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After Li Keqiang’s Death, Chinese Communist Party Bans Unofficial Memorial Activities

After the death of former Chinese Premier Li Keqiang, Chinese authorities have moved to prevent protests and unrest. Internet searches for Li Keqiang have been restricted to only return content from official news sources. Many universities received orders prohibiting gatherings and limiting memorial tributes. By the evening of Li’s death, some people had visited Li’s former residence to lay flowers.

The news of Li’s death was announced October 27 and quickly trended online. However, despite 2.24 billion reads on Weibo, only 609,000 comments remained on the Weibo post, showing self-censorship. Only condolences appeared in comments; other posts were deleted. Official accounts disabled comments. Foreign embassies’ condolences were also blocked. On WeChat and Baidu, only official media appeared in searches regarding Li Keqiang.

Messages showed several universities were ordered to ban student gatherings honoring Li. Notices from Shanghai Jiaotong and other schools ordered monitoring of memorial activities, banning gatherings, and reporting to authorities. The Hainan University Student Union was told student leaders could only repost the official obituary with the text “In Memory of the Former Premier.” Online or offline group memorial activities were prohibited.

When former leader Hu Yaobang died in 1989, gatherings to mourn him led to demands for democratic reforms and eventually the Tiananmen Square protests. Chinese authorities aim to prevent any similar unrest after Li Keqiang’s death through censorship and banning public memorials.

Source: Central News Agency (Taiwan), October 27, 2023
https://www.cna.com.tw/news/acn/202310270339.aspx

Briefings | | |   Social Stability

PLA Daily: “Don’t Rely Too Much on High-tech Equipment”

People’s Liberation Army Daily (PLA Daily), the official mouthpiece of the Chinese military has published an opinion article titled “Don’t rely too much on high-tech equipment.” The article, published on October 24 follows the imposition of U.S.-led computer chip sanctions aimed at curbing China’s ability to build out its military force.

The article states “[we should] avoid breeding arrogance through over-reliance (on weapons and equipment). As Engels said, guns do not move on their own; it takes a brave heart and strong hands to use them.” It goes on to say, “Throughout the history of human warfare, the well-equipped army is not always victorious, and the technologically advanced party may not be the ultimate winner of the war. If an army relies too much on advanced technology and excellent equipment to the neglect of physical exercise and the training of fighting spirit, it is easy to breed ‘arrogance’ and ‘squeamishness’. This leads to lack of aggressiveness and combat effectiveness under harsh combat conditions.”

The article says that, during “the War to Resist US Aggression and Aid Korea” (i.e. the Korean War), a captured American company commander said “the U.S. Army troops pay far too much attention to weapons and equipment to the serious neglect of combat strategies, tactics, and the will power of officers and soldiers. This may be the reason why we were often defeated by the Chinese People’s Volunteers (CPV) army”.

The article concludes with the following remark: “In the battlefield of the future, even while in possession of high-tech equipment that can compete with the strongest of enemies, we cannot neglect to sharpen our spirit. Just as it is important to upgrade our weapons and equipment, we should also strengthen the fighting spirit of our officers and soldiers — to have no fear of suffering and death.”

Source: ifeng.com (Phoenix), October 24, 2023
https://news.ifeng.com/c/8U8Vv1CGXMh

Briefings | | |   Defense/Military

Mitsubishi Motors to End Car Production and Sales in China

The Japanese Mitsubishi Motors Corporation announced on October 24th that it will end production of vehicles in China, and that it will end car sales in China once the company’s existing inventory is depleted. The company’s decision was driven by the rapid rise of local Chinese electric vehicle (EV) companies (negatively impacting Mitsubishi’s own EV car sales) as well as the downturn in sales of Mitsubishi’s gasoline cars.

Mitsubishi’s board of directors has finalized the withdrawal from China; the company’s 2023 fiscal year statements will include a 24.3 billion yen (approx $172 million) special loss from the departure. Going forward, Mitsubishi intends to focus its resources on the market in Southeast Asian.

