Deputy Attorney General Rod J. Rosenstein Delivers Remarks at the Center for Strategic & International Studies Event on Defending Rule of Law Norms | OPA | Department of Justice I

In the absence of a culture that respects the rule of law, written protections are routinely violated and seldom enforced, and victims are bereft of any legal remedy. In those nations, law may be used instrumentally as either a weapon or a shield, not merely against their domestic populations but also beyond their borders.

They direct their transactional approach to the law outward, with far reaching effects. China, for example, appears to detain foreign citizens as a means of retaliating or inflicting political pressure on other countries. In 2014, Canadian authorities arrested a Chinese national named Su Bin at the request of the United States to face serious charges. We sought his extradition for hacking-related offenses and the theft of sensitive military and export controlled-data, that was sent to China.

In an apparent act of reprisal, Chinese authorities apprehended a Canadian couple who had lived in China for 30 years without incident. They were accused of spying and threatened with execution. The wife ultimately was detained for six months before being released on conditions. The husband did not meet with a lawyer for almost a year. He was held for more than two years. Meanwhile, Su Bin, the defendant charged in the United States, consented to his transport here, retained a lawyer of his choice, and received all the protections afforded a criminal defendant in our system, including the right to a fair and open trial.

5. More Hukou reforms coming?

Could this be the end for China’s notorious household registration system? | South China Morning Post

China is reviewing its decades-old household registration system to enable migrant workers to stay in cities as the country grapples with an ageing population and a shrinking workforce.

Sun Lijun, deputy minister of public security, said on Thursday that his ministry is considering changes in policy to make it easier for the migrant workers to become the urban residents.

But any changes to the system would not apply to congested the megacities of Beijing, Shanghai, Guangzhou and Shenzhen that the authorities deem overpopulated, Sun said

公安部:加快建立新型户籍制度 探索以常居地登记户口 

6. Electric Vehicles in China

Electric cars: China's drive to dominate the industry — "60 Minutes" - CBS News

There is perhaps nothing more emblematic of the American century than the automobile. Assembly lines rolled out millions of Fords, Chryslers, Chevys and Buicks and made Motor City-Detroit, Michigan-the capital of the global car industry. But in the race to dominate the auto industry of the 21st century, it is China vying for the pole position. It's Chinese auto-makers building the smart cars of tomorrow. And the energy fueling them is electric.

Today, U.S. automakers are caught between a tariff-fueled trade war and threats of cuts to electric car subsidies by the Trump administration. At the same time, Beijing is trying to win the race by ensuring the electric vehicles of the future are made in China.

Michael Dunne: This year, China will build a million electric vehicles. That's nice scale. That's half of the electric vehicles in the world...

Comment: They also interview the CEO of Nio. The Nio looks like a very cool car, and nostalgia for me as they start the interview with the Nio founder in the Central Park compound in Beijing CBD, where we lived for 10 years...

Ding Xiaohua is deputy manager of the Shanghai Electric Vehicle Data Center, which collects millions of bits of information every day on nearly 200,000 electric cars on this city's streets...

Inside every electric vehicle in the city is a black box, automatically transmitting data to the center every 30 seconds.

Nio is one of nine Chinese electric vehicle—or EV—companies to set up shop on the West Coast where they can entice the world's best engineers, programmers and software developers. Nio has hired more than 600 of them.

Padma Warrior: We have people here that have worked at—at Google, at Apple, at Cisco, at—at Tesla, you name it.

Holly Williams: Think some people might see that as a transfer of American technology to a Chinese company.

Padma Warrior: I don't see it that way. I think I see it more as, where is the biggest market for EVs, right? And where is the biggest problem with respect to pollution? Clearly, that's China. So I look at it as taking the best of the talent pool that's available and changing the world for the better.

Background: CSIS November 2018 Report - China’s Risky Drive into New-Energy Vehicles 

7. Beijing-Tianjin-Hebei (Jing-jin-ji) integration plan 5 years on

This article was near the top of most news sites over the last day, really pushing the Jing-jin-ji (3Js) plan and its progress. Like the BRI, the 3Js plan is one of Xi's signature initiatives so as long as he is the boss it is going to drive forward, regardless of the financial or environmental feasibility questions. 

