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The Essential Eight

1. US-China trade deal

We are still waiting for the details, and timing of the signing. Reuters reported today that President Trump will attend the Davos Forum, which runs from January 21-24. I tweeted yesterday that I was hearing “Growing chatter of a trump-xi meeting at davos to sign the trade deal”. There is no confirmation yet that Xi will attend, and the expectation is that the trade deal will be signed before Davos, but it certainly would be interesting, and symbolic, if the two leaders were to meet at Davos.

Meanwhile, Bloomberg reports that some creative accounting may help the Chinese achieve the targeting increase in imports from the US - China Plans to Buy Ethanol, Count Hong Kong Trade in U.S. Pledge - Bloomberg

That accord, yet to be officially signed, includes reaching purchases of $40 billion to $50 billion per year in agricultural commodities, a level some analysts have doubted is feasible. To help attain that figure, Beijing plans to restart purchases of ethanol by lifting or waiving trade war tariffs on the fuel, said people familiar with the matter, who asked not to be identified discussing the plans...

In addition, China is considering re-routing trade that currently passes through Hong Kong to mainland ports, the people said. That could enable around $10 billion a year in goods transshipped there from the U.S. to be directly booked in the mainland, boosting the tally. The U.S. does not count shipments that go through Hong Kong as part of its trade with China.

Question: So hurt Hong Kong and the net increase of US exports will be much smaller than hyped?

Exclusive: IMF Chief Boosts China 2020 GDP Forecast Following U.S.-China Trade Deal - Caixin

In an exclusive interview with Caixin in Washington Monday, IMF Managing Director Kristalina Georgieva said she expects the agreement between the two countries to boost China’s growth to around 6% next year, up from the IMF’s previous estimate of 5.8% made in October.

Sinology by Andy Rothman - A Disappointing Deal, and a Healthy Economy

Because the deal sets highly unrealistic goals for U.S. exports to China, the risk of disappointment and a return to tariff battles remains, so corporates in both countries are unlikely to feel secure enough to resume investment spending. Second, there are no signs that the two sides are preparing to use this pause in the tariff dispute to reconsider the poor direction the bilateral relationship is taking, towards decoupling and confrontation.

2. China’s second aircraft carrier, the Shandong

First made-in-China aircraft carrier, the Shandong, officially enters service | South China Morning Post

The ship’s captain will be Lai Yijun, who previously commanded the frigate Lianyungang, while its political commissar will be Pang Jianhong, who served on the destroyer Xian. Both are senior colonels...

Xi inspected an honour guard during the ceremony and met service personnel on board the warship. Other senior officials, including Vice-Premier Liu He, Xi’s chief of staff Ding Xuexiang, China’s top economic planner He Lifeng, and chief of the joint staff department Li Zuocheng, also attended the ceremony...

Beijing-based naval expert Li Jie said that in total the vessel would be able to carry 40 aircraft, including Z-9 helicopters and KJ-600 early warning planes.

[视频]我国第一艘国产航空母舰交付海军习近平出席交接入列仪式_CCTV

The report on the carrier launch took up the top 8 minutes of the Tuesday CCTV Evening News. Interesting that Liu He was there and his presence highlighted, as he has no military portfolio? Liu He and NDRC head He Lifeng's presence may make sense as the construction is also an economic and manufacturing achievement, but perhaps Xi is also making clear to everyone who wants to attack Liu for cutting a weak deal with the US that Liu is still his guy, as he did with the Jiangxi inspection tour after the May deal talks collapsed?

Xi Focus: Xi attends commissioning of first Chinese-built aircraft carrier - Xinhua

Xi also met with representatives of the aircraft carrier unit and the manufacturer at the dock.

Commending China's achievements in aircraft carrier construction, Xi encouraged them to continue their efforts to make new contributions in the service of the Party and the people.

FT correspondent Christian Shepherd reminds us of the historical significance of the launch date:

Christian 马思潭 @cdcshepherd

China’s second aircraft carrier is called Shandong and was launched on this date in part due to Dec 17, 1888 being the date the northern fleet of the late Qing was launched in Weihaiwei naval port in Shandong. Fixing the century of humiliation thinking still going strong.

Institute of Modern History, Academia Sinica 中央研究院近代史研究所

December 17, 1888, the court appointed Ding Ruchang Admiral of Northern Ocean Fleet. This is the establishment of the Northern Ocean Fleet. Despite it was destroyed during the Sino-Japanese War, given for the first time establishing a modern naval defense

3. Maximum pressure on North Korea over and not coming back?

China, Russia propose lifting some U.N. sanctions on North Korea, U.S. says not the time - Reuters

China and Russia on Monday proposed the U.N. Security Council lift a ban on North Korea exporting statues, seafood and textiles, according to a draft resolution seen by Reuters, in a move Russia said is aimed at encouraging talks between Washington and Pyongyang.