Mitsubishi launched a new Outlander hybrid vehicle in China in December 2021 but sales fell short of expectations. From January to August 2022, Mitsubishi’s sales in China almost halved, dropping 47.6% year-over-year. Besides Mitsubishi, other Japanese automakers are also lagging in terms of EV sales within China. Local giant BYD and Tesla dominate China’s EV market. Research firm MarkLines stated that in 2022, Chinese automakers accounted for 51% of passenger car sales within China, while Japanese automakers had only an 18% share of the market.

Mitsubishi’s joint venture GAC Mitsubishi Motors and its plant in China’s Hunan Province, which produced gasoline vehicles, stopped production in March. Mitsubishi will sell its shares in the joint venture and dissolve the partnership, though Mitsubishi’s other joint ventures in China will continue engine production.

Source: Kyodo News, October 24, 2023
https://china.kyodonews.net/news/2023/10/db6e9f1790e0.html

Briefings | | |   Geo-Strategic Trend

CCTV: Beijing Cracks Another U.S. Spy Case

State broadcaster China Central Television (CCTV) said in a special program that an employee of a Chinese defense company was coerced into revealing Chinese state secrets while he was a visiting scholar at a U.S. university in 2013. The employee, named Hou, was then developed into a spy for the U.S., according to the report. Hou was arrested for espionage. CCTV’s coverage of his case highlights Beijing’s desire to steer public sentiment in China regarding Chinese state security and involvement with the U.S.

CCTV said that a professor in the U.S. introduced Hou to someone claiming to work for a consulting firm, and that this person was actually a U.S. intelligence officer. Over time, the intelligence officer cultivated a close relationship with Hou and paid him to provide information about China. Although Hou acted under duress, he was arrested in July 2021 by Chinese authorities and charged with espionage. The report stated that Hou has now been sent to stand trial, and that the case was a major security breach engineered by the U.S.

The CCTV program said that “any acts jeopardizing China’s security would be punished” and that China’s Ministry of State Security had issued a reminder that espionage often involves deception. The program did not name the university that Hou visited, nor did it name his work unit.

Source: Radio France International, October 22, 2023
https://rfi.my/A2Yb

Briefings | | |   US-China Relations

Huawei May Have Breached U.S. Chip Ban with Purchases From ASML

Huawei launched its new Mate 60 Pro smartphone in September, using what appears to a 7nm processor in the phone. The processor, called the Kirin 9000S, was apparently manufactured by China’s SMIC foundry (although SMIC denies producing the chip). The launch came after the U.S. enacted high-tech sanctions on China, attempting to restrict trade that would give China access to high-end computer chips.

Huawei likely acquired key equipment from Dutch firm ASML enabling production of the 7nm chips. According to one estimate, China’s purchases from ASML over the past two years may have exceeded 120 DUV lithography machines, exceeding the capacity of Taiwanese rival chip foundry TSMC. With 120 DUV systems but no extreme ultraviolet lithography (EUV) system, SMIC would be able to approximate a 7nm process via multiple exposures, albeit with 50% lower yields than would be possible with the use of EUV. Still, this could enable production of between 50,000 and 60,000 7nm wafers monthly, critical for Huawei’s smartphone business and China’s drive to achieve “chip independence.”

Before the U.S.’s broader chip sanctions were in place, Huawei acquired significant DUV capacity from ASML, accounting for 18-25% of ASML’s sales. ASML’s recent sales to Huawei may be in violation of the current U.S. trade sanctions. Although Huawei has made progress in the direction of self-sufficiency, it still has a long way to go before achieving fully self-reliance in semiconductor manufacturing.

Huawei’s large DUV stockpile, combined with the nationalist buzz in Chinese media regarding the Mate 60 Pro, could drive sales to 70 million units despite high costs. This would represent a major win for China. Even if ASML’s DUV sales are blocked, Huawei has gained breathing room to advance domestic production within China. Acquiring EUV systems would be an even bigger win for Huawei.

