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China’s Income Distribution as Derived From State Taxation Administration’s Numbers

The State Taxation Administration released the 2023 Individual Income Tax Settlement and Payment Report. An individual analyzed the data to derive the Chinese people’s income level breakdown.

According to the official data:

  • After raising the minimum income level for taxation from 3,500 yuan to 5,000 yuan per month, the number of people filing income tax dropped from 157 million to 65 million in 2022.
  • Among the income tax-filing people, less than 30 percent paid tax.
  • Among those who paid income tax, 60 percent were in the 3 percent tax rate bracket (5,000 – 8,000 yuan/month).
  • 1 percent of the income tax-filing people have income above 1 million yuan.
  • People with annual income less than 100,000 yuan usually do not need to pay income tax (due to various deductibles).

The author thus deduced:

  • Income between 3,500 yuan and 5,000 yuan per month: Near 100 million people (between 65 million and 157 million).
  • Income above 5,000 yuan per month: 65 million people.
  • Income between 5,000 and 10,000 yuan per month: 45 million people (only 30 percent of the 65 million paid taxes).
  • Income above 100,000 yuan per year: 20 million people (only 30 percent of 65 million paid taxes).
  • Income between 100,000 and 150,000 yuan per year: 12 million people (60 percent paying at the 3 percent tax rate).
  • Income between 150,000 and 1 million yuan per year: 7.3 million people (8 million minus 700,000 whose income is above 1 million yuan).
  • Income above 1 million yuan per year: 700,000 (around 650,000) people.

Source: Aboluo, October 16, 2024
https://www.aboluowang.com/2024/1016/2116093.html

Briefings | | |   Economy/Resources

Chinese Government Spokesperson Defends Possible Further Chinese Trade Barriers Against Taiwan

Chinese state media outlet People’s Daily recently reported on comments made by a government spokesperson on the topic of measures that Beijing has taken to restrict trade with Taiwan. The below is from the People’s Daily report:

At the regular press conference of the Taiwan Affairs Office of the State Council (mainland China) on October 16th, a reporter asked: “The Ministry of Commerce recently announced that it would consider taking further measures based on the conclusions of the investigation into trade barriers with Taiwan. The Taiwan Mainland Affairs Council stated that ‘the mainland is using economic and trade relations as a political weapon to coerce Taiwan into complying with its political demands.’ What is your response to this?”

Chen Binhua, spokesperson for the Taiwan Affairs Office of the State Council, responded that the Democratic Progressive Party (DPP) authorities in Taiwan have long unilaterally restricted a large number of products from the mainland, harming the interests of relevant industries and enterprises in the mainland. Since the final conclusions of the investigation into Taiwan’s trade barriers were released, the DPP authorities have not taken any actual steps to lift trade restrictions on the mainland. Instead, they have intensified efforts to obstruct normal economic and trade exchanges and cooperation across the Taiwan Strait, harming the interests of mainland enterprises and the well-being of the people. The further measures being considered, based on the conclusions of the investigation into Taiwan’s trade barriers, are necessary actions in response to the DPP authorities’ obstinate and unrepentant behavior.

Chen Binhua further noted that the DPP authorities and “Taiwan independence” forces often label the mainland’s policies benefiting Taiwan as “United Front actions.” He emphasized that the united front has always been an important strategy of the Chinese Communist Party to win hearts and gather strength. In the new era, the CCP’s main task of the united front is to uphold broad unity and solidarity, continuously consolidate and develop the most extensive patriotic united front.

Source: People’s Daily, October 16, 2024
http://tw.people.com.cn/n1/2024/1016/c14657-40340652.html

Briefings | | |   @CS Geo-Strategic Trend

China Strengthens Cultural Ties with Indonesia’s Muslims to Change Their Views on Xinjiang

Via its program of “cultural exchange and collaboration,” Beijing has made progress in reshaping the view of Indonesia’s Muslims on Xinjiang .

