Xi does rare earths and the Long March monument in Jiangxi; Huawei; 70th anniversary activities

I wish I could say happy Monday but based on conversations and developments since the last issue of the newsletter I do not remember ever being this pessimistic about the trajectory of US-China relations.

The Chinese side has ramped up the nationalist propaganda, including airing old movies glorifying fighting Americans in the Korean War, while the US move against Huawei is a direct strike against China’s most successful tech company and a symbol of the PRC’s achievements and its aspirations.

Each side looks to be digging in and it is really hard to see an offramp, especially if some of the other actions I am hearing about in DC come to fruition. Sorry, nothing specific yet, but it looks like the dam may have burst in DC when it comes to sentiment and policies towards the PRC.

Xi went on an inspection tour of Jiangxi and as is always the case with these tours there are key signals. The full propaganda packaging of Xi's Jiangxi inspection tour will likely hit Tuesday or Wednesday but from the brief online reports today we know that Xi visited a leading rare earths miner and manufacturer and laid a wreath at the monument marking the starting point of the Long March.

The rare earths visit sure looks like a signal from Xi that China may try to use RE export limits as a weapon in the trade war. Such a move makes China look weak and will worry other countries besides the US. I think they have less rare earths leverage than they once had, and threatening this, if that is what they are doing, plays right into the hands of the “decouplers” and the “Uber hawks” in DC.

In the video of Xi laying a wreath at the Long March monument Liu He is by his side, a clear signal to anyone with incorrect thoughts that Liu is still his guy and is unassailable, in spite of the breakdown in the US-China trade talks, as well as effectively saying “we have been through tougher struggles and can deal with the breakdown in relations with the US if we have to”.

Xi regularly talks about every generation having its version of a "Long March", but this visit at this moment is also redolent with symbolism about the deepening struggle with the US.

Housekeeping note: You can now search the Sinocism archives here.

Thanks for reading.


The Essential Eight

1. Xi inspects Jiangxi

Xi Jinping makes inspection tour in Jiangxi - Xinhua

Xi Jinping...learns about the production process and operation of the JL MAG Rare-Earth Co. Ltd. as well as the development of the rare earth industry in the city of Ganzhou in east China's Jiangxi Province on May 20, 2019

Xi Jinping visits rare earth minerals facility, amid talk of use as weapon in US-China trade war | South China Morning Post

Chinese President Xi Jinping visited one of the country’s major rare earth mining and processing facilities on Monday, in his first domestic tour since the recent escalation of the US-China trade war.

Xi’s visit, reported by the official Xinhua news agency, comes amid growing discussion in China that Beijing could consider banning the export of such minerals as a weapon in the trade war with the United States.

Rare earth minerals were among the few items excluded from the latest US government plans to implement tariffs on almost all of China’s remaining exports to the United States

Video of the wreath laying【独家V观】习近平向中央红军长征出发纪念碑敬献花篮

Xi’s visit boosts China’s critical rare-earth sector - Global Times

Xi's trip also drew much attention, coming at a time when China and the US are locked in trade and technology battles. Many have suggested that China should limit rare-earth exports to the US as a countermeasure to the US decision to slap tariffs on Chinese goods and cut supplies of semiconductors for Chinese companies. Rare-earth minerals were among the few items excluded from the latest US tariff list. 

"It is normal that the top leader investigates relevant industrial policies," said Foreign Ministry spokesperson Lu Kang during a briefing on Monday, while expressing the hope that the media would not relate the rare-earths visit too closely to the China-US trade war.

U.S. Rare Earths Revival Planned Amid Trade Conflict - WSJ $$

An American chemicals company and an Australian miner want to build the first rare-earths separation plant in the U.S. in years, seeking to shore up supplies of important commodities caught up in the U.S.-China trade conflict...

Blue Line and Lynas said their proposed joint venture, which would be majority owned by the Australian miner, would focus on separating heavy rare earths such as dysprosium and terbium. That would make it the only large-scale producer of medium and heavy rare earths outside China, the companies said.


2. Huawei

U.S. may scale back Huawei trade restrictions to help existing customers - Reuters

In effect, the Commerce Department would allow Huawei to purchase U.S. goods so it can help existing customers maintain the reliability of networks and equipment, but the Chinese firm still would not be allowed to buy American parts and components to manufacture new products.