The draft also called for a ban to be lifted on North Koreans working abroad and the termination of a 2017 requirement for all such workers to be repatriated by next week. The draft would also exempt inter-Korean rail and road cooperation projects from U.N. sanctions.

Question: How much of a surge in tourist visa issuance has there been from Russia and China to allow the North Korean workers to stay in their countries?

China urges UN Security Council to back plans to ease North Korean sanctions | South China Morning Post

Cheng Xiaohe, a North Korea expert at Renmin University, said the move was a clear political gesture of support for Pyongyang from Beijing.

“China thinks North Korea’s efforts to denuclearise and maintain stability over the past two years should get some sort of acknowledgement and reward,” he said. “The Chinese leader has also expressed a willingness to help with North Korea’s economic development.”

North Korea tests likely if they 'don't feel satisfied': Pentagon chief - Reuters

“We have seen talk of tests. I think that they will be likely if they don’t feel satisfied,” Esper told reporters traveling with him from Europe back to Washington.

U.S.-led pressure fractures as China, Russia push for North Korea sanctions relief - Reuters

“The Russia-China initiative at UNSC is likely coordinated with Pyongyang as the proposal reflects North Korea’s demands to be rewarded for the concessions it has already taken,” said Artyom Lukin, a professor at Far Eastern Federal University in Vladivostok. “Pyongyang’s recent threats of escalatory action are now backed by the Sino-Russian diplomatic offensive.”

China and Russia are effectively undercutting the United States’ current strategy on North Korea, he said. “Pyongyang has again demonstrated its unrivalled capacity to exploit rivalry between great powers.”

Worth re-reading the North Korea section from the 12.12.19 newsletter:

8. China pushes for relaxing some UN sanctions on North Korea

It must be another brutal winter in North Korea, as China argues its case in the Security Council and blames the US for the increase in tensions again.

Statement by Ambassador Zhang Jun at the Security Council Open Briefing on Discussing the Korean Peninsula Situation:

The situation on the Korean Peninsula has recently taken a twist, leading to renewed tensions between the DPRK and the United States and bringing the Peninsula's situation to yet another critical juncture. China has noted that on 7 December, the DPRK conducted a test and, in relation to it, made a public statement. So far, the details of the DPRK's test -- what it involved, as well as other specifics -- have yet to be established, in which case the Security Council should not jump to hasty conclusions. The DPRK has taken a series of positive steps on denuclearization, but its legitimate concerns and aspirations in respect of security and development have not been given such attention as is commensurate with its effort, and remain unanswered. This is an important reason behind the current deadlock in dialogue and the tensing up of the situation...

It is imperative that the Security Council take action and invoke the reversible provisions in the DPRK-related resolutions as soon as possible in the light of the evolving situation on the Peninsula, and make necessary adjustments to the sanctions measures prescribed in those resolutions, especially in areas where the DPRK people's livelihood is at stake. This is in line with the spirit of the resolutions, conducive to the easing of the humanitarian and livelihood-related situation in the DPRK, conducive to creating a favourable atmosphere for dialogue, conducive to encouraging the DPRK to take greater strides in the direction of denuclearization and conducive to creating conditions and lending impetus to the political settlement of the Peninsula issue.

4. Wang Yi in Europe

Speech by Wang Yi - Enhancing Mutual Trust and Cooperation To Embrace an Even Better Future of China-EU Relations

China has been firm and steadfast in supporting European integration, supporting a united and strong European Union and supporting a bigger role for Europe in international affairs.

As for Europe, over the years, European countries and the EU as an organization have by and large followed a positive China policy, and worked with China to promote cooperation in all fields. That said, to be candid, there have also been divergent views about China in Europe, which are mainly reflected in the following three questions. Failure to address these perception issues may cause unnecessary disruptions to the future of China-EU relations.

Question No. 1: Is China a developing or developed country? [Answer: Developing];
Question No. 2: Is China a partner or a rival? [Answer: Partner]
Question No. 3: Is China a friend for harmonious coexistence or a threat in a zero-sum game? [Answer: Friend]

And of course he takes a thinly veiled swipe at Trump and the US:

Given the governance deficit, peace deficit and development deficit in our world, there is a pressing need to strengthen and improve global governance. China believes that guided by a strong commitment to multilateralism, countries should make active efforts to advance the rule of law and democratization of global governance. A vision of common, comprehensive, cooperative and sustainable security should be embraced, and the Cold War mentality of zero-sum games rejected. Disputes should be settled through dialogue and consultation, not arbitrary use or threat of force. China and the EU need to carry out more strategic cooperation on counterterrorism, deradicalization and the political settlement of international flash-points.

