Xi Holds Mobilization Meeting For Whole Army, Visits Exhibit Celebrating 1950 Battle With Americans In The Korean War ; Beijing Can't Quit GDP Targets ; Heilongjiang Provincial Government Moves Quickly To Address Allegations By Mao Zhenhua
Good morning from snowy DC. I am running a bit late today because of school delays so will get right to it.
The Essential Eight
1. Xi Holds Mobilization Meeting For Whole Army, Visits Exhibit Celebrating 1950 Battle With Americans In The Korean War
President Xi Jinping Wednesday instructed the armed forces to strengthen real combat training and improve its war-winning capability.
Xi, also general secretary of the Communist Party of China (CPC) Central Committee and chairman of the Central Military Commission (CMC), made the remarks while issuing an order at a mobilization meeting held by the commission.
It was the first time for the commission to hold a mobilization meeting for the whole armed forces
PLA Daily Commentary-军报评论：坚定不移把军事训练摆在战略位置
CCTV Evening News on Xi's instructions to the PLA--[视频]中央军委举行2018年开训动员大会 习近平向全军发布训令_CCTV:
The South China Morning Post has posted English-subtitled excerpts from CCTV video, with stirring theme music-"Xi Jinping's new year orders to the Chinese army coincided with a first-of-its-kind military display. Xi sounds like he has a cold.
The Thursday front page of People's Daily is quite a martial sight, seems far from the idea of "Peaceful Rise":
After the mobilization meeting Xi inspected a division at Central Theater Command. --CCTV Evening News--[视频]习近平在视察中部战区陆军某师时强调 大抓实战化军事训练 聚力打造精锐作战力量_CCTV
The report shows Xi climbing on a tank and looking down a gun sight:
CCTV also shows Xi stopping to admire an exhibit about the division fighting Americans in the Korean War at 松骨峰. Xi said back then the PLA had energy but not much steel, but now they have lots of steel and even more energy:
“As Xi Jinping announced his instructions, there was prolonged and thunderous applause,” the party’s official newspaper, the People’s Daily, reported in a front-page story, alongside a photograph showing Xi clad in combat fatigues and black leather gloves.
The newspaper claimed troops had gathered in 4,000 separate locations across China to hear their commander-in-chief’s decree. Turning to the scarlet flag of the People’s Liberation Army (PLA), they vowed to “resolutely obey Chairman Xi’s order”.
Its 334th Mech Infantry Regiment was there to answer Xi's call to kicking-off the 2018 military training with 7000 members and 300 armed vehicles yesterday.
2. Beijing Can't Quit GDP Targets
Comment: This is another bad sign for economic reform prospects.
The proposed target, to be unveiled at the annual parliament meeting in March, was endorsed by top leaders at the closed-door Central Economic Work Conference in Dec. 18-20, according to four sources with knowledge of the meeting outcome.
3. Socialist Ideology Propaganda Work To Deepen
Wang Huning, a member of the Standing Committee of the Political Bureau of the CPC Central Committee and the CPC Central Committee Secretariat, made the remarks at a national conference on communication and publicity, which began Wednesday.
Wang stressed the importance of strengthening the overall CPC leadership in publicity, theory and culture, saying that any ideological developments must follow CPC rules on Party building.
CCTV Evening News on the meeting - 全国宣传部长会议在京召开 王沪宁出席并讲话
4. Tibetan Businessman On Trial For Talking To The New York Times
A Tibetan language activist who appeared in a New York Times video has been put on trial for separatism in proceedings dismissed as a “sham” by rights groups, a sign of increasingly hardline attitudes towards government critics.
Tashi Wangchuk pleaded not guilty to the charges of “inciting separatism” during the four-hour trial in the western Chinese city of Yushu, where the state’s main piece of evidence against him was the nine-minute video, according to his lawyer, Liang Xiaojun.
The activist was detained two years ago after appearing in the video where he criticised policies towards Tibetan language education, attempted to sue the local government and tried to entice China’s state broadcaster, CCTV, to report on his concerns.
A Tibetan businessman who tried to protect his native language, and spoke to The New York Times about his efforts, defended himself in a Chinese court on Thursday against criminal charge that his one-man campaign had fanned resistance to Chinese rule.
