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Anti-American Movie Entertains during Chinese National Day Holiday

The Chinese melodrama Chosin Reservoir, which is based on a battle during the Korean War, hit the box office bringing in revenue of over 2 billion yuan (US$0.3 billion) within five days of its release amid the Chinese government’s propaganda and heightened anti-American sentiment.

It has been a tradition of the Chinese film industry to release “patriotic” blockbusters during the National Day holiday period. Since 2019, the 70th anniversary of the People’s Republic of China, it has become standard to release three films at once for the holiday. Chosin Reservoir was the most eye-catching of the three this year. It depicts the battle in November of 1950 during the Korean War, where the Chinese army suffered heavy casualties due to the assault of the U.S.-led United Nations forces and the cold weather.

The three-hour war drama, costing up to 1.3 billion yuan (US$0.2 billion), with a total staff of over 12,000 people, was shot over a period of 180 days. Schools and workplaces organized students and employees to see the movie. Stories of emotional viewers have flooded China’s social media. Many audience members said they walked out of the theater with tears in their eyes.

There were critical reviews of the film, but they were soon taken down from the Internet.

Source: Central News Agency, October 5, 2021
https://www.cna.com.tw/news/acn/202110050150.aspx

Briefings | | |   Government/Politics

China’s Leading AI Company Bypassed U.S. Restrictions

SenseTime is a prominent Chinese tech company and an industrial leader in artificial intelligence and facial recognition. In October 2019, the U.S. Commerce Department added SenseTime to its Entity List, which effectively prevents listed entities from obtaining many U.S. tech items. The Department states SenseTime was among a list of Chinese companies that were “implicated in human rights violations and abuses in China’s campaign targeting Uighurs and other predominately Muslim ethnic minorities in the Xinjiang Uighur Autonomous Region.”

In 2020, the Commerce Department’s Bureau of Industry and Security made a subtle tweak to the designation. The company on the Entity List was changed from SenseTime generally to Beijing SenseTime, one of its subsidiaries. As a result, the firm says it can “continue to source” items as long as it doesn’t use its Beijing SenseTime subsidiary.

According to the company, the designation “has not had any material adverse impact on the [parent company’s] business.” It recently told this to potential investors.

Prior to the sanctions, SenseTime was widely referred to as “Beijing SenseTime” and most of the firm’s key patents and trademarks are still owned by Beijing SenseTime while Beijing has the most SenseTime workers listed on LinkedIn.

However, SenseTime’s current ownership chart shows Beijing SenseTime to be an isolated subsidiary. SenseTime’s website no longer lists Beijing SenseTime in its footer, but now lists Shanghai SenseTime.

In April 2019, the New York Times reported  that the company had provided facial recognition software to Chinese authorities who then used the software to monitor Uyghurs in Xinjiang.

Source: IPVM, September 28, 2021
https://ipvm.com/reports/sensetime-sanctions
Axios, September 29, 2021
https://www.axios.com/chinese-tech-firm-sidesteps-sanctions-de43feaf-7df5-46ad-85bd-8a37ab468e2e.html

Briefings | | |   US-China Relations

CCP’s Grassroots Control of Local Communities – Grid Administrator’s Microscopic Grip over every Chinese Citizen and Resident.

Chen Yixin, Secretary General of the Political and Legal Affairs Commission (PLAC) of the Chinese Communist Party’s (CCP’s) Central Committee, recently visited the city of Shenzhen. Chen pointed out that the current domestic and international security environment is becoming more complex and that it is necessary to optimize the grid-based grassroots management mechanism, improve the coverage of video surveillance, and set up a “red property management team.”

The PLAC is a very powerful Chinese Communist Party organ that oversees all judicial and law enforcement authorities, including the Supreme Court, Supreme Procuratorate, the Ministry of State Security, Ministry and Public Security, and the police force. The Secretary General is a senior leadership position in the Commission.

Chen pointed out that, in recent years, there have been mass social unrest cases where people’s conflicts and disputes were not solved in a timely manner. They all relate to “grassroots governance.” He said that “grid management” is an effective innovation in grassroots governance, and it is necessary to improve China’s grid management.

The Chinese government has divided local “grassroots” communities into a grid pattern, with each grid made up of 15 to 20 households. They are monitored by a designated person called the “grid administrator.” These persons must fully familiarize themselves with the residents in their grid – who lives there, their housing and facilities, their membership in organizations, and their place of work. In addition, they must identify any possible hidden dangers. The authorities make use of the “grid management” system to exert the most microscopic grip over every Chinese citizen and resident.

Chen proposed that there should be a focus on the entrances and exits of buildings and public areas, improved coverage of video surveillance, and a focus on the use of big data to predict risks and refine the “grid management” to ensure that the grid covers a moderate population and area. Business buildings, enterprises and institutions are divided into specially designated grids.

Chen asked grid administrators to mingle themselves with the people, watch out for the first signs of any problems, and organize CCP members and cadres in the community grids.

