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China’s CRRC Drops Out of Bidding After EU Subsidy Probe

On February 16th, the European Union announced a subsidy investigation against China Railway Rolling Stock Corporation (CRRC). CRRC Qingdao Sifang Locomotive & Rolling Stock Co., Ltd. was suspected of relying on state subsidies to submit a bid with an undue advantage in the tender for electric trains in Bulgaria. The Bulgarian tender was for the purchase of 20 electric trains and maintenance for the next 15 years, with a total value of approximately 610 million euros (660 million US dollars).

On March 26th, the European Commission stated that CRRC withdrew its bid, and that because of the CRRC’s withdrawal, the EU will terminate the investigation.

Thierry Breton, the EU’s Internal Market Commissioner, said “In just a few weeks, our first investigation under the Foreign Subsidy Regulations has already produced results.”

The European Union has recently intensified its scrutiny of Chinese companies that may receive state subsidies to gain bidding advantages. Ursula von der Leyen, President of the European Commission, announced an investigation in September of last year into Chinese government subsidies potentially causing “artificially depressed” prices for Chinese electric vehicles hitting the European market.

Source: VOA, March 27, 2024
https://www.voachinese.com/a/china-withdraws-from-balgaria-tender-20240326/7543652.html

Briefings | | |   Economy/Resources Geo-Strategic Trend

Xinhua Commentary: Pacific Island Countries Should Not be Anyone’s “Backyard”

Xinhua News Agency published a commentary regarding a statement by Linda Thomas-Greenfield, the U.S. ambassador to the United Nations. Thomas-Greenfield made the following statement in an interview on April 1st:

“[The U.S. is] not trying to force countries to choose between us and China. What we’re doing is giving them a choice to make. Many countries will say we’re forced into these relationships because we don’t have other choices. We’re giving them those other choices. And those other choices mean having the U.S. have their backs, having the U.S. standing with them side by side as they address some of the challenges that China is forcing upon them.” [2]

Xinhua called the statement “not only illogical but also a misrepresentation of the facts.” It stated that the Pacific Island countries have the political wisdom to make their own decisions. Below are some translated excerpts from the commentary:

“In recent years, the U.S. has been aggressively promoting the “Indo-Pacific strategy,” from the AUKUS (security partnership among the US, UK, and Australia), to the QUAD (quadrilateral security dialogue among the US, Japan, India, and Australia), and further to the “Blue Pacific Partnerships” initiative (involving the US, Australia, Japan, New Zealand, and the UK). The United States has gone to great lengths in creating various “circles” to contain China, enticing and utilizing Pacific Island nations as a crucial part of its containment strategy. However, the United States underestimates the political wisdom of the Pacific Island countries in discerning the current situation, as well as their determination to pursue an independent and autonomous development path.”

“In April 2022, China signed a government-to-government security cooperation framework agreement with the Solomon Islands. In July 2023, China and the Solomon Islands formally established a comprehensive strategic partnership based on mutual respect and common development in the new era. During the 2024 Boao Forum for Asia Annual Conference, President Lionel Aingimea of Nauru stated that, as a Pacific Island nation and a developing country, Nauru supports “building bridges” rather than “erecting walls” and hopes to construct a more integrated and closely-connected world.”

“Fiji Prime Minister Frank Bainimarama recently stated that China’s assistance to Pacific Island nations has played an important role in regional development.”

“The various slanders and smears by the U.S. against China’s pragmatic cooperation with Pacific Island nations will only expose the U.S.’ domineering attitude of judging others by its own standards. Pacific Island nations are independent sovereign states and not anyone’s “backyard.”

Sources:

Xinhua, April 4, 2024
http://www.xinhuanet.com/world/20240404/7934d20bdc9c476c81c1035425ffdc4a/c.html

CSIS, April 1, 2024
https://www.csis.org/analysis/us-ambassador-united-nations-linda-thomas-greenfield-us-diplomacy-pacific-islands

Briefings | | |   Geo-Strategic Trend US-China Relations

China Makes Progress on eVTOL Aircraft Development

China has made progress in development of electric Vertical Take-Off and Landing (eVTOL) aircraft. China views the eVTOL platform as a revolution in aviation. “Similar to the transition from gasoline cars to electric cars on the ground, [a transition] from gasoline-powered helicopters to eVTOL aircraft [is occurring],” said Xie Jia, Senior Vice President of Fengfei Aviation Technology, Shanghai.