Chinese text of this speech - 增进互信，深化合作，迎接中欧关系更加美好的明天 — 中华人民共和国外交部

——王毅国务委员兼外长在欧洲政策中心举办的欧洲智库媒体交流会上的演讲

And a different speech he gave on multilateralism - Wang Yi - Adhering to Multilateralism and Jointly Creating a Better Future

At the First Plenary Session of the 14th ASEM Foreign Ministers' Meeting

践行多边主义，共创美好未来 — 中华人民共和国外交部

——王毅国务委员兼外长在第十四届亚欧外长会议第一次全会上的引导性发言

Foreign Ministry Spokesperson Geng Shuang's Regular Press Conference on December 17, 2019

Under the theme of "effective multilateralism", State Councilor Wang Yi expounded on China's position for multilateralism and called on countries in Asia and Europe to lead by example. He said that multilateralism in the context of our times should have win-win cooperation as the goal, equity and justice as the essence, and be action-oriented. We need to defend the UN-centered international system, the international order based on international law, and the multilateral trading system underpinned by the WTO. We should oppose the abuse of "long-arm jurisdiction", unilateral sanctions, technology blockade, digital hegemony, the creation of technological divide and decoupling. China's position was broadly endorsed by representatives at the meeting.

ASEM foreign ministers stressed that as the international order based on international law was being challenged, Asian and European partners are committed to multilateralism, a multi-polar world and the WTO-centered multilateral trading system. They expressed opposition to protectionism in all forms and called for the resumption of the WTO appellate body's normal functioning as soon as possible. It is a strong testament to ASEM members' collective resolve and will.

EU-China investment treaty talks in jeopardy | Financial Times $$

Sabine Weyand, the European Commission’s director-general for trade, said on Tuesday that commitments from Beijing earlier this year to intensify talks had yielded little real progress...

“At the moment we are not yet on a pathway to that,” Ms Weyand told an event organised by the European Policy Centre in Brussels. The talks “need more political commitment on the Chinese side”.

Germany’s Faustian Bargain With China – The Diplomat - Theresa Fallon

The term “systemic rival” appeared to be directly lifted from the report and added to the “EU-China: A strategic outlook” policy paper from the European Commission and the EU High Representative for Foreign Affairs and Security Policy. The commission’s paper urged a tougher stance on China.

The paper was published shortly before the EU-China annual summit, held this year in April, and yielded a great deal of ink on how Europe (like the United States) was also getting tougher on China.

What was missed by just about everyone who wrote about the new era of EU “wokeness” on China was that the much ballyhooed list of tough actions, though welcomed by the Council of Foreign Ministers of EU Member States, never received the endorsement of the European Council of Heads of State and Government of the EU Member States — which meant that the Heads of State and Government of the EU Member States could not agree on a tougher position on China. The paper had explicitly requested this endorsement.

Comment: It is going to take a lot of skillful diplomacy to achieve any sort of EU unity towards China

5. Return of great-power politics?

This view from Washington is a reminder of why Xi keeps saying "The world today is undergoing major changes unseen in a century 当今世界正处于百年未有之大变局"

American, China, Russia, and the Return of Great-Power Politics - Foreign Affairs - Elbridge A. Colby and A. Wess Mitchell

“Trump,” as Henry Kissinger pointed out in the Financial Times in 2018, “may be one of those figures in history who appears from time to time to mark the end of an era and to force it to give up its old pretenses.” Dispensing with the paradigm of unipolarity, the new government created an opening to articulate a new grand strategy. In the 2017 National Security Strategy, the 2018 National Defense Strategy, and their ancillary regional strategies for the Indo-Pacific and European theaters, the United States made clear that it now saw relations with China and Russia as competitive and that it would focus on maintaining an edge over these rivals. As both then Secretary of Defense James Mattis and then National Security Adviser H. R. McMaster made clear, great-power competition would now be the primary focus of U.S. national security...

The United States long hesitated to confront the European Union about its one-sided tariff and nontariff barriers against U.S. products, even as trade deficits mounted. Unwilling to accept that status quo, the Trump administration has tried to achieve by shock therapy what earlier successive administrations failed to obtain with finesse and gradualism. But the collateral damage of this aggressive approach has been significant, with potential spillover effects for the transatlantic relationship that risk undermining the common push against China...

the United States is entering what is likely to be a protracted struggle over who will decide how the world works in the twenty-first century. The coming era will be less forgiving of hubris and unpreparedness than were the circumstances of the recent past. Recognition of that has prompted a long-overdue reassessment of U.S. military, economic, and diplomatic priorities, which future administrations will need to carry forward.

