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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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Xinhua Commentaries: “Exposing the Three Major Political Deficits of the U.S.”

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The CCP’s Performing Arts Troupes in the U.S.

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Report Discloses Huawei Was Able to Eaves-drop on Dutch Phone Calls

A report from Holland made serious allegations against Huawei, China’s tech giant that supplied mobile cellphone network equipment for KPN, a Dutch mobile telecom company that also operates in Belgium, Germany and France. According to the report, Huawei was able to monitor any calls that subscribers made, even including the Prime Minister and several cabinet ministers.

According to reports from The Daily Mail on April19, “Huawei staff were able to monitor all of KPN’s mobile users and eavesdrop on their private conversations. According to the Dutch newspaper de Volkskrant, the staff even knew which numbers the police or intelligence agencies were tapping.”

“The newspaper cited a report that consultancy firm Capgemini prepared for KPN, which it said flagged that Huawei could have been accessing users’ calls in 2010 without KPN knowing.”

“Huawei was, allegedly, even able to monitor phone calls that the former Prime Minister Jan Peter Balkenende, government ministers and Chinese dissidents made.”

Ma Yongtao, a Chinese citizen movement activist living in exile in the Netherlands, told Radio Free Asia that this is a real-life version of the movie “The Lives of Others.” Ma said, “Unlike the former East German regime, the Chinese Communist Party (CCP) has been practicing high-tech totalitarianism not only in China, but around the globe. The CCP allows Huawei to enter the Western market as a private company with a low price and then it acts as a tool for its expansion.”

According to an anonymous source, Huawei remains a key supplier to KPN. This even includes the radio antenna equipment for its 5G network. This means that the company’s mobile network now runs almost entirely on Huawei equipment and technology. The source warned that once the Western governments start to monitor Huawei, Huawei can immediately turn off its surveillance functions. In Europe, he said, if these telecom companies cannot remove Huawei equipment, the security risks will remain.

The Daily Mail added, “The report’s findings were so shocking that the internal report was kept secret, de Volkskrant reports.  … ‘The continued existence of KPN Mobile is in serious jeopardy as licenses can be revoked or the government and businesses can lose their trust in KPN if it becomes known that the Chinese government can eavesdrop on KPN mobile numbers and shut down the network,’ the report said.”

The report disclosed that Huawei, as early as 2004, was acquiring the information of the then Dutch telecom company Telfort, which was later merged with KPN. In 2009, KPN started using Huawei’s network technology and hired six Huawei employees to work at its headquarters in the Hague.

KPN switched to working with Ericsson and Nokia only after the Dutch intelligence agency AIVD issued an alert and launched a security investigation into the matter. After the report came to light, KPN said it found no evidence of wiretapping by Huawei and insisted that it had not outsourced its core network to Huawei.

Source: The Daily Mail, April 19, 2021
https://www.dailymail.co.uk/news/article-9487631
Radio Free Asia, April 20, 2021
https://www.rfa.org/cantonese/news/nd-tap-04202021114941.html

Briefings | | |   Geo-Strategic Trend

Chinese Military Suspected of Being behind Cyberattacks against Japanese Companies

The Japan Aerospace Exploration Agency (JAXA) and many defense-affiliated companies have been subjected to large-scale cyberattacks. Japanese police believe that hacker groups may have carried out these attacks at the behest of the Chinese People’s Liberation Army (PLA).

JAXA suffered a cyberattack in 2016. The Tokyo Metropolitan Police Department found that the attack used a server rented in Japan, and that a Chinese man in his 30s was in Japan at the time and had rented the server five times under a false name. The man, a Chinese Communist Party member, is a systems engineer. It was reported that the ID information needed to log in to the server was passed to a Chinese hacker group called “Tick.”

Police found that another Chinese man also rented a server in Japan under a false name at the behest of the People’s Liberation Army’s “Unit 61419,” a group that specializes in cyberattacks.

