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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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Beijing Is Beefing Up Its Aircraft Carrier Capability

Several Chinese media reported that Beijing is about to launch its third aircraft carrier into the water. This carrier will be the world’s largest conventional (non-nuclear powered) aircraft carrier. The last U.S. conventional carrier was the Kitty Hawk that was decommissioned in 2009. A Chinese submarine had once “humiliated” the Kitty Hawk. In 2006, a Chinese submarine approached the Kitty Hawk battle group but the U.S. navy wasn’t aware of it at all.

A report said the new aircraft carrier is likely to use three electromagnetic catapults to launch planes, replacing the sliding takeoff mode of the first two carriers. This is “the most advanced aircraft catapult system in the world.”

Also, Guangming Daily reported that China launched the world’s first intelligent unmanned mother ship, the “Zhuhai Cloud” in Guangzhou on May 18.

The ship has a spacious deck and can carry dozens of air, sea, and submarine unmanned equipment, which can be deployed in bulk in the targeted sea area and self-form task-oriented networking groups to achieve dynamic 3D observation of specific targets.

Sources:
1. SINA, June 3, 2022
https://news.sina.com.cn/c/2022-06-03/doc-imizmscu4848118.shtml
2. Guangming Daily, May 19, 2022
https://news.gmw.cn/2022-05/19/content_35746121.htm

Briefings | | |   Defense/Military

Global Times: It Is Not Russia Who ‘Weaponizes’ Food

China’s state media Global Times published an opinion article by Zheng Fengtian, the director of the Rural Development Institute of Renmin University of China, stating that it is not Russia who weaponizes food.

The article said, “Russian President Vladimir Putin said in an interview with the media that the West is trying to ‘shift’ the responsibility for problems in the world’s grain market to Russia. Ukraine, however, has multiple food transportation channels to choose from. Also, Russia will not stop Ukraine’s grain shipments from being shipped out. At the same time, he also announced that Russia’s wheat exports in the next agricultural year will increase to 50 million tons.”

The article continued, “Following its strategic needs, the United States and the West put the responsibility for this global food crisis on Russia and use a number of means to put pressure on Russia to release food. Putin, however, retorted when he had a phone conversation with Italian Prime Minister Draghi. He said, ‘It is groundless for the West to blame Russia for the supply of agricultural products in the international market.’ Putin attributed the current crisis to the sanctions that the United States and the West imposed on Russia. It is the anti-Russian restrictions imposed by the US and the EU that make the situation worse. Indeed, it is precisely because of these economic sanctions that the global food supply chain has been disrupted and food prices have soared. Instead of providing a viable solution, the United States and its allies are currently escalating conflicts by increasingly providing  new weapons and equipment, which will only increase future global food security risks.

“When the Russian side expressed its willingness to provide 50 million tons of grain to ‘help overcome the food crisis,’ the United States and the West accused it of ‘blackmail’ because the Russian side proposed that ‘sanctions against Moscow should be lifted.’ A U.S. Pentagon spokesman said Russia weaponized food. In fact, ‘weaponizing food’ is a common practice of the United States. It is precisely because the United States has used grain as a “weapon” many times that grain has become a main source of the problem in the current global trade. Even the developed countries dare not freely hand over grains to the international market.

“On the one hand, the United States continues to add fuel to the conflict between Russia and Ukraine and intensifies sanctions against Russia. On the other hand, the United States has made arrangements in its own country ahead of schedule to grab Russia’s share of the world’s food market. According to reports, U.S. President Biden has increased the number of counties eligible for “double crop insurance” nationwide by 681 to 1,935, and the federal government’s investment in domestic fertilizer production has increased from $250 million to $500 million, to stimulate fully the export of American agricultural products and increase the external dependence on American food. It seems that the real intention of the United States is to expand its hegemonic advantages to the field of food security.”

Source: Global Times, June 6, 2022
https://opinion.huanqiu.com/article/48J1rhGFuKN

Briefings | | |   Government/Politics US-China Relations

Ministry of State Security Offers Rewards (Up to $15,000) for Reporting National Security Cases:

China’s Ministry of State Security (MSS) recently promulgated new rules to encourage citizens to report acts that “endanger national security.” It offered  different amounts as rewards, depending on the level of contribution, with the highest reward being 100,000 yuan ($15,000) or more.

On June 6, MSS, a CIA type agency, issued the “Rules for Rewarding Citizens for Reporting Acts that Endanger National Security.” The rules went into effect on the same day.

The MSS official said in a press session that China’s national security is facing a serious and complex situation, “especially as the infiltration and theft activities of foreign espionage and intelligence agencies and various hostile forces against us have significantly intensified.” The purpose for the new regulation is to mobilize public support for national security work.

The public is encouraged to report through a phone number, website, letter and in person. The national security authorities will issue spiritual (award certificates) or material awards (bonuses) depending on the situation. The bonus is divided into four levels according to the degree of contribution, with the lowest being less than 10,000 yuan ($1,500) and the highest more than 100,000 yuan ($15,000).