Re-upping what I wrote on September 11 this year:

In spite of the problems China and the Party face, and all the risks and struggles Xi is exhorting the Party to battle, there is a reason Xi, officials, official documents and authoritative propaganda pieces keep repeating the phrase "当今世界正处于百年未有之大变局 the world today is undergoing major changes unseen in a century".

Xi and his theoreticians see massive global opportunities for Xi, many created by the US response to the 9/11 attacks, the decision to invade Iraq, the 2008 financial crisis and now the US foreign policy under President Trump. You see it in all sorts of utterances, most recently in the Qiushi essay by Yang Jiechi, and while the risks Xi keeps highlighting are real, and potentially existential, there may be too much focus on why the Party is destined to fail and not enough on how it may survive, and with that survival how it will reshape the world to fit its expanding interests.

6. US tech restrictions may be weaker than expected

Good news for Beijing as it needs more time to be able to develop its own key technologies to end its dependence on the US in certain areas.

U.S. finalizing rules to limit sensitive tech exports to China, others - Reuters

The Trump administration is finalizing a set of narrow rules to limit exports of sophisticated technology to adversaries like China, a document seen by Reuters shows, in a boon to U.S. industry that feared a much tougher crackdown on sales abroad...

The Commerce Department is putting the finishing touches on five rules covering products like quantum computing and 3-D printing technologies that were mandated by a 2018 law to keep sensitive technologies out of the hands of rival powers.

Before drafting the rules, Commerce sought industry comment last year on a raft of high-tech sectors that it could cover under the law, from artificial intelligence technology to robotics. That fueled concerns among U.S. businesses the department would craft broad, tough regulations that would stymy a host of exports to key customers.

US tech groups rebuff Trump’s new anti-Huawei push | Financial Times $$

US technology companies have rebuffed a Trump administration request that they pledge to stop sourcing supplies from some Chinese companies, amid concerns that such a policy could break competition laws.

The state department asked telecoms carriers and chipmakers to sign up to a set of principles which would have in effect shut out Huawei, and possibly others, according to three people briefed on the proposals.

7. China’s massive oil imports

China’s Oil Imports Are Most World’s Ever Seen And Still Growing - Bloomberg

Even as economic expansion has slowed, the pace of growth still requires ever more oil. China imported an unprecedented 11.18 million barrels a day in November, which surpassed the U.S. high-water mark of 10.77 million set in June 2005. China’s purchases will probably continue to rise into next year as new refineries in Zhejiang and Zhanjiang increase runs, and as a widely anticipated tax rebate boosts domestic production of marine fuel.

Question: So shouldn't China be playing a bigger role in the Middle East?

8. GPS spoofing

Systematic GPS Manipulation Occuring at Chinese Oil Terminals and Government Installations – SkyTruth

This Chinese system is clearly being deployed both at central government offices and at the much more remote locations of oil terminals. In the case of the government office buildings it seems likely that these GPS disrupting devices were activated as a security measure. Some are only active for a few days, perhaps to coincide with the visit of an important official. However, the AIS manipulation occurring at oil terminals particularly interests us at SkyTruth: One possible motive for deploying GPS manipulation devices at oil terminals could be recent U.S. sanctions on Chinese companies importing Iranian crude. And the intentional disruption of a navigation safety system, in close proximity to crude oil storage, is a serious concern...

In the November article first documenting the strange GPS anomaly in Shanghai, the question was posed whether this was the work of the Chinese state or some other actor like a mafia engaged in smuggling river sand. Based on the very specific characteristics of the GPS manipulation observed and its deployment at high level installations, it seems very likely that the Chinese state is responsible

Ghost ships, crop circles, and soft gold: A GPS mystery in Shanghai - MIT Technology Review - 11.15.2019

A sophisticated new electronic warfare system is being used at the world’s busiest port. But is it sand thieves or the Chinese state behind it?

Question: Does this spoofing fool classified systems too?

Business, Economy and Trade

Defaults in One of China’s Richest Provinces Spook Investors - Bloomberg Six privately owned companies in one of China’s wealthiest provinces have defaulted on their debt or come perilously close in the last three months. With 68.1 billion yuan ($9.7 billion) in outstanding debt among those six companies alone, the distress in Shandong has rattled even seasoned investors. The problem isn’t the defaults themselves -- other provinces have seen more and worse. It’s the practice common among Shandong companies of guaranteeing each others’ debts.

Corporate default hotspot tests Beijing’s appetite for bailouts | Financial Times $$ “We view the plight of Shandong privately owned enterprise as indicative of China's wider challenge: the difficulty of transitioning to a higher value-added economy, while managing high debt and slowing growth,” S&P Global Ratings said in a recent report. To make matters worse, many Shandong-based companies have arrangements with peers in which one company guarantees a loan for another to convince banks to lend more.

