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Monthly Archives: November 2024

Nikkei Chinese: Outflows From Chinese Stock Market Reach All-Time High Over Past 4 Weeks

Nikkei Chinese Edition recently reported that money is flowing out of emerging market assets, especially Chinese equity funds. Chinese stock markets experienced outflows for five consecutive weeks. Outflows from the Chinese market during the last four weeks reached US$16.9 billion, an all-time high. Nikkei cited data from EPFR, an American research firm that tracks global investment trust funds.

The Conference of the Chinese National People’s Congress, which concluded on November 8, did not introduce further fiscal stimulus to the Chinese markets. According to Naoki Tsukioka, chief economist at Mizuho Research & Technology in Japan, “There is a growing view in Chinese markets that the situation is ‘worse than expected.'”

Equity funds in India, Brazil, and Thailand also saw major capital outflows. The backdrop to such outflows is the strength of the US economy. The appreciation of the US dollar relative to other currencies has led to the expansion of US dollar debt in emerging market countries. Capital flows in emerging markets may further change under policies expected from the coming Trump administration, with China and Mexico likely to be negatively affected.

Source: Nikkei Chinese, November 19, 2024
https://cn.nikkei.com/china/cfinancial/57284-2024-11-19-09-14-59.html

Briefings | | |   Economy/Resources

Xi Jinping and Peruvian President Boluarte Discuss New Maritime-Land Trade Route

Chinese President Xi Jinping met with Peruvian President Dina Boluarte on November 14, proposing a new China-Latin America maritime-land trade corridor starting from Peru’s Chancay Port. This meeting occurred during Xi’s state visit to Peru for the APEC summit in Lima.

The leaders virtually attended the opening ceremony of Chancay Port, a significant infrastructure project completed by Chinese enterprises. Xi emphasized that this port demonstrates China’s commitment to long-term strategic cooperation with Peru. The proposed trade corridor aims to create an efficient, multi-dimensional connectivity network extending from Peru’s coast to inland regions and other Latin American countries.

President Boluarte highlighted that the “Chancay to Shanghai” connection would serve as a crucial bridge between Latin America and Asia, becoming a major engine for Peru’s economic growth. She noted that China remains Peru’s most important trading partner, with bilateral cooperation flourishing under the Belt and Road Initiative.

The meeting resulted in several significant agreements and initiatives, including an upgraded Free Trade Agreement and a cooperation plan for the Belt and Road Initiative. The leaders also signed multiple bilateral agreements covering trade, industrial investment, industrial parks, education, and green development. Additionally, they established a sister city relationship between Suzhou and Chancay and planned to establish “Luban Workshops” and “Chinese Language Workshops” in Peru.

Both leaders expressed commitment to strengthening strategic trust, supporting each other’s core interests, and enhancing cooperation in various fields, including anti-corruption efforts and combating illegal fishing. China also offered to increase scholarship opportunities for Peruvian students to promote people-to-people exchanges.

Source: Central News Agency (Taiwan), November 15, 2024
https://www.cna.com.tw/news/acn/202411150284.aspx

Briefings | | |   Geo-Strategic Trend

People’s Daily: PLA Develops Innovative Military Teaching Models

People’s Daily, the official newspaper of the Chinese Communist Party, reported that the Training and Management Department of China’s Central Military Commission has coordinated military academies to integrate new technologies and methods into military educational reforms since early last year. They have developed six basic teaching models:

  1. Inquiry-Based Theoretical Learning
  2. Immersive and Interactive Case Studies
  3. Hybrid Real-and-Virtual Skills Training
  4. Step-by-Step Scenario-Based Exercises
  5. Adversarial Research-Based Comprehensive Drills
  6. Integrated Application-Oriented Assessments

These six basic teaching models also incorporate methods such as scenario presentation, war-gaming simulations, hands-on training, and integrated teaching approaches.

For example, the National Defense University’s Classic Battle Case Study course has moved away from the traditional teaching method of instructor lectures and student critiques. Instead, it employs flexible approaches such as scenario reenactment and role immersion, enabling students to assume the roles of battlefield commanders and conduct in-depth analysis.

