China in Quotes
“The United States can’t afford to be in a position where our competitors know more about us than we know about them,” said Democratic congressman Joaquin Castro of Texas, sponsoring a bill to open source translation centre; you can read the bill here, and our commentary on it when it passes.
De/Cypher Data Dive📈
Quick China: Six Unmissable Stories 📜
Ma-Xi meet in Beijing
Compatriots from both sides of the Taiwan Strait belong to the same Chinese nation, Xi said. The over-5,000-year history of the Chinese nation saw successive generations of ancestors move and settle down in Taiwan and people from across the Strait fight side by side to recover the island from foreign invaders, he said.
People on both sides of the Taiwan Strait are all Chinese, Xi said. “There are no knots that cannot be untied, no issues that cannot be discussed, and no force that can separate us,” he said. The distance of the Strait cannot sever the bond of kinship between compatriots from across the Strait, Xi said. He said that the difference in systems does not alter the reality that both sides of the Strait belong to one China, and external interference cannot hold back the historical trend of national reunification. Calling youth “the hope of the country and the future of the nation,” Xi encouraged young people from both sides of the Strait to aspire to become more proud, confident, and assured in their identity as Chinese people, work together for the long-term prosperity of the Chinese nation, and continue to create new glory of the nation. Ma a spent political force in Taiwan told Xi that adhering to the 1992 Consensus and opposing “Taiwan independence” constitute the common political foundation for the peaceful development of cross-Strait relations. While highlighting the need to deepen cross-Strait exchanges and cooperation to jointly carry forward Chinese culture and stay dedicated to the rejuvenation of the Chinese nation, Ma noted that people on both sides of the Strait belong to the Chinese nation and are descendants of Emperor Yan and the Yellow Emperor. (Various Chinese State Media)
EU is getting ready to get serious on anti-dumping from China
The European Commission has updated its report on state-led distortions in the Chinese economy, adding new sectors and potentially opening the door to anti-dumping complaints from EU chip and clean-tech producers. The update, published on Wednesday and stretching to 712 pages, adds details of what the EU executive considers to be distortions in sectors of telecom equipment, semiconductors, the rail industry, renewable energy and electric vehicles. It retains the steel, aluminium, chemicals and ceramics sectors of the initial report in 2017. There is no similar EU report for any other country. The report is a tool for EU industries to use when filing complaints about dumping practices. If Chinese prices and costs are found to distorted, they can be replaced with those from another country to calculate normally higher dumping tariffs. “This could be taken as an invitation to sectors that have not yet brought anti-dumping complaints to explore their use,” said Laurent Ruessmann, partner at trade law firm Ruessmann Beck & Co. Read more: Reuters
China is still rising and Beijing reads Foreign Affairs
Last week, Senior Fellow at the Peterson Institute for International Economics Nicholas R. Lardy published an article on the website of Foreign Affairs titled “China Is Still Rising—Don’t Underestimate the World’s Second-Biggest Economy”. It mentioned that US academics’ recent view of China already peaking as an economic power underestimates the resilience of its economy. Although China faces several headwinds, the country overcame even greater challenges when it started on the path of economic reform in the late 1970s. China is likely to expand at twice the rate of the US in the years ahead. What’s China’s comment?
Mao Ning: We noted the article. As President Xi Jinping stressed during his recent meeting with representatives of the US business, strategic and academic communities, the Chinese economy is sound and sustainable. China did not collapse as predicted by the “China collapse theory,” nor will it peak as forecasted by the “China peak theory.”
There are varying perspectives on China’s economy. The widely shared view, however, is that China is among the fastest-growing major economies. As the second largest economy in the world, the Chinese economy has a solid foundation, remarkable resilience and enormous potential. I’d like to share with you some facts:
First, China is the only country in the world that has industries across all categories in the UN industrial classification and home to over 200 mature industry clusters. The size of China’s manufacturing industry has been the largest in the world for 14 consecutive years. Second, China has over 400 million people in the middle-income bracket, and the number is on course to reach 800 million in the next decade or so. There are close to 300 million rural migrants who are acquiring permanent urban residency at a faster pace. It will create massive demand and significantly transform consumption in areas such as housing, education, medical services and elderly care. Third, China’s total input in research and development and investment in the high-tech sector have been growing at double-digit rates for several years running. China also tops the world in the number of patent applications and technology clusters. Fourth, the Chinese government is speeding up the cultivation of new quality productive forces. The effort has visibly given boost and support to high-quality development. Last but not least, more and more multinational businesses are investing in the Chinese market, which is a vote of confidence for China’s economic outlook. In January and February this year, 7,160 foreign-invested companies were set up in China, marking a year-on-year increase of 34.9 percent, the highest in the past five years.