"Jing-jin-ji": China's regional city cluster takes shape - People's Daily Online:

What will Beijing be like as China is developing rapidly to become a modernized country? And how will the capital city spearhead regional development and blaze a new trail of balanced, high-quality growth?

These questions, among others, were on the minds of China's decision-makers when the country initiated a key strategy in 2014 to coordinate the development of Beijing, its neighboring port city Tianjin, and Hebei Province -- a regional city cluster called "Jing-jin-ji."

"The core of integrated development of 'Jing-jin-ji' lies in the concepts of optimization, adjustment and streamlining, all for the sake of pursuing healthier development," said Li Xiaojiang, a member of the expert committee advising the coordinated development of the "Jing-jin-ji" region and former head of the China Academy of Urban Planning and Design.

Today, with a better economic structure, a cleaner environment and improved public services, the "Jing-jin-ji" region is exploring a new growth mode in densely-populated areas and becoming a model for urban-rural coordinated development for the rest of the country.

The original Chinese - 开辟高质量发展的光明前景——以习近平同志为核心的党中央谋划推动京津冀协同发展五周年纪实 

8. Did the "CRISPR babies" use PRC government money?

Comment: This is a blockbuster story if it turns out He did but given the vagaries of fundraising in China it is quite plausible He did not tell the full story when he got the grants. It is also plausible he did, but I am not convinced this story proves it

Chinese government may have funded 'CRISPR babies' project - STAT:

Three government institutions in China, including the nation’s science ministry, may have funded the “CRISPR babies” study that led to the birth last November of two genetically modified twin girls, according to documents reviewed by STAT.

These findings appear to support what many researchers inside and outside China have suspected since scientist He Jiankui revealed the births in late November, sparking international condemnation for violating scientific guidelines against the use of gene-edited human embryos to start pregnancies. “I don’t think He Jiankui could have done it without the government encouragement to press ahead” with research they thought would merit a Nobel Prize, said Jing-Bao Nie, a bioethicist at the University of Otago in New Zealand...

The documents examined by STAT — a slide presentation prepared by He’s team, Chinese-language patient consent forms, and China’s clinical trial registry — list three funding sources for the study that led to the twins’ birth: the Ministry of Science and Technology; Shenzhen Science and Technology Innovation Commission, part of the municipal government; and Southern University of Science and Technology, where He worked.

Comment: But, and this is the key, line, it is quite possible the government sources were not in the loop on He's plans.

It’s not clear, however, whether the institutions knew how their grants would be used.

The CRISPR-baby scandal: what’s next for human gene-editing - Nature:

He promised to follow up with the girls until they were 18 years old, but it is unlikely that the health ministry, which ordered He to stop doing science, will allow him to be involved in the evaluations. It is not known what, if any, special measures are being taken to look out for the girls’ health or to track the other pregnancy.

Business, Economy, Finance And Trade

China central bank to encourage innovation in financial markets this year | Reuters The role of the bond market in replenishing banks’ capital will be strengthened while bond financing by private and small firms will also be encouraged, the People’s Bank of China (PBOC)said in a statement on its website. Fending off financial risk is still a difficult task, said the PBOC, adding that it will seek to step up risk controls over property financing, the gold market and commercial bill market.

Regulators Offer Remedies for Local Government Debt Hangover - Caixin The China Banking and Insurance Regulatory Commission (CBIRC) will deal with all indebted cities under the “One City One Policy” principle, Wang Zhaoxing, a vice chairman of the agency, told Caixin on Monday when asked about the commission’s plans for Zhenjiang. Support will be tailored to suit the conditions of each city with the aim of strengthening their ability to pay the money they owe and dealing with their borrowing problems, he said.

Qinghai SOE Made Late Payments After Default Fears - Caixin Qinghai Provincial Investment Group Co. Ltd. said Tuesday morning in a statement that it has made full repayments on principle and interests of the one-year private placement note totaling 21.4 million yuan to the Shanghai Clearing House by 7:00 p.m. Monday. The delayed payment, which was due at 5:00 p.m., was due to technical reasons, the company said in the statement.

