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Corruption Allegation in Namibia involves 5G deal with Huawei

As the “Five Eyes Alliance” countries are taking countermeasures against China’s telecom giant Huawei, Huawei continues to accelerate its expansion in Africa.

Al Jazeera ran an exclusive report on July 15 that Brunhilde Cornelius, a city councilor in Namibia’s capital city Windhoek, disclosed that, in order for Huawei to obtain an exclusive contract for 5G network construction in the city, a local politician was bribed and asked to give up her opposition to the deal.

Earlier this year, Cornelius publicly opposed the memorandum of understanding (MOU) between the city council and Huawei. According to Al Jazeera, Cornelius filed a charge with the police on June 19. Cornelius, who is also the secretary-general of the opposition Rally for the Democracy and Progress Party (RDP), alleged the bribe was offered by Nicanor Ndjoze, her colleague who is also the RDP’s director of elections. Ndjoze allegedly paid bribes on behalf of his nephew, Reckliff Kandjiriomuini, the head of the Information and Communication Technology (ICT) division of the City of Windhoek (COW).

Cornelius said that Ndjoze mentioned a bonus fund of about US$2.4 million, which could be used for potential beneficiaries of the deal that would give Huawei the exclusive right to develop local 5G network construction. She was told that she could receive an amount between US$300,000 and US$360,000 dollars. According to Cornelius, Ndjoze told her on May 12 that she could get the money if she gave up her opposition to the MOU. Allegedly, Ndjoze also told Cornelius that his nephew, Kandjiriomuini, led the transaction with Huawei. Kandjiriomuini hoped that Ndjoze would help persuade his party members to accept bribes and sign the MOU.

Andy Keiser, a former professional staff member of the U.S. House of Representatives Intelligence Committee testified before the U.S. Congress in June 2018, exposing that Huawei and ZTE have been subject to corruption investigations, charges, or corruption convictions in as many as 21 countries in the past 12 years. In 2009, Nuctech, a Chinese state-owned IT firm was involved in a bribery and corruption case in Namibia.

Source: Radio Free Asia, July 17, 2020
https://www.rfa.org/cantonese/news/bribe-07172020091246.html

Briefings | | |   Geo-Strategic Trend

Beijing to Deploy Korean War TV Dramas to Arouse Nationalism

China’s National Radio and Television Administration (NRTA) is a ministry-level executive agency that controls state-owned TV and radio broadcasters, as well as other non-state movie and television studios. On July 17, NRTA held a nationwide video conference with its subsidiary entities to arrange and schedule TV dramas that have the theme of the Sino-Japanese War during WWII and the Korean War. The Chinese government has been calling the former  the War of Resistance against Japanese Aggression and the later the War to Resist US Aggression and Aid Korea. It also emphasized TV dramas with the themes of battling the corona virus so as to “tell the touching story of China’s action against the (Wuhan) pneumonia epidemic.”

The year 2020 marks the 75th anniversary of the victory in the Sino-Japanese War, which was actually fought by the Nationalist government, the predecessor of today’s Taiwan government. It lost the civil war to the Communists in 1949. To Beijing, the Sino-US relations pose the biggest challenge since the establishment of diplomatic relations. The theme of the Korean War has also become the focus of the regime’s propaganda. Claiming to be the winner of the war, for decades, the Chinese Communist Party has been using it to promote anti-American nationalist sentiments .

Source: Central News Agency, July 23, 2020.
https://www.cna.com.tw/news/acn/202007230400.aspx

Briefings | | |   US-China Relations

RFA: “Xi Jinping Research Center for Diplomatic Thought” Deviates From Deng’s Diplomatic Principal and Promotes “Wolf Warrior” Diplomacy

Xinhua reported that the inauguration ceremony of the Xi Jinping Research Center for Diplomatic Thought was held in Beijing on July 20. Comments from China experts overseas show they believe that the establishment of this center means that China has formally bid farewell to Deng Xiaoping’s diplomatic principle of “hiding our capacities and biding our time.” Instead, it promotes the “wolf warrior” diplomacy that China has pursued in recent years.

The China Institute of International Studies set up the research center under the direction of the Ministry of Foreign Affairs. It aims “to coordinate national research resources, and to conduct comprehensive, systematic and in-depth research, interpretation, and publicity with regard to Xi Jinping’s diplomatic thoughts. … It focuses on studying the nature, theory, practice, communication, policies, and specific subjects of Xi Jinping Thought on the subject of Diplomacy … enabling and supporting the guiding role of Xi Jinping’s diplomatic thinking on diplomatic practice. … It also makes a positive contribution to opening up a new era of major country diplomacy with Chinese characteristics.”