Creditors’ Woes Deepen as Gionee Liquidation Hits Another Snag - Caixin Bankrupt smartphone-maker Gionee Communication Equipment Co. Ltd. is illegally holding shares in Tencent-backed online bank WeBank, Caixin has learned, complicating efforts to liquidate the once high-flying tech group whose debts have been estimated at between 17.4 billion yuan ($2.49 billion) and 21 billion yuan.

Chart of the Day: Overseas Investors’ Growing Appetite for Chinese Government Bonds - Caixin The total value of Chinese onshore bonds held by overseas institutional investors reached 2.2 trillion yuan ($313.6 billion) at the end of November, growing 33.5% year-on-year, according to Caixin calculations

Lenovo Co-Founder Set to Retire - Caixin Liu Chuanzhi, who 30 years ago founded a company in a Beijing workshop that would go on to become global PC-maker Lenovo, will step down from his role as chairman of Lenovo’s parent this week, a source close to the company told Caixin.

Daimler seeks majority control of its main China joint venture - sources - Reuters Daimler is seeking to buy a majority stake in its Chinese operations, three people familiar with the matter told Reuters, after initial efforts to raise its stake failed and as Chinese investors tighten their grip on the German carmaker.

China further alleviates burdens on private companies: official - Xinhua Government departments and large state-owned enterprises have paid over 580 billion yuan (about 82.89 billion U.S. dollars) of debts to private enterprises in the first 11 months of 2019, according to the Ministry of Industry and Information Technology. // Question: How much is overdue?

Japan Widens Lead on China as Top Foreign Treasuries Holder - Bloomberg Japan’s holdings of U.S. notes, bills and bonds increased to $1.17 trillion in October from $1.15 trillion a month earlier, the Treasury Department said in a report Monday.

China corporate subsidies swell further in 2019 as US cries foul - Nikkei Asian Review China has roughly doubled its industrial subsidies since 2013, with further increases expected this year, creating a massive sticking point for the next phase of trade negotiations with the U.S. The Chinese government doled out 156.2 billion yuan ($22.4 billion) of subsidies in 2018 to companies listed on the Shanghai and Shenzhen stock exchanges, Nikkei has found, based on data from financial research firm Wind.

Chainalysis Report on PlusToken 'Scammers' Blamed for Monday’s Crypto Selloff - CoinDesk Six people tied to PlusToken were arrested and extradited to China from Vanuatu, where Beijing claimed the company operated a Ponzi scheme. Chainalysis said it was able to track down $2 billion in cryptocurrencies taken from victims, with a lot of that going to other “investors” – a hallmark of traditional pyramid schemes.

Apple iPhone sales dropped 30% in China last month, Rosenblatt says after channel checks - CNBC “Based on our recent channel checks, we believe Apple’s total iPhone sales in China were down ~-30% y/y in the month of November,” said Rosenblatt Securities research analyst Jun Zhang in a note to clients on Tuesday. Zhang believes consumers there were buying cheaper models instead of the iPhone 11 PRO. Apple shares fell slightly in premarket trading Tuesday. Rosenblatt has a sell rating on Apple and a $150 price target, near 50% downside for the stock.

Politics and Law

Cities’ Steel Mill Squabble Reveals Smog Struggles - SixthTone Under pressure from provincial authorities to clean up Xingtai’s smog-choked air, municipal officials aim to move the vast factory and others like it out of built-up areas by 2020 in an effort to improve public health and develop suburban and rural economies. But there’s a problem: Although the new site lies within Xingtai’s jurisdiction, it borders Hengshui, a city of more than 4 million people that has its own environmental issues. Officials there claim the move will push the mill’s emissions closer to Hengshui and threaten the fragile ecology of a nearby protected lake. The result: deadlock.

Instructions to build government service assessment system - SCIO The General Office of the State Council issued a circular on Dec 17, laying out instructions to build a government service assessment mechanism. By the end of 2020, a mechanism will be established throughout administrative service institutions and platforms at all levels, which will grant the right of evaluating to enterprises and citizens, the circular said, adding that every service item should be assessed.

Senior CPC official stresses primary-level publicity work - Xinhua 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 Monday at a symposium attended by trainees of a course for newly appointed county-level publicity officials. 黄坤明在同新任县委宣传部长培训班学员座谈时强调推动基层宣传思想工作强起来实起来暖起来

教育部关于同意复旦大学章程部分条款修改的批复 - 中华人民共和国教育部政府门户网站 revised Fudan University charter makes clear that the Party is charge of everything. Will every University make similar revisions, and what do they mean for Western institutions' cooperation with them?

