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• China sending pair of pandas to Washington’s National Zoo by end of 2024
• US urges Nato partners to stay wary of China over its support for Russia in Ukraine war
• 2 new giant pandas are returning to Washington’s National Zoo from China by the end of the year
• Philippines, Brunei sign deal on closer maritime cooperation, with eye on Beijing in South China Sea
• PwC faces defections by Hong Kong, mainland China clients amid concerns about China Evergrande accusations
• Chinese foreign vice-minister Ma Zhaoxu to visit US in latest exchange
• Tech war: China’s Big Fund III brings US$47.5 billion in fresh outlay for nation’s semiconductor supply chain, analysts say
• South China Sea: expect choppy waters when US and Chinese defence chiefs meet
• China ‘pained’ by Gaza situation, President Xi Jinping tells Egyptian leader Sisi
• China-Russia alliance is going strong but unlikely to unseat the US
• France study dream dies as China woman succumbs to malaria in Africa after fleeing abusive family to make money
• Japan’s Kishida meets senior Chinese diplomat, pledges to ‘fully utilise’ all available dialogue platforms with China
• TikTok ban: Shark Tank’s Kevin O’Leary wants to buy Chinese-owned app, sets up crowdfunding campaign
• Tencent sharpens focus on ‘evergreen’ video games in mainland China as domestic industry matures
• China’s EV sector could offset looming EU tariffs with detours via ‘friendly’ tracks, but be prepared for countermeasures
• China-Africa relations: Xi Jinping vows to help Equatorial Guinea diversify economy away from heavy oil and gas reliance
• US trade policy towards China is dangerously incoherent
• Xi Jinping Boulevard in Phnom Penh a ‘new milestone’ in Chinese-Cambodian relations
• Hong Kong considers investing in incineration, upcycling facilities in mainland China as it hunts for ways to handle waste
• Meet the Malaysian Chinese man who adopted 3 Malay sons: ‘I’m a grandfather now and will never be lonely’
• China EV wars: BYD mounts ‘big challenge’ to petrol-guzzling rivals with its new fuel-efficient hybrid technology
• IMF ups China’s 2024 GDP forecast, urges focus on market-oriented reforms at July’s third plenum
• Chinese astronauts complete record-breaking spacewalk to protect Tiangong space station from debris
• China hands death sentence to senior banker for taking US$151 million in bribes
• US sanctions Chinese individuals over Covid-related fraud and bomb threats
• Climate change: China aims to introduce nationwide corporate ESG disclosure standards by 2030
• Hong Kong crypto exchange licence applicants with ties to mainland China withdraw from city
• Anger as China couple let daughter urinate near Thai palace, follows case of ‘Chinese tourists, please keep clean’ sign
• World first: living cancer patient in China receives pig’s liver transplant
• Philippines urged to tap South China Sea reserves to ease energy costs despite Beijing tensions

China sending pair of pandas to Washington’s National Zoo by end of 2024

https://www.scmp.com/news/china/diplomacy/article/3264627/china-sending-pair-pandas-washingtons-national-zoo-end-2024?utm_source=rss_feed

China will send a pair of pandas to Washington by the end of this year, the Smithsonian’s National Zoo said on Wednesday, breathing new life into a decades-long conservation partnership between the two countries.

The news of giant pandas returning to America’s capital came six months after pandas Tian Tian, Mei Xiang and their cub Xiao Qi Ji left the zoo last year in a departure symbolic of deteriorating Sino-US relations.

China has long been sending the rare members of the bear family to nations overseas as a goodwill gesture meant to build ties in a practice dubbed panda diplomacy.

In 1972, Beijing dispatched its first pair of pandas abroad to Washington after US president Richard Nixon met Chinese leader Mao Zedong. Since then, the lending of giant pandas has come to symbolise US-China comity for the last 50 years.

Each US-bound bear is two years old: Bao Li is a male giant panda whose name means “treasure” and “energetic”, and female Qing Bao’s name means “green treasure”.

Bao Li’s grandparents are Tian Tian and Mei Xiang, who both lived in the Washington zoo from 2000 until last year. His mother is Bao Bao, who was born at the zoo in 2013.

While a public debut date has yet to be determined, the zoo said the pandas upon their arrival would undergo routine quarantine of at least 30 days and take a few weeks to settle into their new habitat.

US first lady Jill Biden announced the news of the pandas via a lighthearted video in which she was preparing to receive guests who were playfully called “particular”.