Similarly, the Army Infantry Academy’s Coordinated Shooting for Mechanized Infantry Teams skills training course combines real equipment with simulations to create extreme, high-risk environments, significantly increasing the intensity of the training.

Source: People’s Daily, November 4, 2024
http://military.people.com.cn/n1/2024/1104/c1011-40353325.html

Briefings | | |   Defense/Military

Chinese Auto Exports Show Strong Growth Despite Challenges

In the first nine months of 2024, China’s automotive industry demonstrated remarkable export performance, with total vehicle exports reaching 4.31 million units, marking a 27.3% year-over-year increase. According to the China Association of Automobile Manufacturers (CAAM), the export landscape shows a diverse mix of both new energy vehicles (NEVs) and traditional fuel vehicles.

NEV exports reached 928,000 units, growing by 12.5%, while conventional fuel vehicle exports hit 3.38 million units, surging by 32%. Russia emerged as China’s largest export market, with exports increasing by 33% in the first nine months. Other significant growth markets included Brazil, Mexico, and the United Arab Emirates.

Despite tariff pressures from Europe and the United States, Chinese automakers have maintained growth momentum. However, exports to the EU have declined, with the share of NEV exports to Europe dropping from 46% in 2022 to 32% in the first nine months of 2024.

Chinese automakers are actively pursuing localization strategies in overseas markets to address tariff challenges and improve competitiveness. Major companies including BYD, Chery, Changan, Great Wall Motor, GAC, and SAIC have announced plans to build or expand factories in Thailand, Indonesia, and Brazil. They are also accelerating plans for local production in Europe to mitigate tariff impacts.

Cui Dongshu, Secretary General of the China Passenger Car Association, attributes this year’s growth to improved product competitiveness, modest growth in Western markets, and the replacement of international brands by Chinese vehicles in the Russian market.

Source: Central News Agency (Taiwan), November 17, 2024
https://www.cna.com.tw/news/acn/202411170133.aspx

Briefings | | |   Geo-Strategic Trend

People’s Daily: Rising Global Influence of Chinese Pop Culture, From Online Literature to Gaming and Beauty Trends

People’s Daily reported that the growing popularity of Chinese pop culture into the global market has strengthened China’s cultural soft power.

The 2023 China Online Literature Blue Book released by the China Writers Association reveals that the overseas market for online Chinese literature exceeded 4 billion yuan in 2023, with nearly 200 million active users globally. Among them, 80% belong to Generation Z, and the audience spans most countries and regions worldwide.

Voice of America noted a new trend in China’s “short drama exports.” The report highlighted that Chinese mini-program short dramas emerged in 2021, and by 2022, they began exploring overseas markets. Between August 2022 and June 2024, over 100 short drama apps were active in international markets, accumulating 148 million downloads and generating $252 million in in-app purchase revenue.

At the end of August, the release of the Chinese game “Black Myth: Wukong” drew significant attention from foreign media, including The Economist and Bloomberg. The game sparked widespread discussion on its launch day, topping sales charts on multiple platforms such as Steam and WeGame across several countries. It also climbed to the top of Steam’s global bestseller list on the second day of its pre-sale.

An article on Pakistan’s Friday Times website also highlighted the popularity of Chinese cultural exports across Asia, particularly in Vietnam, Malaysia, Singapore, Thailand, Indonesia, the Philippines, Sri Lanka, and Cambodia. Chinese TV dramas are frequently streamed and downloaded, Mandarin pop music continues to attract fans across the region, and Chinese fashion brands are gaining recognition. Cosmetics companies like Perfect Diary and Florasis, known for their use of natural and traditional Chinese ingredients, are becoming increasingly prominent in the global beauty industry.

