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Package Delivery Companies in China on Strike

Recently, people in many parts of China have complained about the delay in package delivery. The media reported that a number of package delivery companies are on strike due to wage cuts. The strike highlights the unhealthy price competition among the booming package delivery companies in China.

Metropolitan newspapers reported that due to rising logistics costs, some delivery companies chose to cut the delivery fee paid to couriers to save money. One company cut the delivery fee from the original 1.2 yuan (18 cents) per item to 0.5 yuan (7.5 cents).

The couriers who went on strike came from companies including ZTO Express, Yunda Express, Best Express, and the YTO Express Group. The affected areas included Changsha in Hunan province, Sanming in Fujian province, Hebei province, Suzhou in Jiangsu province, and Changchun in Jilin province.

The booming e-commerce in China has sent the package delivery industry on a high growth path. Although companies such as SF Express, Yunda Express, and STO Express have gone public, the industry has been stuck in a price war for a long time.

For example, in 2015, in Yiwu city of Zhejiang province, the delivery fee was 7.44 yuan (US$ 1.11) per item, and in the first half of 2019, it dropped to only 3.45 yuan (52 cents). Parcels under one kilogram had a fee as low as 1 yuan (15 cents).

In addition, most couriers, except SF Express employees, are paid using a piece rate only and have no minimal pay.

Source: Central News Agency, October 18, 2020
https://www.cna.com.tw/news/acn/202010180200.aspx

Open Slots for TOEFL Test Taken within 5 Minutes

TOEFL, the Test of English as Foreign Language, is an important test for foreign students to take in order to study in the universities in the U.S. China’s official TOEFL test site recently opened the first wave of registration for the 2021 TOEFL test. People were shocked to find out that the slots from January to August for test centers in Beijing and Shanghai were gone in the first 5 minutes. However, later on, the China TOEFL site assured the test takers that more seats would be released later on every Wednesday and Friday.

Chinese netizens commented that the media inside of China constantly attack the U.S. but the TOEFL test slots were still taken in the first 5 minutes. Many Chinese high ranking officials, diplomats or spokesperson send their daughters and sons to study in the U.S. People joked that it is because “Slandering America is their job but living in America is their life.”

Source: Liberty Times Net, October 17, 2020
https://news.ltn.com.tw/news/world/breakingnews/3324266

European Union Chamber of Commerce Concerned about United Front Work in Private Companies

Back in September, the CCP General Office issued the “Opinions on Strengthening United Front Work in the Private Economy in the New Era.” Recently the European Union Chamber of Commerce in China issued a position paper which expressed concerns that the Opinions will further influence a company’s policy and that the CCP will directly intervene in the business decision-making process.

In the Opinions, all private economic enterprises operating in China were required “to strengthen and expand political consensus.” It stated further that the party should “further strengthen its leadership over the united front work in the private companies, let them unwaveringly listen to the party and follow the party, let the entrepreneurs in the private sectors maintain a high degree of consistency with the Party Central Committee and always be politically sensible persons in their political stance, political direction, political principles, and political path.”

The European Chamber of Commerce stated that this may cause private companies to react to the political elements in the decision-making process, which could pose great harm and hinder the company’s productivity and profitability. This will also impact their business confidence and will make them reconsider their current and future investment strategies in China. These companies worry that, in the long run, such united front policies will appear regularly.

As early as the end of 2017, China passed Article 19 of the “Business Law” which required that a company can have a party sub-branch (in a company) as long as there are three Chinese Communist Party members in any state-owned enterprise, foreign investment company, or joint venture.

In June of this year, the European Union Chamber of Commerce in China conducted a survey. Many European companies believed that the major obstacles to operating in China were from imposed scrutiny and from unfair privileges that the state-owned enterprises have. Among the 626 European companies surveyed, 44 percent expect that China will further impose more regulations in the next five years and nearly half expect that the state-owned enterprises will gain growth opportunities this year, while private enterprises will be sacrificed.