Chinese Foreign Minister Wang Yi stated at the ceremony that, in the face of the uncertain international situation, Xi Jinping’s diplomatic thoughts must be used as the fundamental guiding principles to maintain (China’s) strength in chaos, seize opportunities in changes, and continue to make breakthroughs in a new era of major country diplomacy with Chinese characteristics.

It is believed that, since Xi Jinping came to power, the CCP has reversed its course on the party’s ruling ideology on diplomacy.

Sources:
1. Xinhua, July 20, 2020
http://www.xinhuanet.com/2020-07/20/c_1126262860.htm
2. Radio Free Asia, July 21, 2020
https://www.rfa.org/mandarin/yataibaodao/zhengzhi/gf1-07212020071317.html

Briefings | | |   Government/Politics

Top Apple Supplier Foxconn to Invest $1 Billion in India

Well-known Chinese news site Sina (NASDAQ: SINA) recently reported that, per a strong request from Apple, its top supplier Foxconn is about to invest US$1 billion in Southern India to expand it manufacturing capacity. With the trouble of trade disputes between China and the United States, as well as the coronavirus impact, this is part of Apple’s quiet plan of moving its manufacturing center out of China. According sources familiar with the plan, Foxconn will establish a new factory in Sriperumbudur – 50 kilometers from Chennai. The factory will mainly be used to assemble the iPhone XR. The investment plan will create around 6,000 new jobs. Some of the other iPhone models currently made in China will move to this new factory as well. Currently Foxconn already has some capabilities in India  to assemble low-end iPhones. Foxconn refused to comment on any news regarding its customers and their products. Apple did not respond to this report either.

Source: Sina, July 12, 2020
https://finance.sina.com.cn/stock/s/2020-07-12/doc-iivhvpwx4949394.shtml

Briefings | | |   Geo-Strategic Trend Information/Technology

Lianhe Zaobao: Deutsche Bank Asian CEO Office Moved to Singapore

Singapore’s primary Chinese language newspaper Lianhe Zaobao recently reported that Deutsche Bank just announced its new Asian-Pacific CEO Alexander von zur Muehlen will move the office of his new regional headquarters to Singapore. He is replacing  Werner Steinmueller, who is retiring and still has his office in Hong Kong. Another member of the leadership team of the Bank, Kamran Khan, will also move to Singapore. Singapore has long been the competitor of Hong Kong to be the central hub of the Asian-Pacific financial market. Nearly all major banks like Goldman Sachs, JP Morgan Chase and Citigroup have their Asian Chiefs in Hong Kong. However, in the past couple of years, Hong Kong’s political stability has been under serious question and is now at the center of the storm between China and the U.S. Currently Singapore also has Credit Suisse as well as UBS who have their Asian-Pacific chiefs there. Singapore has played a significant role in Deutsche Bank’s Asian-Pacific strategy for many years.

Source: Lianhe Zaobao, July 16, 2020
http://www.uzaobao.com/bolg/20200716/74896.html

Briefings | | |   Geo-Strategic Trend

Countries Move Supply Chains from China; Japan to Subsidize 87 Companies to “Exit China”

Relocating manufacturing and supply chains out of China has become a trend amid the COVID 19 outbreak.

Japans’ Ministry of Economy, Trade and Industry announced on Friday July 17 that the first group of Japanese companies had received “exit China” subsidies. These subsidies are designed to help Japanese companies move manufacturing from China to Southeast Asia or back to Japan. According to the Nikkei Asian Review, 87 Japanese companies or groups will receive a total of 70 billion yen ($653 million) in funding. These funds will be used to transfer production lines to reduce Japan’s dependence on China and establish a flexible supply chain. Among them, 30 companies will shift production to Southeast Asia. Hoya, a hard disk components manufacturer, will relocate its factories from China to Vietnam and Laos. Sumitomo Rubber Industries will produce nitrile rubber gloves in Malaysia, while Shin-Etsu Chemical will shift the production of rare earth magnets to Vietnam. The remaining 57 companies will be relocated to Japan.

Household product manufacturer Iris Ohyama currently produces masks in factories in Dalian and Suzhou, China. Non-woven fabrics and other major materials are purchased from Chinese companies. With the help of Japanese government subsidies, the company will start producing masks at the Kakuda plant in Miyagi Prefecture in northern Japan. All materials will be prepared locally, independent of overseas suppliers. Saraya, a manufacturer of sanitary products, is also eligible for subsidies. The company’s products include alcohol-based disinfectants.

The Japanese government allocated 220 billion yen (US$2.05 billion) in the supplementary budget for fiscal year 2020 to establish a subsidy program to encourage companies to relocate factories from China to Japan. Among them, 23.5 billion yen (US$0.22 billion) was used to promote the transfer of production lines from China to Southeast Asian countries.