NPCSC Session Watch: Civil Code, Securities Law, Yangtze River Protection, Taiwanese Investments & Export Control (Updated) – NPC Observer No property tax law, as CBN notes 这个重要会议议程已定，2019年房地产税法未提请审议

这朵“花”，习近平珍之重之 -国内新闻-四川新闻网 The original headline for this CCTV Online piece republished on "Sichuan News Net" was "人民领袖习近平这朵“花”，习近平珍之重之" started with "People's Leader", but at some point that was removed. Interesting, the original headline seemed non-sensical, but what editor thought it made sense ti put it there? copy and paste issue?

Foreign and Defense Affairs

Japan borrows US playbook to prevent student espionage - Nikkei Asian Review Japan will weigh stronger protections on technology with potential military uses at universities and research institutions, as the U.S. urges Tokyo to bolster oversight amid a surge in international students.

China Protests U.S. Expulsion of 2 Diplomats Accused of Spying - The New York Times After The Times story was published Sunday, some Chinese Embassy officials continued to insist in private that their colleagues who drove onto the base had made an innocent mistake. Earlier, Chinese diplomats had told associates that the embassy employees had been on a sightseeing trip. One associate of the embassy said some Chinese officials were still asserting that the State Department had expelled the diplomats to retaliate for a propaganda campaign that Beijing had run in August against Julie Eadeh, a political officer in the American Consulate in Hong Kong

5G restrictions in Australia have expanded, says China - Sydney Morning Herald China has accused Australia of expanding restrictions on Huawei and ZTE beyond the rollout of next-generation 5G technology, complaining that "unreasonable requirements" were now affecting Chinese companies' involvement in existing 4G networks. The allegation raised at the World Trade Organisation represents an escalation of complaints from China's representatives in Geneva, who have used meetings over the past year to argue the ban on Chinese suppliers' 5G participation breaches global trade rules.

Telenor ditches Huawei, taps Ericsson for 5G RAN in Norway | FierceWireless State-controlled mobile operator Telenor announced Friday that it selected Ericsson as RAN vendor for its planned 5G network in Norway, ditching Huawei, which was the RAN supplier for Telenor’s 4G network. Telenor will phase out Huawei over the course of the 4-to-5-year network modernization project, using the vendor to maintain the 4G infrastructure, and also upgrade to 5G coverage in selected areas of the country

Czech cybersecurity chief fired amid dispute over Huawei security threat | South China Morning Post The sacking on Monday of Dusan Navratil – who had earlier warned of the threats – also adds to a growing list of controversies between China and the Eastern European nation. Babis said government ministers had “unanimously agreed” to the dismissal and that Navratil lacked the experience, managerial skills and communication expertise for the job, national broadcaster Czech Radio reported. //Comment: Misleading headline, hear it had nothing to do with Huawei

Yicai Global - China's Xinwei Shares Defy Refuted Progress on Ukraine's Motor Sich Deal Xinwei Technology Group's shares have kept on climbing although the Chinese telecoms firm countered a media report which claimed that Ukraine's antitrust body has given the go-ahead to its purchase of Motor Sich, one of the world's largest turbine engine makers.

China asks for continued support for Afghanistan - Xinhua The withdrawal of foreign troops from Afghanistan should be conducted in an orderly and responsible manner. //Comment: China very worried about a precipitous US drawdown and the impact that might have on Xinjiang

MLI's Policy-Maker of the Year: Xi Jinping | Macdonald-Laurier Institute Yet, this year a disheartening and desultory election campaign capped what has been a rather sorry year for fans of visionary political or policy leadership. We realized that the person who had done the most to shape public policy in Canada wasn’t even a Canadian. Indeed, on the question of who has done the most to reshape government policies, only one name truly comes to mind – Chinese Communist Party (CCP) General-Secretary Xi Jinping, though his impact on public policy is decidedly not in the best interests of Canadians. Xi Jinping has forced more policy responses on Canada than any foreign leader, including even the US President. What follows lays out for our readers what we think has been Mr. Xi’s outsized policy influence in Canada.

U.N. Security Council to meet on Kashmir on Tuesday at China's request - Reuters The council will meet behind closed doors for the first time since a similar gathering in August, which was also called by Pakistan ally China, after India removed the decades-old autonomy the area enjoyed under the Indian constitution.

India's internet shutdown shows normal practice for sovereign countries - People's Daily Online India recently ordered a shutdown of the internet in the states of Assam and Meghalaya to control protests over the controversial new Citizenship Amendment Bill. It means that shutting down the internet in a state of emergency should be standard practice for sovereign countries.

Policy Brief December 2019 - What should Australia do about… PRC development activities in the Pacific? - China Matters It is in Australia’s interest to ensure that the Pacific Islands are affluent and resilient. Even though Canberra views the PRC as a strategic competitor, there are instances where partnering with the PRC would help achieve these goals. Where possible, Australia should work with the PRC towards shared development goals. This brief outlines the PRC’s bilateral ODA, multilateral co-operation, and finally, the emergence of its NGOs in international development. The brief’s focus is on the Pacific.