The European Chamber of Commerce also mentioned that the Chinese companies operating overseas will also be impacted because foreign companies will face stricter scrutiny from the CCP if they decide to work with any Chinese companies.

Source:
1. Epoch Times, October 18, 2020
https://www.epochtimes.com/gb/20/10/18/n12484864.htm
2. Deutsche Welle, October 16, 2020
https://p.dw.com/p/3k14r

China Mobile Phone Makers Gain Market Share in the West Following Huawei’s Setback

A number of Chinese mobile phone manufactures have become the most active players in the world’s mobile phone market. They capitalized on the opportunity from the recent setbacks that Huawei suffered and have begun to gain market share in the Western world. According to an article in the economics section of the French Le Monde published on Thursday October 15, following two of the Chinese mobile phone manufactures, Oppo and Xiaomi, Vivo, based in Guangdong province of China, has begun to enter the European market. Vivo will debut in France on October 20th. In 2019, Vivo sold 110 million smartphones and ranked fifth in the world, with most of these sales made in Asia. Vivo has close to 10,000 engineers in research and development. Its team in France is recruited mostly from Samsung, Honor, Huawei, Nokia and other companies. Vivo has established partnerships with other telecom communication companies and large retailers, and has planned to rely on word of mouth to break ground. It may also soon announce a partnership with a popular sports event.

In a similar situation, Oppo has greatly benefited from its partnership with sports events this year. Following its advertising during Laurent Garros Tennis Tournament, Oppo’s online search volume quickly rose. Oppo was launched in France two years ago. From January to July of this year, its sales volume increased by 350 percent compared with the same period last year. It has since relocated its customer service department to France. The sale of another Chinese brand, Xiaomi, has experienced a similar growth in France. It entered the French market a little earlier than Vivo, and it predicts that its sales growth this year will be a little over 100 percent.

Source: Radio France Internationale, October 16, 2020
http://rfi.my/6h51.T

India warned Amazon and Flipkart about Products’ Country of Origin

The Indian government issued warning letters to Amazon’s Indian unit and Walmart’s Flipkart, stating that the two e-commerce companies did not indicate the country of origin for the goods sold on their platforms, a violation of government regulations.

Reuters reported on Saturday, October 17, that at a time of intense India-China relations, the letter that the Ministry of Consumer Affairs, Food and Public Distribution issued on Friday showed that the Indian government has strengthened the implementation of the regulation as one of its attempts to slash imports of goods made in China.

The Ministry gave these two companies 15 days to explain why the goods sold on the platform did not indicate the country of origin, and threatened that it would then take action. However, the letter did not mention the specific actions to be taken, referring only to legal actions that have provisions for fines.

After the bloody border conflict between India and China broke out in June of this year, relations between the two countries have continued to escalate. India has since blocked at least 177 mobile applications from China, and Chinese products exported to India have also met with additional inspections and delays.

Source: Voice of America, October 17, 2020
https://www.voachinese.com/a/amid-tensions-with-china-india-warns-amazon-flipkart-over-country-of-origin-rule-20201017/5625414.html

Concerns over China and UN’s Joint Data Center

China’s investment in data collection has increased in recent years, with its tentacles extending around the globe. There have been concerns about the news that China will cooperate with the United Nations to establish a data center.

Xi Jinping, the head of Chinese Communist Party, said at the general debate of the 75th session of the UN General Assembly, “China will set up a UN Global Geospatial Knowledge and Innovation Center and an International Research Center of Big Data for Sustainable Development Goals to facilitate the implementation of the 2030 Agenda for Sustainable Development.”

According to the Chinese government website and state media, as early as April last year, the Ministry of Natural Resources signed a memorandum of intent with the UN Department of Economic and Social Affairs in Beijing to initiate preparations for the establishment of a United Nations Global Geospatial Knowledge and Innovation Centre in Deqing, Zhejiang. The work aims to share global geospatial data and promote exchanges and cooperation among UN member states in the field of geographic information. In addition, the National Bureau of Statistics of China and the United Nations Department of Economic and Social Affairs will jointly establish the big data research institute which will also be located in Hangzhou, less than an hour away from Deqing.

