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Chinese Premier: Prevent the Incidents that Break Moral Bottom Line

On June 27, Chinese Premier Li Keqiang said at an event that, “The population trapped in dire conditions has increased due to the impact of the epidemic and natural disasters.” Li told China’s officials to “detect in a timely manner those people who lost their jobs, those who need to be included in the low-income programs, and those in temporary distress, and prevent the occurrence of incidents that break the moral bottom line.”

Although Li did not specify what the events might be that could “break the moral bottom line,” this is not an often used wording for the premier to use to describe China’s economic difficulties.

Li Keqiang considered that the current economy has recovered to a certain extent, but “the foundation is not yet solid.” He emphasized that, “The unemployment rate should be brought down and controlled as soon as possible.”

The above remarks were made on June 27 when Li Keqiang visited the Ministry of Civil Affairs and the Ministry of Human Resources and Social Security.

Source: Central News Agency (Taiwan), June 28, 2022
https://www.cna.com.tw/news/acn/202206280409.aspxhat

Profit of China’s Local State Enterprises Plunged 22.7 Percent in the First Five Months

China’s Ministry of Finance released the economic statistics of state-owned and state-controlled enterprises for the first five months of 2022. Due to the impact of the epidemic, the profit of local state-owned enterprises dropped by 22.7 percent.

Although the revenue of state-owned enterprises from January to May increased by 9.2 percent over the same period last year, the profit of all state-owned enterprises dropped 6.5 percent. Among them, local state-owned enterprises saw a deep profit dive of 22.7 percent.

As of the end of May, the asset and liability ratio of Chinese state-owned enterprises was 64.3 percent, of which the ratio for central enterprises was 67 percent, and 63.0 percent for local state-owned enterprises.

Source: Central News Agency (Taiwan), June 28, 2022
https://www.cna.com.tw/news/acn/202206280330.aspx

Under Xi Jinping, the Number of Chinese Asylum-seekers Is Increasing. Despite COVID

Figures released by the United Nations’ refugee agency UNHCR showed that around 12,000 Chinese nationals sought asylum overseas in 2012, the year that Xi took office as CCP general secretary. By 2021 that number rose to nearly 120,000.

According to the release of Safeguard Defenders, a human rights NGO based in Madrid, Spain, “By 2019, that figure surpassed 100,000, and despite travel restrictions both in China and worldwide, it continued to increase in both 2020 and 2021. Last year, that figure reached nearly 120,000 people. That is ten times the number of asylum seekers the year Xi came to power.”

“In one year of Xi Jinping’s rule, 2021, China had more asylum-seekers than during the last eight years of the rule of his predecessor Hu Jintao.”

“In fact, since 2012 China has seen some 730,000 people seek asylum. Another 170,000+ persons are living outside of China under refugee status. The number of refugees has held steady for a long time (Many of them are Tibetans living in India).”

Source: Central News Agency (Taiwan), June 18, 2022
https://www.cna.com.tw/news/acn/202206180103.aspx

China Further Tightens Online Censorship, Mandating Real Name Commenting

The Cyberspace Administration of China (CAC), recently issued a draft version of the “Internet commenting service management regulations.” The country’s top Internet authority mandates that providers of commenting services shall authenticate the real identity of registered users and shall not provide commenting services to users who have not provided real identity information. The “comment service” refers to the Internet platforms that, by means of posting, reply, messaging and other means, provide users the ability to publish text, symbols, expressions, pictures, audio and video information.

CAC also requires service providers to establish mechanisms to review postings, conduct real-time inspections, and launch emergency responses. The online postings have to be reviewed before being published. Any “illegal and undesirable information” are to be detected, in a timely manner, processed, and reported to the Internet authorities.

CAC also proposed that the service provider establish a user grading system, which conducts a credit assessment of the user’s commenting behavior. Users with serious violations will be blacklisted, deprived of services, and prohibited from re-registering to use commenting services.

Source: Central News Agency (Taiwan), June 18, 2022
https://www.cna.com.tw/news/acn/202206180106.aspx

Multinational Corporations Have a Crisis of Confidence in China

The French newspaper Les Échos published an analysis on Multinational companies’ crisis of confidence in China, focusing on the business community’s shock at  the brutal closure of Shanghai. They have been forced to re-evaluate the “China risk” including factors such as the zero-Covid policy, the war in Ukraine and tensions between the US and China.