China’s draft foreign investment law to be deliberated at upcoming NPC plenary session - People's Daily Online nce adopted, the law will become the fundamental unified law governing foreign investment in China. Moreover, this unified law will replace three existing laws in the field: the laws on Chinese-foreign equity joint ventures, non-equity joint ventures (or contractual joint ventures) and wholly foreign-owned enterprises. The draft law will give priority to the promotion and protection of foreign investment, according to Ma Yu, director of the foreign investment institute of the Chinese Academy of International Trade and Economic Cooperation (CAITEC), China’s Ministry of Commerce.

Stock Surge Sparks Comparisons With 2015’s Bubble and Crash - Caixin If you take a close look at the money entering the stock market, it looks unlikely that either brokerages or mutual funds were behind the increase because the size of their purchases hasn’t changed much, according to a fund company researcher. “The majority of the new capital is probably coming from the vast number of retail investors,” the researcher said. Some retail investors have significantly added to their stock portfolios and have begun to borrow from brokers to buy more securities, an activity called margin lending. Outstanding margin loans grew to nearly 775.2 billion yuan on Monday, up from a recent low of 710.9 billion yuan on Feb. 11. Still, the numbers don’t come anywhere close to the trillion-level peak back in 2015.

Corners of China's Market Without 10% Limits Are Going Bananas - Bloomberg Some traders are hungry for more even after a monster rally pushed up the CSI 300 almost 6 percent on Monday. One method is convertible bonds that pay a regular coupon and can be exchanged for underlying stocks, but aren’t restrained by rules capping daily gains and losses to 10 percent.

Up $1.4 Trillion, China's Stock Rally Is Nearing a Big Hurdle - Bloomberg The 3,000 level is the "strongest resistance standing in our way," said Kang Chongli, an analyst at Lianxun Securities in Beijing. "A substantial breakout from this line would be an important sign of a bear to bull reversal."  //  Comment: Some thin technical analysis is akin to voodoo but it is widely believed in China, so breaking through 3000 could suck more retail back in

With 10-to-1 Leverage, Shadow Banks Fuel China's Stock Boom - Bloomberg Many Chinese margin-finance firms tout their services through phone calls, text messages and promotions in chat rooms. One such platform, called Dingniudai, allows investors with 5 million yuan ($747,000) of capital to borrow 50 million yuan for stock trading, charging a monthly interest rate of 1.5 percent. The 10-to-1 leverage ratio compares with a limit of 1-to-1 at regulated brokerages. More debt means bigger gains for investors when stocks rise, but steeper losses when they fall.

China infrastructure investment under pressure, state planner says | Reuters Infrastructure investment plans are under pressure in China as the confidence of investors in them has dipped, the state planner said on Tuesday, adding that some provinces have seen a sharp drop in planned projects...The National Development and Reform Commission (NDRC) said in a report that manufacturing investment may also face some downward pressure in the first half of 2019, as company profits have been squeezed since late last year on sluggish demand and weak prices.

Didi slashes employee benefits after announcing layoffs · TechNode Ride-hailing platform Didi is cutting employee perks as it seeks to limit internal spending, a move that comes shortly after the company’s CEO announced plans to lay off around 2,000 employees. Didi is slashing meal subsidies at its cafeterias, while increasing the prices of some goods. In addition, gym benefits and late-night snacks have been canceled, and funding for staff clubs is being cut. Workspaces at the company are also being made smaller. The policy came into effect on Monday.

Hainan sets up multi-billion-yuan fund for FTZ construction - Xinhua The municipal government of Sanya, a popular tourist city, and Hainan Development Holdings Co. Ltd. each invested 1.5 billion yuan to set up Hainan Pilot Free Trade Zone Opening and Development Fund. The fund, with a target scale of 50 billion yuan, will offer financial support for projects in Hainan.

Premier financial magazine bullish on Chinese stocks market - China Daily The Barron's, a financial weekly published by Dow Jones & Company, said the performance of Chinese stocks is much better than the S&P 500. Global investment management corporation BlackRock also suggested lasting gains of the bull market.

Private firms get postponed payments - China Daily Over the past three months, governments at all levels and large State-owned enterprises have paid private enterprises more than 160 billion yuan ($24 billion) in postponed payments, with migrant workers the first to receive delayed wages, high-ranking officials said on Monday. The economy is confronted with multiple challenges, including downward pressure on growth, but people will gain confidence when delayed payments arrive, Xin Guobin, vice-minister of industry and information technology, told a policy briefing hosted by the State Council Information Office on Monday.

