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China Concedes in Dispute with Lithuania over Taiwanese Representative Office, Lifts Sanctions

China recently lifted the severe trade restrictions imposed on Lithuania after the Baltic state established a “Taiwanese Representative Office” in late 2021.

The sanctions were part of Beijing’s vigorous efforts to prevent  other countries around the world from establishing diplomatic relations with Taiwan. Representatives of the Chinese government said that it would only be permissible for the Taiwanese office in Lithuania to be referred to as a “Taipei Economic and Cultural Representative Office,” and that the terminology “Taiwanese Representative Office” was unacceptable. Under normal diplomatic relations between sovereign states, a similar outpost of one country within another would be called an “Embassy.”

German newspaper Frankfurter Allgemeine Zeitung quoted Lithuanian Foreign Minister Gabrielius Landsbergis on the new development in China-Lithuania relations: the Chinese government has ended its attempt at “economic coercion,” and the name “Taiwanese Representative Office” will remain despite Beijing’s criticism. Frankfurter Allgemeine Zeitung praised Lithuania, saying that the small country had won the principles-based fights.

Lithuania conducts trade with China worth tens of millions of euros. China’s restrictive measures led to an 80% drop in Lithuania’s 2022 exports to China. The EU raised the issue of Chinese-Lithuanian trade with the World Trade Organization at the end of 2022.

Many EU countries, including Eastern European countries, no longer see China as a favorable partner. Last year, Baltic countries Latvia and Estonia followed Lithuania’s lead in withdrawing from the China and Central and Eastern European Countries (China-CEEC) initiative, also known as the 14+1 initiative (formerly 17+1). These Baltic states have established trade offices with Taiwan. The Czech Republic also got closer to Taiwan, deviating from its historically-close ties with China. China’s support of Russia during the Russia-Ukraine war further alienated many countries in the EU.

Facing serious economic challenges domestically, China now seeks to ease relations with Western countries. This recent move on trade with Lithuania is one such effort, potentially lightening tensions with the European Union (EU) ahead of the upcoming China-EU Summit. In another such effort, Beijing has cancelled travel visa requirements for citizens of five different EU countries, enabling easier travel to China.

Source: Back China, December 3, 2023
https://www.backchina.com/news//2023/12/03/889175.html

Walmart to Move Procurement Center to Vietnam

Well-known Chinese news site Tencent News recently reported that Walmart has announced it is moving procurement center from China to Vietnam.

As a global manufacturing center, China’s labor costs are rising, which undoubtedly brings additional burdens to large-scale retailers. Meanwhile, Vietnam is an emerging manufacturing country with relatively low labor costs and a loose regulatory environment. Thus, Vietnam has become Walmart’s first choice as an alternative to Chinese labor.

China’s status in the global manufacturing supply chain is gradually declining. At the same time, other countries are becoming more important links in a transformed global supply chain. These other countries include Mexico, India, Thailand, Vietnam, etc.

According to the Tencent article, these countries are likely to succeed China and become the next world factory. The impact of Walmart’s departure from China is not only the loss of an important foreign-owned retail system, but more importantly, there is a series of chain reactions that may result from Walmart’s departure. As one of the world’s largest retailers, Walmart has a huge procurement operation. Once Walmart leaves, it will no longer have demand for Chinese suppliers, which may lead to increased pressure on the survival of some small and medium-sized Chinese manufacturers. Also, Walmart has a large number of employees in China, and the departure may result in significant job losses. This will bring pressure to China’s job market and social stability. However, Walmart’s departure will provide more opportunities for Walmart’s rivals to compete for the Chinese consumer market share.

Walmart began to close its stores in China in 2016. Over 130 Walmart locations in China have closed since then.

Source: Tencent News, November 23, 2023
https://new.qq.com/rain/a/20231123A00DCU00

Canadian Intelligence: China Attempting to Recruit Canadian Government Employees

The Canadian Security Intelligence Service (CSIS) warned that China is plotting to recruit Canadian scholars and government officials. It has issued an alert to federal employees, warning of a large-scale email campaign from Beijing attempting to lure Canadian employees into participating in an overseas “talent program.” The alert included a photo of a recruitment email with the subject “2024 Invitation for Overseas Talents to Apply for the China Global Excellent Scientists Fund.” The CSIS stated that the email requested that recipients supply “significant” personal information and promised salaries ranging from 95,000 Canadian dollars to 374,000 Canadian dollars.

Source: Radio France International, November 25, 2023
https://www.rfi.fr/cn/国际/20231125-加情报部门警告中国针对加拿大政府雇员的招聘活动

Consular Volunteer Programs: Another of the CCP’s Long-Armed Control Mechanisms

According to a report by Spain-based human rights organization Safeguard Defenders, Beijing has established a “Consular Volunteer” mechanism over the past decade. The Consular Volunteer Programs, which operate out of Chinese consulates in foreign countries, engage in information gathering, infiltration, and surveillance globally. Beijing does not notify host countries about such programs, violating the Vienna Convention on Consular Relations. The report follows Safeguard Defenders’ disclosure last year of over 100 overseas police stations established by the Chinese government in more than fifty countries.

Such “Consular Volunteer networks” have been established in several dozen Chinese overseas communities, including in the U.S., Belgium, Sweden, Italy, the U.K., Spain, Greece, Portugal, France, the Czech Republic, Ukraine, Turkey, Chile, Malaysia, Japan, the UAE, South Africa, and other countries across five continents. The report by Safeguard Defenders has released an investigative report titled “China’s Consular Volunteers.”

According to the report, the programs would recruit Chinese overseas individuals, some unpaid but provided with operational expenses directly managed by the consulate. Working as “volunteers,” these individuals are controlled by the Chinese government to engage in the Chinese Communist Party’s (CCP’s) united front work.