The one-day trial of the businessman, Tashi Wangchuk, 32, was held in his hometown Yushu, a heavily Tibetan area in the northwestern Chinese province of Qinghai, two years after he was detained by the police.
5. Alibaba's Ant Financial Caught Enrolling Users In Sesame Credit By Default
Ant Financial Services Group, which operates Alipay, China’s top third-party payment service provider, apologized Wednesday for automatically enrolling users into its credit-rating system in the wave of a backlash from the public as well as the central bank.
Earlier this week, Alipay added a new feature to its year-end electronic billing service that allows Sesame Credit to access the user to access shopping and payment history on the app unless they opt out.
The move elicited a strong outcry from the public, saying the company was improperly gathering personal consumption data. The People’s Bank of China on Wednesday also told Alipay to apologize and correct the situation, Caixin learned.
Ant Financial might have been trying to get around newer, stricter laws that would prevent them from sharing user data unless they had explicit permission, said Zhai Zhenyi, a lawyer at Yingke, a China-based law firm.
“Problems like telecom fraud and malicious marketing have severely vexed the general public, so people’s consciousness about their rights is awakening,” he said. “This is a very good thing to see.”
But it’s not clear to what degree that consciousness extends to government collection of data, even though China’s biggest internet companies often provide user information to Beijing.
Caijing on the Sesame Credit mess - 支付宝年度账单怎么惹了用户_原创频道_财经网:
Comment: It is only a problem if you are caught is the mantra that has made Alibaba and the other Internet behemoths so successful to date.
6. PRC To Curtail Bitcoin Mining Operations
Local regulators will take action to ensure bitcoin mining companies no longer receive preferential policies for electricity prices, taxes or land use, a source close to regulators told Caixin.
Another source from the central bank-led committee in charge of internet financial risk told Caixin that localities have been told to use electricity prices, land-use policy, taxation and environmental measures to “guide” companies out of the bitcoin mining business.
The committee also ordered localities to submit regular reports on bitcoin mining operations in their jurisdictions, according to the source.
The People's Bank of China outlined plans to limit power use by some bitcoin miners at a closed-door meeting Wednesday, people familiar with the matter told Bloomberg News. But the business model may already be under threat regardless of bank regulation, thanks to the way China's energy system is changing.
Sick of wasting electricity, Beijing has in recent years introduced measures to prevent the building of surplus generation and to transfer the electricity that's available to where it's most needed.
7. Heilongjiang Provincial Government Moves Quickly To Address Allegations By Mao Zhenhua
Background: As highlighted in the 1.2 newsletter, a video of entrepreneur and Dean of Institute of Economics of Renmin University of China (English bio) Mao Zhenhua criticizing local corruption that has hurt his ski resort in Yabuli, Heilongjiang has gone viral...the general reaction seems to be of course, Dongbei is perhaps the most corrupt place in China, no wonder the economy is such a disaster up there...
Comment: Mao Zhenhua's video tirade has an effect, Heilongjiang inspection team finds problems with the local Yabuli management committee, disciplines local officials, announces measures to rectify the problems. And the local committee has apologized to Mao. Any chance Mao's tirade was pre-approved in Beijing? Cracking down on corrupt local officials who are stifling economic growth in Dongbei very much fits with Beijing's agenda.
The video is here on Youtube
The Heilongjiang Provincial Party Committee has launched an inspection of the provincial Forestry Bureau in the wake of the Mao Zhenhua allegations
8. Is HNA Group Running Out Of Money?
Comment: Creditors and debtors should be very worried, and service providers should be asking for much of their payments upfront.
A unit of HNA told employees in an email Tuesday that payments on investment products they previously purchased would be delayed, according to a person familiar with the matter.
HNA employees as well as outside investors are among the customers of JBH.com, an internet-based investment and financing platform owned by HNA that makes loans and sells high-yielding investment products that mostly mature in under a year.
It was the second such notification that employees of the sprawling airlines-to-hotels conglomerate had received in about a month, according to a person familiar with the matter.
Business, Economy, Finance And Trade
China building new world of trade rules to serve changing needs - Global Times In 2018, China is likely to make great strides in promoting free trade agreements (FTAs) that will frame new rules and norms governing global trade and investment. China will pursue negotiations of 10 FTAs in 2018, while carrying out feasibility studies for 10 other agreements, the Economic Information Daily, a publication of the Xinhua News Agency, said in a recent report, citing a Ministry of Commerce official.