Ms. Rosett, an adjunct fellow with the Hudson Institute, wrote a Wall Street Journal opinion article in which she stated, “Mr. Xi’s promised U.N.-China geospatial and big-data complex would allow for detailed mapping of everything from topography and infrastructure to human behavior, across time and around the globe. China under its own steam is already collecting and in some cases pilfering troves of data world-wide. However, the U.N. badge of legitimacy would make it easier for Beijing to secure flows of data from member states, influence U.N. standards and norms for such data collection, shape the results, feed them into the U.N. system—and project the Chinese Communist Party’s techno-tyranny around the world.”

Source: Radio Free Asia, October 14, 2020
https://www.rfa.org/mandarin/yataibaodao/junshiwaijiao/hj-10142020135400.html

Hong Kong Government Requires New Civil Servants to Swear Allegiance

In response to the demonstrations reflecting the anti-extradition law amendment movement, the Hong Kong government now requires new civil servants to swear allegiance to the Basic Law and the Special Administrative Region (SAR).

The SAR Government announced on October 12 that civil servants appointed on or after July 1 of this year will have to declare their support for the Basic Law, swear loyalty to the Hong Kong SAR and vow to be accountable to the SAR government.

A spokesperson for the Civil Service Bureau (CSB) said that the move is to strengthen civil servants’ awareness of the expectations and responsibilities of public office, help further maintain and promote the values that civil servants should abide by, and ensure that the Hong Kong government has effective governance.

After the outbreak of the anti-extradition law amendment movement in Hong Kong last year, some civil servants who participated were punished. According to the figures, as of July, 46 civil servants had been arrested in the demonstrations.

Source: Central News Agency, October 12, 2020
https://www.cna.com.tw/news/acn/202010120207.aspx

China’s Draft Data Security Law: Foreign Companies Caught in the Middle

In July of this year, the Chinese government introduced the Draft Data Security Law. Article 2 of that law states that the law’s jurisdiction extends to “organizations and individuals outside of” China who engage in data activities that harm China’s national security or the public interest of the Chinese people. It is expected that the law will take effect after being discussed and passed at the National People’s Congress next year.

Observers pointed out that the Chinese government may use Article 2 of the law, which extends the legal responsibility for data security to other parts of the world, to achieve its political purposes.

James Andrew Lewis, senior vice president and director of the Technology Policy Program at CSIS, (The Center for Strategic and International Studies) told Voice of America, “The bill gives Chinese authorities the ability to regulate data controllers, whether they are in China or outside of China, so it has an extra-territorial effect.”

Dr. Lynette Ong, an associate professor of political science at the University of Toronto, said that the draft law is certainly a deterrent to foreign companies, just like the Hong Kong National Security Law. “In fact, the effect of this law is to legalize their (the government’s) actions … but this does not mean that, without this law, no action would be taken. If any foreign organization’s actions harm China’s interests, they would also take action, even if there were no such law.”

In addition, under Article 32, as long as the police or another law enforcement agency adheres to relevant law and procedures vis-à-vis a request to access data, data holders will be obliged to cooperate.

Professor Ong said that this legal provision may worry the chief executive of a foreign company. “If I were the chief executive officer of a data company, I might be worried about whether to continue to operate in China. I think data companies are particularly sensitive, because their customers have high expectations for data security. Therefore, if a certain standard cannot be met, they may leave mainland China completely. In fact, this will have a certain impact on the Chinese economy.”

 

In 2005, Shi Tao, a Chinese journalist, writer and poet, was sentenced to 10 years in prison for releasing a document of the Communist Party to an overseas Chinese democracy site. Yahoo!-China was later discovered to have facilitated his arrest by providing his personal details to the Chinese government.

Source: Voice of America, October 12, 2020
https://www.voachinese.com/a/China-data-security-law-its-impact-on-foreign-companies-in-China-20201012/5618170.html