Source: People’s Daily, November 4, 2024
http://paper.people.com.cn/rmrbhwb/html/2024-11/04/content_26088834.htm

Briefings | | |   @CS Geo-Strategic Trend Government/Politics

China’s October Exports to Russia Hit Record Levels

According to China’s customs data, China’s exports to Russia in the month of October grew by approximately 27 percent year-on-year, marking the fastest growth in nearly 11 months. In September, China’s exports to Russia also increased by 15.7 percent year-on-year. The trade volume between China and Russia reached $202.11 billion in the first ten months of this year.

In 2019, China-Russia’s total trade was $110 billion. The two countries set a goal then to double their trade volume. In 2021, China-Russia trade totaled $147 billion. The Russia-Ukraine war sped up the trade between China and Russia. Their trade volume surged to $190.27 billion in 2022, a growth of about 30 percent, and $240.1 billion in 2023, an increase of 26.3 percent. The two countries achieved their doubling goal ahead of schedule.

Sources:
1. Huanqiu, November 7, 2024
https://m.huanqiu.com/article/4KAIYOmFmrB
2. VOA, October 15, 2024
https://www.voachinese.com/a/china-s-exports-to-russia-grow-in-september-at-fastest-pace-20241015/7822803.html

Briefings | | |   @CS Economy/Resources Geo-Strategic Trend

Rising Social Tension and Violence in China

Recent incidents of indiscriminate violence in China have sparked concerns about deepening social issues amid China’s current economic downturn. According to Taiwan-based Academia Sinica researcher Lin Zong-hong, these attacks directly correlate with deteriorating economic conditions and increasing psychological distress among lower-income citizens.

Unlike democratic societies where religious organizations, social workers, and civil groups can provide emotional outlets during economic hardship, China’s strict top-down political control severely limits such support systems. The government’s tight social control has disrupted interpersonal connections and eliminated crucial support mechanisms for mentally distressed individuals.

Experts predict that information about such violent incidents will become increasingly restricted. The authorities fear these events could trigger larger waves of public discontent and protests, similar to how the Urumqi fire incident led to the “White Paper” protests. As a result, the government is likely to further tighten information control to prevent collective grievances from emerging.

Wang Zhi-sheng, a member of the Taiwan’s Chinese Asia-Pacific Elite Exchange Association, describes Chinese society as a “pressure cooker.” With limited channels for expressing dissatisfaction with social governance, some individuals are turning to violence as a form of protest. Recent examples include a car ramming incident in Zhuhai, Guangdong (35 deaths) and a school stabbing in Yixing, Jiangsu (8 deaths, 17 injured).

The situation reflects multiple intersecting problems within Chinese society. As economic conditions worsen and social pressures mount, experts warn that without addressing the underlying issues, similar incidents may continue to occur, potentially leading to a copycat effect in what is described as an increasingly volatile social environment.

Source: Central News Agency (Taiwan), November 19, 2024
https://www.cna.com.tw/news/acn/202411190174.aspx

Briefings | | |   Social Stability

Portuguese Edition of “Up and Out of Poverty, Selected Works” by Xi Jinping Published in Brazil

The Portuguese edition of “Up and Out of Poverty” was officially launched on November 12 in Rio de Janeiro, Brazil, as part of the ongoing China-Brazil Governance and Development Seminar.

According to the event organizers, the book “Up and Out of Poverty” documents Xi Jinping’s perspectives on poverty alleviation, local governance, and reform and development. “It embodies the concepts of Chinese-style modernization and is expected to inspire new ideas and provide practical insights for enhancing exchanges and cooperation between China and Brazil in areas such as poverty reduction and modernization.”

The book has already been published in English, French, Spanish, Cyrillic Mongolian, Hausa, Swahili, Uzbek, and Lao.

The event was co-hosted by China’s State Council Information Office, the China International Communications Group (a foreign-language publishing organization under the Chinese Communist Party’s Propaganda Department), China’s Embassy in Brazil, and a Brazilian think tank.

Source: People’s Daily, November 14, 2024
http://paper.people.com.cn/rmrb/html/2024-11/14/nw.D110000renmrb_20241114_2-01.htm

Briefings | | |   Geo-Strategic Trend Government/Politics