Chen said he would work with government bodies to promote “red property management” and introduce the participation of CCP members and university students, so that CCP cadres in the community also serve as the head of property management.

Source: Website of Political and Legal Affairs Commission, September 22, 2021
http://www.chinapeace.gov.cn/chinapeace/c100007/2021-09/21/content_12539687.shtml

Briefings | | |   Social Stability

Tsinghua to Cut Number of Doctoral Students in Liberal Arts

In recent years, the Chinese government has signaled that there are “too many liberal arts students.” Tsinghua University in Beijing has proposed to control the scale of liberal arts programs and reduce the number of liberal arts doctoral students.

According to Tsinghua University’s website, when Qiu Yong. the current president of Tsinghua University, attended a conference on liberal arts on September 17, he put forward a 10-point to-do list for the future liberal arts education. At the top of the list was to control the scale of discipline and to downsize doctoral programs.

According to China Youth Daily, an official newspaper targeting young people, starting in 2019, Chinese universities and colleges have kept a tight grip on enrollment and significantly scaled back humanities and social science programs.

In April of this year, the People’s Bank of China published a paper titled, “Understanding and Responding to China’s Demographic Transition.” The paper argued that one of the reasons that Southeast Asian countries fell into the middle-income trap was that “there were too many liberal arts students.” It suggested that China “should pay attention to science and technology education” when formulating population policy.

Source: Tsinghua University, September 20, 2021
https://www.tsinghua.edu.cn/info/1177/87151.htm

Briefings | | |   Economy/Resources

China’s New Equipment Manufacturing State Giant

China Electrical Equipment Group Co., Ltd. (CEEG) was established in Shanghai on the 25th. CEEG is a state-owned company which the central government manages directly. It is based on the restructuring of a few electric equipment companies including China XD Group Co. Ltd, XJ Group Corp, Pinggao Group Co. Ltd and Shandong Electric Engineering & Equipment Group Co. Ltd.

China aims to move its electrical equipment manufacturing industry up to the high-end of the global value chain. It is viewed as being of strategic importance to the implementation of China’s energy security.

After the completion of the reorganization, CEEG’s business will produce equipment related to power generation (including new energy), power transmission, transformation, and distribution. It may also be involved in energy storage, rail transportation, industrial automation, and energy grid. It vows to be the most capable and comprehensive manufacturer of AC and DC electrical equipment.

Source: SASAC, September 25, 2021
http://www.sasac.gov.cn/n2588025/n2643314/c20909163/content.html

Briefings | | |   Economy/Resources

China’s Central Bank Governor: Large Fintech Firms May Lead to Market Monopoly

Yi Gang, the Governor of China’s central bank, recently pointed out that the “winner-take-all” attribute of large fintech firms could lead to market monopoly. Yi noted that there are more than 4,000 small and medium-sized banks in China. He expressed concern about the banks increased reliance on large technology companies.

As China recently took a heavy-handed approach toward fintech giants such as Alibaba and Tencent, the website of the People’s Bank of China released Yi’s speech on September 14th at a Sino-German video conference on financial technology .

Yi noted that China’s rapid development in fintech has also highlighted a number of problems. These include the payment institutions entering into the financial sector and offering a variety of financial products such as insurance and microfinance. They thereby add to the chances of cross-product and cross-market contagion of financial risks.

Yi said Chinese regulatory authorities will bring all financial activities under financial supervision and make sure that financial businesses must be licensed. China also requires that payment methods be divorced from other financial products. In addition, Yi vowed to strengthen anti-monopoly efforts and promote large Internet companies to protect consumers’ choice of payment methods.

Yi also noted that the development of fintech will have an impact on the traditional banking industry. “Small and medium-sized banks are facing greater challenges. With limited resources of their own, small and medium-sized banks can only rely on the technology and platforms provided by large IT companies for customer maintenance, credit analysis and risk control.”

Source: People’s Bank of China, September 18, 2021
http://www.pbc.gov.cn/goutongjiaoliu/113456/113469/4345544/index.html

Briefings | | |   Economy/Resources

China Stepped up Control of Web Contents

China has been strengthening its overall supervision of cyberspace. On September 15, the Cyber Administration of China (CAC), the country’s top cyber regulator, released the “Opinions on Further Clarifying the Responsibilities of the Online Platform Operators in terms of Information Content.”

The CAC pointed out that the main purpose of releasing the “Opinions” was to focus on different indications of web chaos, and “to ensure that the online platform always adheres to the correct political direction, public opinion guidance and value orientation.”

The “Opinions” gives ten key tasks, including setting up online community rules, the preparation of lists and directories of illegal and unhealthy conduct, the establishment of user credit records and evaluation systems, and the maintenance of records on users’ violations.

The “Opinions” requires the online platforms to improve the content approval mechanism, implement the chief-editor’s responsible system, further expand the scope of manual audits, and establish a dynamic updating mechanism for the database of illegal activities.

Source: Cyber Administration of China, September 15, 2021
http://www.cac.gov.cn/2021-09/15/c_1633296790051342.htm

Briefings | | |   Information/Technology