When asked about the menu and dietary restrictions for a formal dinner, Brandie Smith, the National Zoo’s director, in the clip said the guests were strict vegetarians and noted they might honk if they felt nervous.

Smith described the zoo as “thrilled” to continue its breeding-and-conservation partnership with Chinese scientists, touting its “irrefutable impact”.

“Through this partnership, we have grown the panda population, advanced our shared understanding of how to care for this beloved bear and learned what is needed to protect wild pandas and preserve native habitat,” she said in a statement.

Earlier this month, Xie Feng, China’s ambassador to the US, hailed the conservation partnership for the black-and-white bears as “fruitful” during an event held at the Chinese embassy in Washington.

“As envoys of goodwill, giant pandas have brought joy to many American people over the past five decades,” Xie said.

“Our cooperation on panda conservation has been fruitful. Together, we have successfully bred 17 panda cubs, helping to take pandas off from the endangered list.”

The US zoo on Wednesday said it had signed a new cooperative research-and-breeding agreement with the China Wildlife Conservation Association that is effective through 2034.

Under terms similar to previous agreements, a pair of adults will be sent to the zoo and any cubs born on its premises will move to China by the age of four. They remain under China’s ownership.

Scientists from both countries would conduct joint research in China and at the Washington zoo to find new techniques to boost the health and welfare of giant pandas in captivity and the wild, the zoo said.

The researchers plan to study how climate change affects panda habitats by measuring the growth of bamboo under experimentally increased temperatures.

They also plan to create bamboo-restoration plots and look into how connected protected areas in the wild support pandas and their neighbours, including the red panda, golden pheasant and snub-nosed monkey.

Additional reporting by Bochen Han in Washington

US urges Nato partners to stay wary of China over its support for Russia in Ukraine war

https://www.scmp.com/news/china/article/3264623/us-urges-nato-partners-stay-wary-china-over-its-support-russia-ukraine-war?utm_source=rss_feed

Washington has painted for its military allies across the Atlantic Ocean a stark picture of China’s role in supporting Russia’s war with Ukraine, arguing Beijing should not be able to boost Moscow while seeking to enjoy normal ties across Europe.

US Deputy Secretary of State Kurt Campbell briefed Nato counterparts in Brussels this week, highlighting Beijing’s assistance to Moscow “through the provision of dual-use components that are in essence enabling Russia to execute this war inside Ukraine”, according to Julianne Smith, US permanent representative to Nato, on Wednesday.

Campbell, formerly a national security adviser to US President Joe Biden on Indo-Pacific affairs, at his meeting on Tuesday said China’s objective extended beyond merely backing Russia.

Beijing sought to publicly downplay its support for Moscow, the envoy said, while trying to maintain normal diplomatic and economic relations with Europe.

Describing the meeting inside Nato headquarters as a “really critical moment”, Smith said the US, its partners and allies were doing “everything” to call out such support.

They were also trying to make known to the Chinese that “we don’t believe that they can credibly declare that they are neutral in Russia’s war inside Ukraine”.

It was “very clear” that China has “picked sides”, she said.

Smith contended that Moscow was receiving items from Beijing like machine tools, microelectronics, drone technology and nitrocellulose – the main ingredient of modern gunpowder but also used in certain lacquers and paints.

While Smith did not elaborate on what type of evidence Campbell offered, media reports in Europe said he had provided “as much detail and specifics as possible.”

Following the Nato briefing, Politico Europe reported that the State Department’s No 2 official said several European countries stated that maintaining a normal relationship with China would be “impossible” if it continued to “surreptitiously” abet what some have called the most destabilising European conflict since the Second World War.

Earlier this month, British Defence Secretary Grant Shapps disclosed at the London Defence Conference, an annual forum on security issues, that US and British military intelligence had uncovered “evidence Russia and China are collaborating on combat equipment for use in Ukraine”.

Shapps called the flow of “lethal aid” from China to Russia and subsequently into Ukraine “a significant development”.

In response to the British minister’s remarks, US National Security Adviser Jake Sullivan drew distance from Shapps, saying the Biden administration “to date” had not observed any plans for the delivery of lethal aid.

Sullivan said he looked forward to speaking with Britain to understand “better what exactly that comment was referring to”.

Meanwhile, US Secretary of State Antony Blinken is expected to join 31 foreign ministers from Nato countries in Prague from Thursday to Friday.

Smith on Wednesday said this week’s gathering would be “informal”, allowing ministers to discuss some of their intended deliverables in the run-up to the Nato summit in Washington in July.

