China Press Review – July 8, 2019

Press review

Geopolitics And The Asian Infrastructure Investment Bank – Analysis
Even though the AIIB is of course an economic and financial institution, its reach and nature must also be analyzed from a perspective of grand strategy. Actually, it can be argued that – well beyond the technical realm of business and mercantile concerns – the AIIB responds to China’s goal of developing finance as a tool to advance its interests on the global geopolitical chessboard. According to this multidimensional interpretation, the AIIB pursues five parallel objectives:

Geopolitics And The Asian Infrastructure Investment Bank – Analysis

Is there a China model?
The US–China trade war has brought to the boil a simmering strategic rivalry between Washington and Beijing that some have begun to describe as a new Cold War. The Cold War analogy is something of a stretch given the interdependence of the Chinese and American economies — an interdependence sometimes referred to as ‘Chimerica’. The US–China relationship and rivalry today is very different from that of the United States and the USSR during the Cold War when the two superpowers conducted trade and investment in different spheres of influence, and presided over radically different systems for organising the means of production and markets.

Is there a China model?

Is the China model a threat?
Western strategists have expressed widespread concern that Chinese leaders will promote the Chinese model of development as an alternative to Western democracy. In fact, the China model works only under severely constrained circumstances and so far, Chinese leaders seem to understand that.

Is the China model a threat?

China’s Economic Success Proves the Power of Capitalism
Whether or not China will go down that road remains to be seen. The process of reform has never been a smooth and consistent one—rather, it has been marred by frequent setbacks, especially in recent years, when instances of governmental intervention in the economy have set back the reform process. The greatest danger for China is that the Chinese themselves will start to believe what many people in the West already think—that the country has discovered a special “third way” between capitalism and socialism and that economic success has been achieved not in spite of, but because of, the great influence of the state.

One year in, US-China trade war is the ‘first sentence of the first chapter’ of a new superpower rivalry
Donald Trump and Xi Jinping seem increasingly entrenched in their positions, 12 months into their bitter trade war Experts describe a ‘chaotic’ year, where widespread use of tariffs has opened a Pandora’s box on what was previously out of bounds in global trade

The looming global trade crisis created by Donald Trump’s administration that you may not have heard about
The WTO’s system for dispute resolution will collapse in December after a US block on appointing new judges means the panel will have insufficient numbers when two retire. After that, it will be the ‘law of the jungle’, favouring the big players

Year one in US-China trade war takes $20bn toll on their exports
Tariffs transform global supply chains as businesses prepare for protracted clash With no end in sight to a yearlong Sino-American trade war that has dragged down each country’s exports to the other by roughly $20 billion so far, U.S. and Chinese companies are realigning supply chains and setting the stage for potentially huge shifts in the global trade landscape.

US-China trade war: hardliners in Beijing are gaining influence
Chinese urging concessions for Washington have been attacked by the media Businesses and residential complexes are being forced to change foreign-sounding names, and the war film The Eight Hundred has been cancelled

US-China trade war: ignore the hype, Trump and Xi are no closer to a deal, even if they are ‘friends’
Neither leader has agreed to anything more than they had previously The lack of a deadline to negotiate the final ‘10 per cent’ of sticking points betrays a lack of confidence that doing so is even possible

Chinese economists warn Beijing to prepare for decoupling from US
Break-up of the world’s two biggest economies is gradually becoming a real possibility, academics tell symposium on the trade war Think tank director says it could be seen as ‘strategic blackmail’ for Washington to try to contain China’s rise

China Is Wrestling With a Changing World. Don’t Underestimate the World’s Second-Largest Economy
Last weekend’s trade-war truce between the U.S. and China brought a brief sigh of relief, but did little to change the sense that uncertainty—and the attendant confusion—has become a permanent part of the global business environment.

