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Lianhe Zaobao: Italy Tends to Withdraw from China’s Belt and Road Initiative

Singapore’s primary Chinese language newspaper Lianhe Zaobao recently reported that, according to people familiar with the matter, Italian officials have hinted in private meetings with Taiwanese officials that they may be willing to withdraw from China’s Belt and Road program in order to strengthen semiconductor cooperation with Taiwan. Officials from the Italian Ministry of Industry recently discussed plans on semiconductor production and exports with Taiwanese officials in Taipei. Relevant decisions will have to be made by Prime Minister Giorgia Meloni, but she has not made her final position public yet. Italy is the only member of the G7 countries participating in China’s Belt and Road Initiative. Although the participation agreement has had little practical impact ever since it was signed by then-Prime Minister Giuseppe Conte in early 2019, it is highly symbolic for Beijing amid tensions between China and the United States and its Western allies. The deal will automatically renew in 2024 unless Italy chooses to abandon it. A spokesperson for the Italian Ministry of Industry declined to comment on the above news. According to Taiwan media reports, Taiwan will open its second representative office in Italy in Milan this coming summer.

Source: Lianhe Zaobao, April 20, 2023
https://www.zaobao.com.sg/realtime/china/story20230420-1385160

Briefings | | |   Geo-Strategic Trend

The U.S. May Introduce Unprecedented Investment Restrictions on China

Well-known Chinese news site Tencent News recently reported that, since February 2023, multiple major U.S. media outlets have successively quoted U.S. officials in their reports, stating that the White House intends to prohibit U.S. companies from investing overseas in some advanced technology-related industries that may threaten national security. Although these reports did not mention any country,  people familiar with the matter broke the news that the new regulations formulated by the White House mainly involve U.S. investment in China. Earlier, the outside world generally believed that, as the world’s two largest economies, China and the United States are deeply connected in the economic field and Washington does not intend to turn its face away completely. Now it appears that the Biden Administration seems to be preparing for a complete showdown. The U.S. media revealed that the White House is preparing to introduce a comprehensive policy to contain China. Bloomberg did suggest that the U.S. government’s investment restrictions on U.S. companies may be too strict. They may cause companies to move their business from the U.S. to other countries. The new restrictions may end up having little benefit to national security and will further weaken America’s global competitiveness. It is worth mentioning that the U.S. media used the word “unprecedented” to describe the new regulations formulated by the White House. Therefore, for the time being, it can be regarded as a comprehensive policy of containing China. One report also showed that a U.S. official confirmed that the government has begun briefing groups such as industry organizations in the U.S. and the American Chamber of Commerce in China on the outline of the regulations. However, some details of the new policy are yet to be finalized.

Source: Tencent News, April 24, 2023
https://new.qq.com/rain/a/20230424A02N1600

Briefings | | |   US-China Relations

Fact Check: Beijing Gave Money to Attract Countries to Switch Diplomatic Ties from Taiwan to Itself

On March 27, China’s Foreign Ministry spokesperson Mao Ning claimed that China didn’t use money to influence or, in fact, to buy diplomatic relations with Honduras. Honduras cut its ties with Taiwan (the Republic of China) and established relations with Beijing (the People’s Republic of China) on March 26. Mao further claimed that there were no preconditions for Panama or any other country when they established relations with China in the past few years.

Radio Free Asia, however, did a fact check and found that Beijng’s claim was false. RFA concluded, “The People’s Republic of China has indeed set preconditions for establishing diplomatic relations with China and has provided a large amount of economic and non-economic assistance and incentives to attract countries if they would break off diplomatic relations with Taiwan.”

For example, Costa Rica established relations with Beijing in 2007. China committed to provide US$30 million in cash within two years of the establishment of diplomatic relations and an additional US$100 million to be delivered through China’s regular “turn-key” program.

Panama established relations with Beijing in 2017. Since then, China has provided US$1.86 billion in infrastructure and other investments to Panama. Beijing also donated US$143 million to Panama after establishing their relationship. It didn’t disclose the donation because it didn’t want to give the impression that “they pay a price (for countries) to break off from Taiwan.”

The Dominic Republic established relations with Beijing in 2018. From 2019 to now, China has provided US$490 million in infrastructure and other investments to the Dominic Republic. The research estimated that Beijing provided US$3 billion in financial aid to the country. China also donated US$30 million in 2021.

During the year when El Salvador established diplomatic relations with Beijing in 2018, Beijing provided El Salvador more than 3,000 tons of rice and pledged US$150 million in aid.

Immediately after the establishment of diplomatic relations in 2021, China pledged to donate one million doses of COVID vaccine to Nicaragua. In addition, Beijing reportedly provided an unspecified amount of supplies to the Nicaraguan police riot squad, where the Nicaraguan police force is led by the father-in-law of Daniel Ortega, the dictatorial President of the country.

It is not clear how much Beijing provided to Honduras to get it to switch sides. Reuters reported that before switching to Beijing, Honduras asked Taiwan for US$2.5 billion in aid which its Foreign Minister Eduardo Enrique Reina called “not financial aid” but a “negotiated refinancing mechanism.”

