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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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Global Times: Russia Plans to Quit the International Space Station

Global Times recently reported that multiple high ranking Russian government officials said Russia will leave the alliances that constructed the International Space Station and start to build its own space station. This may put an end to the 20-year international relationship, which was recognized as a “rare example” of cooperation between Russia and the West. Dmitry Rogozin, Director General of Roscosmos, said Russia is gradually leaving the International Space Station and is ready to build Russia’s own, pending President Putin’s approval. The new Russian Station is expected to be launched in 2030. The International Space Station was founded in 1998. It centered on the United States and Russia, with the help from Japan, Canada, the European Space Agency member countries and Brazil. The 16-country international project received a total investment of over US$100 billion. Russia provided significant support to the International Space Station over the years. Currently the Station is rapidly aging. The United States did not show any interest in working with Russia in the future and both sides expressed the intent to have their own stations.

Source: Global Times, April 25, 2021
https://world.huanqiu.com/article/42rkMQxDBTQ

Briefings | | |   Geo-Strategic Trend Information/Technology

TSMC Chairman: China’s Semiconductor Industry Is Still Far Behind

Major Taiwanese news network China Times recently reported that Morris Chang, Chairman of TSMC (Taiwan Semiconductor Manufacturing Company), gave a speech at a think tank conference. He expressed the view that China’s semiconductor industry is still far behind Taiwan while South Korea’s Samsung is a strong competitor. TSMC is currently the world’s most valuable semiconductor manufacturer. Chang thinks Mainland China is still over five years behind, even with tens of billions of dollars in government subsidies. Chang said that Taiwan has three competitive advantages. One is a large talent pool in the semiconductor area. Even the United State cannot compare. The second is that all levels of managers are from Taiwan. The third advantage is Taiwan’s advanced high-speed railway system and freeway system, which are suitable for large-scale manufacturing personnel movements. TSMC has three major manufacturing centers across Taiwan and thousands of engineers can be mobilized without moving their homes. TSMC has started investments in the United States. However, Chang has some reservation about the popularity of the manufacturing industry in the U.S. as well as the loyalty of U.S. engineers.

Source: China Times, April 22, 2021
https://www.chinatimes.com/cn/newspapers/20210422000563-260102?chdtv

Briefings | | |   Geo-Strategic Trend Information/Technology

Accused of Leaking Xi Jinping’s Daughter’s Info, 22-Year-Old Computer Genius Sentenced to 14 Years in Prison

On April 23, the Chinese high court affirmed the verdict of the lower court and sentence 22-year-old Niu Tengyu to a 14-year prison term. The verdict was issued in the absence of the defendant, the lawyers and the defendant’s family members. Niu and 23 other young people were accused of leaking the personal information of the daughter of Xi Jinping on the Internet.

In May 2019, the personal information of Xi Jinping’s daughter Xi Mingze and Xi Jinping’s brother-in-law Deng Jiagui appeared on two overseas websites called, “The Hong An Foundation” and “Shina.” China’s Ministry of Public Security formed a task force. Cyber police from Maoming city in Guangdong province arrested the members of “Esu wiki,” a website on the mainland. It was said to have connections with the two overseas websites because they were unable to catch the leakers overseas.

On December 30, 2020, the Maonan District Court in Maoming City, Guangdong Province issued a verdict that all 24 people who were arrested were found guilty. Niu, the primary suspect, was sentenced to 14 years in prison, and the rest of the people were sentenced to 1 to 4 years in prison. Niu was only 20 year old, and he is considered a computer genius.

Hong Kong Apple Daily reported that the Niu’s family accused the Maoming police of torturing and forcing Niu to “confess” that he was the primary lead in the case because they were unable to arrest the owners of the foreign websites. Niu’s mom has met with foreign diplomats from countries such as the U.S., the U.K and France to appeal her son’s arrest. She told Voice of America that she wishes that the diplomats would convey the truth to their country’s leaders because the arrested kids are being used as scapegoats and were wrongfully charged. She said that the authorities knew that the owners of the foreign websites admitted that they leaked the information and it has nothing to do with the members of Esu wiki. However, the authorities still told the parents to cooperate with the investigation and even closed the online chat groups that the parents had set up. They told the parents not to speak with any foreign media and threatened the defense lawyers, telling them that they cannot file a not guilty plea for the kids. Niu’s current lawyer is the fifth one. The police from Tianjingy took them away on April 23. Niu’s mom said Xi Jinping promoted the rule by law but the local officials have been covering up their mistakes and they have been “juggling” with the law. She assured those that she communicated with that the case is a wrongful conviction and she is going to fight for her rights all the way to the end.