Source: Central News Agency (Taiwan), June 7, 2022
https://www.cna.com.tw/news/acn/202206070222.aspx

Briefings | | |   Government/Politics

China’s Government Scholar: We Can’t Allow TSMC to Move to the U.S.

On May 30, 2022, a forum was sponsored by the Chongyang Institute of Financial Studies at Renmin University in China. Chen Wenling, Chief Economist at the China Center for International Economic Exchanges (CCIEE), a Chinese government think tank, gave a talk, according to the China based website guancha.cn.

Chen said, “China should be prepared for the U.S. strategic containment and suppression of China, and make sure that the supply chains are under control.  . . .  We need to sort out the advantages that will sufficiently scare our opponents and cause them irreversible losses and pressures. As a countermeasure, we need to stall and slow as much as possible our opponents’ moves to cut off the supply chain, the chain of scientific and technological cooperation, and the chain of innovation.”

“If the U.S. and the West impose destructive sanctions on China as they did on Russia, we must take back Taiwan. In terms of carrying out industrial chain and supply chain restructuring, we must get hold of TSMC (Taiwan Semiconductor Manufacturing Company) and other companies that originally belonged to China. They are accelerating the transfer to the United States to establish six plants over there. We absolutely cannot let their goal of transfer be achieved.” TSMC is the world’s leading semiconductor manufacturing and design company. It is the world’s most valuable semiconductor company, the world’s largest dedicated independent semiconductor foundry, and one of Taiwan’s largest companies.

“We need to support Russia openly, reasonably and by every possible means. For example, the recent Sino-Russian joint air exercises and so on. We can do more in trade, so that China and Russia can dovetail the ‘Belt & Road’ with the Eurasian Economic Union proposed by Putin to form a strategic depth in China, a Silk Road economic belt, and an energy security belt as a major security barrier.”

“It is necessary to step up cooperation with Europe. Europe is deeply affected by the Russian-Ukrainian conflict, and the euro will be hit hard economically in the future. In addition, Europe will see a food crisis, an energy crisis and a refugee crisis. In the time of crisis in Europe, China can offer a helping hand and increase cooperation between China and Europe, so that the two plates of Asia and Europe can return to their historical status as political and economic centers.”

Source: Guancha.cn, June 6, 2022
https://www.guancha.cn/chenwenling/2022_06_06_643134_s.shtml

Briefings | | |   Geo-Strategic Trend

Hong Kong Government: School Libraries Can’t Have Books that Violate National Security Laws

Hong Kong’s Education Secretary Kevin Yeung said that local school libraries cannot have books that violate the National Security Laws.

At an event, a reporter asked about some local secondary schools that used “self-censorship” and removed some books from the library. He wondered whether the authorities have a regulation for providing library collections to secondary schools and how the terms of the national security law apply. Yeung said that as part of the implementation of the National Security Law, schools have the responsibility to ensure that their libraries do not contain books that are harmful to national security. Yeung added, “Books, like textbooks, can influence the ideas or thoughts of young students.”

He said that after the implementation of the National Security Law, schools cannot allow any incident that endangers national security, and that the National Security Law also mentions the responsibility of schools to promote national security education.

Source: Central News Agency, June 6, 2022
https://www.cna.com.tw/news/acn/202206060176.aspx

Briefings | | |   Government/Politics

China’s Shenzhen and Many Other Wealthy Cities and Provinces Will Cut Salaries While Foreclosures on Houses Soar

According to several mainland media reports in May, Shenzhen, the richest city of China, is facing a second wave of significant salary cuts for civil servants. The annual salaries will be reduced to less than 160,000 yuan a 36 percent drop (6.65 Chinese yuan = 1.0 US $). Last year, (2021) the salary was down to 250.000 yuan from the original amount of 300,000 yuan. Many foreclosed house will instantly appear in the Shenzhen property market.

On May 26, a netizen who is a first-level Chinese teacher in Shenzhen Middle School posted,  “Our company asked each of us to fill out a form this morning that we would, in principle, voluntarily reduce our wages.”

Not only Shenzhen, but many other of China’s wealthiest cities and Provinces in China also had already implemented a salary cut plan for civil service positions in 2021. The hearts of government officials have begun to fluctuate. Especially since last December, civil servants in Jiangsu, Zhejiang, Guangdong, Fujian, Shanghai and other provinces and cities have successively received notices of salary reductions, with a drop of about 20 to 30 percent.

The current wave of salary cuts is not only for civil servants, but also for teachers and other positions within the system. In addition, Shenzhen, Hangzhou, Suzhou, Qingdao and other coastal cities within the system have also reduced salaries. This wave of pay cuts are universal, and the higher the income, the greater the reduction.

Due to the extreme COVID-19 epidemic prevention and control measures, China’s economy has suffered a sharp downturn and the finances are tight. The epidemic prevention has lasted for several years and most enterprises have stopped production. Therefore, they will report the loss of production, and they will not pay taxes. Real estate is also all but dead.