The police believe that the hacker group “Tick” carried out the “cyberattacks at the behest of the PLA. The 2016 attack targeted about 200 research institutions and companies, including powerful defense-related companies, in addition to the one against JAXA.

Source: NHK, April 19, 2021
https://www3.nhk.or.jp/nhkworld/zh/news/295247/

Briefings | | |   Defense/Military

Hong Kong Looses over 14,000 Students from Government Subsidized Schools

The Hong Kong government’s Education Bureau recently submitted a written response to the city legislature’s Legislative Council, disclosing the number of students in each district and each grade of primary and secondary schools in Hong Kong in the 2020/2021 school year. The statistics showed a loss of more than 14,000 enrolled students in government subsidized schools as compared to the previous school year, a record high for the past five years.

In primary schools, there was a loss of 4,900 students, a 22-fold increase over the 200-odd dropouts in the 2019/2020 school year. In secondary schools, there were usually a few thousand dropouts every year, but the number of students enrolled this year saw a loss of nearly 9,200 students, more serious than last year.

According to Cheung Yung Pong, the honorary chairman of the Aided Primary School Heads Association in Hong Kong, parents, regardless of their political background, are concerned about the changes in the social and political environment and in the education reform in Hong Kong over the past two years. They have lost confidence in the future of Hong Kong. “Those who can afford to leave will do so and those who do not leave for the time being will also transfer their children to international schools to prepare for emigration.” Cheung believes that the government and the Legislative Council are about to change, setting off waves of repercussions. This year’s dropouts have not topped off, and the situation may be worse next year.

Source: Sing Tao Daily, April 15, 2021
https://std.stheadline.com/daily/article/2349887

Briefings | | |   Government/Politics

BBC Chinese: Record Number of Chinese Military Aircraft Entered Taiwan Air Defense Area

BBC Chinese Edition recently reported that, according to the Taiwanese authorities, on April 12, the number of Chinese military aircraft entering the Taiwanese air defense identification area reached a single-day record of 25 aircraft, including fighter jets and bombers with the capability of carrying nuclear bombs. This happened when the United States warned that China has become more and more aggressive. The Taiwanese Ministry of National Defense also confirmed that the Taiwanese Air Force did send fighter jets to warn the Chinese aircraft and started missile defense system tracking and monitoring of the Chinese activities. Some analysts expressed the belief that this could be a response to the increased U.S. Navy’s activities in the region. It could also be utilized to prepare the public opinion, especially inside Mainland China, for potential military actions against Taiwan. China never made the promise that it would not invade Taiwan militarily.

Source: BBC Chinese, April 13, 2021
https://www.bbc.com/zhongwen/simp/chinese-news-56734011

Briefings | | |   Defense/Military Geo-Strategic Trend

Sputnik Chinese: Ankara Threatens to Rename the Street Where Chinese Embassy Is Located

Well-known Russian news agency Sputnik recently reported on its Chinese Edition site that the authorities from Turkey’s capital city are considering renaming the street where the Chinese Embassy sits. The motion was submitted to the city government committee for review. This happened after the Chinese Embassy in Turkey tweeted condemnation of Turkish politicians for slandering human rights in Xinjiang. The Chinese Embassy’s tweet was in response to criticism from two Turkish opposition politicians. Later the Turkish Ministry of Foreign Affairs summoned the Chinese Ambassador to Turkey to protest. At a regular press conference, the Chinese Foreign Ministry spokesperson supported the Chinese ambassador’s position against certain Turkish politicians’ comments on Xinjiang affairs and stated that the relevant response of the Chinese Embassy in Turkey was completely reasonable and beyond reproach. The Ankara city government has already started “maintenance work” near the Chinese Embassy and cut off the water supply to the Embassy.

