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China’s State Think Tank: China’s AI Technology Is Leading the World

The 2022 World Artificial Intelligence Conference (WAIC) was held in Shanghai from September 1 to 3. At the conference, the China Institute of Science and Technology Information, an institute under China’s Ministry of Science and Technology, released the “2021 Global AI Innovation Index Report”

The report assessed 46 countries on their AI innovation index and divided them into a list of four tiers. Tier 1 has only the U.S. and China, both of which have a significant lead over the countries in the other tiers. Tier 2 has 9 countries, including South Korea and the U.K. Tier 3 has 13 countries, including Sweden and Luxemburg. Tier 4 has 22 countries, including India and Russia.

The report said that, in recent years, China’s AI capabilities have kept increasing. The gap between its overall score and that of the U.S. has been closing. The strength of China’s AI capabilities are in the following areas:

  1. Increasing in the influence of its open source projects.
  2. Maintaining the world’s number one position in the number of super-computing centers and being among the world’s top 500 centers. By June 2021, China had 188 super-computing centers in the world’s top 500.
  3. Prospering its AI companies. By September 2021, China had 880 AI companies.
  4. Increasing in AI output, including AI thesis and patent applications and authorizations.
  5. Rapid development of technologies of 5G and the Internet of Things.

Source: SINA, September 3, 2022


China Continues Lockdown and COVID Control against Its Citizens Even During and After Earthquake

On September 5, a 6.8 magnitude earthquake struck Sichuan Province in southwestern China. Nevertheless, and despite the imminent danger, local officials continued the strict COVID control measures and locked residents inside their apartment buildings.

The quake took place in Luding County and caused landslides involving both rocks and boulders. According to state media reports on September 8, the death toll so far has risen to 86.

China’s state media reported several aftershocks in nearby areas. The US Geological Survey also detected a smaller magnitude 4.6 tremor which hit eastern Tibet less than an hour after the initial quake.

Online videos showed that, despite the quake, local authorities stayed firm on the Communist Party’s COVID control measures.

One video showed that residents rushed downstairs in their apartment buildings, but only found the gate was locked and they could not get it to open.

Another one showed that a staff member guarding the gate argued with the people who wanted to get out, “Let me ask you, did the building collapse?” (meaning: if the building did not collapse, residents should just stay in it.)

A picture showed a notice posted for the residents: “Hello Everyone! An earthquake just took place. Please do not be panic. Please wear your mask and go upstairs back to your home. During the COVID control period, (you) should not go downstairs, take a walk, or gather into groups. Outdoor activities are prohibited. Thank you!”

When volunteers arrived on site to help with rescues, the first thing authorities did was to give them a COVID test.

Source: Epoch Times, September 5, 2022


Article Praising the Policy of Closing the Country from the World

The Chinese Academy of History, under China’s Academy of Social Science, recently published an article on “closing the country.” It set up a project team to research the foreign policy of two dynasties in China’s history: the Ming and the Qing. The team published this article, arguing that the policy to “close the country from the world” was the proper foreign policy at that time, or the right choice to deal with the Western countries.

The Chinese Communist Party has a tradition of using history to give hints about current affairs or policies. Many people questioned  whether this article is to reverse the “opening up” policy that the CCP has adopted since Deng Xiaoping’s time and instead move into a “closed country” stage.

Source: United Daily News, August 30, 2022

China’s Wave of Mortgage Boycotts Has Spread to 340 Locations in 190 cities

Numerous unfinished real estate, also known as “rotten-tail” buildings in China, has led property owners to engage in a wave of mortgage payment suspensions, By September 6, This  involved 119 cities and a total of 340 projects, and 2022 property owners, raising concerns that the payment suspensions may continue to worsen economic development.

The wave of mortgage suspensions triggered by “rotten-tail” buildings began in July, with many property owners stopping payment on their mortgages, issuing one “loan suspension notice,0, after another, demanding that real estate developers resume their construction work in full, or they will stop paying the principal and interest to the banks.

A person involved in the suspension of loans collected some data and stored it at the online repository GitHub (WeNeedHome). The collection at this site showed, on September 6, that the suspension of mortgag payments on property cumulatively involved up to 340 sites in 119 cities across the country. The number is still climbing. Henan Province tops the list with 66 sites, followed by Shaanxi Province and Hunan Province.

On top of that, banks that could not collect on their loans were among those affected, with the share price of Shenzhen-based financier Ping An Bank falling as overdue payments on suspended homes reached 78 million yuan ($11.3 million).

Source: Radio Free Asia, August 18, 2022 (figures updated on September 6)

Under Fiscal Pressure, Chinese Local Governments Have to Resort to Fines to Generate Revenue

China’s economic downturn, along with the Covid epidemic and other factors, has drained local government revenues. Mainland Chinese media reported that many local governments have been resorting to the indiscriminate use of fines to generate revenue.