The CCP’s integraiton of overseas united front networks with consular services has enabled it to systematically obtain personal information, home addresses, and contact details of different targets. The gathered information may be used to systematically harm or manipulate overseas groups or use coercive means against those who have political views unaligned with Beijing.

The Safeguard Defenders report noted that the G7 group issued a joint statement after its May 2023 summit in Hiroshima, explicitly demanding that China comply with the Vienna Convention on Consular Relations. Just a few months later, China’s State Council promulgated a set of “Consular Protection and Assistance Regulations,” effective starting September 1, 2023, which encouraged Chinese overseas consulates to recruit volunteers and to recognize and reward the volunteers’ performance.

Sources:

Radio Free Asia, November 22, 2023
https://www.rfa.org/mandarin/yataibaodao/renquanfazhi/hx2-11222023091732.html

SafeguardDefenders.com, November 21, 2023
https://safeguarddefenders.com/en/blog/chinas-consular-volunteers

China’s Seafood Imports from Japan Dropped by More Than 99 Percent

China responded angrily when Japan discharged treated nuclear wastewater into the sea near the Fukushima Daiichi Nuclear Power Station, imposing a comprehensive suspension of Japanese seafood imports since August. The General Administration of Customs of China reported that the total value of seafood imported from Japan to China in October 2023 was 2.4 million yuan (US$ 339,000), a significant decrease of 99.3 percent compared to the same month last year.

The recently-released statistics did not include data regarding September imports specifically. However, subtracting the cumulative value of January to August from the cumulative value for January to September, the remaining amount (which represents September’s seafood imports) was only 60,000 yuan, a drastic year-on-year reduction of 99.98 percent. The drop for August was 67.6 percent.

China has made up for the reduced imports by using domestic products or importing from other countries instead.

Source: Kyodo News, November 19, 2023
https://china.kyodonews.net/news/2023/11/8cbede403e53-1099.html

NHK Chinese: Less Than 30 Percent of Japanese Companies Plan to Expand Operations in China

NHK Chinese recently reported on a routine survey by the Japan External Trade Organization (JETRO). The survey showed that the number of Japanese companies that believe their business in China will expand in the future has further decreased, falling below 30 percent for the first time since the survey’s inception.

The JETRO annual survey is conducted on Japanese companies investing overseas. The latest result showed that only 27.7 percent of the surveyed companies plan to expand in China within the next one to two years. This figure has fallen rapidly during the past several years — two years ago, 40.9 percent of companies reported plans for expansion in China, and last year the figure was 33.4 percent.

Analysis suggests the following reasons for the decline: China’s economic outlook has become increasingly uncertain; due to the popularity of electric vehicles in China, the market share of Japanese companies that operate in the field of petroleum-fueled vehicles has shrunk.

In this survey, there were a significant increase in the number of Japanese companies that plan to grow their businesses in the Global South, including in India and Brazil. JETRO’s Chairman said that China’s macro economy has slowed down significantly, and that the Chinese market is critical for Japanese companies. Thus, Japanese companies will still need to ensure their presence in the Chinese markets even if they are not optimistic about prospects for business expansion in China.

Source: NHK Chinese, November 21, 2023
https://www3.nhk.or.jp/nhkworld/zh/news/k10014264701000/

CCP’s United Front Minister Meets Future Elite Thai Leaders Trained by China

On November 23rd, a high-level Chinese Communist Party (CCP) official met with representatives of the “Thailand-China New Era Leadership Elite Training Program” in Beijing. The official, Shi Taifeng, is a CCP Politburo member and Minister of the CCP’s United Front Work Department. Shi promoted China’s ideology of the “China-Thailand Community for a Shared Future for Mankind” and the CCP’s “Belt and Road Initiative.” On the same day, Wan Lijun, Chairman of the CCP’s Overseas Chinese Affairs Office, also met with the visiting Thai delegation. Sahathai Maneechot, former Deputy Prime Minister of Thailand, expressed intention to strengthen close ties with the CCP’s Overseas Chinese Affairs Office and to collaborate on the CCP’s “Community of Shared Future for Mankind.”

The “Thailand-China New Era Leadership Training Program” started as early as 2018, initiated by the Chinese Association in Thailand. It is held several times a year, with high-ranking figures from Thailand’s political, military, business, and academic sectors participating.

At the annual summit of the Association of Southeast Asian Nations (ASEAN) and China in September of this year, China’s Premier Li Qiang announced the “Ten Thousand People Training and Seminar Program,” in which China will train 10,000 talents for ASEAN countries in the fields of governance, anti-corruption, and green development.

Sources:
1. Epoch Times, November 25, 2023
https://www.epochtimes.com/gb/23/11/25/n14123929.htm
2. Chinascope, September 15, 2023

Li Qiang Announced China’s Leadership Training Programs for ASEAN Countries

China and Saudi Arabia Sign Currency Swap Deal

According to the People’s Bank of China (PBOC), the central banks of China and Saudi Arabia have signed a 3-year bilateral local currency swap agreement with a size of 50 billion Chinese yuan / 26 billion Saudi riyals on November 20. The agreement can be extended beyond 3 years by mutual consent. The goals of the agreement are to strengthen financial cooperation between China and Saudi Arabia, promote use of local currencies for trade and investment between the countries, and facilitate bilateral trade and investment flows.

The swap agreement was approved by China’s State Council and establishes a framework for the two central banks to provide liquidity in each other’s currency if needed to support trade and financial stability.

Source: Sputnik News, November 20, 2023
https://sputniknews.cn/20231120/1055123725.html