Geo-Strategic Trend - 3. page

Chinese Central Television (CCTV) recently reported that the EU’s member states have voted to adopt the European Commission’s proposal to impose tariffs on Chinese electric vehicles. Ten EU members voted in favor, 12 members abstained, and 5 members — Germany, Hungary, Malta, Slovakia and Slovenia — voted against. According to EU rules, two conditions must be met for the proposal to be shelved: 15 members would have to vote against it, and the number of opponents to the proposal must comprise 65 percent of the total EU population.

The lead Chinese negotiator explained that “the reason why many EU member states voted in favor of imposing additional tariffs on China was to attempt to force Chinese companies to invest in Europe. China’s attitude is very clear – anyone who supports the tariff will lose investment.” The countries that voted in favor were: Italy, France, Poland, the Netherlands, Ireland, Latvia, Lithuania, Estonia, Bulgaria, and Denmark. “Among the nay-sayers, Germany has the loudest opposition, precisely because Germany has cooperated more with China in the automotive industry and has benefited more.”

Source: CCTV, October 5, 2024
https://news.cctv.com/2024/10/05/ARTIHFvkIDnFXtaubcg0SzWb241005.shtml

Japanese companies are facing significant headwinds in the Chinese market, with investment figures showing a marked decline. According to recent data from Japan’s Ministry of Economy, Trade and Industry, Japanese investment in China and Hong Kong fell by 16% year-on-year in the second quarter of 2024. This marks the seventh consecutive quarter where Japanese investment in China has lagged behind its European counterpart.

The downturn is largely attributed to the struggles of Japanese automakers in China’s competitive electric vehicle (EV) market. Giants like Nissan and Honda have been forced to shutter factories, with Honda alone estimating a reduction of 290,000 units in annual production capacity. This retreat has sent shockwaves through the supply chain, affecting parts manufacturers and material suppliers.

The automotive sector’s woes are symptomatic of broader challenges. China, while remaining Japan’s second-largest export destination and primary import source, has become an increasingly difficult market for Japanese firms. A survey by the Japan External Trade Organization revealed that 53% of Japanese manufacturers in China view rising competition as a major concern, a situation exacerbated by China’s economic slowdown.

The impact extends beyond automobiles. Companies across various sectors, including electronics and materials, are reassessing their Chinese operations. DIC, for instance, plans to exit China’s liquid crystal materials business by the end of 2024.

As Japanese companies grapple with these challenges, the trend of reduced investment and operational scale-back in China appears set to continue, potentially reshaping the landscape of Japanese business presence in the world’s second-largest economy.

Source: Central News Agency (Taiwan), October 7, 2024
https://www.cna.com.tw/news/acn/202410070137.aspx

Human Rights Watch released a report revealing the Chinese Communist Party’s (CCP’s) transnational harassment and intimidation of Chinese citizens living in Japan. Several interviewees stated that due to fear of retaliation or concern for their family’s situation in China, they did not seek help from the Japanese police.

F.G., from Inner Mongolia, has lived in Japan for nearly 20 years. In 2019, CCP police went to his family’s home and threatened them. He said, “They threatened my relatives, telling them to inform me that my actions were criminal offenses against the state. They recorded all of my family members’ contact details. My relatives were terrified. Since then, my relatives have cut off contact with me.”

S.T., who moved to Japan from Xinjiang, said, “One day (in 2017), I received a call from a relative asking me to come home. I refused, and immediately a police officer took over the phone. He told me, ‘Listen to your relatives, or I cannot guarantee what might happen to your family.’” S.T. said that was the last time he spoke to his relatives.

Source: NTDTV, October 10, 2024
https://www.ntdtv.com/gb/2024/10/10/a103920610.html

Singapore’s primary Chinese language newspaper Lianhe Zaobao recently reported that the South Korean government has announced that it will launch an anti-dumping investigation into steel plate products originating from China. Hyundai Steel, a South Korean steel manufacturer, filed an anti-dumping complaint with the Ministry of Industry, saying that Chinese traders were exporting thick plates at extra low prices, causing the company to suffer losses. Thick plates are mainly used for shipbuilding or as construction materials. According to statistics from the Korea Iron and Steel Association, South Korea imported a total of 8.73 million tons of steel from China last year, a year-over-year increase of 29.2 percent. This year’s import volume is also growing rapidly. There was no official Chinese response to South Korea’s announcement as of press time.