China Now Taxes Offshore Profits Less - Caixin Global The new policy is seen as similar to the U.S. recent tax cut plan, as both aim to encourage companies and individuals to bring more profits back to the home country, industry insiders say. Retroactive to Jan. 1, 2017, Chinese companies and individuals have more flexibility in determining the part of their repatriated profits eligible for income tax exemption at home, the Ministry of Finance and the State Administration of Taxation (SAT) said in a joint statement Friday.
China tightens bond trading rules in deleveraging campaign -PBOC - Reuters The regulations, jointly issued by the People’s Bank of China and China’s banking, securities and insurance regulators, come as Beijing launches a series of co-ordinated initiatives across government agencies designed to reduce leverage in the financial system. Under the new rules, published on the central bank’s website, institutions must sign written deals when conducting bond repurchase or bond forward transactions. Any deals designed to dodge regulatory requirements are to be banned.
How Swarovski is winning over Chinese customers on WeChat - Digiday The luxury brand launched a campaign on the China-based social and messaging app to drive engagement, brand awareness and purchases (both online and in stores) during the Christmas season, which is seeing more consumer traction in the region. Over the month of December, Swarovski teased an “Advent Calendar” box of products that included three full-priced items and 21 free gifts, selling for $458 dollars. It sold out in fewer than 10 days on the platform.
China revises regulations on table salt monopoly - Gov.cn The salt administrative department under the State Council is in charge of salt administration nationwide. Local governments above the county level can designate a department to undertake the work. As China implements a system where only designated companies can produce or wholesale edible salt, other companies are forbidden to do so, noted the decree.
The Cashless Society Has Arrived— Only It’s in China - WSJ Though the U.S. saw $112 billion of mobile payments in 2016, by a Forrester Research estimate, such payments in China totaled $9 trillion, according to iResearch Consulting Group, a Chinese firm. For Alibaba and Tencent, the payoff isn’t just the transaction fees they make from merchants, typically 0.6%. It’s also the consumer data collected, which can transform their apps into marketing platforms for an expanding array of services, from bike sharing to travel.
Berlin to probe Chinese deal for German aerospace group Cotesa - FT $$ Berlin has intervened in the takeover of a small but innovative German aerospace company, using a new law that gives it enhanced powers to block Chinese deals in strategic sectors of the economy. Cotesa, which makes parts for aircraft makers such as Airbus and Boeing, was due to be bought by a subsidiary of the state-run China Iron & Steel Research Institute Group for a price German media reported at between €100m and €200m.
Politics, Law And Ideology
Vice governor of E China province under investigation for disciplinary violations - Xinhua Ji Xiangqi, vice governor of east China's Shandong Province, is under investigation for suspected "severe disciplinary violations," the Central Commission for Discipline Inspection of the Communist Party of China announced Thursday.
我国社会主要矛盾变化的重大意义（进入新时代 踏上新征程） 颜晓峰 《 人民日报 》（ 2018年01月04日 07 版）//Three items on the principal contradiction on the 1/4 People's Daily Theory section
准确把握社会主要矛盾的变化（大家手笔） 严书翰 《 人民日报 》（ 2018年01月04日 07 版
社会主要矛盾新变化与民族复兴新境界（思想纵横） 叶 帆 《 人民日报 》（ 2018年01月04日 07 版）
既要面对面 又要键对键--舆情频道--人民网 Under guidance from the organization department, Cangxi, Sichuan has launched the first "Intelligent Party Construction Big Data Platform"...and there is an orb...