On October 10, 2023, the Ministry of Industry and Information Technology, the Ministry of Science and Technology, the Ministry of Finance, and the Civil Aviation Administration of China jointly issued an “Outline for the Development of a Green Aviation Manufacturing Industry (2023-2035)” proposing that, by 2025, eVTOLs will achieve pilot operation. The outline further proposes that, by 2035, new types of general aviation equipment characterized by unmanned, electric, and intelligent features will achieve commercialization and large-scale application.

In October 2023, China had its first flight of a 2-ton eVTOL in Shanghai. The aircraft, the M1, was developed by the Future Wing Company in Shanghai. The vehicle became China’s first independently-developed and domestically-produced 2-ton eVTOL. Production was domestic in all three core areas: electric systems, flight control systems, and composite materials. The M1 has a composite wing configuration with 20 rotors, a maximum payload of 500 kilograms, seating for 5 people, a cruising speed of 200 kilometers per hour, and an intended range of 250 kilometers. It can meet short-distance air travel needs within and between cities, shortening travel time from 2-3 hours to around 30 minutes.

In March of 2024, the eVTOL “Shengshi Long” took off from Shenzhen and landed at the Zhuhai, both in Guangdong Province, covering a distance in 20 minutes that would have taken 3 hours by car. This was the world’s first public demonstration of an eVTOL flight that traveled over water and between cities. The aircraft was developed by Shanghai Fengfei Aviation Technology Co., Ltd., with a takeoff weight of 2 tons, seating for 5 people, a cruising speed of up to 200 kilometers per hour, and 100 percent domestic production of its core modules.

Sources:
1. People’s Daily, October 31, 2023
http://sh.people.com.cn/n2/2023/1031/c176738-40623560.html
2. People’s Daily, March 2, 2024
http://ent.people.com.cn/n1/2024/0302/c1012-40187361.html

Briefings | | |   Information/Technology

Ministry of State Security Creates Short Film to Warn Chinese Companies of Spying by Foreign Consulting Firms

Beijing recently held the China Development Forum, where Xi Jinping met in person with representatives of  foreign companies on March 27th and showed an open attitude toward those companies. On March 28th, however, the Chinese Ministry of State Security released a short film warning the Chinese people to be vigilant about foreign consulting companies’ potential theft of sensitive information in key areas.

The ministry’s WeChat account posted the film under the title “Beware! ‘Secret’ Investigations Conceal National Security Risks.” The film charged that, in recent years, “foreign espionage and intelligence agencies” have conducted espionage operations, and that the movie was based on real cases.

The movie lasts about 8 minutes and 22 seconds and is divided into 4 segments for broadcast. It reveals how “foreign espionage and intelligence agencies” instructed “overseas investigative consulting companies” to take advantage when Chinese companies seek overseas investment. These consulting companies conduct comprehensive investigations on the company to “obtain core data and national secrets” resulting in “losses to national security and interests.” They use methods such as enticing company personnel to answer sensitive questions, accessing sensitive information beyond the scope of their work, and filming sensitive files related to core products.

The Ministry of State Security reminded the Chinese people about China’s “Counter-Espionage Law” and its “Regulations on Management of Foreign-Related Investigations,” emphasizing that “national security is everyone’s responsibility.” Citizens who discover “suspicious situations that endanger national security” should immediately call to make a report.

Source: Central News Agency (Taiwan), March 28, 2024
https://www.cna.com.tw/news/acn/202403280311.aspx

Briefings | | |   Government/Politics

Shenzhen Issues Plan to Promote Development of HarmonyOS Operating System

HarmonyOS is a distributed operating system (OS) developed by Huawei for smartphones, tablets, smart TVs, smart watches, personal computers and other smart devices.

On March 3rd, the government of Shenzhen issued the “Shenzhen Support for Open Source HarmonyOS Native Application Development 2024 Action Plan” to promote the Chinese version of this OS.

The plan puts forward specific development goals and directives for the development of the HarmonyOS software ecosystem by the end of 2024:

  • The number of HarmonyOS native applications developed in Shenzhen should account for over 10 percent of the national total;
  • major industries in Shenzhen are to be fully served by native applications targeting HarmonyOS;
  • HarmonyOS development courses will be offered in major universities and training institutions in Shenzhen;
  • the number of certified HarmonyOS developers will account for over 15 percent of the national total;
  • establish at least two industrial parks that rely primarily on HarmonyOS-based applications and software;
  • there will exceed 1000 software companies with staff who are qualified in HarmonyOS application development;
  • promote the stable operation of the HarmonyOS Ecosystem Innovation Center, providing public services such as showcasing and promoting HarmonyOS native applications, and talent cultivation; and
  • officially launch and expand the global Smart Internet of Things (IoT) Alliance to continuously increase the international influence of HarmonyOS applications.