Source: Lianhe Zaobao, October 4, 2024
https://www.zaobao.com.sg/news/china/story20241004-4940646

Major Taiwanese newspaper China Times recently reported that, in a media interview, Indian Commerce Minister Piyush Goyal reiterated India’s refusal to join the Regional Comprehensive Economic Partnership (RCEP). He said that it is “not in India’s best interest” to sign an FTA (free trade agreement) with a country lacking economic transparency (like China).

RCEP’s original negotiation members in 2013 included India, and other countries believed that India’s role could be a check and balance to China. However, India has refused to participate in RCEP in 2019, citing unresolved issues regarding “core interests.” Goyal pointed out that, at the, time India had already signed FTAs with ASEAN, Japan and South Korea, and had reached a bilateral trade agreement with New Zealand worth approximately US$300 million. “Joining RCEP was not in the interests of our farmers and small and medium-sized enterprises, and to a certain extent, it is just an FTA with China,” he said. He further explained that, China’s economy is very opaque, “from trade to politics to management methods. No one in India wanted to sign an FTA with an economy with no transparency.”

Goyal also promoted the idea of India becoming a “Taiwan + 1” semiconductor country, aiming to attract business investment from companies that seek to diversify their computer chip supply chain away from just Taiwan.

Source: China Times, September 23, 2024
https://www.chinatimes.com/realtimenews/20240923004101-260410

Deutsche Welle Chinese Edition recently reported that the German Environmental Protection Agency (UBA) suspects 45 of 66 Chinese climate emission reduction projects of fraud involving carbon credits worth approximately 1.5 billion euros. The German government has taken measures to revoke the certification of these projects, but the huge financial losses have been irreparable.

The German authorities conducted an in-depth review of Chinese projects and found defrauding EU emission reduction certificates through false declarations and exaggerated data. The application period for many projects was during the Covid-19 period when travel of relevant certification personnel was severely restricted.

In EU’s carbon emission reduction system, Upstream Emission Reductions (UER) projects can obtain corresponding carbon credits by implementing reduction measures in the upstream industrial supply chain, such as improving equipment energy efficiency. However, lack of necessary independence and transparency in the UER certification process allowed the same people to involve in the creation, validation and certification at the same time. They were very familiar with the UER system and used their professional knowledge and industry loopholes to enable fake projects to pass certification. The German investigation also found that a market for buying and selling UER certifications has formed in China.

So far, Chinese officials have not responded directly to the relevant investigations and fraud accusations launched by Germany.

Source: DW Chinese, September 22, 2024
https://p.dw.com/p/4kucQ

A South Korean research report indicates that Chinese netizens are systematically posting negative comments on news and posts related to industries where South Korea and China are in competition. These comments primarily disparage Korean products while praising Chinese ones, and this trend is increasing.

The report, titled “Cognitive Warfare in Korea-China Competitive Industries,” was released by a research team led by professors Kim Eun-young and Hong Seok-hoon. They analyzed comments on platforms like NAVER, YouTube, and NATE from July 2023 to August 2024.

The team identified 77 suspected Chinese accounts on NAVER, organized into two groups coordinated by core users. Similar negative comments have appeared in competitive sectors like electric vehicles and smartphones for several years, with increasing frequency recently.

The report categorizes these manipulative behaviors into three types: dismay, divide, and dismiss. Examples include comments suggesting the superiority of Chinese cars over Hyundai, or claiming that the U.S. will betray South Korea.

The researchers believe the 77 NAVER accounts are just the tip of the iceberg, with 239 similar accounts found on YouTube posting even more frequently. They call for establishing a database and analysis mechanism to counter this new form of cognitive warfare and urge the government to develop countermeasures.

Source: Yonhap News Agency, September 29, 2024
https://cn.yna.co.kr/view/ACK20240929000800881?section=china-relationship/index