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Chinese Investments in Australia Plummeted in 2019

The Australian National University’s (ANU) Chinese Investment in Australia (CHIIA) database reported the total investments from China in 2019 were 2.5 billion Australian dollars (US$ 1.8 billion). This was about half of the 4.8 billion Australian dollars (US$ 3.5 billion) invested in 2018.

The inflow of Chinese money reached its peak of nearly 16 billion Australian dollars (US$ 11.7 billion) in 2016, and has since fallen sharply. Most industries saw dramatic declines in 2019, including real estate, mining and manufacturing. Investment in agriculture declined, but the construction and financial industries rebounded slightly.

ANU professor Peter Drysdale, head of the CHIIA database project, reckoned that there were a multitude of factors behind the plunge.

As Chinese companies are increasingly focusing on developing markets and Beijing is trying to prevent capital outflows, in 2019, foreign direct investment from China fell by nearly 10 percent globally. The decline in Australia was even more severe, partly because of the end of the mining boom (which brought a lot of money from China).

Professor Drysdale added that the government’s new regulatory barriers have also pushed away Chinese investors. In recent years, China’s investments in Australia have attracted heated political debates. The Australian Federal Government has generally strengthened its review of foreign investment. Earlier this year, the Treasurer of Australia, Josh Frydenberg, introduced new restrictions to prevent overseas companies from targeting troubled Australian assets due to the economic impact of the coronavirus pandemic.

The largest transaction that CHIIA recorded in 2019 was Mengniu Dairy’s acquisition of Bellamy, an Australian infant formula manufacturer, at 1.5 billion Australian dollars (US$1.1 billion). Last month, Frydenberg blocked Mengniu’s acquisition of the Australian company Lion Dairy and Drinks, claiming the deal was “contrary to their national interest.”

The political relationship between Australia and China has also turned increasingly hostile. The two countries have seen a series of issues, including foreign infiltration, Australian journalists harassed in China, cyber espionage, trade, Hong Kong issues and the COVID-19 outbreak. Professor Drysdale expected a further decline in Chinese investments in Australia in 2020.

Source: Australian Broadcasting Company Chinese, September 14, 2020
https://www.abc.net.au/chinese/2020-09-14/chinese-investment-in-au-takes-nosedive/12661168

Briefings | | |   Geo-Strategic Trend

87 Chinese Cities Showed “Urban Expansion and Population Shrinkage” Between 2014 and 2018

According to the statistics from the Urban and Rural Statistics Yearbook that the Ministry of Housing and Urban-Rural Development issued, between 2014 and 2018, 451 cities had “urban expansion and population growth,” 87 cities had “urban expansion and population shrinkage,” 18 cities had “urban contraction and population growth,” and 13 cities had “urban contraction and population shrinkage.”

In 2018, the total newly constructed urban area was 58,456 square kilometers, an increase of 53.4 percent over 2009, while the permanent urban population was 510 million, only 35.8 percent higher than ten years ago. This indicated a phenomenon in which “land urbanization was faster than population urbanization.”

In comparing the data between 2018 and 2014, one can find that the number of cities with urban population reduction is twice the number of cities with urban area reduction. 122 cities experienced a decrease in urban permanent population during those five years; five cities showed little change; and 507 cities maintained a positive population growth. Among them, Longjing City in Jilin province, Jieyang City in Guangdong province and Honghu City in Hubei province are the only three cities whose population has decreased by more than 50 percent.

Most of those with a declining population are the third and fourth tier cities. Two main types of cities exhibited more urban population losses: cities in northeast China where young people are leaving en masse; and the smaller cities in the Pearl River Delta, whose population is beimg absorbed by the two top-tier cities of Guangzhou and Shenzhen.

Source: 21st Century Business Herald, September 12, 2020
http://www.21jingji.com/2020/9-12/1NMDEzNzlfMTU5MDI1NA.html

Briefings | | |   Economy/Resources

China Moves to Discipline Local Financing Platforms

China’s financial regulatory authority recently issued a document imposing strict restrictions on the products and services that can be provided by the locally established financing platform – the financial asset exchanges (FAE). The move may deal a blow to real estate companies and urban investment companies that have resorted to these exchanges as a financing channel in recent years.

The financial asset exchange is a financial asset trading service platform set up with the approval from local governments (provincial and municipal governments).