Comment: I do not see this as a reprieve for Huawei but rather for the firms and governments affected by the action. My understanding is that allies, including the other members of Five Eyes, were not given advance notice of the addition of Huawei to the entity list.

Trump Huawei Ban Ripples Across Industry as Supplies Halted - Bloomberg

Chipmakers including Intel Corp., Qualcomm Inc., Xilinx Inc. and Broadcom Inc. have told their employees they will not supply Huawei till further notice, according to people familiar with their actions.

Huawei’s Exposure to U.S. Suppliers - Caixin Global

U.S. companies currently provide more than one-third of Huawei’s components, making the group the company’s biggest supplier, even larger than its home market on the Chinese mainland, according to an analysis by research house Jefferies. Other major suppliers include Taiwan and Japan, which each accounting for more than 10% of its components.

Huawei stockpiles 12 months of parts ahead of US ban - Nikkei Asian Review

Huawei Technologies told global suppliers six months ago it wanted to build up a year of crucial components to prepare for trade war uncertainties, even as it moved to secure new sources and become more self reliant, sources familiar with the plans told the Nikkei Asian Review.

Germany's Infineon suspends US shipments to Huawei - Nikkei Asian Review

German chipmaker Infineon Technologies has suspended certain shipments to Huawei Technologies, three people familiar with the matter told the Nikkei Asian Review, in the first sign that Washington's crackdown on the Chinese tech giant is beginning to choke off vital chip supplies from non-U.S. companies.

Google suspends some business with Huawei after Trump blacklist - source - Reuters

Alphabet Inc’s Google has suspended business with Huawei that requires the transfer of hardware, software and technical services except those publicly available via open source licensing, a source familiar with the matter told Reuters on Sunday...

The move could hobble Huawei’s smartphone business outside China as the tech giant will immediately lose access to updates to Google’s Android operating system. The next version of its Android smartphones will also lose access to popular services including the Google Play Store and Gmail and YouTube apps.

Huawei to support its devices after Google Android bar - Reuters

Huawei will support its smartphones and tablets by providing security updates and services, it said, after Google barred it from updates to the Android operating system.

Google and Huawei, Android and Huawei, The U.S. Impact – Stratechery by Ben Thompson

Huawei’s international business is another matter entirely: should this order remain in place, without any license for Google, I expect Huawei to be in very bad shape, thanks to the loss of both Google Services generally and the Play Store specifically.

Dutch spy agency investigating alleged Huawei 'backdoor' - Volkskrant - Reuters

Chinese telecoms equipment maker Huawei has a hidden “backdoor” on the network of a major Dutch telecoms firm, making it possible to access customer data, newspaper De Volkskrant said on Thursday, citing unidentified intelligence sources...

The Volkskrant story did not contain any details of whether the alleged “backdoor” was hardware or software, how it works, or whether it has actually been used.

Chinese technologies pose no threat to the world - People's Daily Online - Zhong Sheng

A US senior official recently “warned” the UK on its approval to let Chinese telecoms company Huawei to help build some non-core parts of 5G data network, saying that it could allow China to “control the internet of the future” and “divide Western alliances through bits and bytes”.

On top of such slander, the US government even put Huawei on the “Entity List” to suppress the company...

Trials and tribulations will only build a country up, and any attempt to impede China’s progress in science and technology is in vain and will only lead to failure.

人民日报:香者自香臭者自臭 中国技术有害论可以休矣|5G网络_新浪财经_新浪网


3. US-China trade

Surprise Attack: CCTV6 Unexpectedly Airs Anti-American Movies as China-US Trade War Intensifies | What's on Weibo

CCTV 6, the movie channel of China’s main state television broadcaster, has gone trending on Chinese social media today [Friday] for changing its schedule and playing three anti-American movies for three days in a row. 

Some suggest the selection for the movies is no coincidence, and that it’s sending out a clear anti-US message while the trade war is heating up. 

The three movies are the Korean war movies Heroic Sons and Daughters (英雄儿女, 1964), Battle on Shangganling Mountain (上甘岭, 1954), and Surprise Attack (奇袭, 1960), airing from May 17-19 during prime time at 20:15.

China's Top Diplomat Calls for US Restraint on Trade, Iran - VOA

Speaking to Pompeo by telephone, Wang said the United States should not go "too far" in the current trade dispute between the two sides, adding that China was still willing to resolve differences through negotiations but that the nations should be on an equal footing.