Beijing urges UN commission not to consider Malaysian claim in South China Sea | South China Morning Post Beijing has accused Malaysia of infringing on its sovereignty after its Southeast Asian neighbour filed an extended shelf claim in the disputed South China Sea. China’s permanent mission to the United Nations also urged the UN’s Commission on the Limits of the Continental Shelf (CLCS) not to consider Malaysia’s submission seeking to establish the outer limits of its legal continental margin beyond the 200 nautical mile limit.

Life Along Pakistan's Mountain Highway Where China Is Investing Billions Of Dollars : NPR The Karakoram Highway, named for the spindly mountain range it traverses, was a major feat when it was built in the 1950s to 1970s. Now, the Chinese government has invested about $2 billion to rebuild a nearly 160-mile stretch of highway to replace the old Karakoram road between the Pakistani towns of Havelian and Raikot. The final stretch is expected to be completed in March.

China's Belt and Road Initiative Threatens to Pave the Planet | Sierra Club For decades, the Setiu District has experienced a steady encroachment of palm-oil plantations and sand-mining operations as well as upstream logging in the highlands that lie inland from the swamp...Now comes a new threat: a 400-mile, cross-country railroad financed by the Chinese government that is scheduled to cut through Setiu. Biologists say that the railroad would likely disrupt the waters that flow from the mountains into the lagoon—in the process potentially pushing the wetlands toward their ecological breaking point.

Strategic Implications of the China-Pakistan Economic Corridor - Carnegie Endowment for International Peace - James Schwemlein This report, which is based on research and consultations with experts worldwide, addresses the question of how the India-Pakistan rivalry will play into the emerging great power competition.

China insists on open and peaceful development route in new era: senior official - Global Times China will maintain its open and peaceful strategic development path in the new era and strive to make a greater contribution to the world, a senior Chinese official said at a symposium on Monday when sharing ideas of understanding China from a historical, cultural, development and world view. Xu Lin, deputy head of the publicity department of the Communist Party of China (CPC) Central Committee and director of the State Council Information Office, made the remarks on Monday at a symposium in Beijing themed "China and the World in the New Era."

Vice Foreign Minister Luo Zhaohui Makes a Special Visit to Speaker of Parliament Karu Jayasuriya of Sri Lanka On December 15, 2019, Vice Foreign Minister Luo Zhaohui made a special visit to Speaker of Parliament Karu Jayasuriya of Sri Lanka at the hotel where he stayed in Beijing. Karu Jayasuriya was on a vacation in China.

Project MUSE - Building a More "Democratic" and "Multipolar" World: China's Strategic Engagement with Developing Countries- Joshua Eisenman, Eric Heginbotham This article contextualizes and clarifies the political and security components of China's contemporary strategic engagement with developing countries. Over the last decade, China has adopted a more self-confident and assertive foreign policy, under which political and military elements have become more prominent. This approach places renewed emphasis on China's position in and leadership of the developing world. China's leaders look to coordinate policy with "newly emerging powers" to support and foster what they identify as the trend towards a more "multipolar" world order, that is, soft balancing against American "hegemonism." Moreover, Beijing seeks to curry favor with and raise the voices of developing countries in international institutions to build a normative constituency against American unilateralism. As part of this effort to "democratize" international relations, Beijing has also underwritten a constellation of China-dominated regional institutions that harmonize its policies and provide venues to build strategic relationships with developing countries.

Chinese money connects Lithuania to Belarus' nuclear plant – LRT Investigation As Belarus is planning to launch the first reactor early next year, one of the contractors building connections between the facility and the country's grid is North China Power Engineering (NCPE), a subsidiary of the state-owned company Power China. NCPE is now working on 23 Belarusian projects funded by a 5-billion-dollar loan that Minsk secured from the Export–Import Bank of China.

Chinese National Sentenced for Immigration Scheme in Irvine – NBC Los Angeles An Irvine woman who helped operate an Orange County-based "birth tourism'' scheme to gain citizenship for the offspring of pregnant Chinese nationals who give birth in the U.S. was sentenced today to 10 months in federal prison

Hong Kong and Macao

任仲平：让濠江莲花绽放更绚丽色彩--理论-人民网 People's Daily "Ren Zhongping" on the 20th anniversary of the Macau handover

Xi Focus: Xi and his firm support for Macao's prosperity, stability - Xinhua //The original 真情厚爱系濠江定向领航展新篇——以习近平同志为核心的党中央关心澳门发展纪实

South China Morning Post reporter denied entry into Macau to cover Xi Jinping’s visit for 20th anniversary handover celebrations | South China Morning Post The officers eventually denied Siu’s entry three hours later with a written statement, which alleged there were “strong signs” he was trying to engage in activities that would “jeopardise the public safety and public order” in Macau. Just before his ordeal, the Post on Tuesday had published two stories by Siu as part of a series examining Macau’s changes over the past two decades of Chinese administration.