China has established free Chinese language courses at the Istiqlal Mosque in Indonesia, the largest mosque in Southeast Asia. In addition, the Chinese Embassy in Jakarta invited staff at the mosque to visit Xinjiang last year. The Chinese government covered all their expenses, including airfare and accommodation, and arranged and accompanied them for all visits. This trip gave the staff a completely different perspective on Xinjiang: In their view, Xinjiang has developed much better than what the media reports, and China has granted religious freedom to the people of Xinjiang.

In 2018, Muhammadiyah and the Nahdlatul Ulama (NU), two of Indonesia’s largest Islamic organizations, publicly condemned China’s actions against the Xinjiang Uyghurs and demanded an explanation from the Chinese government. In recent years, China has actively worked with these two organizations to gain their trust. In October 2022, Indonesia, the world’s most populous Muslim-majority country, voted against having a debate on Xinjiang’s human rights issues at the United Nations Human Rights Council.

Source: VOA, October 16, 2024
https://www.voachinese.com/a/china-cultural-outreach-to-muslims-in-indonesia/7823041.html

Briefings | | |   @CS Geo-Strategic Trend Government/Politics

China’s Top 500 Enterprises Cut 314,600 Jobs in 2023

On October 15, the Hong Kong-based South China Morning Post reported that All-China Federation of Industry and Commerce, a semi-official institution, released a report stating that China’s top 500 enterprises generally have strong risk resilience. However, by end of 2023, these companies employed 10.66 million people, cutting 314,600 jobs from the previous year.

The job cutting trended continued in this year. In May, several leading companies announced layoffs. Alibaba’s mid-May financial report revealed a reduction of over 14,000 employees. JD.com laid off 12,000 employees on May 21. Lenovo Group’s financial report indicated a reduction of 7,500 employees. Li Auto reduced its workforce by 18%, amounting to at least 5,600 employees.

Source: Sound of Hope, October 15, 2024
https://www.soundofhope.org/post/845372

Briefings | | |   Economy/Resources

Xinhua Commentary: US Struggles in Rebuilding Its Manufacturing Industry

Xinhua News Agency published a commentary on the U.S.’ failing to integrate global warming efforts in bringing manufacture businesses back to China.

Recently, Boeing announced plans to cut approximately 17,000 jobs globally, which stands in stark contrast to the high demand for global aviation manufacturing. This incident reflects several issues within American manufacturing: high labor costs, a shortage of skilled technical workers, and supply chain disruptions.

Since the 1960s, the offshoring of U.S. manufacturing has sparked widespread discussion about America’s “deindustrialization.” To address this problem, following the 2008 global financial crisis, various policies were introduced to revitalize the manufacturing industry, from Obama’s “reindustrialization” to Trump’s “America First” and now Biden’s “supply chain resilience” policy.

During this process, the U.S. has pursued protectionist trade policies and “long-arm jurisdiction” measures to forcibly bring manufacturing back. These actions have led to rising production costs, pressure on fiscal expenditure, high inflation, and damage to the supply chain, resulting in further decline of already hollowed-out industries.

According to a recent survey by the Financial Times, over two years into the Biden administration’s ambitious plan to reshore manufacturing, many projects, particularly in the clean technology and semiconductor sectors, are struggling to get off the ground.

Source: Xinhua, October 17, 2024
http://www.xinhuanet.com/20241017/b99368fad2d74d4b856b4e647b3bbaff/c.html

Briefings | | |   US-China Relations

Israeli Politicians Attended ROC’s National Day Celebration But Not the PRC’s

YNET, the electronic newspaper of Yedioth Ahronoth, Israel’s largest media group, published an article titled: “A paragon for Taiwan, a sting for China: this is how the war affected Israel’s perception towards the two rivals.”

Itamar Eichner, a senior Israeli diplomatic correspondent, wrote the article. He discussed that when Republic of China (Taiwan) hosted its National Day reception at the Taipei Representative Office in Israel this year, hundreds of guests attended, including eight cross-party members of the Knesset from the ruling Likud party, the opposition Yesh Atid party, and the National Unity party, as well as five mayors of major cities. On the contrary, when the People’s Republic of China (PRC) hosted its National Day reception at the Chinese Embassy two weeks ago, only Uri Makleb, Deputy Minister of Transportation of Israel, attended as a representative from Israel; no elected members of the Knesset attended. There were only 70 guests in total.

