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Monthly Archives: September 2025 - 3. page

China Seeks Arctic Cooperation with Russia on Northern Sea Route

Huanqiu Times reported that at the Foreign Ministry’s press briefing on September 19, a Russian media reporter asked: “According to reports, a cargo ship at China’s Ningbo Port is preparing for a trial voyage along a new Northern Sea Route, with departure planned for September 20. Could the Chinese Foreign Ministry comment on the significance of the Northern Sea Route for China and how China plans to cooperate with Russia in this area?”

Spokesperson Lin Jian responded that in recent years the international community has increasingly focused on the potential of Arctic shipping routes, which could become key corridors for global trade. China is willing to collaborate with Russia, other Arctic coastal countries, and interested nations to strengthen international cooperation in the construction and operation of Arctic shipping infrastructure, jointly promoting the development, utilization, and environmental protection of Arctic routes.

Source: Huanqiu Times, September 19, 2025
https://3w.huanqiu.com/a/5e93e2/4OO6sD3DH9X?agt=23

Briefings | | |   Geo-Strategic Trend

Malaysia’s Data Center Expansion Slows in AI Chip War

Taiwanese online news platform NowNews recently reported that Malaysia’s rapid data center development is experiencing a major slowdown. This is not only due to energy and water shortages, but also to the U.S.-China competition in the field of artificial intelligence chips.

From Microsoft and Amazon to Tencent and Huawei, global tech giants are betting on Malaysian data centers. However, under the dual pressures of strict U.S. technology controls on AI chip exports and Malaysia’s increased scrutiny of investment projects, China’s use of Malaysia as an “AI backdoor” is facing unprecedented challenges, making this Southeast Asian country a key frontier at the intersection of technology and geopolitics.

Malaysia has become an emerging powerhouse in Southeast Asia due to its low land and electricity prices and proximity to Singapore. Statistics show that more than two-thirds of the data center capacity under construction in the five major markets in Southeast Asia is concentrated in Malaysia.

The United States has been mounting pressure on Malaysia to prevent China from obtaining export-controlled AI chips through overseas data centers. Starting in July of this year, a “Strategic Trade License” must be applied for and a 30-day advance notification must be submitted for all high-end chips exported, reshipped, or transited through Malaysia.

However, the Malaysian and Southeast Asian markets remain attractive to China due to their proximity, high demand, and relatively low political friction. But with the United States tightening regulatory and trade barriers, overseas expansion for Chinese companies is no longer as smooth as it once was.

Source: NowNews, September 13, 2025
https://www.nownews.com/news/6730676

Briefings | | |   Geo-Strategic Trend Information/Technology

CNA: Poland Closed Belarusian Border, Cutting Off 90 Percent Chinese Rail Traffic to EU (Updated)

Primary Taiwanese news agency Central News Agency (CNA) recently reported that Poland closed its border with Belarus, freezing a critical export route for China to the EU. A Polish Foreign Ministry spokesman said the border closure was in response to “destructive actions by Moscow and Minsk.”

This has caused a major rail route from China to the European Union to come to a standstill. Given that the route accounts for 25 billion euros in annual trade, China has put pressure on Poland to resume cargo transportation as soon as possible. Around 90 percent of rail freight between China and the EU passes through Poland. However, after three hours of talks between Chinese Foreign Minister Wang Yi and Polish Foreign Minister Sikorski, no results were achieved and Warsaw still refused to reopen the border.

Poland decided to close its border with Belarus before the joint military exercise Zapad-2025 between Belarus and Russia began on September 12. Yet after a Russian drone intruded into Polish airspace, Warsaw authorities announced the measures would remain in place until further notice.

Latest Update: Poland announced on September 22 that it will reopen the ports on September 25, restoring the trade link for the China-Europe Railway Express.

Source:
1. CNA, September 17, 2025
https://www.cna.com.tw/news/aopl/202509170151.aspx
2. Caixin, September 24, 2025
https://www.caixinglobal.com/2025-09-24/poland-reopens-belarus-border-restoring-key-china-europe-rail-route-102365374.html

Briefings | | |   Geo-Strategic Trend

China’s Trade with ASEAN Reaches Historic High Amid US Tariff Pressures

China’s trade relationship with the Association of Southeast Asian Nations (ASEAN) has reached unprecedented levels, according to new data from China’s General Administration of Customs. From January to August 2025, bilateral trade totaled 4.93 trillion yuan (approximately $690 billion USD), marking a historic high with a 9.7 percent year-on-year increase.

