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

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

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Xi Jinping Orders Comprehensive Improvement of Troops’ Ability for War Preparation

Chinese Communist Party leader Xi Jinping inspected the 78th Army Group on September 8th, ordering improvements in war preparedness and ability to fight. Xi emphasized implementing the military strategic policy and innovations in management and operations for the new era’s strong army concept.

Xi was accompanied by Vice Chairman Zhang Youxia of the Central Military Commission. Xi said the 78th Army Group needs to enhance military struggle preparation, strengthen specialized training in difficult courses, build new high-quality combat capabilities, and integrate joint combat systems.

Xi also said Communist Party building in the troops must be strengthened to implement the spirit of the All-Military Party Construction Conference. This will increase creativity, cohesion and combat effectiveness of Party organizations. Grassroots troop education and high levels of centralized unity and stability are also crucial.

The second round of thematic education should be carefully organized to solve troop development bottlenecks, solve officer and soldier problems proactively, and create new progress in army group construction.

In July, Xi visited the Eastern Military Zone authorities, saying war and combat planning should be deepened, joint combat command systems strengthened, and combat-oriented training conducted to accelerate capability improvements for winning.

The Eastern Military Zone covers six provinces near the Taiwan Strait and East China Sea. Xi’s recent visits emphasize building up China’s military strength and readiness for conflict, particularly regarding Taiwan.

Source: Central News Agency (Taiwan), September 11, 2023
https://www.cna.com.tw/news/acn/202309110135.aspx

Briefings | | |   Defense/Military

Lianhe Zaobao: Financing from China’s Four Major Banks to Russia Surged

Singapore’s primary Chinese language newspaper Lianhe Zaobao recently reported that, since the outbreak of the Ukrainian war last year, Western institutions have imposed a series of sanctions on Russia, and banking institutions have also stopped operations in Russia. However, China’s Big Four banks are lending billions of dollars to Russia, filling the gap left by Western banking institutions. China’s four largest banks, including Industrial and Commercial Bank of China, Agricultural Bank of China, China Construction Bank and Bank of China, have quadrupled their exposure to Russia since the war began. At the beginning of 2022, the total loans of the four major banks in Russia were US$2.2 billion. According to the Russian Central Bank, in the 14 months to the end of March this year, this figure increased to nearly US$10 billion. This is part of China’s push to make the Chinese Yuan a global currency that will replace the U.S. dollar. More than 70 percent of trade settlements between Russia and China have been using local currencies. Almost all the currency used by China to purchase Russian oil in the past year was RMB. Before the war, more than 60 percent of Russia’s exports were paid in U.S. dollars and Euros, with RMB accounting for less than one percent.

Source: Lianhe Zaobao, September 5, 2023
https://www.kzaobao.com/shiju/20230905/146186.html

Briefings | | |   Geo-Strategic Trend

China’s Top Computer Server Manufacturer Suffered Major Profit Decline

Well-known Chinese news site Sina (NASDAQ: SINA) recently reported that, with the advent of the artificial intelligence era, the traditional CPU server market has gradually shrunk, and new AI servers have soared. However, Inspur Information is subject to tight supply of GPUs, and it has not been able to jump onto the bandwagon. According to the global server market report for the third quarter of 2022 released by Gartner, Inspur ranked first in China, and second in the world, after Dell, with a global market share of 10.3 percent. However, in the first half of this year, Inspur’s server revenue fell by 29.03 percent year-over-year. Its net profit in the second quarter of this year suffered a year-over-year decrease of 81.46 percent. Inspur explained that its server product revenue was “affected by factors such as the tight supply of global GPUs and related special chips.” With the short supply of AI chips by Nvidia and Intel, the company emphasized that “the raw materials of the domestic server industry are currently mainly imported.” If there are major changes in supply, it will have an impact. Inspur’s server products are highly dependent on upstream chip suppliers. The company’s 2019 annual report showed that Intel and Nvidia are its top two suppliers respectively. Since 2020, Inspur has no longer published information about its main suppliers.

Source: Sina, September 7, 2023
https://finance.sina.com.cn/tech/csj/2023-09-07/doc-imzkwctn6755618.shtml

Briefings | | |   Information/Technology US-China Relations

HKTDC: Chinese Companies Planning Overseas Business

Hong Kong Trade Development Council (HKTDC) recently published a research study on Mainland companies’ overseas strategy changes when Belt and Road is now at its 10-year anniversary. The research focused on companies in the Canton Greater Bay Area and the Yangtze River Delta Region. The study found that, in the face of the slow recovery after the pandemic and the increasing business challenges in traditional overseas markets affected by geopolitical factors, many Mainland companies have adjusted their “going global” strategies. Around 83.9 percent of the companies surveyed said they are facing various challenges caused by geopolitical tensions, insufficient market demand, and financing difficulties, etc. Nearly 90 percent of the companies have plans to develop international business in the next one to three years. As many as 72.8 percent of the companies hope to explore business opportunities in RCEP and other Belt and Road emerging markets. They mainly plan to expand international business in four major areas: logistics and transportation (28.8 percent), marketing and sales (26.9 percent), investment and factory establishment (23.3 percent), and overseas procurement (15.9 percent). Successfully conducting international business requires extensive professional service support to assist them in planning and risk management. The study shows that the services most needed include: marketing and e-commerce (97 percent), financing and risk management (89.9 percent), product standards and ESG service support (89.2 percent), as well as tax planning and compliance (88 percent).

