Geo-Strategic Trend - 20. page

Following the election of Sanae Takaichi as the new leader of Japan’s ruling Liberal Democratic Party (LDP), the 26-year coalition between the LDP and Komeito abruptly collapsed, raising concerns about possible interference or influence from the Chinese Communist Party (CCP).

Analysts noted that shortly after Takaichi’s victory, Chinese Ambassador Wu Jianghao visited Komeito’s headquarters to meet with senior party officials. Soon afterward, Komeito announced the end of its long-standing alliance with the LDP, casting uncertainty over Takaichi’s prospects of becoming Japan’s next prime minister.

The close timing of these events has fueled speculation that Beijing may have sought to obstruct Takaichi’s rise and undermine Japan’s pro-U.S., anti-China policy stance under her leadership.

Source: Epoch Times, October 11, 2025
https://www.epochtimes.com/gb/25/10/10/n14613844.htm

Xinhua News Agency reported that the Bolivarian Alliance for the Peoples of Our America (ALBA) issued a statement on October 3 strongly condemning an alleged “illegal and provocative incursion” by a U.S. fighter jet about 75 kilometers off Venezuela’s coast, calling it a flagrant violation of sovereignty and international law. The alliance accused Washington of engaging in systematic military harassment intended to destabilize the region and urged international organizations to denounce U.S. militarism.

ALBA warned that such actions endanger civilian and commercial aviation and pose an unacceptable threat to regional stability. The organization reaffirmed that Latin America and the Caribbean will not serve as a theater for foreign military operations and pledged to defend peace and independence across the region.

The statement came amid reports that the United States has recently increased its military presence in the Caribbean, deploying warships, a nuclear-powered submarine, more than 4,500 troops, and F-35B stealth fighters to Puerto Rico. Founded in 2004, ALBA – which includes Cuba, Venezuela, and Nicaragua among its members – seeks to promote political and economic integration throughout Latin America and the Caribbean.

Source: Xinhua, October 4, 2025
http://www.xinhuanet.com/20251004/f4dd87fb05eb40cd92859be61822d608/c.html

Singapore’s primary Chinese language newspaper Lianhe Zaobao recently reported that China is using shipping routes between Russia and the Arctic to transport goods, making inroads into the Arctic shipping route. Global shipping giants have reiterated their commitment to stay away from the Arctic shipping route, pointing out that although the route is shorter, it is unsafe and environmentally unfriendly.

Most China-Europe container ships choose to head south, entering the Mediterranean via the Red Sea and the Suez Canal. With tensions in the Red Sea escalating due to Houthi rebels, cargo ships are often diverted around South Africa. However, the Istanbul Bridge ship leaving on September 27 from China’s Ningbo Zhoushan Port chose to head north, entering Europe via the Northeast Passage of the Arctic. The Arctic route, which runs close to Russian territorial waters, can cut the Asia-Europe journey in half, compared to the 40-day trip via South Africa.

China is implementing policies to integrate the Northeast Passage into Europe’s and even the world’s transportation system. Unlike other routes such as the one through the Strait of Malacca, 90 percent of the Arctic route’s Northeast Passage passes through Russia. With Sino-Russian relations continuing to develop at a high level, the route faces fewer geopolitical risks.

Yet this route has been opposed by several global shipping giants. Mediterranean Shipping Company (MSC) stated that increased Arctic shipping could impact the region’s fragile ecosystems and ice caps, adding that “the Northern Sea Route remains underdeveloped for commercial shipping because safe navigation and passage are not yet guaranteed.” Maersk, CMA CGM, and Hapag-Lloyd also stated they would not consider using the route. In 2019, they pledged to avoid the route, which stretches over 3,000 nautical miles along Russia’s Arctic coast. Of the top five global shipping companies, only China’s COSCO Shipping did not make this commitment.

Russia has been promoting the use of the route to transport oil and gas to Asian markets, but ships must obtain Moscow’s approval to pass through. The route is covered with ice in winter and may also contain floating ice in warmer seasons. It can only be navigated by specialized vessels, which increases the risk of accidents.

Source: Lianhe Zaobao, October 3, 2025
https://www.zaobao.com.sg/news/china/story20251003-7612141

As the European Union imposes steep tariffs on Chinese-made electric vehicles, Chinese automakers are accelerating their production in Europe this year, though their approach has shifted significantly. Rather than building their own factories, many companies are now choosing to partner with European firms and utilize existing European manufacturing facilities.

The EU’s anti-subsidy tariffs on Chinese electric vehicle imports last year substantially increased costs for Chinese EVs. Given the high expenses and regulatory risks of exporting to Europe, establishing local production lines has become essential for Chinese new energy vehicle makers. Recent announcements reveal this partnership trend: Leapmotor is working with its investor and joint venture partner Stellantis to produce vehicles at a Spanish factory starting in 2026, while Xpeng has partnered with European automotive giant Magna to manufacture its G6 and G9 models at an Austrian facility this year. Reports suggest GAC Group is also exploring contract manufacturing with Magna.

With localized production support, Xpeng will simultaneously enter five European markets, including Austria in October and Switzerland through collaboration with Hedin Group, one of Europe’s largest automotive dealers. Hedin has partnered with BYD since 2022 for sales in Sweden and Germany, and last August sold its German subsidiary, including multiple dealerships, to BYD.

Learning from Tesla’s troubled experience building its German factory, most Chinese automakers now have heightened risk awareness and are exploring lower-cost entry methods beyond independent factory construction. As more Chinese automakers establish European production, auto parts suppliers are also accelerating localization and favoring partnerships with European firms. Battery giant CATL now operates three European production bases—self-invested facilities in Germany and Hungary, plus a Spanish factory under construction in partnership with Stellantis.

European consumers have mixed reactions: some find Chinese vehicles’ technological features attractive, while others remain cautious or refuse to purchase them, preferring to support the European automotive industry during this sensitive period.

Source: Central News Agency (Taiwan), October 3, 2025
https://www.cna.com.tw/news/acn/202510030203.aspx

South Korea’s largest newspaper Chosun recently reported in its Chinese Edition that, of the sixteen liquefied natural gas (LNG) carriers ordered globally this year, fourteen were taken by South Korean shipyards, while Chinese shipyards failed to secure any orders. The remaining two ships were won by the United States, and these orders will be manufactured by the Philadelphia Shipyard acquired by South Korean Hanwha last year.

Following the relatively easy-to-build container ships and bulk carriers, China has begun to undertake a large number of orders for LNG carriers, which require higher technical standards. Previously, the LNG carrier newbuilding market was dominated by South Korea and China. In 2022, South Korea held a 67.5 percent share of the LNG carrier newbuilding market (115 ships), while China held a 32.5 percent share (56 ships). Last year, this gap narrowed, with South Korea holding 57.2 percent (48 ships) and China 42.8 percent (28 ships). China’s Hudong-Zhonghua Shipbuilding received orders for 24 LNG carriers last year, making it the world’s largest shipyard by orders for LNG carriers.

However, with the USTR’s (United States Trade Representative) port restrictions and Qatar’s order book cooling, China’s LNG carrier orders have been halted. Starting from the 14th of next month, Chinese shipping companies or shipping companies operating Chinese ships will be charged a fee of US$50 per ton based on net tonnage (the volume actually used to transport goods or passengers) when entering the United States. Also, frequent breakdowns of Chinese ships have had an impact on China’s reputation.

Source: Chosun Chinese, September 29, 2025
https://cnnews.chosun.com/client/news/viw.asp?nNewsNumb=20250963604&cate=&mcate=