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China’s Reaction to Trump’s Election Win

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Xinhua Commentary Series: Spotlight on the U.S. Presidential Election

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Wu Guoguang: Xi Jinping’s Reversal of the Course, Will China’s Transition be Peaceful or Marked with Bloodshed?

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Cheng Xiaonong: U.S.-China Strategic Relations Have Crystallized

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Shanghai’s New Talent Recruiting Plan

Shanghai is openly recruiting 5,157 Post Doctors, with a maximum annual salary off 700,000 yuan (US$ 103,000) and a living subsidy. The median salary is 300,000 Yuan (US $44,000). Shanghai is not alone. Many Chinese cities are in the competition for the talents that have Doctors and Post Doctors status.

The U.S., U.K, and Germany are the top three countries that are Shanghai’s recruiting targets. This caused people to wonder whether this recruiting effort is a continuation of the infamous “Thousand Talents” program. The “Thousand Talents” program included some cases of participants stealing Western technology and giving it to China.

Source: Radio Free Asia, July 29, 2022
https://www.rfa.org/mandarin/yataibaodao/kejiaowen/wy-07292022100754.html

Briefings | | |   Economy/Resources

JCCIC Demands Fair Treatment from Beijing’s Tightened Tech Control

he Japanese Chamber of Commerce and Industry in China (JCCIC),  Which Japanese companies stationed in China have formed, published a position paper on July 29, expressing the wish that the Chinese government improve its business environment. As China tightens control over high-tech products and data processing, the JCCIC asked Beijing not to exclude foreign companies, but to treat them as fairly as domestic companies.

The paper asks for the permission of foreign companies to participate in the stipulation of high-tech-related standards and to disclose product information. Takashima Ryusuke, vice president of JCCIC and director-general for the Beijing Office of the Japan External Trade Organization (JETRO), who also participated in putting together the paper, stressed at a press conference that “one cannot set standards that treat foreign companies in a discriminatory manner.”

Noting that Chinese government procurement is dominated by domestically produced goods, Takashima demanded that, “imports (from Japan) be able to participate on an equal footing.”

China’s Personal Information Protection Law prohibits the provision of domestically collected data to foreign countries, but has yet to offer detailed regulations. Takashima said Japanese companies are concerned about the application of the law, and called for rules to be established and made public as soon as possible.

Source: Kyodo News, July 29, 2022
https://china.kyodonews.net/news/2022/07/fe1c8c42ee64.html

Briefings | | |   Economy/Resources

Before 2025, China’s Population Will Shrink

China’s National Health Commission (NHC), the country’s top agency overseeing the public health, has revealed that the total population will show negative growth during the 14th Five-Year Plan (2021-2025). The statement was made in an article published in Qiushi magazine on August 1. Qiushi is the flagship publication of the Central Committee of Chinese Communist Party (CCP).

According to the NHC’s 2021 survey, women of childbearing age continue to show a low desire to have children. The average number of planned childbirths per woman is 1.64, down from 1.76 in 2017 and 1.73 in 2019. The measure is only 1.54 for Chinese women born in the 1990s, and 1.48 for those born in the 2000s.

As population growth has slowed down significantly, the fertility levels have fallen, with the total fertility rate, or the average number of children per woman, dropping to below 1.3 in recent years. It is estimated that the population will fall during the 14th Five-Year Plan period (2021-2025).

NHC observed that the population distribution will show three major characteristics. First is a seriously aging society. It is expected that around 2035, the proportion of people over 60 years old will exceed 30 percent of the total population. Second is the smaller household size. The average household size will show a drop to 2.62 persons in the figures for 2020, a decrease of 0.48 persons compared to 2010. Third, there will be an uneven regional development.

Source: Central News Agency (Taiwan), August 1, 2022
https://www.cna.com.tw/news/acn/202208010217.aspx

Briefings | | |   Economy/Resources

Xi Jinping Gives Instructions on Uniting Global Ethnic Chinese

On July 29th and 30th, the United Front Work Conference of the Chinese Communist Party (CCP) was held in Beijing. Xi Jinping delivered a speech.

Xi said, “Promoting the great unity of the Chinese people is the historical responsibility of China’s patriotic united front work in the new era. To do this job well, we must . . .  truly unite all Chinese people in different parties, nationalities, classes, groups, and with different beliefs, and those who are living under different social systems.”

Obviously, “those who are living in different social systems” refers to ethnic Chinese who are living outside of China.

“(We ought to) strengthen the overseas patriotic forces, building up the cohorts who know and befriend China.”  … Xi added, “We must do a good job in our united front work in cyberspace,”

The CCP’s united front work strives to track down, maintain relationships with, influence and sway prominent people and groups both inside and outside of China. It focuses on individuals or groups outside the CCP, particularly in the community of overseas Chinese, in an effort to make sure that they support or serve the CCP’s goals. The CCP’s central committee has a United Front Work department.

