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Chinese’ Companies Default Problems

On December 6, Epoch Times’ YouTube Channel “Crossroads of the World”  had a discussion on companies in China that are defaulting on their debt.

Host Tang Hao listed the following recent default cases in China:

  • October 24, Xiwang Group Company Limited, China’s largest corn oil producer, was unable to pay back its 1 billion yuan (US $140 million) short-term bond.
  • November 11, Guirenniao, a Chinese sneaker company could not pay its 500 million yuan bond.
  • November 19, Dongxu Optoelectronic Technology Co Ltd, China’s largest LCD glass substrate manufacturer, couldn’t pay its 2 billion yuan debt.
  • November 27, Xiwang Group couldn’t pay another debt of 861 million yuan.
  • December 2, The Beijing University Founder Group, the largest college-owned enterprise in China, defaulted on a 2 billion short-term bond. The company had 370 billion yuan in assets.
  • December 3, Guirenniao defaulted again, on a 647 million yuan debt.

Tang Hao gave three reasons for these defaults: One, many companies followed the government to take on excessive debts to seek high-expansion. Two, the trade war with the U.S. hurt China’s economy. Three, the owners of the companies, who have low moral values, do not feel any social obligation to pay back their company’s loans. They may just spend the money lavishly or put the borrowed money into their own pockets.

As a result, companies’ credit problems have also dragged down the banks:

  • In May, Baoshang Bank Co., Ltd. had a severe credit risk and the People’s Bank of China and the Banking Regulatory Commission took it over.
  • In July, the Bank of Jinzhou had a high cash risk and the Industrial and Commercial Bank of China had to infuse it with money.
  • In August, Hengfeng Bank in Shandong Province had a cash crisis and the Shandong government took it over.
  • In October, Yichuan Rural Commercial Bank in Luoyang City, Henan Province suffered a bank run that lasted three days.
  • In November, Yingkou Coastal Bank in Liaoning Province suffered a bank run.
  • In November, the government took over Harbin Bank in Heilongjiang Province.

Source: YouTube, December 6, 2019

Briefings | | |   Economy/Resources US-China Relations

Huawei’s “Wolf Culture” in Canada

Chinese people recently have been using the term “wolf culture” to describe a company or a person who behaves like a wolf, who is willing to take any measure to win, and who ignores human nature and morality.

Epoch Times interviewed some former employees of Huawei’s subsidiary in Toronto who took the opportunity to expose Huawei’s “wolf culture” in Canada.

1. Taking down Nortel: Huawei offered prices 40 percent below market so it could quickly grab the global telecom market. It was able to do so because of the Chinese government’s subsidies and the People’s Liberation Army’s “gift contracts.” In addition, from 2004 to 2009, the Chinese Communist Party’s (CCP’s) hackers had been consistently hacking into Nortel’s system to steal its secrets. Nortel filed for bankruptcy in 2009. Huawei was able to hire all of Nortel’s top five 5G experts and make them work for Huawei.

2. Operations in Canada: Huawei maintains a tight central control over its financial operations. It is the Chinese Headquarters in Shenzhen that makes the calls on major financial decisions for its overseas branches. The Shenzhen Headquarters must review all overseas branches’ pricing of equipment proposals and solutions. The Shenzhen headquarters has over 10,000 staff member managing its financial operations globally.

3. Discrimination on “Chinese Faces”: A former Huawei employee said that Huawei Canada has been discriminating against employees because of their race and age. This was the company’s culture in China.

Huawei’s CFO Meng Wanzhou visited Huawei Canada in Toronto in 2016. She was reported to be unhappy when she saw so many “Chinese faces” in the office there.

A former employee said, “(Huawei) prefers non-Chinese people for non-technical positions, such as the public relations positions,” so that the company can appear more “Westernized.”

A former Huawei employee recalled that a high-ranking executive did not like the high labor cost and said that he expected the salary of employees of Chinese origin to be much lower.

4. Discrimination on age: A high-ranking executive sent from China to Huawei Canada in 2016 launched a policy to “make employees younger.” Meng Wanzhou further strengthened this policy.