Trade war could slice 1 per cent off China’s economic growth, top party official says | South China Morning Post

Politburo Standing Committee member Wang Yang reveals ‘worst case scenario’ at forum for Taiwanese businesspeople in Beijing but says dispute will not do any long-term damage

Firms should not relocate away from Chinese mainland as it still offers huge development opportunities, he says

Trade Tensions and National Dignity | China Media Project

[The Friday] “Zhong Xuanli” piece is the most direct invocation yet — at least in the pages of the People’s Daily — of trade tensions with the United States as an affront and challenge to the inevitable rise of the Chinese people, and the link to Xi’s notion of the “Chinese dream” is directly there in the headline..

The language in today’s page-one commentary reads: “In the great journey toward national rejuvenation, the Chinese people are at one in their conviction to protect the interests of our people and the dignity of the nation, our resolution firm as stone and unyielding.”

没有任何力量能够阻挡中国人民实现梦想的步伐

钟轩理 is the pen name for commentaries from the Theory Bureau of the Central Propaganda Department

There is now a micro-site on the People's Daily site for all the recent commentaries about the US-China trade war - 人民日报要论学习:中国经济行不行?看清中美贸易摩擦大势--时政--人民网

U.S., China bicker over 'extravagant expectations' on trade deal - Reuters

In an interview with Fox News Channel recorded last week and aired on Sunday night, Trump said the United States and China “had a very strong deal, we had a good deal, and they changed it. And I said ‘that’s OK, we’re going to tariff their products’.”

In Beijing, Chinese Foreign Ministry spokesman Lu Kang said he didn’t know what Trump was talking about.

“We don’t know what this agreement is the United States is talking about. Perhaps the United States has an agreement they all along had extravagant expectations for, but it’s certainly not a so-called agreement that China agreed to”

Failure to reach trade deal due to U.S. seeking unreasonable interests: spokesperson - Xinhua

Spokesperson Lu Kang made the remarks at a press briefing when asked to comment on the U.S. side's recent remarks that the two countries had an agreement but China broke it.

The U.S. side may have always had an "agreement" that it hopes for, but it is certainly not an agreement that China has agreed to, Lu said.

When widespread suspicion and market turmoil were triggered both in the U.S. and abroad, the U.S. side wanted to confuse public opinion and shift the blame to others, which is also futile, Lu said.

Commentary: China not to satisfy unreasonable demands of the US - People's Daily Online

China has no intention to change or displace the US, while the US cannot expect to dictate to China or impede the latter’s development. On issues concerning its core interests, China will not make the slightest concession to the US.

The deal-making tactic of extreme pressure is doomed to not work for China that had endured so much in the past. The salami-slice strategy in negotiations is only one-sided wish. And the ulterior motives to contain China are nothing more than wishful thinking for the Chinese nation on a journey toward the great rejuvenation.

The unequal treaties that were imposed on China by foreign powers are still fresh in our memory.

U.S. intellectual property complaints a 'political tool': China state media - Reuters

An op-ed article in the People’s Daily targeted the Section 301 report Washington issued in March 2018, saying the authors fabricated the claim that China stole hundreds of billions of dollars worth of intellectual property from the U.S.

“If the report is based on imagined or selective data, it’s a kind of science fiction novel,” it said.

捕风捉影者,风必摧之(钟声)——“中国盗窃知识产权论”可以休矣

China is never rebuilt by the US - People's Daily Online - Zhong Sheng

Some Americans hold that the so-called imbalanced trade between China and the US is a result of the Chinese manipulation of exchange rate, and the US trade deficit with China is wealth sent by the US to China. They attribute China’s success, to a large extent, to the US investment in China.

Such theory, ignoring the struggling and hard work of the Chinese people in the past decades, not only goes against facts, but also is illogic.

‘Game of Thrones’ Finale Frozen Out in China by Trade Fight - WSJ $$

An HBO spokesman said China restricted Tencent from airing “Game of Thrones” due to the trade dispute with the U.S. The spokesman said HBO didn’t experience any trouble with the program’s transmission. He referred further queries to Tencent.

Chinese fireworks to light up US skies on Independence Day - Global Times

The protracted China-US trade war has had little impact on Chinese fireworks exports to the US, some Chinese manufacturers told the Global Times. Their sales to the US have gone as usual, with some seeing a slight increase.