This surge reflects China’s strategic pivot away from US markets amid ongoing tariff tensions. ASEAN now accounts for 16.7 percent of China’s total import and export value, highlighting the region’s growing importance as a trading partner.

ASEAN has maintained its position as China’s largest agricultural trading partner for eight consecutive years. Agricultural trade between the regions reached 290.6 billion yuan (approximately $41 billion USD) in the first eight months of 2025, representing 20.1 percent of China’s total agricultural imports and exports.

Manufacturing cooperation has been particularly robust, driving significant growth in related product categories. China’s exports of machine tools and automotive components to ASEAN increased by 56.1 percent and 22 percent respectively, while imports of computer components and printed circuit boards from ASEAN grew by 47.4 percent and 22.2 percent.

The expansion coincides with China’s broader trade diversification strategy. According to New York Times reporting from July, Chinese traders have increasingly shifted focus to markets outside the United States, including Southeast Asia, the European Union, and African nations. Direct exports to the US dropped by over 20 percent in July as American buyers remained cautious about tariff implications.

Lu Daliang, spokesperson for China’s General Administration of Customs, noted that the China-ASEAN Free Trade Area is advancing toward version 3.0, with both sides planning to expand cooperation and deepen regional supply chain integration.

Source: Central News Agency (Taiwan), September 16, 2025
https://www.cna.com.tw/news/acn/202509160197.aspx

Briefings | | |   Geo-Strategic Trend

China’s Deepening Deflation Crisis

French newspaper Le Monde published an article on September 19 highlighting China’s spreading deflation problem, which has created a vicious cycle affecting the world’s second-largest economy.

According to the latest report from the China-EU Chamber of Commerce released on September 17, China faces systemic challenges including entrenched deflation and persistent imbalances between supply and demand. Official data shows consumer prices fell 0.4 percent year-on-year in August, the steepest decline since February. Food prices plummeted 4.3 percent, with pork prices continuing their sharp drop, causing Chinese farmers to lose an average of 70 yuan (US$9.8) per pig.

The deflation extends beyond food to housing, where average new home prices have been falling since April 2022. First-tier cities including Beijing, Shenzhen, and Guangzhou saw prices drop 0.1 percent in August, while second-tier cities declined 0.3 percent and smaller cities fell 0.4 percent.

The deflation has created a damaging feedback loop. Companies are reducing production and hiring due to falling profits, pushing youth unemployment to 18.9 percent in August – a two-year high. Falling prices encourage consumers to delay purchases, further suppressing demand. Retail sales of consumer goods grew only 3.4 percent year-on-year in August, the slowest pace in nine months, despite government voucher programs for appliances and smartphones.

The deflation’s impact is visible in everyday life. At Tuanjiehu Park in central Beijing, electric boat rental prices have been cut to one-third of previous rates yet still struggle to attract customers. Young people are abandoning paid private gyms in favor of free public fitness equipment, traditionally used by elderly residents.

Wang Yuxun, a 62-year-old resident, philosophically noted the change: “Since this is the case, old people like me come to exercise at dawn. Young people haven’t given up on fitness because they understand that health is most important. For major health problems, reimbursement limits are low, and no one expects the state to increase healthcare investment. Now, the best approach is still to economize.”

Source: Radio France International, September 20, 2025
https://rfi.my/C1fB

Briefings | | |   Economy/Resources

What Did Trump and Xi Jinping Discuss During Their September 19 Phone Call?

Trump and Xi Jinping spoke by phone for about two hours on September 19. On Trump’s posting and Xinhua’s report, both sides highlighted discussions on the TikTok deal and bilateral trade.

However, there were notable differences between the information put forth by each side. Trump mentioned issues such as fentanyl and ending the Russia-Ukraine war, which were absent from Xinhua’s account – suggesting that it might be Trump raised them but China didn’t agree with the U.S. position. Xinhua reported that Xi pressed the U.S. to provide a fair business environment for Chinese companies investing in the U.S., but Trump did not reference in his post.

Trump’s post on Truth Social:

“We made progress on many very important issues including Trade, Fentanyl, the need to bring the War between Russia and Ukraine to an end, and the approval of the TikTok Deal. … The call was a very good one, we will be speaking again by phone, appreciate the TikTok approval, and both look forward to meeting at APEC!”