The COVID-19 epidemic has caused sluggish consumption, disrupted supply chains, and has had a huge impact on both production and demand, which has been reflected in finances. In April 2022, the national fiscal revenue was about 1.2 trillion yuan, a sharp drop of 41.3 percent from the same period last year. Among them, tax revenue fell sharply by 47.3 percent year-on-year.

The fiscal revenue has decreased by a large amount, and the epidemic prevention funds have increased by a large amount, so the government must reduce expenditures. The massive pay cuts have not only caused turmoil in the hearts of the people, but also highlighted the sluggishness of China’s economy. The closely related effect of salary reductions suggests a wave of mortgage breaks is coming! At the beginning of 2022, 200,000 homeowners abandoned their houses and stopped paying their mortgages.

There were 9,000 foreclosed homes in 2017. By the end of 2021, the total number of foreclosed homes has soared to 1.68 million.

Real estate is deeply tied to the economy and household wealth, and the resulting financial risks are growing. A downturn in the economy, lower personal incomes or job losses make it a desperate choice for those who have a mortgage. Should they abandon a home and cut off mortgage payments?

The massive wave of salary cuts in Shenzhen and Shanghai, the regions with the highest fiscal revenues in China, as well as in the Pearl River Delta and Yangtze River Delta has made it possible for the outside world to conclude that both the central and local finances of the CCP regime are in serious trouble, with revenues falling short of expenditures, (i.e., People are running out of money).

From the published fiscal revenue in April this year, only 6 out of 21 provinces and municipalities had increased revenue year-on-year. Most of them are mineral resource-rich areas. 14 provinces and municipalities, mostly economically developed manufacturing and service industries, had decreased revenue; and only one province Fujian had remained flat.

The precipitous economic decline caused by the CCP’s harsh COVID-19 control has resulted in the finances of both the central and local governments of the CCP to fall short of their budgets, which has forced them to introduce salary cuts, although that may likely to spark public anger.

The authorities and institutions that have been increasing their salaries and benefits for more than two decades and have had years of living a good life are now preparing for hard times. The first step is to reduce salaries and benefits and compress the administrative expenses. If they still can’t break even, the second step will be to lay off employees just like many enterprises have done in recent years.

Source: Aboluowang, June 4, 2022.
https://www.aboluowang.com/2022/0604/1757327.html

Briefings | | |   Economy/Resources

Global Times: U.S. Overtakes China to Become India’s Largest Trading Partner

Global Times recently reported that, according to the latest statistics from India’s Ministry of Commerce and Industry, the United States has surpassed China to become India’s largest trading partner in the 2021-22 fiscal year.The bilateral trade volume reached US$119.42 billion. In the previous fiscal year, India’s exports to the U.S. increased to about $76.11 billion from about $51.62 billion  while imports rose to about $43.31 billion from about $29 billion. The Vice-Chairman of the Federation of Indian Export Organizations said India is becoming a trusted global trading partner. Global companies are reducing their single dependence on China and settling in India to diversify their businesses. India has joined the US-led Indo-Pacific Economic Framework, a move that will further strengthen economic ties between the two countries. Indian media reported that the U.S. is one of the few countries with whom India has a trade surplus of $32.8 billion in the 2021-22 fiscal year. In the meantime, the trade volume between India and China is also rising steadily. There is no “decoupling of trade with China” as previously hyped by the Indian media. India still has a large trade deficit with China, which is much higher than it was in the previous three years. India’s Ministry of Commerce and Industry said that India’s imports from China are showing a declining trend.

Source: Global Times, May 30, 2022
https://world.huanqiu.com/article/48DLLzsUgba

Briefings | | |   Geo-Strategic Trend

Kishida Expected to Attend NATO Summit

Primary Malaysian Chinese language newspaper Oriental Daily recently reported that Japanese Prime Minister Fumio Kishida plans to attend the NATO summit scheduled for late June in Spain. This move will make him the first Japanese leader to attend this Western alliance meeting. Whether Kishida will actually attend the June 29-30 meeting in Madrid depends on the domestic political situation. The timing may conflict with the political campaign season for the July 10 Senate election. Kishida’s participation in the NATO summit is expected to strengthen the coordination with the United States and European countries to deal with Russia’s war in Ukraine and possible emergencies in the Taiwan Strait. Kishida plans to travel to Spain on June 26 after attending the three-day G7 summit in Germany. Australia, New Zealand and South Korea were also invited to the NATO summit as Asia-Pacific partners. The involvement of Japan and other non-NATO countries will send a strong message of solidarity to the international community in the Ukraine crisis. However, some Liberal Democratic Party lawmakers believe that Kishida, who already has a relatively high approval rating, should concentrate on campaigning before the Senate election.

Source: Oriental Daily, June 4, 2022
https://www.orientaldaily.com.my/index.php/news/international/2022/06/04/490801

Briefings | | |   Geo-Strategic Trend