China’s growth expected to take second quarter hit from trade war
Economists surveyed by Nikkei expect 6.2% expansion, slowest pace in 27 years

Despite Donald Trump and Xi Jinping’s G20 handshake, trade woes will remain a drag on markets, especially in Asia
Slowing global growth will negatively impact trade, while Sino-US talks have had too many twists and turns for investors to become complacent, despite the good optics coming out of Osaka

Globalisation is best way through the trade war, China’s Vice-President Wang Qishan says
Protectionism should be opposed, he says, with US and China set to resume trade talks China is ‘determined to open up to learn the advantages of other nations

China should promote yuan’s globalisation through cooperation not conflict with US dollar, report says
Beijing should sign a free-trade deal with Britain as soon as possible and push for better trade and investment cooperation with the EU, Renmin University says Promoting global trade will help stimulate use of yuan around the world, experts say

China June new loans seen at 5-month high as central bank keeps liquidity ample: Reuters poll
New bank loans in China are expected to have picked up to a five-month high in June, a Reuters poll showed, as Beijing kept ample liquidity in the financial system to support the slowing economy and offset growing U.S. trade pressure.

Central banks’ gold rush gathers pace as China hoard swells
People’s Bank of China raised reserves for seventh month in June, adding 10.3 tons

Facebook’s Libra forcing China to step up plans for its own cryptocurrency, says central bank official
Wang Xin, director of the People’s Bank of China research bureau, warns the new digital currency could have major impact on monetary policy and financial stability PBOC was the first major central bank to study digital currencies in 2014, a step to counter the challenge from cryptocurrencies including bitcoin

Shanghai suffers worst fall in two months on concerns US Fed will not cut rates, new tech board will hurt other share prices
Shanghai Composite drops by 2.6 per cent — its worst fall in two months Hong Kong’s Hang Seng fall 1.5 per cent in worst fall in nearly a month

China’s foreign exchange reserves rise faster than expected in June
The larger-than-expected US$18.2 billion increase comes despite ‘increasing uncertain external factors’, according to the foreign exchange regulator China also adds to its gold reserves for a seventh straight month

China’s venture capital market plummets amid trade war, tech start-up valuation concerns
The value of investments tumbled 77 per cent year on year to US$9.4 billion in the second quarter The number of deals in the country roughly halved to 692

Is the United States Ready for a Tech War?
The Trump administration should develop technology priorities, and technologies considered vital to U.S. economic and national security should receive investments to stimulate advances and promote American leadership.

When China’s father of EVs starts talking up hydrogen vehicles, analysts say investors should pay attention
EV celebrity Wan Gang says a ‘hydrogen society’ is ahead Companies are jumping in, but cost and other challenges remain

China car sales in May rise for the first time in over a year due to discounts, association says
Retail sales of sedans, sport utility vehicles, minivans and multipurpose vehicles rose 4.9 per cent to 1.8 million units in June from a year earlier Prices cut by as much as 50 per cent, according to local media reports, to clear inventories of cars that do not meet new stricter emission standards

China’s furniture makers hope for trade war’s end as US orders ‘disappear’ following the 25 per cent import tariff
Chinese companies hurt by falling orders take a wait-and-see approach to apparent thawing between two largest economies over damaging levies Manufacturers say they have limited room to adjust prices without destroying profit

Hainan Free Trade Zone: Tracking its Progress
Last April, Chinese President Xi Jinping announced the establishment of the Hainan Free Trade Zone to mark the 30th anniversary of the country’s reform and opening-up policy. According to the plan, the entire island of Hainan will be transformed into a free trade zone (FTZ) – the country’s 12th and the first to cover a whole province. The Hainan government aims for the Hainan FTZ to open in 2020 but has a longer-term view for its development that goes to 2035 and beyond.