Source: United Daily News (Taiwan), October 16, 2023
https://udn.com/news/story/7333/7508081

Briefings | | |   Geo-Strategic Trend

China’s 2022 Marriage Registrations below Seven Million, Marking New Low

China’s Ministry of Civil Affairs released its 2022 report showing that only 6.835 million legal marriages were registered last year. This represents a 10.6% drop from 2021 and the first year in recent history with fewer than 7 million marriages.

A Yicai report linked the sharp decline in marriages to (1) people delaying their first marriages, (2) a smaller population of marriage-aged people, (3) changes in mindset among the marriage-aged population, and (4) the impact of the COVID-19 pandemic.

Statistics show that marriages in China fell below 10 million in 2019, below 9 million in 2020, below 8 million in 2021, and now below 7 million in 2022. The trend of decline in marriages has continued for 9 years following the peak of 13.469 million marriages registered in 2013.

Age distribution data show that only 15.2% of marriages in 2022 were entered by people 20-24 years old, down 1.3 percentage points from the year before. A health official said that those born in 1990s and 2000s who grew up in cities with more education and job competition are delaying marriage and children.

Source: Radio Free Asia, October 15, 2023
https://www.rfa.org/mandarin/Xinwen/4-10152023113812.html

Briefings | | |   Economy/Resources

Nearly 20% of China’s Population is Over 60

China’s elderly population continues to grow, according to the latest data released by China’s Ministry of Civil Affairs. By the end of 2022, China had 208 million people aged 60 and over, accounting for nearly 20% of the total population. This indicates that the country’s population is rapidly aging. An official Xinhua commentary said that population aging will remain a long-term challenge for China.

In 2021, Chinese people aged 60+ totaled 267 million, making up 18.9% of the population. The 65+ population was 257 million, or 14.2% of the total. The new data for 2022 illustrates the continued rise in China’s proportion of elderly  people.

Demographic data show that the aging trend will likely accelerate in the coming years. During China’s 14th Five-Year Plan period from 2026-2030, the number of elderly aged 60+ is expected to exceed 300 million as the country enters a phase of “moderate aging.” Around 2035, the elderly population will surpass 400 million, a phase of “severe aging.”

Population aging presents economic and social challenges for China in areas like healthcare, pensions, and elder care. An official commentary said it is a “long-term fundamental situation affecting the nation,  which China will need to adapt to through supportive policies and services.”

China will need to prepare for a society that will have over 400 million elderly by 2035. In 2022, China spent over 42 billion yuan (US$5.8 billion) on elderly welfare and over 17 billion yuan (US$2.3 billion) on elderly services.

Source: Central News Agency (Taiwan), October 16, 2023
https://www.cna.com.tw/news/acn/202310160131.aspx

Briefings | | |   Economy/Resources

Another Chinese Official Charged with Data Fraud

Sun Shutao, former vice chair of the Shandong Provincial Committee of the Chinese People’s Political Consultative Conference (CPPCC), was recently expelled from the Chinese Communist Party and public office for falsifying economic data. This event follows the similar expulsion of former Jiangsu deputy party secretary Zhang Jinghua in May.

The Central Commission for Discipline Inspection (CCDI) charged Sun with falsifying data so as to achieve personal advancement. He was also charged with engaging in transactions for power, sex, and money. The CCDI stated that Sun illegally accepted huge amounts of property (i.e. bribes).

Mainland Chinese media noted that Sun is the third official who has been publicly charged with data falsification. Before Zhang Jinghua, official Kong Lingdong of Qinghai province was charged in September 2022.

The Chinese government has a reputation for data falsification. In March, National Bureau of Statistics director Kang Yi vowed to crack down on the phenomenon, announcing a zero-tolerance policy for falsification.

The expulsions of Sun, Zhang and Kong indicate the Chinese government’s stance on the manipulation of data for political advancement. Despite periodic crackdowns, however, there are fundamental political incentives in place that encourage such data falsification; the practice remains widespread as officials face intense pressure to meet economic targets.

Source: Central News Agency (Taiwan), October 9, 2023
https://www.cna.com.tw/news/acn/202310090254.aspx

Briefings | | |   Government/Politics