China NewsWeek magazine reported on August 29 that, in recent year, in many areas, the revenue from fines, penalties, and confiscations has increased significantly.

In 2021 among the 111 cities that have publicized data on fines. 80 cities saw a rise in the revenue from fines. In 15 of them the fines more than doubled. For example, the fines in Leshan in Sichuan increased by 155 percent and Nanchang in Jiangxi by 151 percent.

Qingdao, the city, ranked Number One. In 2021. The revenue from fines amounted to RMB 4.377 billion ($ 0.63 billion), an increase of 127 percent compared to 2020. In addition to Qingdao, Jiangsu Province includes 6 of the top 14 cities in terms of the highest fine revenue.

For example, in order to raise revenue, traffic police in Inner Mongolia set up check points on highways and have fined the truck drivers for violations such as “not wearing seat belts,” although in fact the drivers had actually buckled up and did not violate any traffic laws.

The newspaper quoted a researcher who reported that the source of a significant portion of local fiscal revenue is from land sales. He said that, according to the National Bureau of Statistics,, the local government revenue from land sales in the first seven months of this year was only about 1/3 of  what it had been in the same period last year, putting pressure on fiscal revenue.

Source: Central News Agency (Taiwan), August 29, 2022

Turkish Media: China is Selling Russian LNG to Europe at Inflated Price

The Turkish newspaper Yeni Safak reported on Friday, September 2, that China will sell Russian LNG (liquid natural gas) to European countries at an inflated price. In practice, this represents an indirect violation of the European embargo.

According to Chinese customs data, in the first six months of 2022, China imported 2.35 million tons of fuel from Russia at a value of $2.16 billion.

The newspaper said Russian LNG exports to China via the Siberian pipeline have increased by 63 percent. .

The article added, “Experts stressed that the supply of LNG exceeds China’s domestic demand and that the Chinese government will sell LNG purchased from Russia to European countries that are coping with the energy crisis,” .

Source: Sputnik News (Russia), September 3, 2022

Lianhe Zaobao: Satellite Data Showed Worsening Consumer Activities in China

Singapore’s primary Chinese language newspaper Lianhe Zaobao recently reported that satellite data showed that retail activities in China have worsened both online and offline. E-commerce demand was particularly weak, and activities in e-commerce distribution centers were even lower than in 2020. According to data shared by satellite image analysis company SpaceKnow, China’s intercity truck flow fell by 20 percent in August, and this indicator is directly related to GDP. Distribution centers faring much better during the 2020 outbreak than they are now. The data also indicated weaker earnings trend for companies like Alibaba could continue as consumers cut back on spending. The weakness also spread to brick-and-mortar retailers, with changes in the number of cars in mall parking lots in August being much lower than the same period in 2021. Chinese officials have tried to use government spending on infrastructure to reinvigorate growth. However, high-frequency data suggests that the infrastructure boost has so far not been able to offset the blow to the construction sector from a sharp drop in China’s real-estate market. Public data shows that China’s consumer confidence index fell to its lowest level in nearly a decade in April and has barely rebounded since then.

Source: Lianhe Zaobao, September 1,2022

CNA: Far Fewer U.S. Companies Are Optimistic about Future Business in China

Primary Taiwanese news agency Central News Agency (CNA) recently reported that, according to a report just released by the US-China Business Council, due to factors such as strict Covid control measures and rising geopolitical tensions, the proportion of U.S. companies that are optimistic about China’s business prospects for the next five years has plummeted from nearly 90 percent 10 years ago to barely more than half as much now. This is a new all-time low. The report is based on interviewing the Council’s 117 member companies, most of whom are large multinational companies headquartered in the United States that have operated in China for more than 20 years. The survey found that optimism about the business outlook in China for the next five years among respondents has fallen sharply. It fell by 18 percentage points this year, to an all-time low of 51 percent. Comparing China’s current business environment with three years ago, 83 percent of the companies surveyed said they are not as optimistic now as they used to be. This represents an increase of 24 percentage points compared to last year. At the same time, the proportion who felt pessimistic doubled last year’s number to 21 percent, a record high. The report pointed out that, given the long-term impact and uncertainties caused by the tension between China and the United States, the surveyed companies believe that geopolitical factors will have the greatest impact on the outlook, including China’s Covid control policies as well as technology regulations. This annual report also details the top ten challenges faced by American businessmen in China. The lockdown policy replaces Sino-US relations as the number one challenge this year. Around 96 percent of the companies surveyed have suffered heavy losses due to the government’s Covid control measures.

Source: CNA, August 30, 2022