Source: People’s Daily, July 31, 2022
http://paper.people.com.cn/rmrb/html/2022-07/31/nw.D110000renmrb_20220731_1-01.htm

Briefings | | |   Government/Politics

Lianhe Zaobao: China’s July Manufacturing PMI Showed Both a Production and a Demand Slowdown

Singapore’s primary Chinese language newspaper Lianhe Zaobao recently reported on an  announcement that China’s National Bureau of Statistics made. China’s manufacturing purchasing managers’ index (PMI) in July declined by 1.2 percentage points from the previous month to 49 percent, falling below the growth line. The Bureau indicated that many factors influence the decline of the manufacturing PMI. For example, it is affected by traditional production off-season, insufficient market demand, and low prosperity of high-energy-consuming industries. Industries like textiles, petroleum, coal and other fuel processing, ferrous metal smelting and rolling processing have continued to be in the contraction range. This was one of the main factors for the decline of PMI. Both manufacturing activities and demand in the manufacturing sector have slowed down. Raw material procurement activities have also tightened accordingly. The purchasing volume index and the import index both decreased by more than two percentage points from the previous month. The international situation has become more complex and severe, and the market demand is under pressure. The new orders index and the index of new export orders both dropped significantly. The manufacturing PMI now is below 50, indicating that China’s economic recovery remains shaky. Challenges to China’s GDP growth in the third quarter may be bigger than earlier expected.

Sources:
(1) Lianhe Zaobao, August 1, 2022
https://www.haozaobao.com/shiju/20220801/122050.html

(2) China’s National Bureau of Statistics, July 31, 2022
http://www.stats.gov.cn/tjsj/zxfb/202207/t20220729_1886928.html

Briefings | | |   Economy/Resources

Tencent Stock Suffered a Major Decline

Well-known Chinese news site Sohu (NASDAQ: SOHU) recently reported that, on the last trading day of July, Hong Kong stocks fell across the board. The Hang Seng Technology Index plummeted by nearly 5 percent, and Tencent Holdings fell by 4.36 percent. Tencent’s stock price approached the HK$300 mark again, almost returning to the level five years ago. Just over a year ago, Tencent’s per-share price approached a historical peak of HK$750. However, now it has fallen by nearly 60 percent. its market value has evaporated by about HK$4.4 trillion (around US$560 billion). In the past two years, Tencent’s share price has been continuously declining due to the combined effects of multiple factors such as China’s anti-monopoly movement, the government restrictions on online gaming for minors, and China’s strict COVID-19 combat policies, as well as the reduction of shares held by the largest shareholder. Tencent’s financial numbers are indeed slowing over the years, according to its 2021 report. The latest growth rate is the lowest in recent years. Since the end of June, Tencent has launched a share repurchase program. The total scale of this program has reached RMB 3.9 billion (around US$578 million). Tencent Holdings has repurchased a total of about HK$10.01 billion (around US$1.28 billion) dollars this year. Tencent has been China’s largest internet company.

Source: Sohu, July 31, 2022
http://www.sohu.com/a/573053386_115433I

Briefings | | |   Information/Technology

Global Times: U.S. Is Tightening Export of Chip Equipment to China

Global Times recently reported that two U.S. chip equipment companies confirmed that the U.S. crackdown on Chinese chips has expanded from 10 nm to 14 nm technologies. In addition, the scope of the new regulations may not be limited to China’s SMIC (Semiconductor Manufacturing International Corporation), but may also include other chip manufacturers investing and operating in China. Analysts expressed the belief that the latest move by the United States to suppress China’s chip industry may try to have a long-term impact on the Chinese chip industry, On the one hand, it will also hurt the interests of American companies. The scope of U.S. export restrictions may include other chip manufacturers operating in China, such as Taiwan’s TSMC. According to people familiar with the matter, in the past two weeks or so, all U.S. equipment makers have received letters from the Commerce Department describing the requirement. A statement released by the U.S. Department of Commerce said that the Biden administration is tightening relevant policies against China, focusing on weakening China’s efforts to produce cutting-edge chips in response to major national security risks facing the United States. In the eyes of the U.S. government, 14nm is a watershed between advanced and backward chip manufacturing processes. Since 14nm and below technologies are considered advanced, the U.S. embargo focuses on chip equipment with 14nm and below capabilities in order to achieve the purpose of containing Chinese chips and their competition. The chip industry is an industry requiring close cooperation among global industries. The suppression of China by the United States will inevitably affect the normal development of the global chip industry.

Source: Global Times, August 1, 2022
https://world.huanqiu.com/article/493RXZYbLEo

Briefings | | |   Information/Technology US-China Relations

North Dakota Governor Urged Federal Investigation of Chinese Company’s Purchase of Land near Air Force Base

Doug Burgum, Governor of North Dakoda wrote a letter to Secretary of the Treasury Janet Yellen and Lloyd Austin, Secretary of Defense, asking the Committee on Foreign Investment in the United States (CFIUS) to speed up its review of the Chinese company Fufeng Group’s plan to  purchase land in North Dakota because it is a national security concern. Also in a letter to the U.S. Department of Defense ,Senators John Hoeven, Kevin Cramer and Marco Rubio requested that (CFIUS) conduct a review of the Fufeng Group’s land purchase.

Fufeng Group wants to buy 360 acres of land in Grand Forks, North Dakota, to build a corn processing plant. However, the site just happens to be only 22 miles away from the Grand Forks Air Force Base, which is what raises the national security issue.

China Aviation Industry General Aircraft Co. Ltd bought Cirrus Aircraft, headquartered in Duluth, Minnesota in 2011. Cirrus has factories in Duluth and Grand Forks. Its Grand Forks plant was even closer to the air force base than Fufeng Group’s planned plant site.

Source: VOA, July 28, 2022
https://www.voachinese.com/a/burgum-calls-for-security-review-of-chinese-firm-s-project-20220727/6676606.html

Briefings | | |   Defense/Military US-China Relations