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On Structural Reform: “What Cannot be Changed Will Not Be Changed”

At the Chinese Foreign Ministry’s regular press briefing on Tuesday, December 18, a reporter asked, “It is reported that Peter Navarro, Director of the White House National Trade Council, said that the purpose of the US-China trade negotiations is not only to ask China to buy more American products. More importantly, China needs structural reforms. What is your response?”

Spokesperson Hua Chunying started with a vague statement, “It is hoped that teams on both sides can earnestly implement the consensus reached at the meeting of the two heads of state … seeking mutually beneficial and win-win results.”

In response to Navarro’s, “China needs structural reforms” question, Hua then suggested that Navarro and “officials or people who hold these thoughts” should “carefully read and study” Xi Jinping’s speech at the celebration of the 40’s anniversary of China’s “Reform and Opening Up” policy earlier that day. Hua continued and repeated paragraphs from Xi’s speech.

In particular, he said, “To advance reform and development in a large country like China with more than 5,000 years of civilization and more than 1.3 billion people, there is no textbook that can be regarded as a golden rule and there is no one who can boss us around like a master teacher.”

“We will resolutely change what should be and can be changed and will resolutely not change what should not and cannot be changed.”

These words were much tougher than the 45-hour speech of Xi Jinping at the Trump-Xi meeting on December 1. At that meeting, Xi Jinping personally promised China would carry out structural reforms; Xi’s promise clearly played an important role in the agreement of the 90-day trade truce.

Source: Radio France International, December 18, 2018
http://rfi.my/3Wy.T

China News: National Bureau of Statistics Responded to Concerns about Economic Pressure

China News recently reported that, at a press conference that the State Council Information Office organized, Mao Shengyong, spokesperson for the Chinese National Bureau of Statistics, commented on the status of the Chinese economy. The conference was to address widespread concerns about the fact that the Chinese economy is under high pressure because of a significant slowdown, especially when the just-released November macro economy numbers did not look encouraging. Mao explained that analysts should look at the Chinese economy in the context of the global economic background. Second, analysts should not look exclusively at November numbers only. Instead, an analysis should be done using a longer time-frame. Mao indicated that many countries as well as international trade are seeing weak growth, which triggered the Chinese slow-down. Some Chinese numbers do indicate pressure, but overall China’s economic health shows stability.

Source: China News, December 14, 2018
http://www.chinanews.com/cj/2018/12-14/8701980.shtml

World Journal: University of Michigan Announced the Closure of Its Confucius Institute

Well-known U.S. Chinese language newspaper World Journal recently reported that the University of Michigan (UM) just officially announced the discontinuation of its Confucius Institute located in Ann Arbor. The announcement was made after the Confucius Institute had been established for nearly ten years. According to the official headquarter records of the Confucius Institute, the UM Institute is a “unique” organization and was recognized in 2013 as an “Advanced Confucius Institute” by the Chinese central government. The University explained that it will merge the Chinese performing arts materials into its regular curriculum and there is no longer a need to operate under the Confucius Institute. UM is one of the several universities that discontinued their Confucius Institute programs not long ago. These universities are the University of Iowa, the University of North Florida and North Carolina State University. There are around 100 Confucius Institutes operating in the United States.

Source: World Journal, December 11, 2018
https://bit.ly/2UMPePj

China’s November Auto Sales Saw Sharp Decline

Well-known Chinese news site Sina recently reported that the China Association of Automobile Manufacturers (CAAM) just released its November sales numbers for the Chinese domestic automobile market. The report showed that 2.17 million automobiles were sold in November, which is the largest decline in six years (since January 2012), representing a 16.1 percent drop. However, the January 2012 decline was merely a reflection of the Chinese New Year’s impact that year. Looking back a few months, the Chinese automobile market has been declining in each of the past consecutive months. Since September, the decline has been around 12 percent per month. This is indicative of the worst market shrinkage since 1990. Unless December data shows a miracle, CAAM is projecting the first annual decline in over 20 years. The Deputy Director of CAAM explained that the decreasing income of middle and low class consumers was the main cause of the sharp decline. Government policy changes also played a role. International auto manufacturers will also see challenges in the Chinese market.

Source: Sina, December 11, 2018
http://auto.sina.com.cn/news/hy/2018-12-11/detail-ihmutuec8177963.shtml

Aboluowang: CCP Openly Set up Party Branch Offices in State Owned Enterprise in Hong Kong

Aboluowang reported that the relevant documents of the Central Commission for Discipline Inspection have recently revealed that the mainland state-owned enterprises and private enterprises based in Hong Kong have openly established party branches.