Chinese media have widely reported Huawei’s “age of 35” policy: If an employee reaches the age of 35 and has not become a manager, Huawei puts that person in a human resource database at the Headquarters in China; if no department wants the person, Huawei will let that person go.

“We often heard that so and so was fired for age,” a former employee said, “Though there is no written evidence, people have been discussing it.”

Another employee who was diagnosed with cancer and took sick leave was let go due to her age. Another employee, in her 50s, was let go too, despite the fact that she maintained a high performance rating. She complained to Huawei management that their action was age discrimination. Huawei denied discrimination but increased her severance pay. She protested again. Huawei increased severance pay again, but still didn’t offer to bring her back. She is considering taking legal action.

5. Communist Study: About 10 percent of the people at Huawei Canada’s Headquarters are from the Shenzhen Headquarters. They must participate in the CCP study every Saturday morning.

6. “Wolf Culture”: All employees, including those hired in Canada or sent from China, must follow the “wolf culture” that Huawei’s Founder Ren Zhenfei has promoted: employees must have the hungry wolf’s nature of being fearless and blood-loving, and must keep fighting in a tough team environment. “There are instructions (about ‘wolf culture’) on Huawei’s internal site for everyone to read and follow. Their idea is that, no matter what, you must fight for success, even if it means to step on your fellow coworkers. They asked us to read the ‘wolf culture’ articles and write learning reports to send to China’s Headquarters.”

“Employees work an average of 10 hours a day. It is normal for people to resume work after dinner. There is no overtime pay. Occasionally you hear a story that someone complained about it and was then fired. The company didn’t give a reason for the firing, but everyone knew why.”

If Huawei wants to fire someone, it creates a tough situation at work for that person, for example, increasing his workload and giving him a low rating, to force that person to leave.

Source: Epoch Times, December 7, 2019
http://www.epochtimes.com/gb/19/12/7/n11707767.htm

Briefings | | |   Economy/Resources Information/Technology

Deutsche Welle: The World Bank Terminated Its Controversial Loan to Xinjiang

Deutsche Welle reported that, on November 11, 2019, the World Bank decided to terminate its loan program and financial support to Xinjiang vocational schools amid questions of whether Beijing used the money to repress Uyghurs in Xinjiang.

The World Bank provided a US $50 million loan to the “Xinjiang Technical and Vocational Education and Training Project” in 2015.

In July, a World Bank employee wrote a lengthy email to an executive director on the bank’s board detailing concerns about the Xinjiang program. The employee listed numerous issues perceived as red flags and suggested that the program should be referred to an internal inspection committee for investigation to ensure that World Bank rules were being followed.

For example, according to a tender dated November 2018, Yarkand Technical School, which is managed by another school as part of the World Bank program, spent about $30,000 purchasing 30 tear gas launchers, 100 anti-riot batons, 400 sets of camouflage clothing, 100 sets of “stab-resistant clothing,” 60 pairs of “stab-resistant gloves,” 45 helmets, 12 metal detectors, 10 police batons, and barbed wire. It is not clear if this money came directly from the World Bank loan, or from other funding sources, but it points to a worrying cross-over between the camps and legitimate schools.

The employee’s concerns went unheeded.

On August 23, the U.S. Congressional Executive Commission on China issued a letter to World Bank President David Malpass expressing its concern.

On November 11, 2019, the World Bank decided to terminate the loan program. However, human rights organizations and experts were not satisfied since the World Bank didn’t release a thorough investigate result about how the money was used.

Source: Deutsche Welle, November 12, 2019
https://www.dw.com/zh/世银终止资助新疆职业学校-专家批治标不治本/a-51207170

Briefings | | |   Economy/Resources Geo-Strategic Trend Social Stability

Belgium Trade Delegation Experienced Severe Cyberattacks in Beijing

The media from Belgium reported that the Belgian Trade Delegation experienced severe cyberattacks that were as high as 135 times per hour, while visiting Beijing.

Princess Astrid, Defense Minister Didier Reynders, and Minister for Security and the Interior Pieter De Crem led the delegation to visit Beijing and Shanghai from November 17 to 22.