China struggling with slow progress on high-speed rail network expansion due to local financing problems
Construction of new high-speed link between Zhengzhou in Henan province and Jinan in Shandong delayed due to funding issue Beijing’s policy moves to reduce debt and cut taxes are hampering local governments’ ability to fund new projects

There is a ‘ray of hope’ in US-China trade war after Donald Trump and Xi Jinping met at G20, says Beijing’s ambassador to Malaysia
During his keynote address, Bai Tian claimed a stable US-China relationship would benefit not only the two countries but also the rest of the world He also characterised China’s belt and road initiative as a platform for international cooperation that has been widely embraced

Taiwan’s Status is a Geopolitical Absurdity
The island is not recognized by its most important ally, faces an existential threat from territory it claims as its own and its sovereign status is being gradually erased by companies seeking to preserve access to the world’s largest market.

Navigating around the Chinese hegemon
How a rising China will integrate itself with the global economic and political order is a salient issue in world politics. On the one hand, China’s rejection of the South China Sea arbitration, its efforts to isolate Taiwan internationally and its willingness to work with controversial leadership in developing states indicate a more assertive ‘China First’ foreign policy. On the other hand, it is evident that China is engaging in significant multilateral and normative actions.

Navigating around the Chinese hegemon

China needs to act on Indian trade deficit before it becomes a political issue, says ambassador
Ambassador to China says the two countries need a ‘very intense dialogue’ about trade to address India’s concerns Vikram Misri says the current US$53.6bn deficit is unsustainable in the long-term and hopes for more action from the government in Beijing

China’s threat to blacklist US firms as security risk could be key weapon in latest trade talks
Beijing is expected to use plans for a list of ‘unreliable entities’ as a major bargaining chip when negotiations resume next week Talks are back on track after the meeting between Donald Trump and Xi Jinping, but the chances of further progress remain uncertain

Explained: the difference between the RCEP and the CPTPP
The RCEP is the latest in an alphabet soup of trade agreements proposed for Asia – and it’s not to be confused with the CPTPP (RIP, TPP) The FTA, if it goes ahead, would create the world’s largest trade bloc, encompassing a quarter of global GDP

US-China feud is accelerating the biggest shift in trade since the cold war, away from globalisation
Trend described as ‘deglobalisation’ and ‘balkanisation’ is leading to shorter supply chains as companies try to keep up with more sophisticated consumer demand As firms rush to avoid Donald Trump’s tariffs and other geopolitical volatility, the trend is accelerating, leading to a complete shift in global trade

Tiffany CEO on Experiential Luxury, Trade War and China
A full-blown trade war between the United States and China is rattling nerves throughout the entire American business community. And the New York-based, acclaimed diamond retailer Tiffany & Co. — as a symbolic luxury player from the States — is no different from any other business that is currently enduring this stress.

How Tiffany’s China Strategy Combats Economic Turbulence

Chinese Whispers: Dior Utilized Huawei’s Digital Marketing Platform for Latest Runway Show
The French luxury powerhouse Christian Dior became the first mega luxury brand in China that utilized Huawei’s digital marketing service

Chinese Whispers: Dior Utilized Huawei’s Digital Marketing Platform for Latest Runway Show, and More

In China, Men’s Makeup Isn’t a Threat to Masculinity — It’s Self-improvement
Ever since brands like Tom Ford and Chanel started launching male cosmetics lines, discussions about whether man makeup would be the next big thing have been nonstop. Both the Guardian and BBC have reported on the rise of male beauty, but both have put a question mark on its commercial viability among Western men. In China, men makeup’s commercial viability has already been a matter of fact. Not only has men makeup gone mainstream, but it has also manifested an entirely different narrative than its western counterpart — makeup isn’t a threat to masculinity. Instead, it is self-improvement to be a more empowered man.

In China, Men’s Makeup Isn’t a Threat to Masculinity — It’s Self-improvement

China says swine fever to cut pork production 10-15% this year
China’s Ministry of Agriculture and Rural Affairs said that China, the world’s largest pork consumer, can expect a 10% to 15% drop in pork production this year, as the deadly African swine fever reduces domestic herds and tightens meat supply, reported Caixin.