Source: HKTDC, September 5, 2023
https://research.hktdc.com/sc/article/MTQ3MTQ1NjU4OA

Briefings | | |   Economy/Resources Geo-Strategic Trend

People’s Daily: Worsening Homelessness Crisis in the U.S.

An article published by People’s Daily, titled “Homeless Problem in the U.S. Is Getting Worse,” talks about the deteriorating homelessness crisis in the United States. The piece cites several Western media outlets, stating that the number of homeless individuals in the U.S. has surged to 577,000, marking an 11 percent increase from the previous year and the most significant spike since 2007 when records were first maintained. This crisis is particularly pronounced in major U.S. cities, with Los Angeles witnessing a staggering 55 percent rise in homelessness since 2015. In New York, approximately one in every 80 people lacks shelter, and the number of homeless individuals in the city’s shelters has surpassed 100,000.

The article attributes this dire situation to “deeply-rooted social inequality” and the vast wealth disparity between the affluent and the impoverished in the U.S. It criticizes government policies as ineffective, emphasizing that the federal, state, and local governments are merely passing the issue around, engaging in political blame games, and implementing largely symbolic measures.

In conclusion, the article underscores that despite being the world’s most powerful developed nation, the presence of a substantial homeless population living on the streets tarnishes not only the U.S.’s human rights record but also its societal governance and governmental efficacy. It quotes Nobel Prize-winning economist Joseph Stiglitz’s assertion that the United States has become a wealthy nation full of poor people.

Source: People’s Daily, September 9, 2023
http://world.people.com.cn/n1/2023/0909/c1002-40073771.html

Briefings | | |   US-China Relations

Chinese Think Tanker: Traditional Economic Stimulus Ineffective in China’s New Normal

Cai Fang (蔡昉), Chief Expert of Chinese Academy of Social Sciences’ National High-end Think Tank, delivered a speech on September 3, highlighting that China’s economy has transitioned into a new normal, rendering traditional stimulus approaches obsolete.

Cai identified three key characteristics of China’s new economic landscape from both macro and micro perspectives:

  1. A rapidly declining population and a significant decrease in its labor force.
  2. Weak consumer demand, exacerbated by demographic aging.
  3. Mounting pressures in labor market, including labor shortages and the need to align the workforce’s skills with evolving industry demands.

Cai proposed three strategic policy directions:

  1. Promote a Competitive Environment: Encourage the removal of less competitive companies to stimulate innovation and enhance productivity.
  2. Rethink Traditional Macroeconomic Stimulus: Recognize that traditional stimulus measures no longer align with today’s economic landscape. For example, previous approaches emphasized infrastructure spending, which does not address the job-seeking preferences of today’s youth, who seek opportunities in the service sector rather than construction.
  3. Advance structural Reforms: Prioritize reforms such as the overhaul of the Hukou (household registration) system to incentivize urban-bound rural residents to increase their spending in urban areas.

Source: 21st Century Business Herald,  September 3, 2023
https://www.21jingji.com/article/20230903/herald/0c1fef010ce245062614214b69e74d02.html

Briefings | | |   @CS Economy/Resources Government/Politics

“Creative” Fees and Charges Emerge in China

A recent report listed a series of “creative” charges in China, driven either by profit-seeking motives or the necessity to survive a sliding economy.

  • High School Air Conditioning (AC) Service Charges: A high school opted to outsource its AC services to a company. To recoup equipment and installation costs, the company levied a fee of 9.9 Yuan per hour for each classroom and 3.9 Yuan per hour for each dorm room when students used the AC.
  • Hotel Charging Cable Fees: Some hotels have introduced fees for using their charging cables to power mobile devices, a service that was previously complimentary.
  • Massage Chairs in Public Spaces: A train station replaced its standard chairs with massage chairs, and numerous movie theaters have installed massage chairs in its premium seating areas, offering these seats at a higher price.
  • Nap Fees at High Schools: Recognizing the post-lunch nap habit among Chinese people, a high school instituted varying fees for students who wishes to nap on a bed, mat, or desk (where students sit with their arms on the desk and rest their heads on their arms).
  • College Library Study Rooms: Several colleges have transformed library rooms into “private study rooms” and imposed charges for their use, diverging from the traditional concept of libraries as free study spaces.

Source: QQ, September 5, 2023
https://new.qq.com/rain/a/20230905A04WZB00

Briefings | | |   Economy/Resources