"The fireworks for the US Independence Day celebration all left Chinese ports by mid-May. This year, sales were up 3 percent from 2018," Qin Binwu, the chairman of Jinping Fireworks in East China's Jiangxi Province, told the Global Times

Year-old Xinhua alert spreads proclaiming U.S.-China trade row ceasefire - Reuters

China’s official Xinhua news agency condemned the spreading of “false news” on Monday after some websites published a year-old alert announcing a ceasefire in the Sino-U.S. trade dispute.


4. Other US-China issues

US spy chiefs warn tech companies on China dangers | Financial Times $$

Dan Coats, the director of national intelligence, has given several briefings alongside colleagues from the FBI and the National Counterintelligence and Security Center to large technology companies, venture capitalists and educational institutions.

According to those who have attended, the sessions are designed to highlight the risks of trade with China — especially the threat of cyber attacks and intellectual property theft.

The briefings have been held across the country, including in Silicon Valley and Washington, and have focused particularly on the technology industry. Those involved in organising them told the Financial Times that executives had been shown classified material as part of this, something they said was a highly unusual step.

U.S. senator convening meetings to warn business, academia of China threat - Reuters

U.S. Senator Mark Warner said on Sunday that he has been organizing meetings between U.S. intelligence officials and the country’s business and academic communities to urge caution in their relationships with China.

“I have been convening meetings between the intelligence community and outside stakeholders in business and academia to ensure they have the full threat picture and hopefully, make different decisions about Chinese partnerships,” Warner said in a statement.

US Navy sails a vessel near contested South China Sea shoal for second time in a week - Stripes

The guided-missile destroyer USS Preble on Monday sailed within 12 nautical miles of Scarborough Shoal to “challenge excessive maritime claims and preserve access to the waterways as governed by international law,” said 7th Fleet spokesman Lt. Joe Keiley.

The Navy last week sent a U.S. vessel to an exercise in the area near the contested shoal.

Trade can no longer anchor America’s relationship with China - Economist special report

This report will look at clashing views in Washington and Beijing about how to manage the technological, military, economic and political aspects of a great-power contest so new that the two sides do not even agree on what successful relations might look like. Rules must be found.

To Many Chinese, America Was Like ‘Heaven.’ Now They’re Not So Sure. - The New York Times

According to the latest nationwide survey by the Pew Research Center, published in 2016, 45 percent of Chinese saw American power and influence as a major threat to their country, up from 39 percent in 2013. More than half of Chinese believed the United States was trying to prevent China from becoming as powerful as America, the survey found.


5. 70th anniversary of PRC founding activities

China to mark 70th anniversary of PRC founding with mass activities - Xinhua

The activities will take multiple forms across the country with patriotism at the core, according to a circular jointly issued by the General Office of the Communist Party of China Central Committee and the General Office of the State Council.

The activities will include touring urban and rural areas to fathom changes in the country, story-telling by citizens about endeavors to realize their dreams, thematic book reading, cherishing the memory of revolutionary martyrs, and national defense education activities, according to the circular.

The slogans of the 70th anniversary celebration were also unveiled in the circular.

中办国办印发《通知》 隆重庆祝中华人民共和国成立70周年 广泛组织开展“我和我的祖国”群众性主题宣传教育活动--党建-人民网

Comment: "Me and My Motherland" the theme of the activities. This circular list 13 activities in total (A rough Google translate of all of them is here). Some of the activities:

remembering revolutionary martyrs;

raising the national flag and singing the national anthem. From now until the end of this year, at 7 o'clock every morning, radio stations and TV stations at all levels will play the national anthem on the main frequency and main channel;

National defense education activity. With the theme of “praising brilliant achievements, building the dreams of the military and the people”, we will go deep into the grassroots organizations to carry out propaganda activities;

online theme publicity and education activity. Focusing on the theme of "I and my motherland", we will actively set up issues, carefully design and develop online cultural products that netizens like to see, and carry out online commemoration of martyrs activities and online knowledge contests

Official calls for clearly informing people of China's achievements, development plans - 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 during an inspection and research tour to Guangdong from May 17 to 19.

