China Press Review – June 15, 2021

China approves highest-ever outflows for mainland investors
Government adds record $10bn to investment scheme against backdrop of rising renminbi. China has approved record amounts of investment to flow out of the country through an official scheme as authorities liberalise the local financial system against a backdrop of a rallying renminbi.  A cumulative $147bn of approvals have been added to the nation’s qualified domestic institutional investor scheme, which allows investors to access assets outside mainland China through banks and other institutions.    In early June, Beijing approved $10bn in new QDII allocation, the highest single amount in the history of the scheme, which was launched in 2006 and is used mainly by China’s retail investors

Chinese FDI in Europe: 2020 Update
Investment falls to 10-year low in an economically and politically challenging year

EU-China investment deal is still possible — but not before 2023, analyst says
Neil Thomas, China analyst at Eurasia Group, said it’s “more probable than not” that an investment pact between the European Union and China will be ratified.  But both sides may wait until 2023 at the earliest to do so, Thomas added.The deal, called the Comprehensive Agreement on Investment, has been put on the back-burner following tensions between the EU and China.

What tech investors are looking for in China
After two years of difficult financing, as the US boomed across the Pacific, Chinese start-ups saw the interest of venture capitalists heat up again. “The capital winter has passed and trading competition is fierce,” said Liao Ming of Prospect Avenue Capital. “To make a deal now, you need to provide more than just cash.”  According to data from data provider ITjuzi, the number of venture capital transactions in China in the first quarter increased by 56% year-on-year, and was active for the fourth consecutive quarter, as start-ups invested 354 billion yuan ($55 billion).

German industry group criticizes China over new sanctions law
Germany’s powerful BDI industry association criticized China on Tuesday for passing a law to counter foreign sanctions, which it said sent a worrying signal to investors and companies abroad. China is one of the most important export markets for German companies outside the European Union’s single market, but concerns over human rights abuses and a crackdown in Hong Kong are putting a strain on political as well as economic ties.

China’s anti-sanctions law is a defence mechanism, not an attack weapon
Legislation rushed through last week reflects Beijing’s growing confidence it could follow through against foreign bodies with tit-for-tat sanctions     Zhuhai Zhenrong is a cautionary tale of how few Chinese businesses, including state-owned enterprises, can afford to be sanctioned

EU says China is a systemic rival, human rights is main issue
China’s record on human rights is the main issue that divides it from the European Union and makes it a systemic rival for the bloc, European Commission President Ursula von der Leyen said on Tuesday. “We are strong economic competitors, without any questions, and for that we need tools,” the head of the EU’s executive told a news conference after talks with U.S. President Joe Biden.

China urges NATO to stop exaggerating ‘China threat theory’ Access to the
China’s mission to the European Union urged NATO on Tuesday to stop exaggerating the “China threat theory” after the group’s leaders warned that the country presented “systemic challenges”.

China takes aim at US efforts to ‘sow discord’ with Europe
Beijing urges European countries not to follow the US line      The United States is sick, Chinese foreign ministry spokesman says

Nato says China presents ‘systemic challenges’ and vows to counter its rise
The North Atlantic Treaty Organization releases a statement a day after the Group of 7 focuses on China as well    Events are part of US President Joe Biden’s plans to rebuild the transatlantic alliance, with an aim of heading off China threats

Will G7 climate pledge prompt Asian governments to ditch coal or lean more heavily on China?
G7 leaders stopped short of committing to deadlines for phasing out coal but there will be no new funding for coal-fired power plants    An end to coal financing from the G7 could either push Asian nations to consider their coal policies or simply turn to China for funding   “They won’t see it as a game- changer but merely just words,” said Marks, assistant professor of environmental politics and policy at Dublin City University in Ireland. An end to coal financing from the G7 could push Asian nations to turn to China for funding in a bid to boost energy security, he added. “This announcement could actually backfire against the G7’s aim and increase China’s growing influence in its own region,” he said.