Accordingly to Geert Baudewijns, a Belgium network security expert who was a member of the delegation, found it to be suspicious that he saw mobile devices outside their hotel in Beijing and all of their network traffic had to go through some specific network system. He brought a few laptops to China. Using special monitoring tools, he found his laptops were hacked into fairly often. Cyberattacks against his computer were as high as 135 times every hour.

It was hard to pinpoint the attacker. From the IP address, Baudewijns felt it might be related to China’s National Security office.

Source: Epoch Times, November 23, 2019
http://www.epochtimes.com/gb/19/11/23/n11676371.htm

Briefings | | |   Defense/Military Geo-Strategic Trend

A Cartoon That Moved Many People to Tears

The Hong Kong people sent a major message to Beijing in the district council election on November 24, 2019. The election saw an unprecedented turnout (71 pecent of eligible voters showed up). The number of people voting has tripled the number of pro-democrats from 124 seats to 388 seats while the number of those who are pro-Beijing parties and independents shrank to only 62 seats, a drop of 242 seats.

A Taiwanese cartoonist, whose Facebook account is SXTbit, posted a cartoon about the vote. The cartoon has moved many people into tears. The following is the cartoon and the translation:

A Hong Kong mother knocked on the door of her daughter’s room: “Sweetheart, mommy’s coming in now!”

 

Holding a wipe in her hand, mother said, “Mommy went out to vote yesterday!”

 

While cleaning the desk, mother continued, “You always asked us to go out to vote. This time I also dragged your dad to go along!” “The line was really long!”

 

Sitting on her daughter’s bed, mother kept talking, “I voted for the young candidate whom you asked me to vote for!” “You know what? This time in our Wong Tai Sin District, the pro-Beijing camp didn’t win any seat at all!”

 

The scene zoomed out. In an empty room, the mother sat on her daughter’s bed and said with great mourning in her heart, “If you could hear this, would that give you a bit more comfort…”

Note: A poster on the wall said, “Five key demands, not one less!” Another one said “Support Hong Kong!”

Source: Facebook, November 24, 2019

[English]"Sweetheart, mummy's coming in now!"

Posted by SXTbit on Sunday, November 24, 2019

 

 

Briefings | | |   Geo-Strategic Trend Government/Politics

Who is Wang Liqiang?

A Chinese young man, Liqiang (William) Wang, defected to the Australian Intelligence Office (AUIO) a few months ago, revealing himself to be a Chinese spy stationed in Hong Kong. He said that he was working at the Hong Kong company listed as China Innovation Investment Limited (CIIL), which was a front company used by a number of different Chinese intelligence agencies. He reported to Xiang Xin, the Chairman, CEO, and Executive Director of CIIL, a key Chinese intelligence officer in Hong Kong. Xiang’s wife, Gong Qin, a Director of CIIL, is also a Chinese intelligence officer.

Wang revealed his work in Hong Kong and how he tried to influence Taiwan public opinion to be favorable towards Beijing. He also mentioned some Chinese spies in Australia. {1}

Australian media reported Wang’s case on November 23, 2019. The Chinese Communist Party (CCP) immediately denied Wang’s allegations, claiming that Wang was rather an economic fraudster and not a spy.

On November 23, Shanghai police claimed that they had opened an investigation, back on April 19, 2019, into Wang who allegedly embezzled 4.6 million yuan through a fake investment project involving car imports. The authorities claimed that Wang’s true name was Wang Liqiang and his passport used the name of Wang Qiang. {2}

On November 27, Huanqiu (Global Times), posted a video online that they claimed was a copy of a court trial of Wang at the Guangze County Court, Nanping City, Fujian Province on October 14, 2016. In the video, the defendant stated that he was Wang Liqiang and admitted to the charge of embezzling 120,000 yuan. This was the first case against Wang; Shanghai’s case was the second one. However, some commentators challenged the authenticity of the video, questioning why the video didn’t provide a clear view of Wang’s face, though in theory Chinese courts has multiple cameras to capture court scenes including the defendant and attorneys. {3}