The analysis says that the closure, as well as the broader disruptions caused by China’s zero-Covid policy, translate into huge economic costs. Foreign companies have massively reduced their forecasts. According to data from the European Union Chamber of Commerce, as of April, 60 percent of European subsidiaries had lowered their business targets for 2022. Production could be suspended at any time, with the epidemic and China’s draconian Covid prevention policies becoming a sword of Damocles hanging over these companies. According to a survey by the French Chamber of Commerce and Industry in China, 80 percent of French subsidiaries said that China’s zero-Covid policy is affecting their investment strategy, with 76 percent believing China’s image has deteriorated.

Geopolitics and the growing competition between the U.S. and China are other major long-term factors. Trade wars have complicated the business of multinational companies in China. The war between Russia and Ukraine has abruptly posed new risks. The potential consequences of Beijing’s possible attack on Taiwan could be even greater than that of Western companies’ retreat from Russia. In addition, companies are weighing the effect of the rise of local competitors, increased regulatory restrictions and the reputational risk of doing business in China due to Western condemnation of issues such as Xinjiang and Hong Kong. Many factors are prompting these companies to reassess their long term “China risk.”

Source: Radio France International, June 21, 2022
https://rfi.my/8WHA

Xi Jinping Criticizes Chinese Universities for Faking Employment Data

China has a record 10.76 million fresh college graduates this year, but the economy is under huge downward pressure due to Beijing’s draconian COVID-19 epidemic control. According to the government statistics, the national urban unemployment rate reached 6.1 percent in April, indicating there is tremendous unemployment pressure. Xi Jinping recently visited a college in Sichuan Province and expressed concern over employment issues.

The official Xinhua News Agency reported that Xi said that the employment data should reflect the real situation. “Some schools, while in pursuit of a high employment rate, falsify the data by coercing the graduates to sign an employment contract regardless of their will.” Xi

stressed, “We cannot fool the higher authorities, let alone the students.”

Source: Central News Agency (Taiwan), June 14, 2022
https://www.cna.com.tw/news/acn/202206140124.aspx

First Russia-China Transnational Highway Bridge Opens to Traffic

On June 10, Russia and China announced the official opening of the Heilongjiang River Bridge, the first transnational highway bridge between the two countries. While confronting the West over the invasion of Ukraine, Russia is turning to Asia for support.

The bridge, more than one kilometer long, connects Blagoveshchensk, the capital of Russia’s far eastern Amur region, with the city of Heihe in northern China’s Heilongjiang province. Although it was started in 2016 and completed in 2019, the opening ceremony was delayed due to the COVID-19 outbreak.

According to official figures, the bridge, which cost 19 billion rubles (about US$328 million), is a two-lane road. According to Chinese media, the bridge is currently limited to cargo traffic only.

Source: Central News Agency, June 10, 2022
https://www.cna.com.tw/news/acn/202206100334.aspx

Ministry of State Security Offers Rewards (Up to $15,000) for Reporting National Security Cases:

China’s Ministry of State Security (MSS) recently promulgated new rules to encourage citizens to report acts that “endanger national security.” It offered  different amounts as rewards, depending on the level of contribution, with the highest reward being 100,000 yuan ($15,000) or more.

On June 6, MSS, a CIA type agency, issued the “Rules for Rewarding Citizens for Reporting Acts that Endanger National Security.” The rules went into effect on the same day.

The MSS official said in a press session that China’s national security is facing a serious and complex situation, “especially as the infiltration and theft activities of foreign espionage and intelligence agencies and various hostile forces against us have significantly intensified.” The purpose for the new regulation is to mobilize public support for national security work.

The public is encouraged to report through a phone number, website, letter and in person. The national security authorities will issue spiritual (award certificates) or material awards (bonuses) depending on the situation. The bonus is divided into four levels according to the degree of contribution, with the lowest being less than 10,000 yuan ($1,500) and the highest more than 100,000 yuan ($15,000).

Source: Central News Agency (Taiwan), June 7, 2022
https://www.cna.com.tw/news/acn/202206070222.aspx