Noting that mass activities are being held across China's urban and rural areas to celebrate the 70th anniversary of the founding of the People's Republic of China, he underscored extensive publicity efforts to explain to the people China's situation and policies.

The people should be clearly informed of the achievements China has made under the leadership of the CPC, the enormous potential and bright prospects for China's economic development, the plans made by the CPC Central Committee to promote high-quality development and improve people's wellbeing, according to the official.

And of course there will be a big parade in Beijing on October 1.


6. No 7 handle for RMB:USD?

China's cbank will not let yuan decline past 7 to the dollar - Reuters

China's central bank will use foreign exchange intervention and monetary policy tools to ensure the yuan does not weaken past the 7-per-dollar key level in the immediate term, three people familiar with the central bank's thinking said.

"At present, rest assured they will certainly not let it break 7," a source told Reuters.

China's forex market to remain stable on solid economic fundamentals: official - Xinhua

The sound and healthy operation of the Chinese economy and finance has been providing solid support for the forex market and the yuan to keep stable at a reasonable level, Pan Gongsheng, deputy head of the People's Bank of China said in an interview with Financial News, a publication run by the central bank...

"China has the foundation, capability and confidence to keep the yuan's exchange rate basically stable at a reasonable and balanced level," he said.

潘功胜:经济金融稳健运行,为外汇市场和人民币汇率保持合理稳定提供有力支撑


7. Gay marriage in Taiwan

Registration of transnational same-sex marriages to start May 24 | CNA

Taiwan will begin to register the marriages of same-sex couples on May 24, including those between Taiwan nationals and partners from one of 26 countries where gay marriage is legal, a senior official at the Ministry of the Interior (MOI) said Monday...

Under the new law, titled Enforcement Act of Judicial Yuan Interpretation No. 748, however, even with the legalization of same-sex marriage in Taiwan, a Taiwanese national cannot enter into a legally recognized union with a partner from a country where gay marriage is not legal.

Taiwan furious after China attempts to take credit for LGBT marriage win - CNN

LGBT activists were overjoyed at the news, but some of the most unlikely praise came from the Chinese Communist Party's mouthpiece.

"Local lawmakers in Taiwan, China, have legalized same-sex marriage in a first for Asia," tweeted the People's Daily newspaper on Friday, along with a rainbow color-infused animated image that says "love is love" underneath.


8. Liu Shiyu under investigation

China’s former securities regulator Liu Shiyu is probed over family members’ alleged insider trading and favouring hometown IPOs, sources say | South China Morning Post

Liu Shiyu, China’s former securities regulator, is being investigated for allegedly fast-tracking initial public offerings (IPOs) of small banks in his hometown and also of having family members who bought bonds at below-market prices, according to sources and media reports.

Liu Shiyu, China’s former top securities regulator, turns himself in as part of corruption investigation | South China Morning Post

Liu, who left the China Securities Regulatory Commission in a surprise reshuffle in January, was said to have turned himself in and is suspected of violating party discipline and laws, according to a terse statement issued by the National Supervisory Commission....

Liu, 57, currently heads the All-China Federation of Supply and Marketing Cooperatives, a Soviet-era holdover of China’s centrally planned economy that operates a network of 30,000 agricultural collectives.

Comment: So much for the theory that Xi put Liu into the ACFSMC to reinvigorate it...空降地方的省部级要员回京 曾在“老虎”落马后补位_凤凰网资讯 Cai Zhenhong was just transferred there after 4 years as propaganda head in Hunan Province...is he in holding before going down too?


Business, Economy and Trade

Central Bank Reveals First Step to Unifying Benchmark, Market Rates - Caixin China’s interest rate liberalization is now focused on unifying the “two tracks” of lending rates, the People’s Bank of China (PBOC) said Friday in its latest quarterly report. The report’s release marks the first time that the central bank has signaled how it will unify the two tracks — one is benchmark rates set by the bank, while the other refers to the ones chiefly set by the market. The PBOC looks likely to first try to merge lending rates instead of deposit rates.

China to further open up financial sector: central bank - Xinhua In expanding financial-sector opening-up, the country will adopt an approach of pre-establishment national treatment with a negative list, and pursue coordinated progress in financial opening-up, the reform in exchange rate formation mechanism and the process of advancing capital account convertibility, the People's Bank of China said in an article posted on its website.

