Chinascope – Page 299

RFA: Pope’s Speech Removed Content Related to Hong Kong

Radio Free Asia (RFA) recently reported that, according to the Italian newspapers Il Tempo and La Verite, Pope Francis’ speech on July 5 removed the content related to the Hong Kong situation from the original draft that was released. The Vatican Press Room did not explain why. The original draft included a call for social freedom, the protection of religious freedom, and sincere dialogues. The removal appeared to be an emergency decision since the Vatican distributed the original content to reporters at 11 am on the same day the Pope gave the speech. The removed contents also said the Pope will continue to pray for the Hong Kong Catholic Church and the kind people in Hong Kong. On his blog, retired Hong Kong Cardinal Joseph Zen Ze-kiun, S.D.B questioned exactly how Chinese President Xi censored the Pope’s freedom of speech.

Source: RFA, July 7, 2020
https://www.rfa.org/cantonese/news/va-pope-07072020124527.html?encoding=simplified

Briefings | | July 14, 2020 | Geo-Strategic Trend

Lianhe Zaobao: Chinese Banks Adjust Plans in Response to U.S. Sanctions

Singapore’s primary Chinese language newspaper, Lianhe Zaobao, recently reported that, according to internal sources from five major China state-owned banks, the Chinese banking industry is updating emergency plans in order to deal with potential new U.S. regulations that may add more sanctions against China after implementing the Hong Kong National Security Law. The Bank of China as well as the Industrial and Commercial Bank of China are preparing for the worst-case scenario which would be losing the source for obtaining U.S. Dollars or the potential of losing the clearing mechanism in the U.S. Dollar system. One source said that one never knows what will actually happen; it is better to hope for the best and prepare for the worst. A new U.S. regulation just passed both chambers (still pending Trump’s signature) which will allow the punishment of banks working with the individuals identified by the U.S. government as having helped destroy Hong Kong’s autonomy. The banks also considered the case of a run on the Bank of China, HK Branch, as well as the lessons that Iranian banks currently suffering from U.S. sanctions have learned. Some Chinese international equipment leasing companies are going through similar exercises.

Source: Lianhe Zaobao, July 10, 2020
http://www.uzaobao.com/shiju/20200710/74557.html

Briefings | | July 14, 2020 | Economy/Resources US-China Relations

On “China’s Growth Story”

by Li Ding

Two Points from the Author of “Whither China” and Their Implications Continue reading →

Perspectives | | July 14, 2020 | Economy/Resources Government/Politics

LTN: China Published Draft Data Security Bill

Major Taiwanese news network Liberty Times Network (LTN) recently reported that, in addition to passing the Hong Kong National Security Law, China’s 13th National People’s Congress also passed a draft Data Security Bill. According to the official draft version online, the proposed new law may require foreign companies operating in China to surrender operational data obtained outside China or face a fine or closure. Until August 16, the draft is currently seeking public opinion. The new proposed data law was drafted under the name of protecting “important data.” It has a broad definition of data whose breach can cause damage in areas of national security, economic security, and social stability. The proposed draft is planned to become law in 2021. The law may also ask foreign companies operating in China to provide information related to “network security.” Experts expressed the belief that the government is, for the first time, seeking an “Extraterritorial effect,” which is designed to cancel out a similar power U.S. laws sometimes have. It also authorizes the government to define what “important data” is. According to the proposal, individuals and organizations operating outside China may also be covered if their activities harm China’s national security or public interests.

Source: LTN, July 9, 2020
https://news.ltn.com.tw/news/world/breakingnews/3222500

Briefings | | July 13, 2020 | Information/Technology

AmCham in Hong Kong: Thirty Percent of Surveyed Members Consider Withdrawal

Radio Television Hong Kong (RTHK), the official broadcasting service in Hong Kong, reported that the American Chamber of Commerce in Hong Kong surveyed 183 businesses regarding the national security law, which accounted for 15 percent of its total membership.

Forty-nine percent of the respondents believed that the national security law has had a negative impact on business. Thirty percent considered divestment or moving their business out of Hong Kong over the medium or long term. Another 5.5 percent were thinking about short-term divestment. The study showed that 41 percent of the interviewees are extremely concerned about the national security laws, including the coverage of the law, the ambiguity of law enforcement, the impact on the judicial independence of Hong Kong, and the weakened status of Hong Kong as a financial center. Another 56 percent believed that the provisions were stricter than expected, and worried about provisions such as extraterritorial jurisdiction, extradition to China, and collusion with foreign forces.

