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

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China Declines Japan’s Proposed Mechanism to Assess Treated Nuclear Water

According to information obtained by Kyodo News, the Japanese government proposed that China join an IAEA international mechanism for objectively analyzing and assessing monitoring results related to radioactive material in seawater samples taken offshore from the Japanese Fukushima nuclear plant. Beijing declined to follow Japan’s suggestion. This highlights China’s uncompromising opposition to Japan’s release of treated nuclear waste water into the sea, making it difficult for Japan to enter science-based dialogue.

The international mechanism will compare and analyze monitoring results conducted separately by the Japanese government and the IAEA on seawater near Fukushima. Research institutions selected by an IAEA to participate in the organization include entities from the U.S., France, Switzerland, and South Korea. To ensure objectivity, Japan is not part of the mechanism.

According to sources familiar with Japan-China relations, Japan has repeatedly urged China through diplomatic channels to join the international mechanism, enabling China to make scientific judgments. China, questioning the mechanism’s effectiveness and independence, did not accept the proposal.

Regarding the treated water, Japan proposed that China and Japan establish a consultation mechanism composed of experts and officials from both countries. China has not yet responded to this proposal.

Source: Kyodo News, September 5, 2023
https://china.kyodonews.net/news/2023/09/28ac08ec5e50.html

Briefings | | |   Geo-Strategic Trend

Chinese Hackers Infiltrate German Corporate and Private Networks to Attack Government Agencies

The German Federal Office for the Protection of the Constitution issued a warning that Chinese hacking groups APT15 and APT31 are targeting German small and medium-sized enterprises and home networks, using the hacked networks to hide their identities when attacking German national and government institutions.

The agency’s cyber briefing report on Thursday said that the hacking groups successfully breached the German Federal Agency for Cartography and Geodesy (BKG) two years ago. The BKG is responsible for creating detailed maps and assessing satellite imagery. The report outlined how the hacking groups exploit security vulnerabilities to gain control of terminals, networks and devices in homes and small businesses.

The agency advised that companies and individuals should update their security software, take stock of all devices on their networks, replace old equipment that can no longer be updated, and change default passwords on new devices.

The hackers exploit flaws in routers, printers, smart home devices, lights, heaters, solar panels and more, using the hacked hardware to conceal their attacks on German national and political bodies. Once they control these devices, they can launch cyber-attacks against organizations, companies and government institutions while hiding behind private, inconspicuous networks.

Source: Deutsche Welle, September 1, 2023
https://p.dw.com/p/4Vpmo

Briefings | | |   Geo-Strategic Trend

RFA Chinese: China’s Manufacturing Industry Marks Fifth Consecutive Month of Contraction

Radio Free Asia (RFA) Chinese Edition recently reported that, according to the data jointly released by the National Bureau of Statistics of China and the China Federation of Logistics and Purchasing, the Chinese manufacturing PMI in August was 49.7, an increase of 0.4 points from the previous month. This is the fifth consecutive month that the Chinese manufacturing PMI has been below the critical threshold of 50 (the “line of prosperity”), indicating ongoing contraction in Chinese manufacturing.

Among the five sub-indices that make up the manufacturing PMI, the production index was 51.9, the new order index was 50.2, and the supplier delivery time index was 51.6, higher than the critical point of 50. The raw material inventory index was 48.4 and the employment index was 48.0, both below the critical point. The Purchasing Managers Index (PMI) is an internationally accepted macroeconomic monitoring indicator. The number 50 is usually used as the boundary for indicating growth or decline.

In an environment where new export orders continue to contract amid weak global demand, Chinese manufacturers will need to rely on domestic demand to make up for the shortfall. Currently, demand for Chinese real estate and exports continues to be sluggish, and insufficient demand in the economy overall constrain prospects for economic recovery.

In order to stimulate China’s real estate market, the Chinese government has recently introduced a number of measures. The central bank will now guide commercial banks to adjust the interest rates of existing personal housing loans “in an orderly manner” so as to reduce the pressure on residents who are faced with mortgage loan repayments.

Source: RFA Chinese, August 31, 2023
https://www.rfa.org/mandarin/yataibaodao/jingmao/hcm2-08312023103501.html

Briefings | | |   Economy/Resources

UDN: Czech Central Bank Liquidates RMB Bond Holdings

United Daily News (UDN), one of the primary Taiwanese news groups, recently reported that the Czech Republic’s central bank announced that it has liquidated all of its RMB bond holdings. People familiar with the matter said that this move was primarily motivated by political factors and risk of Chinese invasion of Taiwan.

The Czech-China relationship had cooled significantly since the beginning of this year. The UDN report cited a Financial Times interview with newly-elected Czechian president Petr Pavel, who said “China and its regime is not a friendly country at this moment, it is not compatible with western democracies in their strategic goals and principles.” Pavel was the first elected European head of state to speak to Taiwanese president Tsai Ing-wen. China’s foreign ministry said that Pavel “ignored China’s repeated attempts to dissuade him” and “persisted in stepping on China’s red line”.