China to annually revise negative list for market access - Xinhua Chinese authorities will revise the negative list for market access on an annual basis, and will unveil the 2019 version later this year. To upgrade the negative list, China will set up a mechanism that combines annual revision with dynamic adjustments, the National Development and Reform Commission said in a statement.

In Depth: Xiangshui Chemical Factory’s Recipe for Disaster (Part 1) - Caixin An official investigation into the cause of the explosion is still underway. But the size and nature of the crater mean it’s very likely that the blast was caused when “at least hundreds of tons, or even thousands of tons” of solid chemicals ignited, one industry source told Caixin. Meanwhile, sources close to the official investigation team said security footage suggested that one of the solid waste warehouses had caught fire minutes before the blast.

Forced Tech Transfers Are on the Rise in China, European Firms Say - WSJ $$ Such technology transfers have continued to take place despite official assurances that this practice would be stopped, according to an annual survey by the European Union Chamber of Commerce in China, with 20% of the survey’s 585 participants saying they have felt compelled to transfer technology to maintain market access, up from 10% in 2017.

Secret Bond Deals Making China's Debt Market More Confusing - Bloomberg An opaque practice that’s increasingly concerning analysts is when a debtor stops servicing bonds through an official clearing house, and instead does private deals with bondholders that might involve late payments. The investment bank CICC has counted at least seven distressed borrowers that have engaged in the method since March.

Politics and Law

State Asset Chief Named China’s Top Market Regulator - Caixin Xiao Yaqing was moved from director of the State Council’s State-owned Assets Supervision and Administration Commission (SASAC) to party head and bureau chief of the State Administration for Market Regulation (SAMR) on Friday, Caixin has learned. Xiao replaces Zhang Mao, who reached the mandatory retirement age of 65 in February, and leaves SASAC’s current party chief Hao Peng to take full charge of the state assets regulator.

Dalai Lama lets slip how India vetoed his meeting with China’s leader in 2014 - The Guardian “I have a brief meeting with prime minister Narendra Modi, [and] when Xi Jinping came to Delhi, I also wanted a meeting with him,” he said. “So I already have some connection, some contact directly through my friend. So Xi Jinping agreed, but the Indian government … was a little cautious.”

Senior CPC official meets Tibetan monks receiving senior academic title - Xinhua You Quan, a member of the Secretariat of the CPC Central Committee and head of the United Front Work Department of the CPC Central Committee, called on Tibetan Buddhists to firmly safeguard the national unification and ethnic unity, and to promote the inheritance of Tibetan Buddhism. The group of 40 monks received the senior academic title, one of the highest titles for Tibetan Buddhism, after passing an examination. 尤权接见第十五届藏传佛教“拓然巴”高级学衔获得者

钟轩理:五四精神与中国道路--理论-人民网 Monday's People's Daily has another long commentary from "Zhongxuan Li 钟轩理", this one on Xi's May 4 anniversary speech, about "The May 4th Spirit and China's Road"

Probe of Former Shaanxi Chief Zhao Zhengyong Turns Up Money-Losing Spa - Caixin After Zhao’s fall in January, Yao also disappeared. Caixin has learned from sources with knowledge of the matter that Yao is cooperating with the investigation of Zhao. Yao is commonly known as Zhao’s “white glove” in Shaanxi Coal. The term refers to a person who acts as a middleman between businesses and politicians to facilitate secret deals. Even though his position in the company is not high, senior management members are afraid of him, people at Shaanxi Coal told Caixin. Zhao has placed similar white glove liaisons in many key companies in Shaanxi province

Provincial legislator under investigation - Xinhua Xiang Lili, vice chairman of the Standing Committee of Hunan Provincial People's Congress, is being investigated for suspected serious violations of Party disciplinary rules and laws.

Foreign and Defense Affairs

Why China is not celebrating the unexpected Australian election result - CNN As it now stands, Morrison will have a full three-year term to shape Australian foreign policy. While he rejects the notion of Australia making a binary choice between one or the other, he has characterized the US as Australia's ally and friend and China an indispensable customer.

Chinese state media says shock federal election victory will impact China-Australia relations - Australian Broadcasting Corporation "This election result also means that China-Australia relations, which have deteriorated in recent years under the leadership of the ruling Coalition formed by the Australian Liberal Party and the National Party, will continue to have uncertain prospects," the editorial read.