The Australian 60 Minutes program pointed out that Wang stated that, “Wang Liqiang” is just a fake name he used for the interview. His real name has not been revealed. However, the CCP’s claims were made against someone with the name of “Wang Liqiang.” {4}

On November 24, Taiwan authorities detained Wang’s boss Xiang Xin and Xiang’s wife, both of whom were visiting Taiwan and were about to board a plane to leave. The Xiang couple denied knowing Wang or that Wang was not an employee of CIIL. Then the Taiwan prosecutors showed a picture of the couple and Wang standing together. The Xiang couple could not explain why they stated earlier that they did not know Wang. {5}

Sources:
1. The Age, November 23, 2019
https://www.theage.com.au/national/defecting-chinese-spy-offers-information-trove-to-australian-government-20191122-p53d1l.html
2. ABC, November 24, 2019
https://abcnews.go.com/International/wireStory/china-confessed-spy-seeking-asylum-fraudster-67262588
3. Huanqiu, November 27, 2019
https://china.huanqiu.com/article/9CaKrnKo1GG
4. Sound of Hope, November 24, 2019
https://www.soundofhope.org/post/316253
5. Next Magazine, November 26, 2019
https://tw.nextmgz.com/realtimenews/news/484558

Briefings | | |   Geo-Strategic Trend

Malaysia Chinese Newspaper Follows Directives from the CCP

The Central News Agency of Taiwan reported that See Hua Daily News, the largest Chinese language newspaper in Eastern Malaysia, was receiving directives from the Chinese Communist Party (CCP).

An internal directive from the See Hua Daily News stated that, per a request from the Chinese Consulate in Malaysia, because Taiwan and Hong Kong are China’s territories, news reports and their titles from now on should avoid listing “China, Hong Kong, and Taiwan” in parallel. If these three regions need to be mentioned together, it should be written as “China (including Taiwan and Hong Kong).” The directive was signed by the newspaper’s Editor-in-Chief, Chia Chew Boon.

People criticized the CCP’s interference in Malaysia’s internal affairs.

A high-ranking person from one of See Hua’s sister media companies confirmed that the directive was true, but said the owner didn’t know about it. After it was reported, the owner ordered a withdrawal from the directive.

That person also revealed that the Chinese consulate staff members frequently have meals with the top managers of the Chinese language newspaper in Malaysia and continuously express what direction and position the CCP wants that media to hold. Especially after the Hong Kong protest, the CCP wants Malaysian reports to be close to the CCP’s position.

Source: Central News Agency, November 17, 2019
https://www.cna.com.tw/news/aopl/201911170002.aspx

Briefings | | |   Geo-Strategic Trend Government/Politics

A Canadian CSSA Lost Its Student Club Status for Reporting to Chinese Consulate

The Chinese Student & Scholar Association (CSSA) of McMaster University in Ontario, Canada was decertified and its club status was removed because it was monitoring college activities and sending information to the Chinese government.

On February 11, 2019, the university held a forum to support the Uyghurs in Xinjiang. The CSSA, along with another four student associations, called that meeting an “anti-China lecture” and reported it to China’s Consulate in Toronto, CA.

Deutsche Welle obtained the Chinese students’ communication from WeChat, including their reporting to the Chinese Consulate and passing down the Consulate’s direction.

The WeChat records showed some students sent the forum’s video to China’s Consulate, some students went to the forum to create a disturbance, and some posted and sent a threatening request in order to find out the name of the son of the speaker at the forum.

The Chinese Consulate responded by asking Chinese students at McMaster University to report the case to their CSSA.

The student representative assembly at the university decertified the CSSA in September for a full calendar year, during which it will be denied club privileges such as being able to book a room and access to student union funding.

None of four other student associations that signed the February statement has faced disciplinary action. One of them testified in writing that it had signed the statement at the invitation of the CSSA’s then-president.

The CSSA filed an appeal. The university’s student union government rejected the appeal on November 3. It also passed a motion to oppose the CCP or the CSSA for trying to “directly or indirectly intervene in college political activities.”

Source: Epoch Times, November 5, 2019
http://www.epochtimes.com/gb/19/11/5/n11635793.htm

Briefings | | |   Geo-Strategic Trend Government/Politics