孙政才通过温家宝夫人升官 前途不妙(图) - 中国政坛 - 倍可亲 Comment: A 2015 article about Sun Zhengcai and his ties to Wen Jiabao and his family, and cheap Beijing land he approved for Wen's wife. Interesting that this author in 2015 said Sun's chances of advancing at the 19th were lower than many thought because he had so many "problems".. Expect to hear more about the ties to the Wen family... // 十六大后，孙政才又如法炮制，将顺义价值几十亿的地皮以极低价格输送给温家宝夫人，终于得到温夫人张蓓莉的认可，也得到温家宝的大力提拔，并获得十七大中央委员资格。后来再任吉林省委书记，也是得到温家宝的鼎力支持。从他作为中共第六代总理接班人的态势来看，温也的确对他信任有加。
Foreign and Military Affairs
Why Xi Jinping is once again letting China’s military have a direct link to local authorities | South China Morning Post: Party standing committees are the main decision-making bodies of any administration in China and the military has long had a presence on them at all levels. The practice dates back to the 1950s when then-defence minister Peng Dehuai suggested that officers from the People’s Libration Army (PLA) join government meetings to improve coordination between military and civilian affairs...The announcements that PLA officers would once again be taking up seats on the party standing committees is a strong signal that the military reforms have been completed and the PLA is regrouping, analysts say.
U.S. and South Korea Agree Not to Hold Military Exercises During Olympics - WSJ President Donald Trump and South Korean President Moon Jae-in agreed not to hold springtime military exercises during the Olympics, the South Korean president’s office said Thursday, a move that could cool tensions with North Korea. The agreement came during a 30-minute phone call between the two presidents, Seoul’s presidential Blue House said in a statement.
China welcomes reopening of Korean border hotline, but US is sceptical | South China Morning Post Chinese foreign ministry spokesman Geng Shuang said Beijing supported efforts by Pyongyang and Seoul to use the Pyeongchang games to improve relations following North Korea’s repeated missile launches and its sixth and most powerful nuclear test last year. In a veiled criticism of US President Donald Trump’s latest war of words with Kim, he also urged Washington to show restraint and make concrete efforts to seek a peaceful solution to the North Korea nuclear crisis, including starting direct dialogue with Pyongyang.
Oman’s Coastline Is the Next Stop on China’s Belt and Road Eager to wean its economy off hydrocarbons, Oman opened its doors to Chinese investment last year in a major step towards transitioning to a knowledge-based economy. Oman Wanfang, a consortium of six private Chinese firms, plans to build a $10.7bn industrial city in Duqm, situated 550 km south of of the capital, Muscat. For perspective, Oman Wanfang’s $10.7bn investment is the equivalent of more than half of Oman’s stock of foreign direct investment. The Chinese consortium has promised to develop at least 30% of the project area within five years, with financing and construction firms to be sourced from China.
Michael Wolff’s ‘Fire and Fury’: Inside Trump’s White House Again, as though setting the issue of Trump aside — merely a large and peculiar presence to both be thankful for and to have to abide — Bannon, in the role he had conceived for himself, the auteur of the Trump presidency, charged forward. The real enemy, he said, was China. China was the first front in a new Cold War. “China’s everything. Nothing else matters. We don’t get China right, we don’t get anything right. This whole thing is very simple. China is where Nazi Germany was in 1929 to 1930. The Chinese, like the Germans, are the most rational people in the world, until they’re not. And they’re gonna flip like Germany in the ’30s. You’re going to have a hypernationalist state, and once that happens, you can’t put the genie back in the bottle. // Comment: Looks like Beijing may have miscalculated in believing Bannon could be a useful channel to Trump
China believes Cambodia's election will be fair, confirms support - Reuters “China respects and supports the development path chosen by the Cambodian people, and believes Cambodia’s future election can, under all sides’ supervision, reflect its fairness and select a party and leader that satisfies the Cambodian people,” Chinese Vice Foreign Minister Kong Xuanyou said.
Taiwanese man bailed over oil transfer to North Korean ship | South China Morning Post Prosecutors in Taiwan suspect that Chen Shih-hsien was the oil dealer behind the transfer of the fuel. He has been released on NT$1.5 million (US$50,000) bail and will face further questioning, according to a statement released on Thursday by the prosecutors office in the southern Taiwanese city of Kaohsiung. Chen denies any wrongdoing.
Institute denies military-oriented work in S China Sea - Global Times The Chinese Academy of Sciences' (CAS) oceanology institute on Tuesday denied reports of leading military-oriented underwater surveillance in the South China Sea. The Hong Kong-based South China Morning Post (SCMP) on Monday reported that China's new hi-tech underwater surveillance network system project, which gathers underwater data, particularly water temperature and salinity, could help the navy more accurately lock in on targets and improve navigation and positioning.