The report analyzes the reasons. Since the Hamas terror attack on Israel, China (PRC) has completely ignored Israel’s concerns. On the one hand, China has aligned itself with the so-called “Axis of Evil,” including Iran, by continuously condemning Israel’s efforts to rescue hostages in Gaza, and on the other hand, it disregarded Israel’s request for China to assist in rescuing Israeli hostages with partial Chinese ancestry. Meanwhile, Taiwan has consistently supported Israel in its resistance against Hamas since the war began, standing firm in its shared values with Israel.

Source: Central News Agency, December 13, 2024
https://www.cna.com.tw/news/aopl/202410130137.aspx

Briefings | | |   @CS Geo-Strategic Trend

Hikvision Cuts R&D Operations Amid Declining Profits and Government Spending

Hikvision, China’s leading surveillance camera manufacturer, is reportedly undergoing major organizational restructuring, including significant cuts to regional R&D departments that could affect over 1,000 employees. The company is reducing its R&D regions from 32 to 12, maintaining only core areas.

According to employee reports on recruitment website Maimai, R&D departments are heavily impacted, with some regions, like Hunan, being completely eliminated, though headquarters areas like Hangzhou haven’t yet been affected. The company is offering N+2 compensation packages to laid-off employees.

Following public discussion of these layoffs, Hikvision responded by denying any large-scale layoffs, stating that this is merely a strategic adjustment to optimize R&D resources in headquarters and key sales cities.

The company’s financial performance has been declining for three consecutive years, with its H1 2023 financial report showing total revenue of 41.21 billion yuan (up 9.68% YoY), profit of 5.064 billion yuan (down 5.13% YoY), and public service sector revenue of 5.693 billion yuan (down 9.25% YoY).

The decline is primarily attributed to poor local government finances, resulting in reduced spending from public security and traffic police sectors. Senior VP Huang Fanghong acknowledged that industries dependent on local government funding are struggling, noting that both government and enterprise customers are now favoring cost-effective products over innovative, high-performance options.

Hikvision, known for its surveillance technology and crucial role in China’s “Skynet” monitoring system, has grown to become a global security industry leader over the past 20 years.

Source: Central News Agency (Taiwan), October 11, 2024
https://www.cna.com.tw/news/acn/202410110414.aspx

Briefings | | |   Economy/Resources

German-Funded, Chinese-Built: Namibia’s Largest Solar Project Highlights Complex Global Energy Partnerships

In September 2024, Namibia’s national power company signed an agreement with two Chinese companies to build the country’s largest solar power station. Notably, 80% of the project’s funding (70 million euros) comes from Germany’s KfW Development Bank, while the remaining funds will be provided by Namibia’s national power company.

The project, located in Rosh Pinah in southern Namibia, will be built by China’s Jiangxi International Economic and Technical Cooperation Company and Chint New Energy Development Company. Expected to be operational by Q2 2026, the plant will increase Namibia’s total photovoltaic capacity from 500,000 to 600,000 kilowatts, significantly reducing the country’s dependence on imported electricity from Zambia and South Africa.

Industry insiders revealed that only three Chinese companies and one Indian company bid for the project, with no German companies participating despite German funding. One anonymous German solar company operating in Namibia noted that this pattern of “German money, Chinese construction” is common in such energy projects.

The situation raises questions about China’s growing influence in Africa, particularly given that the EU has designated China as a systemic competitor. However, KfW board member Christiane Laibach emphasized that the bidding process followed international standards and was objective and economical.

Namibia, with its sparse population of 3 million and abundant desert regions, has become an attractive location for green energy facilities due to its dry subtropical climate and abundant sunshine. Germany, Namibia’s former colonial ruler, is heavily investing in green power projects in the country, partly to produce hydrogen for its own energy transition, though these projects have raised environmental concerns about their impact on fragile desert ecosystems.

Source: Deutsche Welle, October 9, 2024
https://p.dw.com/p/4lZhQ

Briefings | | |   Geo-Strategic Trend