Source: Central News Agency, April 23, 2021
https://www.cna.com.tw/news/firstnews/202104230291.aspx

Briefings | | |   Government/Politics

Apple Daily: Chinese Entrepreneur Sun Dawu Was Officially Arrested

Last November, Hebei police took away Sun Dawu, the founder of the Dawu Agricultural and Animal Husbandry Group in Hebei Province who is known as an “outspoken entrepreneur. They also took “his wife Liu Huiru and a few others for investigation and accused them of “slandering and disturbing the social order. At the same time, officials from Hubei province dispatched 29 teams to the Dawu Group and took over the management of the company. The Dawu Group Legal Director Yang Bin revealed on Weibo on April 22 that the authorities have issued an official arrest notice to Sun Dawu, who by that time, had been in custody for more than five months. Six other senior officials of the company also received arrest notices. Sun was charged with crimes including illegally misleading the public to collect deposits, slandering and disturbing the social order, illegal mining, illegal occupation of farmland and more. Sun is currently being detained at the Hebei Gaobeidian Detention Center. Yang wrote that a number of signs indicate that the investigative agency is speeding up the pace of the case.

Netizens posted comments calling the charges ridiculous and said that the officials can always come up with charges if they want to. [Editor’s note: The Chinese idiom 欲加之罪何患無辭 is applicable. It means, “He who has a mind to beat his dog will easily find a stick.”]

Sun is another outspoken person who was imprisoned for speaking up against the current regime. For more information, please see the previous published briefing on Sun’s arrest: Four Reasons Why the CCP Arrested Farmer Businessman Sun Dawu, http://chinascope.org/?s=sun+dawu

Source: Apple Daily, April 23, 2021
https://tw.appledaily.com/international/20210423/7S7BDLX6Z5HLZIUYDLZHGTRC5Y/

Briefings | | |   Government/Politics

China’s Q1 Foreign Direct Investment Showed a 4.6 Percent Annual Increase

On March 25, China’s Ministry of Commerce announced that foreign direct investment data for the first quarter of 2021 was 206.14 billion yuan (US$31.79 billion), a year over year increase of 4.6 percent. The data showed that foreign non-financial direct investment was 160.81 billion yuan (US$24.76 billion), a year-over-year decrease of 4.9 percent. The amount for the completion of contracted projects was 195.31 billion yuan (US$30.07 billion), roughly the same as the same period last year. The newly signed contract value was 347.24 billion yuan (US$534.62 billion), a year-over-year decrease of 10.2 percent. In addition, 74,000 individuals from different labor forces were dispatched overseas. At the end of March 590,000 personnel were working abroad.

Below are four major highlights:

1) “Belt and Road” countries showed a steady growth in investments. In the first quarter, China’s non-financial direct investment in these countries was US$4.42 billion, an increase of 5.2 percent year over year. The value of newly signed contracted projects was US$31.34 billion, and the completed contract value was US$17.75 billion, an increase of 19.4 percent and 12.4 percent year-over-year respectively.

2) The investments in manufacturing, information transmission and other fields showed a rapid growth. In the first quarter, investment in manufacturing was US$3.84 billion, a year over year increase of 17.8 percent; the investment in the information transmission industry was US$1.62 billion, a year over year increase of 20.9 percent.

3) Foreign investments from local enterprises have increased. In the first quarter, foreign non-financial direct investment by local enterprises was US$20.03 billion, a year over year increase of 9.9 percent, accounting for 80.8 percent of the total foreign direct investment in the same period. The year over year growth of foreign investment from the eastern, central and western regions reached 7.2 percent, 45.6 percent and 6.3 percent respectively.

4) Foreign contracted projects are mostly in infrastructure. In the first quarter, the value of newly signed contracts for overseas infrastructure projects was US$41.2 billion, and for the completed contracts, it was US$24.6 billion, accounting for 77 percent and 81.6 percent of the total respectively.

Source: Sina, April 25, 2021
https://sina.com.hk/news/article/20210425/2/81/2/%E5%95%86%E5%8B%99%E9%83%A8-%E4%B8%80%E5%AD%A3%E5%BA%A6%E4%B8%AD%E5%9C%8B%E5%B0%8D%E5%A4%96%E7%9B%B4%E6%8E%A5%E6%8A%95%E8%B3%872061-4%E5%84%84%E5%85%83-12988123.html

Briefings | | |   Economy/Resources

The Population of Eight Chinese Cities Is Declining

According to the 21st Century Business Herald, a Chinese business-news daily newspaper published in China, at least 26 prefecture-level cities have disclosed their population data. Eight of them see that their natural population growth rate has turned negative. A prefectural-level city is an administrative division that ranks below a province and above a county in the country’s administrative structure.