The matter of Beijing’s position on Ukraine could be covered during the Prague ministerial meeting, she added, saying it “comes up quite regularly around the halls of the Nato alliance”.

As for the question of US support for Ukraine’s entry to Nato, Smith told reporters it was “unlikely” Kyiv would be invited to the July summit.

However, the Biden administration would do everything to help Ukraine “walk across that bridge to membership eventually”, she said.

At last year’s Nato summit in Vilnius, transatlantic security alliance leaders reached an agreement affirming that Ukraine’s future was aligned with the organisation, without establishing a timetable for accession.

“We will be in a position to extend an invitation to Ukraine to join the alliance when allies agree and conditions are met,” the declaration said.

Smith on Wednesday told reporters there would be “new language” in this year’s Nato summit declaration on Ukraine’s membership aspirations, saying “some very important and useful ideas” were circulating among alliance members now.

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2 new giant pandas are returning to Washington’s National Zoo from China by the end of the year

https://apnews.com/article/giant-pandas-washington-zoo-china-764f8016d98c01ab579bdbb6dcc3dd6bFILE - Giant pandas eat bamboo at the Smithsonian's National Zoo, May 4, 2022, in Washington. Two giant pandas are coming to Washington’s National Zoo from China by the end of the year. The zoo made the announcement Wednesday, about half a year after it sent its three pandas back to China. (AP Photo/Jacquelyn Martin, File)

2024-05-29T12:20:54Z

WASHINGTON (AP) — Two giant pandas are coming to Washington’s National Zoo from China by the end of the year.

The zoo made the announcement Wednesday, about half a year after it sent its three pandas back to China. Other American zoos also have sent pandas back to China as loan agreements lapsed during heightened diplomatic tensions between the U.S. and China over economic relations, technology, trade, Taiwan and even a spy balloon.

The Smithsonian’s National Zoo and Conservation Biology Institute said the pair of pandas are Bao Li (pronounced BOW'-lee) and Qing Bao (ching-BOW’). Giant pandas are icons in Washington, D.C., and beloved around the nation and the world. For more than five decades, the institute has created and maintained one of the world’s foremost giant panda conservation programs, helping move the panda from “endangered” to “vulnerable” on the global list of species at risk of extinction.

“We’re thrilled to announce the next chapter of our breeding and conservation partnership begins by welcoming two new bears, including a descendent of our beloved panda family, to Washington, D.C.,” said Brandie Smith, the zoo’s director. “This historic moment is proof positive our collaboration with Chinese colleagues has made an irrefutable impact. Through this partnership, we have grown the panda population, advanced our shared understanding of how to care for this beloved bear and learned what’s needed to protect wild pandas and preserve native habitat.”

Two weeks ago, the Chinese Embassy in Washington held an event for a video series about friendship between people in China and the U.S., and Smith gave an emotional speech recounting her experience with giant pandas.

Chinese President Xi Jinping had signaled during a trip in late 2023 that China would be sending new pandas to the United States. He called them “envoys of friendship between the Chinese and American peoples.”

“We are ready to continue our cooperation with the United States on panda conservation, and do our best to meet the wishes of the Californians so as to deepen the friendly ties between our two peoples,” Xi said during a speech with business leaders while he was attending a summit of Indo-Pacific leaders and meeting with President Joe Biden.

“I was told that many American people, especially children, were really reluctant to say goodbye to the pandas and went to the zoo to see them off,” Xi said in his speech, adding that he learned the San Diego Zoo and people in California “very much look forward to welcoming pandas back.”

In the video announcement released Wednesday on the institute’s social media channels, first lady Jill Biden joined Smithsonian Secretary Lonnie G. Bunch III and Smith to reveal the pandas were returning to the nation’s capital. Last November, giant pandas Tian Tian and Mei Xiang and their cub, Xiao Qi Ji, went back to China, prompting a nationwide outpouring of farewell from millions of U.S. panda fans of all ages.

Zoo Atlanta, the last U.S. zoo with pandas in its care, expects to say goodbye to the four giant bears this fall. The zoo was making preparations to return panda parents Lun Lun and Yang Yang to China along with their American-born twins Ya Lun and Xi Lun, zoo officials said earlier this month. There was no date for the transfer, they said, but it will likely happen between October and December.

It’s possible that America will welcome another new panda pair before the Atlanta bears depart. The San Diego Zoo said last month that staff members recently traveled to China to meet pandas Yun Chuan and Xin Bao, which could arrive in California as soon as this summer.