According to a Reuters report, this document forbids local FAE’s from cooperating with e-financing and real estate companies that are subject to state regulatory restrictions. It also obliges FAE’s to stop providing passages for financial or non-financial institutions to circumvent regulatory requirements such as the scope of investment and leverage constraints.

The document also pointed out that the local FAE’s are not allowed to sell products, in any fashion, to individuals, and that they are not allowed to issue, sell or trade financial products and private equity products under the supervision of the central financial authorities.

Since 2010, China’s local governments have been setting up FAE’s, originally to solve the financing problems of local small and medium sized enterprise. However, many FAE’s were involved in a number of illegal fund-raising activities and were subsequently subject to strict regulation. In recent years, FAE’s are becoming an important financing channel for real estate companies and local government owned infrastructure investment entities. The new document is believed to put a brake on the new waves of housing and infrastructure development.

Source: Central News Agency, September 13, 2020
https://www.cna.com.tw/news/acn/202009130049.aspx

Briefings | | |   Economy/Resources

Indian Economist Points out China’s Faked Population Data

China’s National Bureau of Statistics announced in January this year that, at the end of 2019, the country’s population exceeded 1.4 billion. However, an Indian economist pointed out the data on population was falsified, especially the fictitious male-to-female ratio, in an effort to conceal China’s imminent population crisis.

On September 9, Shailendra Raj Mehta, an Indian economist, published an article called “A Shrinking China” in The India Express, an English language national daily newspaper in India. In addition to the serious falsification of population data in recent years, Mehta claimed that the falsification was to maintain the status of “the world’s most populous country,” and to conceal the severely unbalanced sex ratio and the rapidly declining labor force. He predicted that, within 10 years, China’s population problem would inevitably surface.

The article gave an example from the 2000 China Census data. At that time, there were 90.15 million people in the 5 to 10 age range. 15 years later, the same group reached the ages between 20 and 25 years-of-age. At that time, that is in the year 2015, the group had a population of 100.31 million, according to China’s official statistics. The number did not shrink due to normal deaths, but increased by at least 10 million people.

Mehta follow this reasoning in 2018, which had the latest figures which are available. That number swelled to 113.38 million, meaning that there were 23.23 million extra ghost people. Of these, 9.8 million were men, while 13.35 million were women. He concluded in the article “Hardline Chinese elements today are convinced that it is their destiny to be the dominant power in the world. They are eager to colonize the South China Sea and to show the U.S. and India their place. They wish to invade and occupy Taiwan. This combination of arrogance and obfuscation is volatile and always ends in tragedy.”

Source: 6do.news, September 10, 2020
https://6do.news/article/3172752-60
The Indian Express, September 9, 2020
https://indianexpress.com/article/opinion/columns/china-population-crisis-birthrate-one-child-policy-6588472/

Briefings | | |   Economy/Resources

Internal Documents: Persecution of Falun Gong Is Part of Chinese Government’s Daily Business

The Epoch Times recently obtained a number of internal documents from different provinces in China. The documents show that the persecution of Falun Gong has been integrated into the Chinese Communist Party’s (CCP) routine activities, including the officials’ performance assessment, “combating pornography and illegal publications” work, “rural revitalization” activities, and even the recent epidemic prevention and control work.

“The 2019 Evaluation Indicators and Scoring Standards for Provincial City Leadership’s Career Development” and the “2019 Evaluation Indicators and Scoring Standards for Provincial City Leadership’s Party Buildup Work” are two documents that the Anhui provincial government issued  and which were forwarded by one of its subordinate city government staff members. “Party buildup” refers to the official’s work to expand the CCP organizations across the whole society. On the list of activities that are used to evaluate the performance of an official, two items explicitly mentioned Falun Gong. One item said, “conduct searches and solidly collect information on the ‘evil cult’, organize special campaigns to prevent and crack down on ‘Falun Gong’ and other ‘evil cult’ organizations, educate and control key ‘evil cult’ personnel during important activities and sensitive periods.” The other said “conduct in-depth conversion of ‘Falun Gong’ and other ‘evil cult’ members.”

The Chinese regime has been demonizing Falun Gong as an ‘evil cult’ ever since its persecution campaign started in 1999. The “conversion” here usually refers to using any and every means to force Falun Gong practitioners to give up their spiritual practice. These means often include coercion and physical torture.

