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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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Xi Jinping Inspects Rocket Force Unit, Emphasizes Combat Readiness and Party Leadership

Xi Jinping, General Secretary of the Chinese Communist Party, inspected a Rocket Force unit on the 17th, emphasizing the need to strengthen crisis awareness and combat readiness.

During his visit to a Rocket Force brigade in Hefei, Xi observed weapons equipment demonstrations and troop training exercises. In his remarks, Xi stressed maintaining absolute Party leadership over the military and ensuring troops follow orders from the Party Central Committee and Central Military Commission.

He also emphasized strengthening grass-roots Party organizations, investigating and dealing with corruption issues, enhancing combat preparedness and operational capabilities, and adapting to modern warfare changes by focusing on new equipment, skills, and tactics.

The visit came shortly after China’s “Joint Sword-2024B” military exercises near Taiwan on the 14th, and following Xi’s inspection of Dongshan Island in Fujian province, a location with historical military significance in cross-strait relations. Vice Chairman of the Central Military Commission Zhang Youxia accompanied the inspection. The timing of these visits – to Dongshan Island and then the Rocket Force – appears significant given recent military activities in the region.

Source: Central News Agency (Taiwan), October 19, 2024
https://www.cna.com.tw/news/acn/202410190145.aspx

Briefings | | |   Defense/Military

Freedom House: China’s Internet Freedom Ranks at the Bottom for Ten Consecutive Years

Radio Free Asia (RFA) Chinese Edition recently reported that, according to U.S. democracy research organization Freedom House, China has been ranked as the least-free country on the Internet for ten consecutive years, and that the rating has declined year by year. Internet freedom globally has declined for 14 consecutive years as well. China’s rating score has been at the bottom for the 10th consecutive year, falling from 12 in 2015 to 9 in 2024.

The report stated that the Chinese government continues to isolate the domestic Internet from the rest of the world, to restrict international traffic to some government websites, to impose heavy fines on people who use VPNs to circumvent the firewall, and to systematically suppress dissent. Whether people share news reports or talk about religious beliefs, they will be strictly controlled. After a decade of technological progress, the Chinese government’s censorship and surveillance technology has become increasingly effective. In addition, Xi Jinping’s government has established a new bureaucracy to tighten control over the Internet.

Freedom House evaluates the degree of Internet freedom in 72 countries around the world. Internet users in these regions account for approximately 80 percent of the world’s online population. The 2024 report shows that Iceland sits at the top to the ranking list and Taiwan ranks 7th in the world with a score of 79, the best in Asia.

Source: RFA Chinese, October 16, 2024
https://www.rfa.org/mandarin/yataibaodao/renquanfazhi/lu-cyber-freedom-in-china-10162024095604.html

Briefings | | |   Social Stability

Former Chinese Justice Minister Tang Yijun Arrested on Corruption Charges

Tang Yijun, China’s former Minister of Justice, has been arrested on suspicion of accepting bribes, according to Xinhua News Agency. The Supreme People’s Procuratorate has formally approved his arrest following an investigation by the National Supervision Commission.

The Central Commission for Discipline Inspection and National Supervisory Commission previously revealed several allegations against Tang, including using his authority to help relatives secure financial business deals, improperly interfering in market economic activities and judicial proceedings, failing to properly supervise his spouse, using public power for personal gain through large-scale trading of power for money, and illegally accepting massive amounts of bribes in exchange for favors in business operations, company listings, promotions, and case handling.

Notably, Caixin Media reported that during Tang’s two-and-a-half-year tenure in Liaoning Province, he helped Evergrande Group acquire controlling stakes in Shengjing Bank, which led to substantial bad debts. Evergrande also made significant real estate investments in Liaoning, leaving behind unfinished buildings when its capital chain broke.

Tang’s career included extensive work in Zhejiang Province before becoming the Chairman of Ningbo CPPCC in 2011. He later served as Liaoning Province Governor and Minister of Justice (2020-2023). His last position was Chairman of the Jiangxi Provincial CPPCC before his dismissal from both the Party and public office. Sources indicate that most of the alleged violations occurred during his time in Ningbo and Liaoning.

Source: Central News Agency (Taiwan), October 18, 2024
https://www.cna.com.tw/news/acn/202410180098.aspx

Briefings | | |   Government/Politics

Chinese Dairy Giant Feihe Faces Backlash Over Japanese Partnership Amid Rising Anti-Japanese Sentiment

Chinese dairy company Feihe faced significant social media backlash after announcing a technical cooperation agreement with Japanese biotech firm Kyowa Kirin on October 3rd. The controversy emerged amid heightened anti-Japanese sentiment in China following the tragic stabbing death of a Japanese schoolboy in Shenzhen on September 18th.