According to the article, People’s Daily disclosed in September that a document that the Central Disciplinary Commission issued at the end of 2017 corroborated the evidence that a Chinese Communist Party’s grassroots party branch had been set up in the State Owned Enterprises in Hong Kong. The “Guiding Opinions on Strengthening the Prevention and Control of Integrity Risks of Central Enterprises” requires that “the Central Party Committee and the Discipline Inspection Commission effectively fulfill the political responsibility of managing the party and the integrity of the risk prevention and control in party development work overseas.” The guidance disclosed that the international subsidiaries and Hong Kong branches of China Mobile must be under the supervision of the branch office in Shenzhen.

One academic scholar from Hong Kong Baptist University told Voice of America that, in the party organization, work in companies stationed overseas used to be carried out secretly. In recent years, however, the activity has grown more and more open. The goal is obviously “to strengthen the monitoring of all enterprises outside the country, in order to ensure that these enterprises show in their actions that they listen to the party’s commands and obey the party’s mechanism to do things.”

According to an Apple Daily article, there are 123 publicly traded State Owned Enterprises in Hong Kong that have established party offices. Among them, eight of them are blue chip companies. They include, among others, PetroChina, Sinopec, the Industrial and Commercial Bank, the Bank of China, and the Bank of Communications. In addition, there are party branch offices established in private enterprises in Hong Kong. After Suning Appliance acquired Hong Kong Laser Appliances in 2009, the company’s party committee quickly sent people to Hong Kong to set up the “Suning Appliance Hong Kong Laser Company Party Branch,” making it one of the company’s 65 party branches.

The Aboluowang article also mentioned that an article Xinhua published on November 25 disclosed that the party’s newly issued “Regulations on the Work of Party Branches” emphasized that it is necessary to carry forward the tradition and to set up party branches on a company basis. The regulations do not specifically address the operation of party organizations in overseas enterprises. However, it could mean that all enterprises with party members must have party organizations.

Source: Aboluowang, December 16, 2018
https://www.aboluowang.com/2018/1216/1219078.html

RFI: Huawei Sponsors “Seeds for the Future” Project to Establish Contacts with Universities

Radio France Internationale published an article which stated that, not only did Huawei bribe many Australian politicians and the U.S. think tank, The Brookings Institute, it also gave money to top universities through the “Seeds for the future” project. The universities that received the money include Cambridge, Oxford, Manchester, York, Nottingham, Surrey, and other institutions in the UK. Huawei also acknowledged that it has cooperated with over 20 universities in the UK over the past five years. Through the “Seeds for the Future” project, Huawei has established contacts with many universities through the British Council to attract young talent and it has paid travel expenses for UK students to live in China for one month.

In addition, The Daily Telegraph reported that, for many years, Huawei has sponsored technology research projects on mobile and audio networks. Huawei promised to invest 5 million pounds (US$6.3 million) to establish a 5G Innovation Center at the University of Surrey. Huawei also invested more than 1 million pounds (US$1.25 million) in a computer lab at the University of Cambridge to support a Manchester University project to develop graphene. Graphene is the thinnest but hardest material in the world with the lowest resistivity. British physicists developed this nanomaterial in 2004.

Previously, Australian media reported that Huawei had sponsored a number of Australian politicians and family members to travel to China. The list of invitees included former Australian Foreign Minister Bishop. In addition, the Washington Post reported that the Brookings Institute, an authoritative U.S. think tank, was to receive a large donation from Huawei and was to speak favorably about Huawei.

Source: Radio France Internationale, December 14, 2018
http://rfi.my/3RCw.T

CNA: Hong Kong to Legalize Playing China’s National Anthem during Political Members’ Swearing in Ceremony

Central News Agency (CNA) reported that Hong Kong authorities have enacted the National Anthem Law Bill, which stipulates that China’s national anthem must be played during the swearing in ceremony of the Chief Executive, members of the Executive Council, Legislative Council Members, and judicial officers. Radio Television Hong Kong quoted the Constitutional and Mainland Affairs Bureau as saying that the draft is close to being completed and will be submitted to the Legislative Council for initial review as early as next year. The draft also stipulates that anyone who arbitrarily falsifies the national anthem or sings the national anthem in a distorted or derogatory manner can be sentenced to a maximum of three years and a fine of HK$50,000 (US$6,399). The draft also mentions that “middle schools and elementary schools should teach students to sing the national anthem” but there are no specified penalties.

In recent years, since people in Hong Kong started to advocate “Hong Kong independence” or “self-determination,” many would boo China’s national anthem when it was played during certain events such as a soccer game. This has caused Beijing to pay close attention to the issue of using laws to legalize China’s national anthem.

Source: Central News Agency, December 14, 2018
https://www.cna.com.tw/news/acn/201812140214.aspx