Pet-care industry the cat's meow - SHINE News As pet ownership expands, so too the industry that caters to pet care. The industry is expected to grow as disposable incomes rise and more people take to the idea of having a pet, according to a report from China Merchants Securities. The brokerage estimates that the industry will exceed 400 billion yuan in value by 2020, with a compound annual growth rate of 33 percent. China’s pet owners are forecast to spend 2,048 yuan per pet by 2020, double the figure in 2015. That’s still below the average figure in many Western countries.

Chinese vice premier stresses environmental protection, support for real economy - Xinhua Han, also a member of the Standing Committee of the Political Bureau of the Communist Party of China Central Committee, made the remarks during an inspection tour to southwest Yunnan Province from Sunday to Tuesday, where he examined protection of Erhai Lake and visited local companies. Efforts should be made to ensure sustainable and healthy development of the economy and maintain overall social stability, Han said.

Yicai Global - Ledman, Other Chinese Defendants Win Big as US ITC Stops Probe of LED Displays The US International Trade Commission decided to terminate the Section 337 investigation of the light-emitting diode display industry on Feb. 21, thus handing Ledman Optoelectronic and other Chinese defendants a win, Ledman announced on its WeChat account today.

Ridiculous for foreign media to compare China, Venezuela - Global Times Comment: Li Yuan's piece clearly hit a pressure point  //  The New York Times released an article headlined "China's entrepreneurs are wary of its future" on Saturday. The opinionated article used the story of Chen Tianyong, a Chinese real estate developer who chose to leave China, to declare that China's economic environment is "tightly controlled." According to the Times reporter, some businesspeople are comparing China's future to that of Venezuela "where the government seized control of the economy and didn't ease up." It is ridiculous to compare China with Venezuela...The Western media do not understand China. They have no idea how China accomplished today's achievement after 40 years of reform and opening-up...In the 21st century, it is a shame that Western people still view China in such an obsolete way. Instead of trying to observe China more objectively, they narrow-mindedly stick to their own ideology. Many Chinese people are confused: Why are some Western countries so stubborn in distorting facts and blackening China?

For Company and For Country: Boeing and US-China Relations - MacroPolo Boeing’s place in US-China relations shows how structural changes in the international system over the past five decades have affected the commercial calculus of a powerful multinational firm. Of course, Boeing was not the only one affected by these sweeping changes. But understanding how this single company sought to adapt to the evolving environment yields valuable insights into commercial diplomacy, US-China politics, and how the future dynamics of globalization might be shaped.

Politics, Law And Ideology

County govt halts shale exploitation after earthquakes - Global Times Government of Rongxian county, Southwest China's Sichuan Province vowed to stop shale gas exploitation, after residents gathered outside a local government building claiming that shale exploitation is responsible for recent frequent earthquakes. Two earthquakes, measured 4.3-magitude and 4.9-magnitude struck Rongxian county on Monday, killing two, the government announced. This sparked concerns among the public about whether the government's exploitation of shale gas triggered the earthquakes. "Some residents came this afternoon after the earthquake, and now they have calmed down and left. Government officials have responded to their requests," a public relations employee surnamed Yu at Rongxian county government told the Global Times on Monday.

RFA posted a video that it says are of the protests in Rongxian:

Chinese protesters blame fracking for earthquakes that killed two people in Sichuan | South China Morning Post The 4.9-magnitude quake hit on Monday. Three of the injured were in critical condition, while two people were killed when a balcony railing fell on them, state news agency Xinhua reported. The government in Sichuan’s shale mining heartland suspended all fracking operations. Officials in the city of Zigong in Rong county said on Monday the suspension was a safety measure, reported.

Former municipal political advisor of Beijing arrested - Xinhua Li Shixiang, former vice chairman of the Beijing Municipal Committee of the Chinese People's Political Consultative Conference (CPPCC), has been arrested on suspicion of taking bribes, according to a decision by the Supreme People's Procuratorate (SPP). Li also used to serve as the deputy secretary of the Committee's leading members' group of the Communist Party of China.