Australia’s China Challenge - The New York Times In a gold-curtained meeting room in Sydney, the Chinese consul general appealed to a closed-door gathering of about 100 people, all of them Australian residents and citizens of Chinese ancestry. He called on the group to help shape public opinion during a coming visit of China’s prime minister, Li Keqiang, in part by reporting critics to the consulate. Rallies in support of China should be coordinated, he suggested, and large banners should be unfurled to block images of protests against Beijing. “We are not troops, but this task is a bit like the nature of troops,” said the diplomat, Gu Xiaojie, according to a recording of the session in the consulate obtained by The New York Times and verified by a person who was in the room. “This is a war,” he added, “with lots of battles.”

Study outline on Xi Jinping's thinking on strengthening military published - Xinhua It is the basic study material on Xi's thinking on strengthening the military, and it consists of 18 sections and 85 entries, elaborating the significance, structure, content, principles and instructions for practice, the statement said. The CMC has ordered the whole armed forces to carefully study and make good use of the booklet. 经中央军委批准 《习近平强军思想学习纲要》印发全军--时政--人民网

China and ASEAN nations meet on South China Sea cooperation - China Military Senior officials from China and ASEAN member countries met Saturday in Hangzhou, east China's Zhejiang Province, to further coordinate on the South China Sea, agreeing to continue efforts for peace, tranquility and common development in the area.

Chinese court hands Japanese man 15-year jail sentence for spying | South China Morning Post Hot spring development firm boss sentenced for stealing state secrets two years after he was detained in Hainan province Last week another Japanese man held at the same time was given a five-and-a-half year sentence by a court in Shandong

Japan and India to develop Colombo port, countering Belt and Road - Nikkei Asian Review The deal comes as China has been using Belt and Road projects to increase its influence in the region, and with Japan aspiring to play a significant role in the area pushing its Free and Open Pacific Ocean and Indian Ocean strategy. The three partners will sign a memorandum of understanding by summer, and work will begin by next March

Follow the leader - China Books Review In Leadership and the Rise of Great Powers https://amzn.to/2WmNQXr , Yan Xuetong, a professor of international affairs at Tsinghua University, has tasked himself with the responsibility of articulating the Chinese answer to the biggest problem in international affairs: navigating the shift in global power prompted by the country’s rise. As a rare book-length articulation of leading Chinese thinking on international affairs in English, the book merits readership beyond what its academic prose would otherwise invite.

Branstad to Make First Visit to Tibet by U.S. China Ambassador Since 2015 - VOA U.S. Ambassador to China Terry Branstad will travel to Tibet from Sunday for official meetings and visits to religious and cultural heritage sites, in the first such trip by a U.S. envoy to China since 2015, the State Department said.

‘Like Escaping Into the Desert.’ More Women Forced Into Sex Trade When Fleeing North Korea. - WSJ $$ Some 60% of female North Korean defectors in China are trafficked into the sex trade, according to a new report from the U.K.-based Korea Future Initiative, with about half of those forced into prostitution and others sold into marriages or forced to perform cybersex acts for online viewers. Sex trafficking targeting North Korean defectors in China generate at least $105 million a year for traffickers and criminal organizations, the human-rights group found.

China goes all out to fight claims of purge of diplomats - Daily Nation Top Chinese diplomats in Nairobi were replaced in an apparent bid to protect the image of their country in Kenya, following negative publicity over the Standard Gauge Railway scandal. Officially, Beijing says the changes, as those elsewhere, were routine but the Sunday Nation learnt the Embassy in Nairobi also started implementing a new policy that would see the new diplomats engage the public on social media.

Hong Kong and Macao

Hong Kong and the US-China New Cold War | The Diplomat the United States can impose territory-wide sanctions by suspending part or all of the differential treatment granted to Hong Kong under the USHKPA. This option could be quickly executed under the existing USHKPA by way of presidential executive orders. This would make sense if the United States sees the OCTS model as becoming a threat to its national interests and it does not have the leverage (or it is already too late) to stop China from transforming Hong Kong. This option, even if adopted partially (e.g. imposing a technology export ban), will greatly undermine Hong Kong’s role as an international financial center

Hong Kong airport and subway ban ad showing two men holding hands - Inkstone 

Tech and Media

A “Collective Work Report” of the five major “National Team” members — BAT, iFlytek, and Sensetime - Google Docs from Jeff Ding's excellent ChinAI newsletter

Baidu reports quarterly losses for first time since listing, head of search resigns · TechNode In an internal memo to employees on Friday obtained by TechNode, Baidu CEO Robin Li acknowledged that the company is facing a “grim situation,” but said that 2019 holds great opportunities. Meanwhile, Baidu said that Xiang Hailong, senior vice president of the company’s search business, resigned after joining in 2005. Shen Dou, previously head of Baidu’s mobile products, will take Xiang’s place.