Xinhua’s report:

“Xi Jinping stressed that the U.S. should avoid taking unilateral trade-restrictive measures that could undermine the outcomes achieved through multiple rounds of talks. On the TikTok issue, Xi said China’s position is clear: the Chinese government respects corporate autonomy, welcomes companies to conduct business negotiations on the basis of market rules, and supports reaching a solution that complies with Chinese laws and regulations while balancing interests. He expressed hope that the U.S. would provide an open, fair, and non-discriminatory business environment for Chinese enterprises investing in the U.S.”

“Trump stated that the U.S. seeks to promote bilateral economic and trade cooperation, will support the consultations between the two sides, and will properly resolve the TikTok issue. He added that the U.S. is willing to work with China to safeguard world peace.”

Sources:
1. Truth Social, Trump
https://truthsocial.com/@realDonaldTrump/posts/115231649861246548
2. Xinhua, September 19, 2025
http://www.news.cn/world/20250919/3bb67004417649309270b8a7f6c3295d/c.html

Briefings | | |   US-China Relations

Lianhe Zaobao: China Asked Tech Companies to Stop Purchasing Nvidia Chips

Singapore’s primary Chinese language newspaper Lianhe Zaobao recently reported that China’s Cyberspace Administration instructed several large domestic technology companies, including ByteDance and Alibaba, to stop purchasing Nvidia’s RTX Pro 6000D chips and cancel existing orders.

The RTX Pro 6000D is a new AI chip Nvidia customized for the Chinese market to circumvent U.S. export controls. It’s primarily designed for AI inference tasks. Nvidia previously projected that it would ship 1 million to 2 million of these chips this year. Several Chinese companies have indicated that they will order tens of thousands of RTX Pro 6000Ds and have begun testing and verification work with Nvidia’s server suppliers, but after receiving official instructions, these companies have asked suppliers to stop testing. Chinese officials said that Nvidia had violated China’s anti-monopoly law and would continue to investigate the matter.

Nvidia CEO Jensen Huang responded, saying that he was disappointed with the current situation, but understood that there were larger issues between China and the United States that needed to be resolved, and Nvidia would remain patient.

Some market analysts expressed the belief that China is simply trying to put additional pressure on the U.S. to get more favorable terms in trade talks. When asked about this at a regular press conference, the Chinese Foreign Ministry spokesman did not confirm whether China asked companies to stop purchasing. He only said that China has always opposed discriminatory practices against specific countries on economic, trade and technological issues, and is willing to maintain dialogue and cooperation with all parties.

Source: Lianhe Zaobao, September 18, 2025
https://www.zaobao.com.sg/finance/china/story20250918-7534280?ref=global-finance

Briefings | | |   Information/Technology US-China Relations

China’s Youth Unemployment Hits 20-Month High

China’s youth unemployment rate has reached its highest level in 20 months, reflecting deep structural challenges in the job market that experts warn could persist for decades.

China’s National Bureau of Statistics reported that the unemployment rate for 16-24 year-olds (excluding students) reached 18.9% in August, the highest since December 2023. While officials attributed this spike to graduation season, with expectations that rates will decline as graduates find employment, underlying issues suggest a more persistent problem.

The employment crisis stems from a fundamental mismatch between supply and demand. China graduated approximately 12.22 million university students in 2024, an increase of 430,000 from the previous year. This trend of over 10 million annual graduates is expected to continue until 2040, creating sustained pressure on the job market.

Traditional sectors that historically absorbed large numbers of graduates—real estate, internet platforms, private tutoring, and finance—have yet to recover their pre-pandemic hiring levels. Government crackdowns on tutoring companies through the “double reduction” policy in July 2021 particularly devastated the education sector, which has not returned to 2021 employment levels despite some recovery in non-academic training.

Recruitment data shows a 22% year-over-year decline in corporate job postings for graduates in the first half of 2024, while job seekers increased by 8%. The hardest-hit industries include internet/e-commerce, professional services, real estate, education, and utilities.

While emerging sectors like semiconductors, artificial intelligence, new materials, and renewable energy show growth, their scale remains insufficient to offset job losses in traditional industries. As researcher Mao Yufei noted, the expansion in new sectors cannot compensate for the contraction in established ones.

This employment squeeze has led more graduates to pursue advanced degrees, with top-tier universities seeing postgraduate enrollment rates jump from 68.5% in 2022 to 77.5% in 2024, while direct employment dropped from 31.5% to 22.5%.

Source: Central News Agency (Taiwan), September 18, 2025
https://www.cna.com.tw/news/acn/202509180221.aspx

Briefings | | |   Economy/Resources