According to the latest data released by the Czech National Bank, as of June 30 this year the Czech central bank no longer had any RMB assets in its investment portfolio. In the foreign exchange reserve currency allocation table, the RMB column is no longer present. Members of the Czech financial regulatory organization confirmed that the possibility of a Chinese attack on Taiwan went into the decision to liquidate RMB positions, as did the “economic and non-economic context” surrounding the Czech-China relationship.

At the end of March 2023, the Chinese currency RMB still accounted for 1.9 percent of the foreign exchange reserves of the Czech National Bank. The Czech Republic has been deepening its ties with Taiwan, including exchange of high-level political visits, direct flights between Taiwan and Prague, and a commitment to co-operate in computer chip development.

Sources:

UDN, September 1, 2023
https://udn.com/news/story/7333/7409636

Financial Times, February 1, 2023
https://www.ft.com/content/df41b4a8-97f0-4e20-9ef4-4a53c0ab8f30

Briefings | | |   Geo-Strategic Trend

Global Times: U.S. Restricts AI Chip Exports to Middle East

China’s Global Times recently published a report on social media regarding new U.S. restrictions that prevent technology companies NVIDIA and AMD from exporting advanced AI chips to the Middle East. Analysts say the restrictions are aimed at preventing Middle Eastern countries from reselling the chips to China.

In a recent regulatory filing for its A100 and H100 chips, NVIDIA disclosed that the Biden administration’s new measures will affect exports of those chips. It’s not clear which specific countries are targeted by the new export controls.

In October of last year, the Biden administration announced its implementation of artificial intelligence (AI) chip export controls targeting China. NVIDIA’s A100 and the H100 were restricted, and AMD’s exports were similarly restricted by the U.S. government. Both companies stated that, although the new control measures will affect the export of some products, they will not have a direct and significant impact on the  companies’ business performance.

On the one hand, the U.S. may be concerned about China’s acquisition of advanced AI chips from Middle Eastern countries, especially considering the close relationship some Middle Eastern countries have with China. On the other hand, the U.S. export controls may not be aimed at curbing AI tech acquisition by China alone; they may also be part of U.S. policy targeting Middle Eastern countries specifically.

Compared with the earlier U.S. measures that targeted exports to China specifically, these latest controls targeting Middle Eastern countries have a less-direct impact on China’s AI industry. According to the Global Times report, however, they still reflect the U.S.’s attempt to stifle China’s semiconductor and AI capabilities.

Source: Global Times, August 31, 2023
https://tinyurl.com/mvuph8k7

Briefings | | |   Geo-Strategic Trend US-China Relations

Third Wave of Mass COVID Infection in China

COVID-19 infection rates are on the rise again in China. According to the Beijing CDC, the number of COVID patients has surged by more than 70% in recent days, with outbreaks occurring in many places throughout China. The main strain of the COVID virus currently prevalent within China is EG.5, according to an August 19 announcement by China’s Center for Disease Control and Prevention (CDC).

A large number of young children in various places are showing symptoms such as high fever, “white lungs” (patient’s lung appear as white in X-ray or CT picture due to infection), and difficulty in breathing. Many hospitals in China are calling the virus “mycoplasma pneumonia.” Some people have speculated that the authorities may be purposely avoiding the term “COVID,” opting to call the infection by a different name.

Many Chinese people are now being infected with the COVID virus for the third time, known as the “third positive” on Chinese social media. The “first positive” wave happened during late 2022 and early 2023, and the “second positive” wave happened in Spring of 2023.

Source: NTDTV, August 31, 2023
http://cn.ntdtv.com/gb/2023/08/31/a103776688.html

Briefings | | |   Social Stability

China’s Three Major Airlines Report Heavy Losses for First Half of 2023

A number of Chinese airlines recently released their annual reports. The three leading airlines, Air China, China Eastern Airlines, and China Southern Airlines, posted a total combined loss of about 12.58 Billion Yuan (US$1.73 Billion) in the first half of 2023. Air China reported a net loss of 3.45 Billion Yuan, China Eastern Airlines lost 6.25 Billion Yuan, and China Southern Airlines lost 2.88 Billion Yuan.

The current number of foreigners traveling Beijing and Shanghai is only about 10% of what it was before the start of the COVID-19 pandemic. Some tour guides said that this has been the first time in their 30 years as tour guides that they don’t have foreigner tour groups to service.

Source: Radio Free Asia, August 31, 2023
https://www.rfa.org/mandarin/yataibaodao/gt1-08312023011737.html

Briefings | | |   Economy/Resources

CCP Publishes Textbooks on “Xi Jinping Thought”

The Chinese Communist Party (CCP) is known for brainwashing the public, especially young people, with communist ideology and lies. Recently, PRC media outlet Xinhua reported that the CCP Central Propaganda Department, in conjunction with the Ministry of Education, created a textbook titled “Introduction to Xi Jinping Thought on Socialism with Chinese Characteristics for the New Era.” The textbook will be distributed nationwide, effective immediately.

Xinhua said the text book is designed to “further promote Xi Jinping Thought in teaching materials, in classrooms, and in (student’s) minds.”

Source: Xinhua, August 28, 2023
https://www.gov.cn/yaowen/liebiao/202308/content_6900617.htm

Briefings | | |   @CS Government/Politics