Source: Sputnik Chinese, April 13, 2021
http://sputniknews.cn/politics/202104131033471779/

Briefings | | |   Geo-Strategic Trend

RFA: Forced TV Confession Victims Called for Chinese Communist Broadcasting to Stop

Radio Free Asia (RFA) Chinese Edition recently reported that thirteen victims who had been forced by the Chinese Communist Party to make TV confessions jointly called the European satellite carrier Eutelsat for an immediate stop to the broadcasting of the CCTV4 and CGTN channels. According to one of the organizers, Swedish human rights activist Peter Dahlin, Norway communications provider Telia already agreed to cut off CGTN. In addition to Peter Dahlin, the thirteen victims also include people from the former staff of the British Consulate General in Hong Kong, other Hong Kong residents, and Chinese Mainland human rights lawyers and activists. The joint announcement was published via NGO (Non-Governmental Organization) Safeguard Defenders. The announcement described the facts that the Chinese Communists forced the victims to confess guilt on national TV and took away their legal rights to a fair trial. The open announcement also stated that more victims could not speak up and some had even been executed. The victims have nowhere to claim compensation. Earlier, Sweden stopped CGTN and CCTV4 due to the fact that the channels broadcasted the forced confession video of two Swedish citizens.

Source: RFA, April 13, 2021
https://www.rfa.org/cantonese/news/nw-tele-04132021102013.html

Briefings | | |   Geo-Strategic Trend

Former Premier Wen Jiabao’s Article Banned from Being Shared on Wechat

Former Chinese Premier Wen Jiabao recently published a long article in the Macao Herald to commemorate his mother. The article mentioned that, for him, to work inside the Zhongnanhai leadership compound was like walking on thin ice. At the end of the article, he wrote, “In my mind, China should be a country that has complete fairness and justice,” but the article was banned from being shared on WeChat citing violations of WeChat policy. The contents shared on Phoenix.com and other media were also deleted.

Many people are shocked that Wen’s article was blocked from being shared and wondered why. Cai Xia, a CCP party school professor currently living in the U.S. said that Wen did some self-reflection in the article. There was no mention of democracy or the rule of law but it was still banned from being shared. This suggests that the ruling party fears the rights of the people. @LifetimeUSCN commented on its twitter account that Wen’s mentioning the danger and risk that he faced while working inside the Zhongnanhai CCP leadership compound might have upset Xi Jinping.

When Wen Jiabao was the prime minister and Hu Jintao was the general secretary of the CCP, people referred to them as the “Hu-Wen Administration.” It was considered by many to have been a stable period. Wen Jiabao was regarded as a moderate and open-minded leader because of his advocacy of universal values in party newspapers. He also repeatedly expressed the hope of promoting political system reform.

Some netizens believe that there is another important reason why Wen Jiabao still got attention in China. The Hu-Wen administration is considered to be much better than the current “new era.” Although it was also a one-party communist dictatorship, at least it was not like the current stage where everything is determined by the “Supreme One” [Xi Jinping] who amended the constitution and became a self-proclaimed emperor. SARS didn’t spread to the world and became a worldwide epidemic. Hong Kong was not like what it is now, and there was no trade war between China and the U.S.

Source: Radio France Internationale, April 19, 2021
https://www.rfi.fr/cn/%E4%B8%AD%E5%9B%BD/20210418-%E6%B8%A9%E5%AE%B6%E5%AE%9D%E5%BF%86%E6%AF%8D%E6%96%87%E7%AB%A0%E5%BE%AE%E4%BF%A1%E7%A6%81%E6%AD%A2%E5%88%86%E4%BA%AB

Briefings | | |   Government/Politics

Bank of China: Economic Slowdown in the Next 30 Years Due to Demographic Transition

The Bank of China, the central bank of the Chinese Communist Party (CCP), recently published a paper dated March 26, 2021. The paper warned that the aging population and declining birthrate are more severe in China than in developed countries and that China will face far more severe challenges for a long time into the future.

China’s economic growth will slow down.