After the announcement of their joint innovation laboratory for developing fermented lactoferrin production technology, false claims began circulating on Chinese social media. These included allegations that Feihe was receiving Japanese investment and importing Japanese raw materials. Some netizens connected this to concerns about Japan’s nuclear wastewater release, leading to calls for boycotts and expressions of distrust regarding Japanese involvement in products for Chinese children.

As the misinformation spread and reached trending topics, Feihe issued a statement on WeChat on October 18th addressing these claims. The company clarified that the partnership was limited to technical exchange and did not involve raw material imports or formula usage. They also announced they had filed a police report and would pursue legal action against those spreading false information.

Feihe emphasized its status as a leading Chinese national enterprise, noting its establishment in Heilongjiang in 1962 and its position as China’s top infant formula manufacturer with 21.5% market share as of January 2023. The company stressed its patriotic alignment with consumers and explained that its collaborations with domestic and international research institutions aim to improve their products for Chinese babies.

Source: Central News Agency (Taiwan), October 19, 2024
https://www.cna.com.tw/news/acn/202410190226.aspx

Briefings | | |   Geo-Strategic Trend

European Airlines Suspend China Flights Amid Rising Competition from Chinese Carriers

In mid-October, Lufthansa, Scandinavian Airlines, and LOT Polish Airlines successively announced the suspension of their flight operations to Beijing and Shanghai. This news comes after earlier suspension of flights to and from China by British Airways and Virgin Atlantic.

The reported reason was that Chinese airlines have a unique advantage due to the Russia-Ukraine War. Since the start of the war, Russia has closed its airspace to 36 countries and regions, including Europe, forcing European airlines to take longer detours when flying to China. However, China has a special relationship with Russia and thus Chinese airlines can continue flying over Russian airspace as usual. This allows Chinese airlines to have shorter flight times, less fuel consumption, and potentially lower ticket prices. Chinese airlines are expanding while the European airlines are retreating. Air China, China Eastern Airlines, China Southern Airlines, and Hainan Airlines have all added new routes from China to Europe. (Note: this situation didn’t happen between the U.S. and China, since the U.S. insisted on the reciprocal rule: that Chinese airlines need to match the U.S. airlines’ operations.)

Some European airlines are dissatisfied with the situation and are asking their governments to take “non-market” special measures to curb Chinese competitors. In July of this year, Austria rejected China Eastern Airlines’ proposal to launch a Shanghai-Vienna route, saying that “Russia’s current airspace restrictions and China Eastern’s competitive advantage over the local Austrian Airlines would be against the overall economic interests.” Air France-KLM and Lufthansa are actively lobbying their governments to take action to address the imbalance in competition on China-Europe routes.

Source: Creaders.net, October 19, 2024
https://finance.creaders.net/2024/10/19/2786525.html

Briefings | | |   Economy/Resources Geo-Strategic Trend

Xinhua Commentary: War Will Continue Between Hamas and Israel Though Israel Killed Sinwar

Xinhua News Agency published a commentary on Israel’s killing of Hamas Chief Yahya Sinwar, who planned and executed the Hamas attack on Israel on October 7, 2023. It quoted several analysts who all predicted that the war between Hamas and Israel will continue. “Analysts believe that Sinwar’s death is unlikely to mark a turning point for peace in Gaza, and the Israeli-Palestinian conflict will continue, with the regional situation possibly worsening further.”

Yonatan Freeman, an international relations scholar at Hebrew University in Jerusalem, said that Sinwar’s death might weaken the fighting resolve of some Hamas militants, but Hamas as a whole will continue to fight against Israel.

Mohamed Elmasry, an expert from Doha Institute in Qatar, stated that unless the root causes of the Gaza war are addressed, the cycle of violence may persist. “As for the root causes, they are well known, including Israel’s illegal occupation of Palestinian land, the apartheid system established by Israel, and the blockade of Gaza, among others.”

A new bulletin jointly released by the International Labor Organization and the Palestinian Central Bureau of Statistics on October 17th shows that since the new round of the Israeli-Palestinian conflict began a year ago, the poverty rate in Gaza has reached nearly 100 percent. Ruba Jaradat, Regional Director of the ILO for Arab States, stated that the losses caused by the war in Gaza are not limited to casualties, severe humanitarian disasters, and material destruction, but have fundamentally altered Gaza’s socioeconomic structure, while also severely impacting the economy and labor market of the West Bank.

Source: Xinhua, October 18, 2024
http://www.news.cn/world/20241018/8f566136a685418ca20082323b268eb5/c.html

Briefings | | |   Geo-Strategic Trend Government/Politics

CCP Leverages U.S. Legal System to Counter U.S. – Trying to Stop Sanctions and Criticism

Voice of America (VOA) reported that the Chinese Communist Party (CCP) is leveraging the U.S. legal system, using the law as “both a sword to attack opponents and a shield to protect its interests.”