“Incorporate ‘combating pornography and illegal publications’ into grassroots law and order work” is a document that the Wuhu city government in Anhui province issued. The document mentions the ability to “discover the clues about illegal publications that involve political and religious (evil cult) illegal propaganda.” The date of signing of the document was August 6, 2020. Falun Gong books were banned in mainland China right after the persecution was launched.

The persecution of Falun Gong is also part of the CCP’s “rural revitalization” work in Fuyang city, Anhui province. The mention of the crackdown on Falun Gong has appeared in internal documents such as the “2018 Fuyang Municipal CCP Committee’s Opinion on Promoting the Rural Revitalization Strategy,” and the “2018 Fuyang Municipal CCP Committee’s Opinions on Prioritizing the Agricultural and Rural Development and Doing a Good Job for Agriculture, for the Countryside and for Farmers.” The “Countryside Law and Order” section says to “crack down harshly on the infiltration into rural areas of hostile forces, ‘evil cult’ organizations, and illegal religious activities.” According to incomplete statistics from Falun Gong’s overseas website Minghui.org, between April 1, 2019, and May 10, 2019, 17 Falun Gong practitioners were captured in Fuyang city.

The Epoch Times also obtained internal documents from the Guye District of Tangshan city, Hubei province, and Huocheng County, Xinjiang autonomous region. The persecution of Falun Gong is mentioned as part of local governments’ daily obligations.

Source: The Epoch Times, August 30, 2020
https://www.epochtimes.com/gb/20/8/30/n12367319.htm

Briefings | | |   Government/Politics

Beijing Alleges Inner Mongolia Protesters “Incited by Overseas Forces”

The People of Inner Mongolia in China recently launched large-scale rallies to demand that the authorities cancel the so-called bilingual education to be implemented in the region in the new school year. [Editor’s note: three core subjects in Inner Mongolia are supposed to be taught in Mandarin, China’s official language. Many ethnic Mongolians view the move as a threat to their cultural identity.]

However, the authorities have refused to give in. According to Mongolian herders, the government has blamed the large-scale protests on “being incited by overseas forces.”

A Mongolian scholar Aricha told Radio Free Asia (RFA) that the roads between several banners and counties were blocked and the communications between the parents and teachers were severed. In addition, the authorities are searching for and arresting the demonstrators. A large number of armored personnel vehicles have been seen on the streets every day.

On Wednesday September 2, the police of Horqin Left Rear Banner issued a notice that demanded nine suspects to surrender. The police alleged that the nine persons mentioned gathered in elementary and middle schools in a number of towns in the Banner between August 28 and 30, and were suspected of breaking the law. Everyone who gives information to the authorities is rewarded with RMB 1,000 (US$146).

Farmers and herdsmen from Urad Middle Banner and Hure Banner in Tongliao City told RFA that to express their opposition, the vast majority of parents refused to send their children to school. In recent days, classrooms in Mongolian schools have been empty. In Hinggan League and Ulanhot, the local police are hunting down Mongolian students and forcing them to return to school.

The Urad Central Banner issued an “emergency notice” to all towns and villages, ordering Mongolian public servants to take their children to school before Wednesday evening to report. Those who do not attend school before noon on Thursday (September 3) will be subject to disciplinary sanctions and be expelled directly.

Tsakhiagiin Elbegdorj, former President of Mongolia, issued a video statement to urge the Chinese government to respect the ethnic rights of Mongolians to maintain their mother tongue and called on Mongolians around the world to show support.

Source: Radio Free Asia, September 3, 2020
https://www.rfa.org/cantonese/news/textbook-09032020075137.html

Briefings | | |   Social Stability

New add-on to China’s Social Credit System: Suzhou’s “Civilization Code”

Media in China reported that Suzhou, a city west of Shanghai, introduced a “Civilization Code” on September 3rd. It consists of a “civil transport index” and a “volunteer index,” with more indices and functions to be added in the future.

The civil transport index relates to manners on the road, such as traffic violations and voluntarily assisting with traffic duty, while the volunteer index is a measure of the degree of involvement in voluntary work, which the local authorities say aims to help strengthen awareness of social responsibilities and duty.

During the earlier days of the covid-19 epidemic outbreak, China introduced a “health code” to identify people’s health status and their movements. This invited widespread concern over the issues of privacy and social control. The new measure announced by the Suzhou city government also went viral in China’s cyber space.