A Huge Chinese Video App Is Charging People, Draining Their Batteries, And Exposing Data Without Their Knowledge More than half a billion people have installed VidMate, an Android app that enables them to download videos from YouTube, WhatsApp, and other platforms. This functionality made VidMate, which has ties to Chinese tech giant Alibaba, hugely popular in countries such as India where streaming mobile video can be expensive or at times unreliable. But it appears that convenience still comes at a high cost for users. VidMate has been displaying hidden ads, secretly subscribing people to paid services, and draining users’ mobile data, according to findings from security researchers at a London-based mobile technology firm

Society, Arts, Sports, Culture and History

Silent for So Long, Elderly Gays Livestream at Full Volume - Sixth Tone A Blued spokesperson says the app’s livestreaming feature, available since 2016, has seen “hundreds of thousands” of users turn their cameras on themselves. Though the majority of them are young, Blued has noticed a rise in livestreamers aged over 50 since the second half of 2018. Hu attributes this to the closeted lives that gay men of his generation lead.

Surface Tension | ChinaFile I never realized that so many Chinese people have tattoos,” says photographer Xu Song, who spent the summers of 2014, 2015, and 2016 photographing people at outdoor swimming pools in Beijing with his phone. // The pool at Tuanjie Hu in Beijing is quite the scene in the summer

Energy, Environment, Science and Health

As a Timber Plantation Flourishes, Village Dissent Takes Root - Sixth Tone Now, in a landmark case, around 150 Yong’an residents are suing both Guangxi Lee & Man Forestry Technology Ltd. — the timber company that operates the nearly 300,000-square-meter eucalyptus plantation — and the local government body that partnered with it. Villagers claim the eucalyptus sucks up water from three mountain springs, leaving little for them to use for cooking and rice farming farther downstream. They hope a court will cancel the company’s contract and pay them compensation, but also face stiff opposition from both Guangxi Lee & Man and the local government, who say the villagers’ claims are groundless.

China unveils plan to strengthen food safety - Xinhua More than 97 percent of the country's major produce should pass quality and food safety test by 2020, while over 98 percent of food should pass spot checks, according to the guideline released by central authorities.

Premier Li urges more efforts to advance medical reforms - Xinhua Li, a member of the Standing Committee of the Political Bureau of the Communist Party of China Central Committee, made the remarks in a written instruction to a video and telephone conference on medical reforms held in Beijing Friday. Hailing the achievements made in major tasks of medical reforms last year, including centralized medicine procurement and lower prices of anticancer drugs, Li extended sincere greetings to participants in medical reforms and medical workers. Li called for the in-depth implementation of the Healthy China initiative, and more health promotion activities with extensive coverage.

China’s green efforts hit by fake data and corruption among the grass roots | South China Morning Post Recent audit reports covering the past two years released by the environment ministry showed its inspectors were frequently presented with fake data and fabricated documents, as local officials – sometimes working in league with companies – have devised multiple ways to cheat and cover up their lack of action.

Education

Universities Aren’t Ready for Trade War Casualties – Foreign Policy Some affected U.S. industries have protested the spiraling tariffs. Others have been promised protection and subsidies by the Trump administration. Yet one U.S. industry is far more exposed than any other—and far less likely to receive compensation from the White House. The trade war leaves U.S. higher education far more endangered than its leaders realize.

Rural and Agricultural Issues

Dim Sums: Rural China Economics and Policy: Shandong Feed: Hog-to-Poultry Shift Statistics from China's largest feed-producing province show steep decline in swine feed output this year as impacts of African swine fever took hold, but gains in poultry feed offset the decline. Shandong Province January-April feed production statistics show a 27.5-percent in swine feed output from a year earlier, but poultry feed production was up 8.6 percent, leaving overall output in the province unchanged from year-earlier levels.