Facts speak louder than words. No matter how some people try to dampen the outlook on China’s economy, the overall trend of long-term growth will not change, China’s super-sized market and well-functioning industrial system remain its notable strengths, and factors underpinning the high-quality development are building up. Through its steady development, China will remain a strong engine and source of opportunities for the world economy. (Foreign Ministry Mao Ning in response to a question by Beijing Youth Daily)
Chinese Premier Li Qiang set to visit Australia in June, live lobster import ban expected to be lifted
Chinese Premier Li Qiang is scheduled to visit Australia in June, a move set to consolidate improving economic relations between Beijing and Canberra following last month’s trip by Foreign Minister Wang Yi, according to two sources with knowledge of the issue. Li’s trip is planned for the third week of June, one of the sources said, and it would represent his first visit to Australia since he was sworn in as premier in March 2023. “It is also expected that the unofficial ban on Australian live lobsters will be lifted as a signal of resuming a normal and friendly trade relationship for both sides,” the source said, with the curbs having been in place for more than three years. The major topics of the visit, however, remain unknown. Read more: SCMP
Will the PBOC reflate, probably not.
The People’s Bank of China is giving a whole new meaning to “monetary science.” Asia’s biggest economy’s central bank is devising a program to provide as much as 500 billion yuan (US$69 billion) to support innovation in science and technology. It’s a “relending” scheme, meaning that the PBOC will extend credit to select institutions that lend funds to targeted sectors in need of monetary support. Having unveiled the enterprise on April 7, during US Treasury Secretary Janet Yellen’s visit to Beijing, the Communist Party is demonstrating why Washington’s hopes for massive reflationary stimulus seem unlikely to happen. Read more: Asia Times
Manila hardens its stance on South China Sea
Ambassador Jose Manuel Romualdez made the comments on television on Tuesday, two days before Philippine President Ferdinand Marcos Jnr is set to hold talks at the White House with US President Joe Biden and Japanese Prime Minister Fumio Kishida. Romualdez said the Philippine government had been generally “accepting” of the situation in its own waters, referring to China’s aggression within the South China Sea.
“We can’t continue to be like this. Some people have this wrong notion that we just sit back and nothing will happen to us. We may wake up one day, and we won’t have a country any more,” Romualdez warned.
“What President Marcos is doing is simply saying, ‘enough is enough’. We are going to talk to you seriously. We are not here because we want to have a conflict. We are not here because we are looking for a fight. We are the ones that are being aggressively bullied,” he added. Read more: SCMP
Beyond The Great Wall 🧱
Exploring News About China in Depth
Internal Politics 🏛️
China regrets Fitch’s downward revision of its outlook
Fitch Ratings has shifted China’s long-term foreign debt outlook to negative, citing increased debt as the nation seeks economic recovery amid a real estate downturn. China’s Ministry of Finance China’s finance ministry said it regrets Fitch Ratings’ downward revision of its outlook for the country, asserting its fiscal policies aim to stabilize growth and manage debt ratios effectively. The downgrade reflects China’s doubled public debt burden, now at approximately 80% of GDP. Fitch highlighted the importance of fiscal support in reigniting GDP growth as a crucial factor to monitor. Despite the negative outlook, China’s long-term foreign-currency issuer default rating remains at A+. Read more: Caixin Global
China’s top anti-graft body vows intensified crackdown on misconduct, corruption
According to a meeting between the Communist Party of China (CPC) Central Commission for Discipline Inspection (CCDI) and the National Commission of Supervision, the campaign to eradicate misconduct and corruption at people’s doorsteps in China will be stepped up. Read more: China Daily
Study Finds Female Legislators Outperform but Are Underrepresented in Chinese Congress
