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Geo-Strategic Trend

SINOPEC Is Selling Its Argentina Assets at a Loss

Well-known Chinese news site Sina recently reported that SINOPEC (China Petroleum & Chemical Corporation) is looking for buyers for its assets in Argentina. The primary asset is located in the Santa Cruz region and is priced at US$0.75~1 billion. This asking price is not even half of the cost SINOPEC paid in 2010 when it first bought this asset from U.S. Occidental Petroleum at US$2.45 billion. SINOPEC has been losing money (around US$2.5 billion as of 2015) in Argentina and it is also facing labor troubles. It is estimated that there may be 15 potential buyers mainly from the U.S., Europe, Africa, and Latin America. However, Russia and Mexico are also interested. The SINOPEC selling plan has not yet been announced publicly, so all information sources remain anonymous. New oil fields have been found near the SINOPEC fields that sold recently. This may further hurt SINOPEC’s deal. SINOPEC is the largest oil refiner in Asia.

Source: Sina, October 9, 2017

Global Times: The U.S. Alone Cannot Decide on the Status of the Iranian Agreement

Immediately after U.S. President Donald Trump announced he would refuse to certify Iran’s compliance with the nuclear agreement, the Global Times published a commentary. The commentary stated that Trump is determined to go down the path of unilateralism and once again triggered a global disagreement with the EU, Britain, France, Germany, and Russia. The Agreement is the fruit of negotiations between six countries (the U.S., China, Britain, France, Russia, and Germany) and Iran. The final agreement was a UN registered international multilateral agreement. However, since day-one, the United States has treated it like a deal in which the U.S. can do anything it wants. If a single country can easily overturn an agreement, it will set a poor example for the North Korean issue, which may never arrive at a trust-worthy deal. The commentator questioned the benefit of driving Iran to restore its nuclear program. Isn’t the nuclear threat from North Korea bad enough?

Source: Global Times, October 14, 2017

Attack of Taiwan Student’s Protest Is Example of Mainland Threat to Democracy and Security in Taiwan

According to an article that Duowei News published on September 25, National Taiwan University rented out its track field for an event called Sing! China – – Shanghai Taipei Concert, a cultural exchange program set up between the mainland and Taiwan. During the preparations, the field was damaged. A group of students from National Taiwan University went to the university track field to protest the Sing! China – Shanghai Taipei Concert.  The students planned to seek repairs of the damage  to the track field and to question the approval process of renting the university venue to a third party. At the scene, members of the pro-mainland Unionist Party physically attacked them. The protest turned into a bloody sight. Police arrived 40 minutes after the initial phone call and several students were hospitalized.

The incident that took place at National Taiwan University concerned people who recognized that the Chinese Communist Party controlled the local gang members who carried out the action. They observed that the concert has become part of the mainland’s United Front effort in Taiwan. In a news article Taiwan Central News Agency reported that the police department launched an investigation into incident at National Taiwan University. The article also stated that the police department arrested a few gang members who participated in political protests using certain political groups as a cover. In a separate article, Taiwan United Daily News reported that a group under the mainland’s Taiwan Affairs Office is alleged to have hired gang members to execute plans to attack democracy in Taiwan. The Minister of the Interior vowed that such an espionage effort would not be tolerated in Taiwan.

Duowei News, September 25, 2017
United Daily News, September 29, 2017
Central News Agency, September 29, 2017

EU Reached Agreement on Anti-Dumping Rules against China

Well-known Chinese news site Sina recently reported that, after 18 months of internal debates, the 28 member countries of the European Union finally reached an agreement on the anti-dumping issue against China. The newly established rules will treat all WTO members equally. However, for those countries that significantly interfere with the free market, the EU will take special actions. For many years, China was not considered a “free market economy.” In the meantime, after 15 years being a WTO member, China expressed its belief that it should not be treated that way. Now the new rules define the concept of “dumping” as exporting goods at a price lower than its domestic price. EU investigators will determine the degree of dumping based on this new standard and recommend punishment. Critics expressed their concerns about the new EU rules, which have shifted the burden of proof from China to EU companies. On September 13, the EU also established its new plans for screening foreign investments.

Source: Sina, October 4, 2017

BBC Chinese: China Invested Heavily in African Leaders’ Hometowns

BBC Chinese recently reported that, based on a few studies and on academic research, it seems the hometowns of many African leaders received more Chinese aid than other places. For example, the last time that then Chinese Foreign Minister Yang Jiechi visited Sierra Leone, he visited Yoni, a small village deeply hidden in the jungle, with a grand school-building plan. Why? It turns out Yoni is the hometown of President Koroma of Sierra Leone. Studies showed that, among 2000 Chinese aid projects in 50 African countries, presidential hometowns received the largest portion of the money. Even the hometowns of the spouses of these leaders received more aid. It was very hard to find proof of corruption in these projects and China insisted on not attaching any “political conditions” to aid. However, the studies found China’s aid usually had more conditions than the West.

Source: BBC Chinese, October 6, 2017

South Korea Export Growth Rate Reached No. 1 in the World

Well-known Chinese news site Sohu recently reported that, based on data that the World Trade Organization (WTO) released on September 19, South Korea’s export volume between January and July of this year enjoyed a year-over-year growth rate of 16.3 percent, reaching US$328 billion. This rate is the highest among the world’s top 10 largest export countries, and happens to be double China’s number. Ironically, the high growth was achieved during a period when China has been heavily boycotting South Korean products, mainly due to China’s unhappiness of the Deployment of the U.S. THAAD missile defense system. In the meantime, China’s export growth rate (8.3 percent) was below the average of the 70 primary export countries in the world. Experts expressed the belief that South Korea’s strong export recovery was based on the global economic recovery as well as the unit price increases of Korean products. The author of the article suggested that foreign investments play an important role in the Chinese economy. Boycotting foreign products may impact China’s own position in the supply chain.

Source: Sohu, September 23, 2017

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