People questioned on WeChat whether “scores” could actually quantify the degree of civilization. Others compared this to the British sci-fi series Black Mirror where there was a scoring system to distinguish good people from bad ones.

In 2014, the State Council issued the Planning Outline for the Construction of a Social Credit System. The main objectives were as follows. By the year 2020, to have established basic fundamental laws, regulations and standard systems for social credit and to have completed a credit investigation system that would cover the entire society with credit information and resource sharing as the basis. This would represent the basic completion of the credit supervision and management systems.

Source: Central News Agency, September 5, 2020
https://www.cna.com.tw/news/acn/202009050206.aspx

Briefings | | |   Social Stability

China-Argentina ‘Pig Deal’ Sparks Protests

Argentina’s citizens, including environmental and animal rights groups, are protesting a pork investment and export deal with China, a $3.5 billion agreement that makes Argentina the largest pork supplier for China. More than 200,000 people also signed an online petition to oppose the plan. As a result of the public pressure, the Argentine authorities have postponed signing the memorandum of understanding with China.

Activists accused the authorities of causing ecological damage. In the Atlantic coastal city of Mar del Plata, Juliet Paladino, a member of the environmental organization, told local media that Argentina does not have enough grain to feed the pigs. “This will mean more land to grow genetically modified corn, the destruction of wetlands and a number of protected areas. This agreement will destroy us.”

A press release that the Argentine Ministry of Foreign Affairs issued on July 6 mentioned the goal of an increase in the country’s pig production of 9 million tons in four years, 14 times the current output of 630,000 tons in 2019. China plans to invest US$3.5 billion within two to three years and build 25 local farms. Each will raise 12,000 pigs. The entire industrial chain includes fodder production plants, waste treatment and conversion tanks, slaughterhouses, and packaging and export factories.

Biologist Guillermo Folguera at the University of Buenos Aires (Universidad de Buenos Aires) told the BBC that such projects are likely to lead to (more of) “the zoonotic diseases we are currently experiencing.” He explained that intensively raised animals and the large number of chemicals and antibiotics may bring considerable risks. To a large extent, it is because of the outbreak of African swine fever that China has “outsourced” this risk to other countries.

China is the world’s largest producer and consumer of pigs. The number of live pigs once exceeded 440 million, almost half of the global stock. However, since 2018, the sudden outbreak of African swine fever has forced China to cull millions of pigs. Many farmers have stopped raising pigs, and China’s pork production has fallen by more than half.

Professor Folguera added that similar cases in countries such as Chile, Mexico and Spain show that such giant factories will lead to serious pollution of air, water and land. The pollutants include ammonia, nitrite, nitrate and antibiotics.

Argentine environmental writer Soledad Barruti worries about water consumption, as 6000 liters of water are needed to produce a kilogram of pork. “We not only export meat, but also millions of liters of water, but no one pays for it. Another problem is the waste and toxins produced by millions of animals.”

For years, China has been Argentina’s largest market for agricultural product and beef exports. In 2019, Argentina exported more than 630,000 tons of beef to China, accounting for three-quarters of its total beef exports. The cooperation between the two countries goes beyond agriculture. In April, China replaced Brazil and became Argentina’s largest trading partner. As early as 2014, when China proposed the “Belt and Road” initiative, then Argentine President Cristina Fernández de Kirchner already set her sights on the East after the government defaulted on US$100 billion of international debt. The two sides quickly finalized a number of projects involving cooperation, such as railways and nuclear power plants.

After Mauricio Macri, who tends to be conservative, came to power, he stopped or began to review a number of Chinese-funded projects. The relationship between the two countries temporarily cooled down.

When Alberto Fernández was elected President last year, the Argentine government restarted the Patagonia dam project. In July, he approved China’s space station project in Neuquén, South Argentina, an agreement reached with Christina Fernandez in 2014. Not long ago, a well-known local media Revista News (Revista News) used “ArgenChina” on the cover to describe the close relationship between the two countries. The background is a picture where President Alberto Fernandez wears a Chinese style bamboo hat.

Source: BBC Chinese, September 4, 2020
https://www.bbc.com/zhongwen/simp/world-54008386

Briefings | | |   Geo-Strategic Trend