Indian road project threatens border stability: experts - Global Times An Indian road construction project connecting all border posts along the China-India frontier could lead to new military standoffs between China and India, Chinese experts warned on Wednesday. During his New Year visit to the "Indo-Tibet Border Police" at Nelong valley in Uttarkashi district bordering China on Monday, Indian Union Home Minister Rajnath Singh said that a number of border posts had already been connected with roads and many would soon be linked, The Times of India reported on Monday.
Old China hand to guide India's global path | Asia Times Vijay Keshav Gokhale, a fluent Mandarin speaker and a former Ambassador to China, is India's new Foreign Secretary
China's underwater glider completes first dive in Indian Ocean - Xinhua Spearheaded by the Third Institute of Oceanography of the State Oceanic Administration, the mission, between Dec. 11, 2017 and Jan. 2, 2018, was aimed at observing interaction between global climate change and marine conditions, said Yu Jiancheng, a research fellow with the Chinese Academy of Sciences (CAS) Shenyang Institute of Automation, the developer of the glider.
China has started building its third aircraft carrier, military sources say | South China Morning Post One of the sources said Shanghai Jiangnan Shipyard Group was given the go-ahead to begin work on the vessel after military leaders met in Beijing following the annual sessions of China’s legislature and top political advisory body in March. “But the shipyard is still working on the carrier’s hull, which is expected to take about two years,” the source said. “Building the new carrier will be more complicated and challenging than the other two ships.”
China land grab on Lake Baikal raises Russian ire - FT $$ Comment: I can't remember how many times I have heard people say Russia stole the most territory from China...all that unpopulated land, fresh water, all those resources...Russians are right to be worried // While Ms Ivanets’ petition claimed that 10 per cent of the town’s prime real estate had been bought by Chinese developers, Mr Sin’kov said: “Ten per cent is an exaggeration. It’s a lot less than that.” But he said that Chinese tour groups made a point of telling visitors that Lake Baikal — the world’s deepest freshwater lake — was part of China during the Tang and Han dynasties. “People here say this means they want it back,” said Mr Sin’kov.
Trump Steps Up Efforts to Check China Influence in Latin America - Bloomberg The U.S. Treasury Department took steps to check the Asian nation’s growing influence in the region last month, when it raised questions about Beijing’s overtures to Latin America’s multilateral lender. The U.S. is the largest shareholder of the Inter-American Development Bank at 30 percent, whereas China’s stake in the lender is a minuscule 0.004 percent. In a Dec. 19 letter obtained by Bloomberg, U.S. Under Secretary for International Affairs David Malpass asked IDB President Luis Alberto Moreno why he had selected China to host the bank’s 60th anniversary meeting next year. “I have serious reservations about the bank’s process that led to that initial decision, and I do not think the 2019 meeting could be nearly as successful in Beijing as it would be if held in the region,” Malpass wrote.
Designations Under the International Religious Freedom Act of 1998 - US State Department Today, the Department of State announces that the Secretary of State re-designated Burma, China, Eritrea, Iran, North Korea, Sudan, Saudi Arabia, Tajikistan, Turkmenistan, and Uzbekistan as Countries of Particular Concern on December 22, 2017.
Taipei protests after Beijing opens new aviation corridors over Taiwan Strait | South China Morning Post The mainland’s Civil Aviation Administration announced on its website that commercial aircraft could begin from Thursday flying south to north through the M503 air corridor, and using three connecting regional corridors. To ensure aviation safety, it said aircraft flying through those corridors will avoid existing aviation routes to and from Taiwan’s outlying islands of Matsu and Quemoy which lie just off the southeast coast of China.
Tech And Media
Google and Intel Beware: China Is Gunning for Dominance in AI Chips - WSJ $$ Past Chinese efforts to dominate the chip industry foundered because of poor technology and political interference. And the new crop of Chinese AI chip companies could still fail. They face formidable competition, from old hands like Intel and Qualcomm and deep-pocketed new entrants such as Apple Inc. and Alphabet Inc.’s Google. This time around, Chinese chip makers and some analysts say, the stars are aligning. China has the capital, the talent, a huge consumer market and—crucially—rafts of data that fuel AI programs. Another huge plus: the government has set its sights on making China an AI powerhouse.