G7 summit: ‘unprecedented’ united front piles pressure on China, analysts say
Greater consensus poses concerns for Beijing and could make it harder to disrupt ties between the US and Europe     Leaders raised trade issues, human rights concerns in Xinjiang and Hong Kong, and called for new Covid-19 origins probe

Semiconductor development still focus for Huawei
Embattled tech giant Huawei is continuing its development of cutting-edge semiconductors, despite facing on going US sanctions that present serious supply-chain issues, reported Nikkei Asia.  Nikkei reports that, according to an announcement by Huawei director and SVP Catherine Chen, there will be no restructuring at HiSilicon, the company’s chip design subsidiary, signaling a decision to continue its chip development work. The organization had more than 7,000 workers on its payroll in 2020, a number difficult to maintain by a subsidiary expected to go years without contributing to earnings. But, Chen said, Huawei is privately held and unaffected by external forces.  In May 2020, the US government barred companies using American-made products or services from doing business with Huawei. As a result, Taiwan Semiconductor Manufacturing Co., the world’s biggest contract semiconductor maker, and other companies have stopped accepting new orders from Huawei.

More Chinese provinces crackdown on crypto mining, digital yuan trials: Blockheads
Regional Chinese governments continue to crack down on crypto mining after a top government agency held high-level talks of mining crackdown in May. This week, local governments in Qinghai, Yunnan, and Xinjiang followed Inner Mongolia and Sichuan to issue new crackdown policies. Former Chinese central bank governor Zhou Xiaochuan sounded pessimistic about cryptocurrency’s future in payments. And more cities began to use digital yuan—including a first-ever digital yuan/blockchain tie-up.

No abnormal radiation levels at Taishan, says Beijing
Beijing said Tuesday that there had been no change in radiation levels at the Taishan nuclear power station in Guangdong, after its French operator said it was working to resolve an issue linked to gas build-up.

China census: migration drives Han population growth in Xinjiang
The region’s Uygur community grew 16 per cent in the decade to 2020 compared with 25 per cent for Han      Regional government says data prompted it to revise down Uygur population figures

China’s closed borders ‘a real problem’ for foreign business operations amid coronavirus
Many firms fear that draconian travel restrictions may result in fundamental shift away from the way business was done in China before the coronavirus    There are widespread concerns that China’s foreign talent pool may never fully recover

Coronavirus: Guangzhou reports 1 new case but official says pandemic battle is at ‘critical stage’
Megacity must stay vigilant to avoid a resurgence of infections, health commission says    Three new areas have been locked down and dozens of other hotspots are still under quarantine

Guangzhou Eases Covid-19 Curbs as Flare-Up Subsides
The southern Chinese city of Guangzhou has lifted lockdowns in 11 areas of five districts as the spread of Covid-19 eases in the city. The areas include both residential neighborhoods and workplaces, which were closed early June after Covid-19 cases were found there or in nearby areas, Chen said at a press conference Monday.

Taiwan Covid-19 vaccines may be too late for US emergency approval
Former health official flags competition problems for home-grown shots as global brands complete phase 3 clinical trials    Two locally produced vaccines have finished phase 2 trials and are expected to be marketed on the island in the next few months

Russia and China defy attempts to destroy ties, Putin says
Relations remain high, Russian president says ahead of key meeting with Joe Biden in Geneva    Beijing is not a threat to Moscow, Putin says in interview with American broadcaster

China and India should look back to move forward on border impasse
A year after the shock of a fatal border clash, tensions remain high with no consensus on how to resolve the issues over an unverified LAC   To prevent conflict, both sides should dust off previously agreed confidence-building measures and enforce the less-contentious ones

China-Australia relations: top exporting state down under calls for reset in China ties
Western Australian Premier Mark McGowan says ‘this isn’t about kowtowing to other countries’   Comments come two days after G7 leaders chided China over a wide range of issues

US strike group in South China Sea ahead of Asean defence talks
USS Ronald Reagan leads maritime exercises in disputed waterway before expanded regional discussions aimed at easing tensions     US Navy says its patrol is part of ‘routine presence’ in the energy-rich region which is subject to numerous competing claims

China’s space race gathers pace: next stop, Jupiter?
Government hopes Chinese spacecraft will get there in 2029    Also projects to get samples from Mars, moon, and elsewhere

The CCP’s next century: expanding economic control, digital governance and national security
As the Chinese Communist Party (CCP) approaches its 100th anniversary in July, it appears stronger and more confident than ever. Even though Xi Jinping recently stressed the necessity to soften the tone and “strive to create a credible, lovable and respectable image of China,” the leadership in Beijing is still convinced that its own governance model is superior to Western democratic models.

China Fantasizes About a ‘Low-Desire’ Life
Tired of the urban grind, young Chinese are rejecting consumerism and decamping to the countryside. That’s not the same thing as fighting back.

Alain Gillard
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