Aside from Japan, Australian rare earth supplier Lynas has also previously stated that the outbreak of the epidemic highlights the importance of the decentralization of the supply chain from China. Lynas announced back on May 20, 2019 that it would build a rare earth processing plant in the United States, and signed a memorandum of cooperation with Texas manufacturer Blue Line Corporation. The U.S. government has repeatedly stressed the need to move the supply chain out of China. The White House chief economic adviser Larry Kudlow said in May that the Trump administration was willing to compensate American companies to help them move their supply chain out of China and Hong Kong and back to the U.S. The Times reported that British Prime Minister Johnson has ordered the “Project Defend” plan to end Britain’s dependence on the importation of key products from China, including pharmaceuticals and other strategic imported products. According to Agence France-Presse, before the outbreak, an investigation found that 104 German companies have decided or are considering withdrawing production capacity from China. In 2020, many companies in Taiwan made moving their production out of China an operational focus. According to a previous report in Science and Technology News, Quanta, Compal, Pegatron, Wistron, Inventec, Hon Hai, and others will work on relocating their production lines outside of China this year.

Source: Epoch Times, July 19, 2020
https://www.epochtimes.com/gb/20/7/19/n12267649.htm

Briefings | | |   Economy/Resources

UDN: Taiwan Representatives in Hong Kong Were Refused Visas

United Daily News (UDN), one of the primary Taiwanese news groups, recently reported that the Taipei Economic and Cultural Representative Office in Hong Kong said that several leaders did not receive their visas upon renewal. Four of the five group leaders in the Hong Kong Office left Hong Kong and returned to Taiwan. The Office is still operating. The Taiwanese government concluded that the officials were refused their visas due to the fact that they did not agree to sign the document that recognizes the “One China” policy. The Office performs the equivalent functions of an embassy in Hong Kong. Currently the Hong Kong Office does not even have a Chief Officer. The Taiwanese media described the situation as the direct result of the new Hong Kong National Security Law taking effect. In addition to top level group leaders of the Office, multiple secretary personnel are also waiting for visa renewals. The Hong Kong government did not respond to their renewal applications. The Office is still providing Taiwan visa services to foreigners and Hong Kong local residents. The Hong Kong government declined to comment on this matter.

Source: UDN, July 17, 2020
https://udn.com/news/story/7331/4709076

Briefings | | |   Geo-Strategic Trend

VOA: China’s Largest Private Enterprise Rare Challenge to the Authorities Takeover Was Quickly Silenced

Tomorrow Holding Group, China’s largest private company, issued a statement on Saturday, July 18, publicly slamming regulators’ takeover of its nine financial companies. However, this rare public challenge was quickly silenced in the social media.

The China Banking and Insurance Regulatory Commission and the China Securities Regulatory Commission announced on Friday July 17 that they will take over the nine companies that Tomorrow Holding Group owned: Tian An Property Insurance, Huaxia Life Insurance, Tian An Life Insurance, Yi An Property Insurance, New Times Trust, New China Trust, New Era Securities, Guosheng Securities, and Guosheng Futures. At the end of 2019, the total assets of these companies exceeded 1.2 trillion yuan (US$0.17 trillion). Among them, Huaxia Life Insurance’s assets accounted for nearly half of all assets, about 587.3 billion yuan (US$83.99 billion).

Tomorrow Holding was accused of putting multiple financial assets at risk, that its founder owned them secretly and that the founder illegally owned or controlled a large number of financial licenses through countless shell companies and has sat on a large amount of financial institution funds for a long time. They were said to have caused the major shareholders to be trapped in a debt crisis. The action by the regulatory commissions marked the final collapse of this comprehensive financial enterprise that the once popular character Xiao Jianhua controlled. Chinese industry insiders commented, “Tomorrow has become yesterday.”

The statement that the Tomorrow Holding Group issued said that the company has been actively working on asset disposition, but the regulatory body’s sudden takeover has disrupted their work. The statement said that the companies have no liquidity risk have had no protests from the investors, and that the regulator exaggerated the risks.

In China, it is rare for listed companies, especially private companies, to challenge the authorities’ decisions openly after being investigated and punished by regulatory authorities. The statement Tomorrow Group issued was immediately deleted from all social accounts. The official message from Wechat stated that the contents violated the regulations.

Xiao Jianhua founded the Tomorrow Holding Group in 1999. Over the past 20 years, Xiao has developed the company in many fields including finance, industry, real estate, communication services, energy, and the Internet. At the end of January 2017, Xiao Jianhua was secretly arrested in Hong Kong and then returned to the mainland.

Source: Voice of America, July 18, 2020
https://www.voachinese.com/a/china-s-tomorrow-holdings-slams-seizure-of-its-financial-firms-20200718/5507955.html

Briefings | | |   Economy/Resources