A recent study in the China Quarterly highlights the substantial legislative impact of female representatives within China’s National People’s Congress (Feng et al., 2023). Despite making up just 23% of the seats in the 12th NPC, women proposed 44% of all bills and over half pertaining to women’s issues. Moreover, female legislators sponsored more initiatives on average than their male counterparts, contributing substantially across all issue areas and particularly in education, health, and women’s rights. This underrepresentation yet overperformance challenges assumptions within authoritarian contexts and showcases the potential for minority voices to significantly shape policy. Read more: China Quarterly
Jack Ma Cheers Alibaba’s Latest Overhaul Plan in Rare Missive
Jack Ma, Alibaba’s co-founder, recently expressed his support for the company’s restructuring efforts in a memo published on an internal Alibaba forum. In the memo, Ma praised new leaders Joseph Tsai and Eddie Wu’s efforts to revitalize the company and urged employees to stay the course. This is the second time Ma has emerged from seclusion in recent months to address the company’s issues and boost morale. Read more: Bloomberg
China’s tech workers trapped in jobs by noncompete contracts
Noncompete agreements have become more common in China, affecting tech workers throughout the industry. Originally intended to protect trade secrets, these agreements now cover employees at all levels, from junior staff to senior executives. Companies like Tencent, ByteDance, and Pinduoduo aggressively enforce these contracts, frequently using surveillance tactics such as secret filming. This practice, which is legal in China, puts employees at risk of facing severe penalties or even job loss if they violate these agreements. Employees who lack clear definitions of what constitutes a breach frequently find themselves at a disadvantage in legal battles with their former employers. As China’s tech sector competes fiercely, there are concerns about how these contracts will affect workforce mobility and innovation. In contrast to the United States, where some states have prohibited noncompete clauses, China’s legal landscape poses challenges for workers seeking to change employers within the industry. Read more: Nikkei
De/Cypher Lighthouse🔦
Written by De/Cypher Team
Over the last 5 years, many high-level officials and prominent businessmen have gone missing in China. Globally it has been seen as a sign of creeping paranoia amongst the Mandarin class. Listed are a few of the many high-level disappearances:
The political system under Xi Jinping is a course correction to be on the right side of the communist ideology which General Secretary Xi felt took a backseat to the commercial and economic interests of the People’s Republic of China. The CCP does not have a pact with its people to dispel economic reforms in exchange for democracy. The Central Commission for Discipline Inspection (CCDI) is a lightning rod for all corruption within the party and is answerable to the Central Committee of the Politburo. The CCDI under Xi is an entity that uses allegations of corruption to stifle any criticism or dissent against the leader and the party’s policies. The recent disappearances of officials and prominent personalities of financial institutions and business people point to a possible political purge to ensure unchallenged control by Xi. Between December 2021 – December 2022, more than 339 leaders were investigated on corruption suspicions. A second line of reasoning attributes these disappearances to a plot to divert the attention of the international community from the looming economic crisis threatening China. Given the lack of a free press, an independent judiciary or a non-partisan investigating agency it would be difficult to assume that these disappearances and purges are not politically motivated.
China And The World🌐
Joint Vision Statement from the Leaders of Japan, the Philippines, and the United States and China’s Response
The US, Japan, and the Philippines issued a Trilateral Joint Vision Statement emphasizing the importance of upholding international law, specifically the United Nations Convention on the Law of the Sea (UNCLOS), in the Indo-Pacific region.
“Today, President Biden reaffirms the ironclad U.S. alliance commitments to both Japan and the Philippines, which have helped safeguard peace and security in the Indo-Pacific for decades. We underscore our nations’ unwavering commitment to freedom of navigation and overflight, and the importance of respecting the sovereign rights of states within their exclusive economic zones consistent with international law, as reflected in the 1982 United Nations Convention on the Law of the Sea (UNCLOS).” Read more: White House
China on the other hand saw red over the trilateral statement. The Chinese spokesperson criticized the US and Japan’s positions on Taiwan and maritime issues, emphasizing China’s sovereignty over disputed territories.