The eight cities include the northeastern cities of Shenyang and Fushun, five cities in Jiangsu province – Taizhou, Yangzhou, Zhenjiang, Changzhou and Wuxi – as well as Weihai in Shandong province. In 2020, Wuxi, a city with a household population of more than 5 million, registered a birth rate of 7.75 percent, a death rate of 7.91 percent and a natural population growth rate of -0.16 percent. Some cities are also on the verge of negative growth, such as Wuhu from Anhui province, Jiaxing and Ningbo from Zhejiang province, with natural population growth rates of 0.12 percent, 0.43 percent and 0.75 percent respectively.

Jiangsu ranks among the richest provinces in China. In 2020, it reported a gross regional product of 10.27 trillion yuan (US$1.58 trillion), becoming the second province to break 10 trillion yuan after Guangdong. Jiangsu’s GDP per capita reached 125,000 yuan (US$19,230), ranking first in the country. The city of Wuxi has an economy of 1.2 trillion yuan (US$180 billion); Changzhou, Yangzhou and Taizhou’s economic volume also range between 530 billion and 770 billion yuan.

Cai Fang, a member of the Monetary Policy Committee of China’s Central Bank, stated at a recent meeting that China’s total population will peak in 2015 and then decline afterwards. The People’s Bank of China released a research paper on April 14, calling for the complete removal of restrictions on childbirth and easing the difficulties that women encounter in pregnancy, childbirth, childcare and schooling, so that “women dare to have children, can have children and want to have children.”

Yi Fuxian of the University of Wisconsin in Madison is skeptical. “This involves a series of reforms … and is more difficult than (the reform) in 1979. The government can’t do anything if they don’t want to or they can’t give birth. The only thing it can do is to (solve) the problem of not being able to afford to have children. This requires real money, but local governments are cheapskates and no one is willing to pay money to encourage childbirth. Education, health care and childbirth subsidies all need money. Raising consumption taxes would lead to a decline in economic vitality.”

Source: Radio Free Asia, April 21, 2021
https://www.rfa.org/mandarin/yataibaodao/shehui/xx-04212021161813.html

Briefings | | |   Economy/Resources

Finnish Military Rejects China’s Attempted Purchase of Arctic Airport

Finnish media recently reported that the city of Kemijärvi, located in Finland’s northernmost Lapland region, after notifying the Finnish Defence Forces, rejected an offer a Chinese state agency made to buy or lease a local airport adjacent to a military zone.

The Finnish Broadcasting Company (YLE) reported on March 4 that the  director of the Polar Research Institute of China (PRIC), the head of the polar research of China’s State Oceanic Administration, and a military attaché from Chinese Embassy in Finland, led a delegation, and traveled to Kemijärvi in 2018 with a plan to buy the airport. The airport would be used for landing and take-off of Arctic research airplanes. The Chinese side did not rule out covering the costs of renovating and expanding the airport.

“Their intention was to conduct Arctic research on the polar ice cover. They would have needed a base for these operations in Kemijärvi. A large jet aircraft with different measuring equipment would have come there, and they would have flown to the North Pole, taken their measurements and flown back,” explained Kemijärvi’s Mayor Atte Rantanen.

The flight route would have also made observations possible over the Arctic Ocean and the Northeast Passage, which is an area of interest to both China and Russia.

The 3,000-nautical-mile-long Northeast Passage of the Arctic Route, sailing westward through the Bering Strait, passing through the Chukchi Sea along the northern waters of the Eurasian continent, through the Barents Sea to the vicinity of the North Cape of Norway, and finally arriving at various ports in Europe, is the shortest sea channel to connect China and Europe. From the perspective of maritime transport efficiency, the Arctic route is 12 to 15 days less than the traditional route, known as the “Golden Waterway.”

The Kemijärvi municipal airport and airspace is adjacent to the Rovajärvi firing range, which  the Finnish Defence Forces often use. After receiving the Chinese proposal, the city inquired about the response of the Defence Forces to the idea. “There was a clear view from the army that this type of activity could not be carried out there. It’s too close to Rovajärvi,” said Mayor Rantanen.

Anu Sallinen, a consultant with the Finnish Ministry of Defence, also told YLE that the idea to buy the Kemijärvi airport came to the Ministry three years ago. She noted that the property is unlikely to be sold to a foreign state-owned enterprise as it is next to a strategically important firing range. Moreover, such a proposal would be unrealistic given the 2020 EU legislation restricting foreign investment. China currently has Arctic research centers in Greenland, Iceland and Svalbard, a Norwegian archipelago in the Arctic Ocean, situated north of mainland Europe.

Source: Radio France International, March 5, 2021
https://rfi.my/7BxW.T

Briefings | | |   Geo-Strategic Trend

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