Former senior food, drug administration official arrested - Xinhua Wu Zhen, former deputy head of the now-defunct China Food and Drug Administration, has been arrested on suspicion of abuse of power and taking bribes, according to a decision made by the Supreme People's Procuratorate (SPP).

从历史中汲取治国理政智慧 _光明网 This piece in Guangming Day by Bu Xianqun, the dean of CASS' China Ancient History Research Institute 中国古代史研究所 argues there ist historical consensus on China requiring a highly centralized leadership to rule the country...fts nicely with Xi's direction, and the theme of the letter Xi sent to CASS on January congratulating the institution on the establishment of the Chinese History Research Institute in which Xi urged Chinese historians to construct a discourse and narrative system with Chinese characteristics in the discipline of history  // 创造并长期维护统一多民族国家的治理体系。源于先秦时期的大一统思想理念,在秦汉时期转化为政治实践,形成了“事在四方,要在中央”“海内为郡县,法令由一统”的中央集权制国家治理体系。由于这一治理体系符合我国实际,得到历代有为政治家和思想家的高度认同,拥有深厚的政治基础、思想基础和社会基础。中华民族长期凝聚不散,就是这一治理体系延续不断的结果。历史反复证明,统一多民族国家的完整与安定是国家治理的首要目标。任何分裂与动荡,都会导致国家与人民陷入灾难。

Foreign and Military Affairs

IAF Strikes: China Asks India, Pakistan To Exercise Restraint After Indian Air Force Attack On Jaish-e-Mohammed Camp In its first reaction after Indian Air Force jets pounded a terrorist camp across the Line of Control days after the Pulwama terror attack, China on Tuesday urged New Delhi and Islamabad to "exercise restraint". "We hope that both India and Pakistan can exercise restraint and adopt actions that will help stabilise the situation in the region and improve mutual relations," China's foreign ministry spokesman Lu Kang said, according to news agency PTI.

China offers support for Pakistan counterterrorism efforts after Pulwama attack | South China Morning Post Chinese foreign minister Wang Yi expressed support for Pakistan’s counterterrorism efforts in a phone call on Monday in the wake of the deadly Pulwama terrorist attack in Indian-controlled Kashmir. Pakistan foreign minister Shah Mahmood Qureshi briefed Wang on Pakistan’s position regarding the suicide attack that killed more than 40 Indian paramilitary personnel on February 14, and said Pakistan would work with India in “sincerity and determination, to find out the truth of the incident”, according to a statement about the call from China’s foreign ministry.

China, Pakistan complete joint marine geological survey - Xinhua The Chinese vessel for this expedition, Haiyang Dizhi 10, or literally Ocean Geology 10, returned to Guangzhou, capital of south China's Guangdong Province, Tuesday after a 91-day, 26,100-km voyage. The vessel set sail on Nov. 28, 2018, from Guangzhou to the Indian Ocean. During the trip, researchers from multiple institutions in Pakistan went aboard the ship for visit and exchange, which enhanced cooperation in deep-sea geological expedition between the two countries.

China unveils national service center for veterans - Xinhua The service center is mainly responsible for helping veterans find jobs or start businesses, providing preferential treatment and assistance, as well as arranging visits to ex-servicemen, said an official with the Ministry of Veterans Affairs. As a key component of the veterans' service and security system, it also undertakes work such as dealing with petition letters and visits of veterans, in addition to safeguarding their legitimate rights and interests.

人民日报人民要论:牢牢把握我国发展的重要战略机遇期--观点--人民网 上海市习近平新时代中国特色社会主义思想研究中心 - 内容提要:“我国发展仍处于并将长期处于重要战略机遇期”,这是一个具有战略意义的基本判断。只要我们坚持唯物辩证法,全面地、联系地、动态地看待我国发展的内外部环境,就不难得出“时”与“势”依然在我国一边、我国发展仍处于并将长期处于重要战略机遇期的结论。在新时代,我们要增强辩证思维能力,始终保持战略定力,用好我国发展的重要战略机遇期。//Tuesday Theory page of People's Daily as another article on the importance of grasping China's period of strategic opportunity

Chinese spies covet Cincinnati's corporate secrets — was October arrest an isolated incident? - WCPO Cincinnati companies are regular targets of Chinese spies, hackers, counterfeiters and business partners, the I-Team learned from court documents, government records and interviews with business and federal law enforcement officials. “Economic espionage is a very significant threat,” said Benjamin Glassman, U.S. Attorney for the Southern District of Ohio. “It could cost people their jobs. It could destroy companies. With the destruction of companies comes the destruction of communities and really a radically different place for the United States in the world.”