Fifty-one percent of the respondents felt working and living conditions in Hong Kong were less safe after the implementation of the law, and 41 percent were pessimistic about the prospects of Hong Kong.

Source: Radio Television Hong Kong, July 13, 2020
https://news.rthk.hk/rthk/ch/component/k2/1537397-20200713.htm

Briefings | | July 13, 2020 | Economy/Resources

China’s Looming Bad Debt Risks

The China Banking and Insurance Regulatory Commission (CBIRC), which regulates the country’s financial industry, is concerned about the rise in non-performing assets, or bad loans, due to the deteriorating economic and epidemic conditions. The CBIRC suggested measures to prepare for the increase in non-performing loans.

In response to the questions from journalists, the spokesperson of the CBIRC listed four major risks and challenges.

1. The increased pressure of non-performing loans. Although the balance of non-performing loans has not increased significantly since the beginning of this year, due to the time lag between the decline in the real economy and the impact seen in the financial sector, as well as the short-term hedging effect of macro policies, the risk of default has been temporarily delayed. However, the number of non-performing loans will continue to rise in the coming months.

2. Serious problems in some small and medium-sized financial institutions. As the asset quality has increasingly deteriorated under the impact of the epidemic, risks continue to build up.

3. The resurgence of chaotic practices. Some high-risk shadow banks have revived; the leverage (debt) ratio of companies and households has increased. Some funds have flown into the real estate and stock markets, adding to the asset bubbles.

4. Illegalities occur from time to time. For example, the fake gold scandal of Wuhan’s Kingold Jewelry has revealed the almost nonexistent internal control and risk management in some financial institutions.

As of the end of June, the balance of non-performing loans in the banking industry was RMB 3.6 trillion (US $0.51 trillion), an increase of RMB 400.4 billion (US $57.2 billion) from the beginning of the year, with a non-performing loan ratio of 2.10 percent, 0.08 percentage points higher than the beginning of the year.

Source: Central News Agency, July 11, 2020
http://https://www.cna.com.tw/news/acn/202007110163.aspx

Briefings | | July 13, 2020 | Economy/Resources

Merkel’s Weak Attitude Toward Beijing Criticized

The French newspaper Le Monde published an editorial on Wednesday, criticizing the European Union’s weak response after Beijing passed its rubber-stamp Hong Kong National Security Law. The newspaper cited Washington’s elimination of Hong Kong’s special status and the ban on arms exports, Canada’s suspension of its extradition treaty with Hong Kong, and the UK’s offering of citizenship to up to 3 million Hong Kong residents. However, the 27 EU countries have fallen into the trap of interdependent economic relations with China.

Le Monde pointed the finger at Germany, which has served as the EU’s rotating presidency since July 1. Germany finds it difficult to look beyond the economic cooperation that has been carefully woven with China for 15 years, which translates to an annual trade of over 200 billion euros between Berlin and Beijing. The Hong Kong people are disappointed with Merkel.

The newspaper also criticized France, which fears to damage relations with Beijing at the moment when it must fully reopen the economy after coming out of the epidemic. While not giving any details, on Wednesday evening, French Foreign Minister Le Drian assured the Senate that France would take countermeasures against the Hong Kong National Security Law.

Le Monde believes that since the emergence of the epidemic, Beijing has shown its true face. Xi Jinping’s China has transformed and become more aggressive in all respects without hesitation, including the usage of provocative rhetoric to support its policies and disparage the EU model. It has proven that Beijing has become the EU’s institutional opponent. The newspaper pointed out that China’s brutal approach in Hong Kong also poses a severe test for European Commission President Ursula von der Leyen. It proposes that the EU could at least suggest to the Hong Kong people that they would be willing to provide asylum to whoever wishes to escape from the authoritarian regime. If the EU wants to become a global actor and be respected, there is no other choice but to be tough when facing China.

Inside Germany, there has been much criticism of Merkel’s weak performance on the Hong Kong issue. The Social Democratic Party (SPD) criticized Merkel’s attitude towards China. Nils Schmid, a spokesman for the SPD’s parliamentary group, reminded Merkel that she should bid farewell to her outdated perception of China and face reality. Christian Lindner, leader of the Free Democratic Party (FDP), believes that Germany cannot betray its values.

Source: Radio France International, July 8, 2020
https://www.rfi.fr/cn/中国/20200708-港版国安法-默克尔对北京小心翼翼受质疑

Briefings | | July 9, 2020 | Geo-Strategic Trend

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

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

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

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