”US-Japan relations should not target other countries, harm their interests or undermine regional peace and stability. China firmly opposes the Cold War mentality and small group politics. China firmly rejects anything that creates and drives up tensions and may undermine other countries’ strategic security and interests.” Read more: FMPRC
China’s Xi Jinping Meets With Russian Foreign Minister in Show of Support
President Xi Jinping met with Russian Foreign Minister Sergey Lavrov in Beijing on April 9, 2024. Lavrov’s visit to China comes after Russian President Vladimir Putin hinted that he was considering China as his first overseas trip following his recent election victory. During the meeting, Xi pledged to improve communication with Russia and expressed his support for Moscow’s efforts to maintain social stability. Read more: The Diplomat
China’s No 3 official Zhao Leji to lead delegation to North Korea on ‘goodwill visit’
China’s third-highest-ranking official, Zhao Leji, will lead a Chinese delegation on a three-day visit to North Korea as part of a “goodwill visit” and to attend the opening ceremony of the “China-North Korea Friendship Year” marking the 75th anniversary of diplomatic ties between the two countries. This visit comes as tensions have been running high on the Korean peninsula and is the latest high-level exchange between China and North Korea. Read more: SCMP
U.S., China to start new talks on balanced growth, Yellen says
US Treasury Secretary Janet Yellen and Chinese Vice Premier He Lifeng have agreed to begin discussions on balanced economic growth, with an emphasis on addressing China’s economic imbalances and excess manufacturing capacity. They also intend to create a forum to coordinate anti-money laundering efforts in their respective financial systems. Yellen intends to advocate for a level playing field for American workers and businesses while also raising concerns about China’s industrial strategy, particularly in the clean energy sector. The discussions were described as productive and frank; however, resolving the issues may take time. Read more: Nikkei
China’s wind sector latest in European cross hairs after EVs, solar panels, trains
The European Union (EU) has opened an investigation into subsidies in China’s wind turbine industry. The investigation, announced by competition commissioner Margrethe Vestager, looks into the conditions for the development of wind farms in Spain, Greece, France, Romania, and Bulgaria. This investigation is part of the EU’s efforts to address market distortions caused by state subsidies in a variety of sectors, including electric vehicles (EVs), solar panels, and trains. To address these issues, the EU adopted a regulation on foreign subsidies. Read more: SCMP
China Providing Geospatial Intelligence to Russia, US Warns
The US has warned allies about China’s increased support for Russia in the Ukraine conflict, including providing geospatial intelligence. This assistance included satellite imagery, microelectronics, tank machine tools, optics, and space collaboration. President Biden and Xi Jinping discussed concerns about China’s support for Russia’s defense industry. China-Russia trade reached $240 billion in 2023, with China serving as a key channel for restricted technologies. Treasury Secretary Janet Yellen warned of “significant consequences” for companies that support Russia’s military operations. Read more: Bloomberg
Türkiye becomes 10th nation to join Chinese-Russian led International Lunar Research Station program
Türkiye has applied to participate in the International Lunar Research Station program, making it the tenth nation to do so. The ILRS, founded by China and Russia, seeks to advance lunar exploration and research. The project has sparked interest from a variety of countries and organizations, with plans underway to establish a collaborative data processing center and investigate the possibility of a nuclear reactor on the Moon. Read more: Global Times
Chinese embassy urges U.S. authorities to stop harassing Chinese citizens traveling to U.S.