Source: Radio Free Asia, April 21, 2023
https://www.rfa.org/cantonese/news/factcheck/internationalrelations-04212023141728.html

Briefings | | |   @CS Economy/Resources Geo-Strategic Trend

The Overtime Phenomenon in China

Working overtime has become a common phenomenon in China. IT companies even have the “996” work style (work from 9 am to 9 pm for 6 days a week). An Internet article provided an analysis of the “China-style overtime.” It said that according to China’s National Bureau of Statistics, Chinese workers work on average 2,272 hours a year (or 9.2 hours per day). It listed eight characteristics of this “China-style overtime.”

  1. Overtime is usually forced though it may be called “voluntary.”
  2. Overtime usually applies to all employees (and therefore people won’t benefit from it since it is required of everyone).
  3. Overtime workers’ hours are usually unpaid or insufficiently compensated.
  4. Overtime in many instances occurs over a long term and is of a high intensity.
  5. Overtime can just be a formality and the work is not efficient.
  6. Overtime is a result of management’s lack of capability or low efficiency.
  7. Overtime sometimes is a vehicle to please the upper management or to suppress subordinates.
  8. Overtime may morph into a test of an employee’s obedience.

Source: China Digital Times, April 24, 2023
https://chinadigitaltimes.net/chinese/695261.html

Briefings | | |   Economy/Resources

Why Do Countries Choose Renminbi in Bilateral Trade?

Recently some countries such as Russia, North Korea, and Brazil agreed to the use of Renminbi (RMB) jn settlements in bilateral trade with China. Economist Yin Hetian gave three reasons for their decision:

The first is a political reason: Countries such as Pakistan, Laos, Cambodia, North Korea, and Iran receive financial support from Beijing. For this reason, they feel they are compelled to accept the RMB when exporting to China. However, there is not much for China to gain in this, since these countries “suck China’s blood.”

 

The second is the discounted goods from China. Russia and Brazil provide energy resources to China and have a trade surplus over China. China sells them goods of daily necessities, which they can also buy from other countries using the U.S. dollar. Therefore, China must sell its goods at a discount.

The third is China’s US dollar reserve. Those countries feel comfortable about the RMB because of China’s foreign reserve of 3 trillion US dollars. They put their dollar reserve in a different format: holding the RMB which links to China’s dollar reserve. If China’s dollar reserve is gone, then no one will want to take RMB.

Source: China News Center, April 24, 2023

失去庞大美元外汇储备支持 人民币在国际上就是废纸；说人民币能够取代美元的大外宣实际上是在害中国只有习近平不懂罢了

Briefings | | |   Economy/Resources Geo-Strategic Trend

Suicide Cases Are More Frequent In China

Suicide cases have been reported more frequently as the political and economic environments continue to deteriorate in China under the Chinese Communist Party’s (CCP’s) rule.

On April 25, a male from Linyi City, Shandong Province bought a knife at a convenient store and then cut his own throat right there.

On April 23, a man jumped out of a shopping mall in Shanghai and died. His body also hit and injured a woman who was shopping at the mall.

On the same day, two 5th grade girls from Xiangtan City, Hunan Province jumped out of a high building.

On April 20, three people came to a tourist site in Shifang City, Shandong Province and drank poison to commit suicide.

On April 4, four people from different provinces gathered at Zhangjiajie, Hunan Province, a famous mountainous site in China, took poison and then jumped off the cliff.

Source: Aboluowang.com, April 27
https://www.aboluowang.com/2023/0427/1894748.html

Briefings | | |   Social Stability

China Pilot Project: Paying Salaries with Digital Currency

China has been piloting the use of a digital currency issued by the state. Recently Changshu City, Jiangsu Province announced that, starting in May, it will make the salary payments for people working in the public sector in digital currency. The first pilot city to do so was Taichang City, also in Jiangsu Province, in July of last year. China has also started piloting digital currency and a digital wallet in 26 regions among 17 provinces.

Some people feel that digital currency can help prevent bribery or improper income. However, there are concerns about privacy and whether the government can use it as a weapon to suppress the people it wants to target.

Sources:
1. China.com, April 25, 2023
http://news.china.com.cn/2023-04/25/content_85251374.shtml
2. Central Network Agency, April 22, 2023
https://www.cna.com.tw/news/acn/202304220117.aspxApril 22, 2023

Briefings | | |   Economy/Resources

Chengdu Demolished Its 40-Billion-Yuan Green Way to Change the Land Back to Grow Crops

China used to call for a “green environment (绿化)” and promoted “turning farmlands back into forests (退耕还林).” However, it has now made    a 180 degree turn to stress growing more crops, or to “turn forests back to farmlands (退林还耕),” as it faces a shortage in its food supply both domestically and internationally.

Chengdu residents complained that some portions of the green beltway surrounding the city, which the city spent 40 billion yuan (US$ 6 billion) on  building has since been demolished and replanted with wheat. Even some parks have  been changed in order to grow crops, whereas the parks were once a big selling point for the nearby apartments.

A researcher also reported that village officials have been forced to take land back in order to grow crops. In some mountain areas, the local government encouraged peasants to build orchards. However, after people put all their savings into planting fruit trees, the government is now asking them to cut all the trees to grow crops.

Source: Epoch Times, April 25, 2023
https://www.epochtimes.com/gb/23/4/25/n13980976.htmi

Briefings | | |   Economy/Resources