The plan also encourages capable enterprises to expand outsourcing services for development of HarmonyOS-native applications, aiming to reach a scale of 500,000 HarmonyOS developers.

By the end of 2023, a total of 49 enterprises in Shenzhen had participated in the construction of the open-source HarmonyOS ecosystem, contributing 133 products and 11 software distributions. The open-source HarmonyOS community has more than 250 ecosystem partners, 35 project donors, 173 partners passing the HarmonyOS compatibility evaluation, and over 230 commercial devices in fields such as finance, education, smart home, transportation, digital government, industry, and medical care.

Source: Xinhua, March 3, 2024
http://www.news.cn/local/20240303/dca3e6d4bd734380b4dc9602d5df9b76/c.html

Briefings | | |   Government/Politics Information/Technology

Secretariat of China-Central Asia Mechanism Launched

The launching ceremony of the Secretariat of the China-Central Asia Mechanism (CCM) was held in Xi’an, Shaanxi Province on March 30. China’s Foreign Minister Wang Yi and the foreign ministers of the five Central Asian countries — Kazakhstan, Kyrgyzstan, Tajikistan, Turkmenistan, and Uzbekistan — sent congratulatory letters.

Wang Yi stated that the CCM was established four years ago, helping cooperation between China and the countries of Central Asia to develop at a rapid pace. China’s Xinhua news agency stated that “The launch of the secretariat marks the implementation of the heads of states’ consensus and once again demonstrates to the international community the firm determination of the six countries to work together to pursue development and promote cooperation side by side.”

Source: Xinhua, March 30, 2024
http://www.news.cn/politics/leaders/20240330/4b872c0eb352441989dd9063866fafd3/c.html

Briefings | | |   Geo-Strategic Trend

Chinese Social Media Celebrates Baltimore Bridge Collapse

The Francis Scott Key bridge, located in Baltimore, Maryland, collapsed on March 26th after being rammed by a cargo ship, the Dali, which lost control of its steering. Much of the bridge sank into the river within seconds of being rammed.

The accident immediately drew attention on Chinese social media. On Weibo, for example, a video of the accident has been viewed more than 1.2 million times. On Chinese social media platforms, where anti-American sentiment is prevalent, many netizens celebrated the incident. A Weibo blogger named “Air Sky Toner” wrote: “This is a really beautiful sight, like watching a movie; this bridge is free from now on.”

The bridge was named after Francis Scott Key, the author of the lyrics of the U.S. national anthem “The Star-Spangled Banner.” Some Chinese netizens inferred that the bridge collapse signaled the decline of the United States. “It is not a good sign that this bridge collapsed,” one blogger wrote.

Some social media users also used the bridge collapse to mock American democracy. On the Chinese video website Bilibili, a commentary video with 24,000 likes said that the “a ship of democracy” caused the collapse of “a bridge of democracy.” The video went on to criticize the U.S.’ infrastructure problem.

False information about the accident spread widely on Chinese social media. A number of bloggers with large numbers of followers have claimed that the captain of the Dali was from Ukraine and that the accident was staged by the U.S. government. Some bloggers posted photos of the alleged Ukrainian captain’s credentials. The Associated Press found that a Ukrainian captain did indeed pilot the Dali years ago, from March 19 to July 27, 2016.

Some Chinese bloggers also claimed that CNN incorrectly reported that the collision was an attack from China. They posted screenshots with captions reading “A cargo ship loaded with Chinese goods attacked our bridge!” However, unlike Chinese media that often use the term “our country” to refer to China, American media, including CNN, rarely use that term to refer to the United States. According to Agence France-Presse (AFP), the screenshot was not from CNN, but from NBC’s local channel in Baltimore. In a statement to AFP, CNN said that it had never run a story like that; the image was fake, and the caption, font, and style are not CNN’s either.

Source: VOA, March 31, 2024
https://www.voachinese.com/a/baltimore-china-disinformation-20240329/7549288.html

Briefings | | |   @CS US-China Relations