First, there will be a reduction in the working population. China’s economic growth has been under the reform and opening up of production.  A demographic dividend transformed China’s economic growth. Since 2010, the Chinese economy has entered a new norm with declining potential output, directly caused by the decline in the labor force. It is estimated that from 2020 to 2050, the working population will decrease year by year at a rate of more than 0.5 percent and by 2050 it will have dropped by 15.2 percent compared to 2019. In 2010 the working population was 74.5 percent of the total population By 2019, it fell to 70.6 percent. It will be 64.6 percent by 2035 and 59.8 percent by 2050.

Second, the burden of elderly care is growing. The elderly dependency ratio, the ratio of the elderly population (ages 65+) per 100 people of working age (ages 15-64), will reach 36 percent. It was 17.8 percent in 2019 and is expected to be 32.0 percent and 43.6 percent by 2035 and 2050, respectively. If calculated based on retirement at the age of 60 (that is, no delay in retirement), the elderly dependency ratio will rise to 49.8 percent and 67.6 percent, respectively. It means one worker will need to support 0.5 and 0.7 elderly, respectively. Further, government pension expenditures as a proportion of GDP have risen rapidly. They were at 5.3 percent in 2019, an increase of 4.5 percentage points from 1990. As the old-age dependency ratio increases in the future, this expenditure will continue to rise.

Third, China will face low growth, low-interest rates, low inflation, and high debt. China’s demographic transition means that more people are consuming and fewer people are producing, which leads to economic stagnation, weak consumer prices, and declining asset prices. It will be very similar to the current situation of low growth, low-interest rates, low inflation, and high debt in Japan, Italy, and other countries. Moreover, the situation in China may be more difficult because of the faster population transition, with a growing aging population and declining birthrate.

The central bank paper said, “The economic gap with the United States will continue.”

The paper continued, pointing out that while China is facing the acceleration of its aging population and a declining birth rate, the U.S. population is undergoing favorable changes due to immigration and other reasons.

While the population in China is declining, the United States’ population is increasing. The United Nations predicts that, by the year 2050, the United States’ population will increase by 50 million, compared to 2019, an increase of 15 percent, while China will decrease by approximately 32 million in the same period, a decrease of 2.2 percent.

Fourth, China’s working population has been decreasing while the U.S. working population has been increasing. It is estimated that in 2035 and 2050, the size of China’s working population will drop by 4.6 percent and 15.2 percent from 2019, while the United States will grow by 2.4 percent and 7.7 percent, respectively, for the same periods. In terms of the ratio between the working population and the total population, China and the United States were 70.6 percent and 65.2 percent, respectively, in 2019. China will be 5.4 percentage points higher than that of the United States; in 2035, the gap will be reduced to 3.2 percentage points; in 2050, China will be lower than the United States by 1.3 percentage points.

Fifth, China’s elderly care burden is increasing faster than that of the United States. In 2019, China’s elderly dependency ratio was 17.8 percent and the United States was 24.8 percent, and China was seven percentage points lower than the United States. In 2035, the two countries will be basically the same. In 2050, China will be seven percentage points higher than the United States.

Sixth, China’s population structure will be very different from that of the United States. By 2050, China’s population distribution will be narrower at the bottom with fewer children and a shrinking working population in the middle, but wider at the top with a larger elderly population. For the United States, the bottom and middle of its population structure will be much wider, showing more young people and more working-age people. The top will be narrower, showing a smaller elderly population.

The central bank paper asked, “If, in the past 40 years, China had been able to narrow the economic gap with the United States by relying on cheap labor and substantial demographic dividends, then what would China rely on in the next 30 years?”

Sources:

1. Bank of China, March 26, 2021
http://www.pbc.gov.cn/redianzhuanti/118742/4122386/4122692/4214189/4215394/2021032618473569432.pdf

2. China.com, April 14, 2021
https://finance.china.com/domestic/11173294/20210415/37251654.html

Briefings | | |   Economy/Resources US-China Relations