China says swine fever to cut pork production 10-15% this year

Foreign firms lure compliance officers with CEO level salaries but are struggling to recruit talent in China
The average pay package for an experienced financial fraud officer on the mainland can reach up to 2 million yuan a year, which matches the pay of a CEO of a small Hong Kong-listed company International financial firms are seeking individuals in their 30s and 40s with strong digital skills

HK to develop smart-city tech with Greater Bay Area
Asian financial hub advised to focus more on ASEAN markets, which have 600-million people Hong Kong should develop and promote “smart city” technology in the coming few years and utilize the human resources in the Greater Bay Area to serve the ASEAN markets, experts said in a forum on Monday.

Political unrest, trade war highlight bay area’s importance to Hong Kong’s, analysts say
Analysts and policymakers at Caixin GBA forum urge acceleration in integrating Hong Kong, Macau, and the Guangdong region The trade war too has heightened the need for China to maintain its links with the world, said Xiao Geng, a professor at Peking University HSBC Business School

Erosion of Hong Kong’s institutional autonomy will hurt advantage over mainland China cities, high credit rating: Moody’s
Ratings agency affirms city’s long-term issuer rating of ‘Aa2’ City’s status as an independent entity could be ‘altered suddenly and much earlier than 2047’ by some of its international partners, the agency says

Could psychology have helped Carrie Lam avoid Hong Kong’s extradition bill fiasco?
From confirmation bias to risk aversion, behavioural science principles shed light on Hongkongers’ reactions to the controversial extradition lawA better understanding of cognitive psychology could have helped the Hong Kong government

What Denise Ho, Jackie Chan and Other Celebrities Think About the Hong Kong Protests
For many stars whose careers depend on mainland China, the blacklisting of a Cantopop singer served as a warning that the Communist Party has a low tolerance for political dissent.

Chinese Premier Li Keqiang’s address to the World Economic Forum in China
Openness, inclusiveness and win-win cooperation are the sure way to lasting prosperity of the world economy. China is prepared to join hands with all other countries to make economic globalization more open, inclusive, balanced and beneficial for all, and together create a brighter future for humankind!

Chinese Foreign Minister Wang Yi seeks Eastern European support for Belt and Road Initiative
Beijing looking to bolster support amid worries new EU leadership will adopt more hostile stance towards China

Trade war hits BRI financings
The trade war between the US and China is forcing lenders to reassess, or even reject, financings linked to China’s massive US$1trn Belt and Road Initiative that includes transportation, energy and infrastructure projects in more than 70 countries.

China’s Piraeus power play: In Greece, a port project offers Beijing leverage over Europe
For Beijing, this Mediterranean trade hub is the showpiece investment for the globe-spanning Belt and Road Initiative. But for Washington and its EU allies, it’s a worrisome foothold for Chinese influence in the West. Caught between two sides in a cold war, what will Greece do

South Korea’s US-China dilemma deepens with support for America’s Indo-Pacific strategy
Seoul’s involvement in Indo-Pacific policy is expected to increase the US’ capacity for operations in the contentious South China Sea South Korea is caught in the quandary of trying to placate both its security ally, the US, and top trading partner, China

China’s tech sector faces ‘hangover after the party’, with trade war and economic slowdown hitting employment
Tech sector demand for new hires down 25 per cent in first quarter from a year earlier, while jobs seekers up 37 per cent, meaning demand outpaces supply Baidu, Tencent and are all ‘optimising’ their workforces, as analysts point to a sector in decline after years of expanding at an unrealistic pace

Chinese buyers snag small but vital links in Japan supply chains
Record pace of deals helps hard-up parts makers but poses trade war risks

EU opts for 5G over wifi for driverless cars
European Union member states on Thursday rejected a European Commission push to adopt wifi technology for connected vehicles systems. The wifi-based standard was backed by automakers Volkswagen, Renault, and Toyota. Companies including Daimler, Ford, and Huawei support 5G standard, saying that the technology enables a wider range of in-vehicle and traffic management applications. The commission proposed legislation backing wifi in March, which was voted down last week by 21 countries including Germany, France, and Italy

Briefing: EU opts for 5G over wifi for driverless cars

Tencent wins bigger share of game revenue from Android app stores
Gaming giant Tencent has successfully negotiated a more favorable revenue split with a number of Chinese Android stores for its mobile titles, media outlet GameLook reported. Tencent’s new terms reduce the commission paid to Android stores to 30% of mobile title revenue. Previously, Chinese publishers generally had to hand over 50% of titles’ revenue to third party Android marketplaces as distribution fees. Games covered by the new terms include the recent “Jian Wang 3 Mobile” and “PopKart Mobile.”