Shares of Renren—China's forgotten social network—just jumped after ICO announcement · TechNode The spike came after Renren announced its plan to start an ICO project called RR Coin, “an open-source blockchain platform for social networks,” says the social networking company. Renren marks another top Chinese dot-com company after Xunlei that wants to reinvigorate their business through a blockchain dream. // Comment: more like scamscam
Didi’s Drive Overseas Moves Forward With Brazilian Acquisition - Caixin Global Chinese ride-hailing kingpin Didi Chuxing has acquired Brazilian peer 99 as Didi continues its overseas push, posing a challenge to U.S.-based Uber.
Beijing Suburb to Host Capital’s First Autonomous-Car Testing Zone - Caixin Global With the establishment of the testing zone in the town of Yizhuang, “the government will promote the development of autonomous driving technology by updating road facilities — such as signaling and marking — to enable ‘car and road synergy,’” an official from the Beijing Municipal Commission of Transport Commission told Beijing Communication Radio on Wednesday.
Society, Art, Sports, Culture And History
Chinese billionaire Richard Liu makes public appeal to help trace family history | South China Morning Post Richard Liu Qiangdong, founder and CEO of online retail giant JD.com, announced he was on a mission to find his family’s origins – at the request of his father – on his Weitoutiao social media account on Tuesday. Liu, who has been dubbed the “Jeff Bezos of China”, said in the post that he wanted to hear from other Lius who lived around Xiangtan county in the central province of Hunan if they had any information that could help him piece together his family tree.
Chinese blacklist an early glimpse of sweeping new social-credit control - The Globe and Mail "We are in dire need of rebuilding. We must rebuild social morality, business integrity, food safety, officials' power," said Lin Junyue, an academic sometimes called the founder of China's social-credit theory, which he has studied since the mid-1990s. Such a system, he said, can serve as a "fantastic" counterterrorism tool, promoting social stability and peaceful co-existence. "People who like it see me as a great contributor to a better society. People who disdain it accuse me of providing a digital tool for government to wield its power against people. I've heard voices of both sides."
Beijing Court Accepts Case Requiring China's Censors to Justify Ban of Gay Content | Hollywood Reporter Fan Chunlin, a 30-year-old man from Shanghai, filed a lawsuit Wednesday with Beijing No. 1 Intermediate People's Court demanding that China's State Administration of Press, Publication, Radio, Film and Television (SAPPRFT) clarify the policy basis for a regulation introduced last summer banning depictions of homosexuality from online video platforms. The court accepted Fan's case and is now required to hold hearings and issue a decision within six months, the plaintiff's lawyer, Tang Xiangqian, told local state media.
Energy, Environment, Science And Health
China admits space lab will fall, but in 'controlled way' | Asia Times Tiangong-1's expected re-entry of the Earth's atmosphere will be closely controlled, says the China National Space Administration
China Becomes World’s Second-Largest Liquefied Natural Gas Importer in 2017 - Caixin Global China bought a total of 37.89 million metric tons (41.77 tons) of LNG from overseas last year, an increase of more than 48% from 2016, according to data compiled by the international energy and commodity information provider. Purchases in December alone reached 5.05 million metric tons, the highest-ever monthly volume since the country started importing LNG in 2006.
Beijing provides subsidies to kindergartens after child abuse case - Xinhua The municipal government said Wednesday that it would provide 1,000 yuan (154 U.S. dollars) per child a month to the city's first-class public kindergartens, and 700 yuan per child a month to other kindergartens. The government will for the first time also allow private kindergartens to join the kindergarten rating held by district education commissions. In the past, only public kindergartens could join the rating, which is often related to different levels of government subsidies.
Train Derails Two Days After Service Begins on Beijing Light Rail - Caixin Global “The new light train XJ003 was running out of track as it was leaving the Fragrant Hills station in the city’s west on Monday afternoon,” Beijing Public Transportation Group said in a statement on Monday night. The accident did not cause any injuries as the train had no passengers and only one driver at the time, the statement added.
Beijing to see record high residential land sale: report - Xinhua The city will sell 23 land lots for residential use to property developers from Jan. 4 to Feb. 6, the Securities Times reported, citing data from Centaline Property Research Center. The total construction area of the land will exceed 3 million square meters, larger than the same period in any previous year.