The Chinese embassy in the United States has urged US authorities to stop harassing Chinese citizens traveling to the US. According to the embassy spokesperson, in recent years, US border control personnel have repeatedly and unjustifiably harassed, interrogated, and deported Chinese nationals, particularly students and scholars, upon their arrival in the United States. According to the spokesperson, the US has deported nearly 300 Chinese citizens since July 2021, including over 70 Chinese students with legal and valid documents. Read more: Xinhua
News From Asia 🌏
Friday
- Vietnamese property developer Truong My Lan was sentenced to death by a court on April 11, 2024, after he was found guilty of masterminding Vietnam’s largest fraud case. The 67-year-old was accused of swindling US$12.5 billion from the Saigon Commercial Joint Stock Bank (SCB) over a decade. The verdict came at the end of a five-week trial in the business capital Ho Chi Minh City, where 85 others also face verdicts and sentencing for their roles in the crime. Read more: SCMP
- A research team in China says it has discovered a potentially fatal flaw in Nasa’s hypersonic aerodynamics software. This small deficiency amid tangled equations could lead to “inevitably erroneous outcomes” when scientists simulate and analyse important issues, such as high-temperature ablation, said the team led by Professor Liu Jun, a researcher at the Hypersonic Technology Laboratory of the National University of Defence Technology, in a peer-reviewed paper published in the Chinese academic journal Acta Aerodynamica Sinica on March 14. Read more: SCMP
- Amid globally weak public listing activity, investors flocked to the initial public offering, the first by a chip design house on the local bourse. It was oversubscribed by 77 times, pushing its stock price up 286% on its first trading day. “Being the first one is always tough,” founder and co-CEO Ng Meng Thai told Nikkei Asia. “When we started the IPO process, we feared that many local investors might not know our industry well. So it took us an effort to go and explain.” Read more: Nikkei
- Long-simmering tensions between China and its neighbours will be in the spotlight on Thursday (Apr 11) as leaders of the US, Japan and the Philippines gather at the White House to push back on Beijing’s stepped-up pressure on Manila in the disputed South China Sea. Read more: CNA
Thursday
- Chinese Premier Li Qiang is scheduled to visit Australia in June, a move set to consolidate improving economic relations between Beijing and Canberra following last month’s trip by Foreign Minister Wang Yi, according to two sources with knowledge of the issue. Read more: SCMP
- The big winner in South Korea’s parliamentary election is the country’s most controversial politician: Opposition leader Lee Jae-myung. His Democratic Party (DP) has notched a landslide win, making the scandal-plagued liberal a real danger to beleaguered President Yoon Suk-yeol. Read more: CNA
- Malaysia’s largest port, on the major sea route of Malacca Strait, plans to double its capacity over the coming decades, chasing neighboring hub Singapore as the shift in global supply chains adds to the competition in Southeast Asia’s logistics sector. Read more: Nikkei
- China tried to meddle in the past two Canadian elections but the results were not affected and it was “improbable” Beijing preferred any one party over another, prime minister Justin Trudeau has told an official inquiry. Read more: The Guardian
Wednesday
- Israeli forces are training for the possibility of attacking Iran directly, according to a report by a Saudi news outlet. Such an attack would be carried out if the Islamic Republic bombs the Jewish State, as it has implied it will do, in response to a recent airstrike in Damascus that eliminated seven Iranian military advisers, including two top generals responsible for the country’s military activities in Syria and Lebanon. Read more: JP
- Apple produced iPhones worth 14.1 Billion USD, doubling its output and reducing its longstanding reliance on China. Read more: Bloomberg
- Multinational corporations are increasingly locating some Southeast Asian regional headquarters functions outside Singapore to save money and pursue expanded opportunities. For Japanese companies, Singapore remains the leading hub for Southeast Asian headquarters. But Sakata Inx, a maker of printing ink, established a regional head office in Malaysia this February. Read more: Nikkei
- China and the Federated States of Micronesia underlined their shared commitment to bolstering cooperation on building of the Belt and Road, climate response, infrastructure and healthcare, as President Xi Jinping hosted the island country’s President Wesley W. Simina on Tuesday. Read more: ECNS
Tuesday
- The United States intends to deploy the advanced Typhon mid-range missile system in the Asia-Pacific region by the end of the year, targeting threats from North Korea and China. Analysts believe this move is part of a testing phase, with initial batteries stationed in Guam and then in Japan for training. Read more: SCMP
- Australia rejected Japan’s addition to the Aukus pact, favoring project-based cooperation. Prime Minister Albanese does not intend to expand beyond the current three members. Talks about Japan’s involvement await tangible results from Aukus, which highlight diplomatic and technological challenges. Read more: The Strait Times
- Chevron has announced its withdrawal from Myanmar’s Yadana natural gas field, more than two years after condemning violence and human rights violations in the country. Instead of being sold, Chevron’s 41.1% stake in the gas field was redistributed among the remaining shareholders. Read more: Nikkei
- Over 193 million Indonesians prepare for Eid travel, many opting for Jakarta-Bandung high-speed rail “Whoosh” for the first time. With a maximum time of 46 minutes for 142km, the train offers a quicker option, amid increased travel demand. Read more: CNA
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