Tencent wins bigger share of game revenue from Android app stores

India’s Huawei Dilemma
Battle lines have been sharply etched in India between policy makers and companies who would like the country to do business with controversial Chinese telecom giant Huawei and those advocating keeping a distance. India’s principal scientific adviser to the government, K Vijay Raghavan, who also heads a high-level committee on fifth-generation technology, or 5G, where Huawei is competing as a vendor, says India should proceed with 5G trials with all vendors straightaway, but must strike off Chinese companies from the list.

India’s Huawei Dilemma

Huawei employee CVs show links to Chinese military – study
A study of more than 25,000 leaked resumes, or CVs, belonging to Huawei employees says it has found deeper links between the telecommunications equipment giant and the Chinese military and intelligence agencies. The research was conducted by Christopher Balding, a professor at Fulbright University Vietnam, who co-authored a research paper questioning Huawei’s claims of employee ownership. Balding searched through a database of leaked Chinese resumes and found some Huawei employees had also been simultaneously employed by institutions affiliated with the Chinese military. Huawei said it cannot verify “any of these so-called ‘Huawei Employee CVs’” and that it conducts background checks for job candidates with military or government backgrounds.

Briefing: Huawei employee CVs show links to Chinese military – study

China is the world’s largest source of DDOS attacks, but its share is falling
But according to our statistical analysis and input from experts, the fact that most compromised devices come from China does not necessarily indicate that attackers work from China, nor that security practices are worse there than in other countries. China was the top source of DDOS attacks for the first quarter of 2019, while the US was a close second. Their overall share is decreasing, as countries like Vietnam and Brazil -which didn’t even make the top 10 two years ago- now take the fourth and sixth spots respectively.

China is the world’s largest source of DDOS attacks, but its share is falling

Is China’s propaganda machine losing the public relations battle with the US?
Beijing’s tight grip on all forms of communication linked to the trade war could be doing it more harm than good, analysts say The one exception is Huawei’s 74-year-old billionaire founder Ren Zhengfei

Can ‘internet films’ save the Chinese film industry?
The Chinese film industry has struggled in the midst of a “capital winter” following last year’s series of tax evasion scandals, increasingly strict censorship, and fleeing investments. Cautious investors have looked at the space with skepticism, especially as a number of high-profile, big-budget productions get pulled from major international festivals at the last minute due to vaguely specified “technical reasons.” In the past week, we’ve seen war epic The Eight Hundred yanked at the last minute from opening Shanghai International Film Festival and bullying drama Better Days pulled from cinema release schedules ahead of its planned launch this week

Can ‘internet films’ save the Chinese film industry?

Chinese envoy says Beijing ‘not interested in a diplomatic war’ with Britain
Ambassador Liu Xiaoming says he was ‘very much’ angry when he blasted London over its position on extradition bill protests in Hong Kong He says some British politicians are using ‘cold war mentality language

China looks at Britain and sees only weakness and hypocrisy
Last week’s sudden outbreak of verbal hostilities with China, triggered by violent clashes in Hong Kong, provided a disturbing glimpse of post-Brexit Britain’s isolated and impotent future in a world of more muscular adversaries. It also underlined a dilemma facing all the western democracies in their dealings with Beijing: what matters most – liberal values or money-making?

Super Eight
More diverse than their predecessors, the latest generation of Chinese filmmakers still face struggles of their own

Super Eight

Eight+ Things to Read About China and Other Things, Part 8

Eight+ Things to Read About China and Other Things, Part 8

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