Chinese envoy hits back at Williamson's 'gunboat diplomacy' | World news | The Guardian China’s ambassador to the UK has fired an unmistakable warning shot in the direction of the defence secretary, Gavin Williamson, accusing him of “resurrecting the cold war and gunboat diplomacy” after the British cabinet minister claimed the UK was set to send an aircraft carrier to the Pacific to challenge China. Writing in the Guardian, Liu Xaioming did not name Williamson, but accused “a certain British politician” of hyping up the “China threat”. // Liu Xiaoming - Gunboat diplomacy can only harm Britain’s relationship with China 

Nepal hitches railway to Chinese standards in blow to India - Nikkei Asian Review Nepal will use Chinese gauge standards for a planned nationwide rail network, its transport minister told Nikkei, in a move seen intertwining the Himalayan country more deeply with its northern neighbor on the economic and security fronts. The decision will likely sting for India, which sandwiches Nepal to the south. India uses a wider gauge it has pushed for Kathmandu to adopt, as it tries to build influence in the landlocked nation.

China to form ‘contact group’ on Afghanistan - Tehran Times As hectic efforts are underway to facilitate peace in war-ravaged Afghanistan, China has stepped up efforts to play the role of a peacemaker. China’s Foreign Minister Wang Yi has said that the Shanghai Cooperation Organization (SCO) will form a contact group to help facilitate political settlement in Afghanistan and put an end to the protracted war.

American families of missing Uighurs speak out at DC event - AP On Sunday, about three dozen relatives of some of the 1 million Uighurs, Kazakhs and others being held without charge spoke out about the mass detentions at an event in Washington, D.C., hoping to raise awareness of what many are calling a human rights travesty but which Beijing defends as necessary to counter violent religious extremism.

开窗放入大江来 - 中国军网 PLA delegates to the NPC talk with PLA Daily about the progress in civil-military relations...the momentum for the military-industrial complex is accelerating

Hong Kong, Macao

Greater Bay Area Plan Offers Greater Financial Links - Caixin Monetary authorities in Hong Kong and Beijing are working on plans for pilot programs that will connect the two sides’ wealth management and insurance markets, along with a series of other measures to boost investors’ access to each other’s financial markets, Hong Kong’s Secretary for Financial Services and the Treasury James Lau told media Sunday. The programs, which are expected to kick off by 2022, will allow asset managers and insurers to market and sell their products in each other’s markets, according to Lau.

Beijing requests report on Hong Kong independence party ban, as chief exec. denies 'interference' | Hong Kong Free Press HKFP China’s central government has sent a letter to Hong Kong Chief Executive Carrie Lam expressing support for her administration’s decision to ban the pro-independence Hong Kong National Party (HKNP). The letter also asked that she submit a report on the incident, Lam said. Lam told reporters on Tuesday that she received the letter from the Central People’s Government earlier in the day and wanted to publicise it as soon as possible. The central government will also publish the full text of the letter soon, she said.


Military can hold off China: minister - Taipei Times While the defense minister answered questions about military doctrine and the ability to hold out against a PLA attack, he refused to discuss specifics

Tech And Media

Bitmain co-founder Wu Jihan may be departing from core business · TechNode Wu Jihan, co-founder of Beijing-based cryptocurrency mining hardware manufacturer Bitmain, will no longer lead the company’s core business, according to Chinese media outlet Caijing (in Chinese), which cited multiple sources close to the company. Wu is said to be pivoting away from Bitmain’s cryptocurrency mining unit, which has been the company’s central business.

China's censors are purging the internet of millennial angst - Technode WeChat’s purge of millennial angst came on the heels of Twitter-like platform Weibo. The platform promised last week to severely crack down on accounts that “peddle anxiety.” “Ban negative energy, anxiety, and vulgarity. Just collect a smile tax. Whoever doesn’t have a smile on his face pays tax,” one Weibo user sardonically responded to the news.