Why was China’s domestic security chief Guo Shengkun at Carrie Lam’s meeting with Xi Jinping? | South China Morning Post Monday’s meeting was part of the city leader’s annual duty trip to brief the president, an event at which the president is usually joined by a group of top Beijing officials overseeing Hong Kong and Macau. This time, the group included Vice-Premier Han Zheng, the top Communist Party leader on the two cities’ affairs; foreign affairs chief Yang Jiechi; United Front Work Department head You Quan; Xi’s chief of staff Ding Xuexiang; Hong Kong and Macau Affairs Office director Zhang Xiaoming; and Wang Zhimin, the head of central government’s liaison office in Hong Kong. But Guo Shengkun, the head of the party’s Central Political and Legal Affairs Commission, was also present.

Pro-democracy lawmakers Au Nok-hin and Gary Fan lose seats as Hong Kong's top court rejects election petition appeals | Hong Kong Free Press HKFP Pro-democracy lawmakers Au Nok-hin and Gary Fan have lost their seats after Hong Kong’s top court rejected their applications to appeal separate court rulings that rendered them unduly elected.

Taiwan

Trade-War Winnings Send Taiwan Stocks to Highest Since 1990 - Bloomberg Taiwan Semiconductor Manufacturing Co., the world’s largest supplier of made-to-order chips, reported sales climbed 9.7% year-on-year last month, versus a 4.4% gain in October. TSMC, which accounts for nearly one-quarter of the Taiex’s weighting, added 2.7% on Tuesday, extending its record high. Meantime, Taiwan’s economy was showing signs of resilience even before China and the U.S. reached their phase-one trade deal on Friday. Exports rose 3.3% on-year last month, the fastest pace since October 2018, a rebound the government attributed to global demand for integrated circuits and firms moving production back home. / Question: How much is that 5G and US restrictions-related orders from Huawei?

Taiwan to team up with US to build fighter jet centre, sending another defiant message to Beijing | South China Morning Post The self-ruled island’s Aerospace Industrial Development Corporation (AIDC) and US defence contractor Lockheed Martin signed a strategic partnership agreement on Tuesday to lay the groundwork for construction of an F-16 fighter jet maintenance centre in Taiwan by 2023.

Tech and Media

Twitter's Chinese Export Marketing Business Continues to Grow as Brands Go Overseas- PingWest "Helping Chinese companies expand their visibility overseas has been one of the fastest-growing businesses for Twitter," Tony Dou, Deputy General Manager of Twitter's Greater China operation, told PingWest. // Comment: Twitter corporate has to keep Beijing happy to keep these dollars flowing

Editor’s Pick: 2019's Best Investigative Stories from China - Global Investigative Journalism Network As part of the GIJN Editor’s Pick series for 2019, below are some of the best works of investigative journalism from China in 2019, as selected by the GIJN Chinese team.

Society, Arts, Sports, Culture and History

The censor is watching: China's mega photo fair – in pictures - The Guardian Lianzhou is a four-hour drive from Guangzhou into the forested mountains of Guangdong province. It is perhaps an unlikely destination for a major arts event. But in 2005, Duan Yuting, a 47-year-old former photo editor for a Guangzhou newspaper, chose the city to found the festival, now firmly established as China’s leading contemporary photography event.

Beijing

Beijing migrant population drops for third year - Xinhua Beijing's migrant population was 7.65 million in 2018, down 3.74 percent year on year. The population dropped 1.84 percent and 1.63 percent respectively in 2016 and 2017, according to the report released by the Beijing Administration Institute (BAI) and the Social Sciences Academic Press. The number of permanent residents in the city totaled 21.54 million in 2018, down by 0.76 percent year on year, it showed.

Rural and Agricultural Issues

China to sell 40,000 tons of frozen pork from reserves on December 19: notice - Reuters The move, announced in a notice posted on the website of the China Merchandise Reserve Management Center, followed a previous sale of 40,000 tonnes of frozen pork from state reserves on Dec. 12.

Grim Future Seen for China’s Small Pig Breeders After Swine Fever - Caixin Costly upgrades to production facilities may force small breeders out of the business, an industry executive said, as the sector seeks to recover from a deadly outbreak of the disease that led to the deaths of one-third of the country’s hogs.

政策密集出台保障猪肉供给非法“炒猪”将被严厉打击_中国经济网——国家经济门户 Xinhua on more policies to ensure pork supply and price stability, and to crack down on pork speculators

Sinocism

US-China trade ; New aircraft carrier; Wang…