Chinese drone manufacturer DJI filed a lawsuit against the U.S. Department of Defense (DOD) on October 18, alleging that DOD’s inclusion of the company on the list of companies cooperating with Beijing’s military was erroneous and had caused significant financial losses. China’s semiconductor firm, AMEC, filed a similar lawsuit in the U.S. on August 16. Previously, Chinese companies Xiaomi and Hesai successfully removed themselves from the list by suing DOD. Analysts told VOA that these Chinese companies’ success was not due to a lack of military involvement, but because they exploited loopholes in the U.S. Administrative Procedure Act.

In addition, the CCP can use its state power and resources to hire top-tier U.S. law firms to start legal battles to coerce or even silence organizations or individuals from criticizing it.

Li Rui, Mao Zedong’s former secretary and a senior member of the CCP, left behind diaries detailing the inner workings of the party and his own views. According to his wishes, his daughter, Li Nanyang, handed over the diaries to the Hoover Institution at Stanford University in California. However, Li Rui’s widow, Zhang Yuzhen, filed a lawsuit in Beijing in April 2019 to reclaim the diaries (so that she could take them back to China) and won the case. Stanford University filed a countersuit in the U.S. This ongoing legal battle has lasted for over five years and required Stanford, Li Nanyang, and her attorney’s law firm to spend thousands of hours. Zhang Yuzhen hired four different law firms, three of which are among the largest in the U.S. Li Nanyang’s attorney pointed out that Zhang would not be able to hire those U.S. attorneys on her own, which Zhang neither confirmed nor denied.

Anna Puglisi, a former senior fellow at Georgetown University’s Center for Security and Emerging Technology, published a scholarly paper in May 2024 titled “How China’s Hybrid Economy Distorts Competition.” The paper highlighted the CCP’s direct or indirect relationship with companies like BGI Genomics and MGI Tech, and how China uses market access to protect its own global companies and undermine other global players. In June and July of this year, Puglisi received letters from prominent U.S. law firms hired by BGI and MGI, accusing her of defamation and demanding that she and Georgetown University retract the paper and cease related analysis.

In May 2019, Scott Paul, president of the Alliance for American Manufacturing (AAM), a nonprofit based in Washington, testified during a congressional hearing on transportation and infrastructure, stating that BYD and CRRC, two Chinese companies, are state-owned and state-supported, and had begun securing lucrative contracts funded by U.S. taxpayers to provide rail transit vehicles and electric buses for major U.S. cities. He warned that this trend would systematically undermine the competitive landscape of the U.S. locomotive and vehicle manufacturing industries. BYD filed a defamation lawsuit against AAM and several of its employees. The lawsuit dragged on for nearly two years, with several dismissals and unsuccessful appeals, until October 2022, when the Supreme Court refused to hear BYD’s appeal, ruling that BYD failed to prove that AAM’s statements were defamatory. However, the chilling effect of the lawsuit became apparent when AAM’s insurance company, Hartford, partially canceled AAM’s insurance in April 2021.

Source: VOA, October 23, 2024
https://www.voachinese.com/a/ccp-us-law-repression-20241020/7817608.html

Briefings | | |   @CS US-China Relations

China’s Income Distribution as Derived From State Taxation Administration’s Numbers

The State Taxation Administration released the 2023 Individual Income Tax Settlement and Payment Report. An individual analyzed the data to derive the Chinese people’s income level breakdown.

According to the official data:

  • After raising the minimum income level for taxation from 3,500 yuan to 5,000 yuan per month, the number of people filing income tax dropped from 157 million to 65 million in 2022.
  • Among the income tax-filing people, less than 30 percent paid tax.
  • Among those who paid income tax, 60 percent were in the 3 percent tax rate bracket (5,000 – 8,000 yuan/month).
  • 1 percent of the income tax-filing people have income above 1 million yuan.
  • People with annual income less than 100,000 yuan usually do not need to pay income tax (due to various deductibles).

The author thus deduced:

  • Income between 3,500 yuan and 5,000 yuan per month: Near 100 million people (between 65 million and 157 million).
  • Income above 5,000 yuan per month: 65 million people.
  • Income between 5,000 and 10,000 yuan per month: 45 million people (only 30 percent of the 65 million paid taxes).
  • Income above 100,000 yuan per year: 20 million people (only 30 percent of 65 million paid taxes).
  • Income between 100,000 and 150,000 yuan per year: 12 million people (60 percent paying at the 3 percent tax rate).
  • Income between 150,000 and 1 million yuan per year: 7.3 million people (8 million minus 700,000 whose income is above 1 million yuan).
  • Income above 1 million yuan per year: 700,000 (around 650,000) people.

Source: Aboluo, October 16, 2024
https://www.aboluowang.com/2024/1016/2116093.html

Briefings | | |   Economy/Resources