Olympic broadcaster vows to make Beijing 2022 most tech-driven ever - Xinhua OBS will adopt technologies like 4K, 8K and virtual reality with expectations to "experiment with artificial intelligence (AI) to provide an additional level of experiencing". Among these technologies, Exarchos believes that 5G technology will have a catalytic effect. OBS is developing the cloud technology, a 5G network, together with Olympic Worldwide Top Partner Alibaba Group to allow broadcasters to work more efficiently and viewers to enjoy more personalized programs.

Samsung's folding screen tech has been stolen and sold to China - CNN The Suwon District Prosecutor's Office charged 11 people on Thursday with stealing tech secrets from Samsung (SSNLF), the office said in a statement. The prosecutors allege that a Samsung supplier leaked blueprints of Samsung's "flexible OLED edge panel 3D lamination" to a company that it had set up. That company then sold the tech secrets to the Chinese firms for nearly $14 million, according to the prosecutors. They did not name the people or companies involved in the theft.

天安门广场实现5G信号全覆盖,将首次服务“两会”新闻报道_中国政库_澎湃新闻-The Paper 5G network up and running for Tiananmen Square area during the upcoming two meetings

Chinese police test gait-recognition technology from AI start-up Watrix that identifies people based on how they walk | South China Morning Post Chinese artificial intelligence start-up Watrix says its software can identify a person from 50 metres away – even if they have covered their face or have their back to a camera – making it more than a match for Sherlock Holmes.

Society, Art, Sports, Culture And History

Young People Left Behind in China’s Snowbound Rust Belt - The New York Times Ronghui Chen’s photographs of young people in Northeastern China capture a loneliness he recognized in his own trek from village to city.

Energy, Environment, Science And Health

Blood purification for medical cosmetology refuted by experts - Global Times According to Sina Weibo user "Zhangmofan MOMO", who has more than 11 million followers, the "medical cosmetology" project to purify blood she received in Japan has four steps: acupuncture; drawing blood; injecting ozone into the blood; and finally transfusing blood back into the body, The Beijing News reported on Sunday. The user said that the blood turned from dark red to bright red after being injected with ozone and she claimed that the altered, "fresher" blood can accelerate metabolism and help the body expel toxins. Nowadays this practice has run rampant in many Chinese cities, including Beijing, Ningbo in East China's Zhejiang Province and Guangzhou in South China's Guangdong Province.

As China Cuts Air Pollution, An Unseen Killer Emerges - Sixth Tone “China should pay more attention to ozone control,” says Zhang Junfeng, a professor of global and environmental health at the Regional Ozone Sino-US Collaborative Research Center at Duke Kunshan University, China’s first research institute for ozone pollution control, established in 2016. “Once ozone gets into the human body, it causes considerable damage to the immune system and aggravates existing cardiovascular and respiratory problems.”

Rate of breastfeeding in China lower than 30 pct: survey - Xinhua The survey, conducted between Sept. 2017 to Jan. 2018 among over 10,000 mothers with infant children across the country, also found that only 11.3 percent of the participants breastfed their children within an hour of birth. Fang Jin, deputy secretary general of the foundation, attributed the low rate of breastfeeding to easy access to breast milk substitutes and the misleading advertising of such products.

Food And Travel

China launches large-scale salmon farming in Yellow Sea - Xinhua China has launched a project for the large-scale cultivation of salmon in the cold water mass of the Yellow Sea to cater to growing seafood demand in Chinese markets. The project will build a salmon farm about 130 nautical miles off the shore of Rizhao in east China's Shandong Province, with the aim of producing 45,000 tonnes of salmon annually, said Dong Shuanglin, a professor at the Ocean University of China and the project's chief scientist.

How the WeChat App Is Driving NYC’s Chinese Restaurant Scene - Eater NY Some of New York’s most popular new Chinese restaurants have never appeared in an American publication. They don’t get ’grammed by Instagram influencers. Their owners don’t look at Yelp, and they often aren’t mentioned in the Michelin Guide. But they’re still flourishing, packed with primarily Chinese diners — and they have little interest in attracting people in the city who don’t speak Chinese.