Pandas have long been the symbol of the U.S.-China friendship since Beijing gifted a pair to the National Zoo in 1972, ahead of the normalization of bilateral relations. Later, Beijing loaned the pandas to other U.S. zoos, with proceeds going back to panda conservation programs.

When U.S-China relations began to sour in recent years, members of the Chinese public started to demand the return of giant pandas. Unproven allegations that U.S. zoos mistreated the pandas, known as China’s “national treasure,” flooded China’s social media.

The National Zoo said the pandas coming to Washington are:

— Bao Li, a 2-year-old male whose name means “treasure” and “energetic.” He was born Aug. 4, 2021, at the China Conservation and Research Center for the Giant Panda in Sichuan to father An An and mother Bao Bao. The zoo said Bao Li’s mother was born at the zoo in 2013, and his grandparents Tian Tian and Mei Xiang lived at the zoo from 2000 to 2023. It was Mei Xiang and Tian Tian, along with their cub Xiao Qi Ji, who left the zoo in November.

— Qing Bao, a 2-year-old female whose name means “green” and “treasure.” She was born Sept. 12, 2021.

Smith, the zoo’s director, said “this historic moment is proof positive our collaboration with Chinese colleagues has made an irrefutable impact.”

“Through this partnership,” Smith said in a statement, “we have grown the panda population, advanced our shared understanding of how to care for this beloved bear and learned what’s needed to protect wild pandas and preserve native habitat.”

The zoo said that the new pandas will be quarantined in the panda house for a minimum of 30 days upon their arrival. The date for the pandas’ public debut will be announced when their care team feels they are ready.

A research and breeding agreement with the Chinese runs through April 2034 and, like previous ones, says any cubs born at the zoo will move to China by age 4, according to the announcement. The zoo will pay a $1 million annual fee to the China Wildlife Conservation Association to support research and conservation efforts in China.

Philippines, Brunei sign deal on closer maritime cooperation, with eye on Beijing in South China Sea

https://www.scmp.com/week-asia/politics/article/3264610/philippines-brunei-sign-deal-closer-maritime-cooperation-eye-beijing-south-china-sea?utm_source=rss_feed

The Philippines has signed a maritime cooperation deal with Brunei to boost “stability of the region”, but analysts say Bandar Seri Begawan’s ties with China could limit its commitment to working with Manila on countering Beijing’s influence in the South China Sea.

In his first official visit to Brunei on Tuesday, Philippine President Ferdinand Marcos Jnr signed a deal with the country’s monarch, Sultan Hassanal Bolkiah, that committed their two nations to mutually developing their maritime capabilities through joint skills training, as well as research and information sharing.

Aside from maritime cooperation, the two leaders forged deals on mutual recognition of education certificates and boosting tourism, as well as renewed memorandums of understanding (MOU) on food security and agricultural cooperation.

At the state banquet the sultanate hosted at Istana Nurul Iman, the Brunei leader’s official residence, Marcos Jnr emphasised the importance of continuing to work together on a bilateral basis, as well as other international coalitions, “for the peace and the stability of the region”.

“And not only for Asia, but for the Indo-Pacific as well. It is important that those partnerships now be brought back into the modern world. And I look forward for this state visit to once more give an added impetus and warmth and inspiration to the relationship between our two countries,” he said.

In response, the sultan, who has ruled Brunei for nearly 60 years, said his government was committed to “further strengthen” its ties with the Philippines to “protect and safeguard our common aspiration”.

Before Marcos Jnr left for Brunei, he told the media that he would look for “ways for further cooperation with Brunei in ensuring the defence of our countries and of our region”. However, it is not clear if the maritime cooperation deal signed by the two leaders involves any defensive components.

The Philippines, Brunei, Malaysia, Vietnam and China have competing claims in the South China Sea. In 2016, the Permanent Court of Arbitration at The Hague dismissed China’s claims to the South China Sea but Beijing rejected the ruling, insisting it has jurisdiction over all the territory located within the so-called nine-dash line used on its maps.

In contrast with Manila’s increasingly confrontational stance towards China’s maritime territorial claims, Brunei’s stance on the South China Sea dispute is notably subdued. It claims a 200-nautical mile exclusive economic zone but avoids occupying disputed features or maintaining a military presence.

Brunei has stated it prefers peaceful bilateral negotiations, which observers say is influenced by significant economic ties with and investments from China, which limit its opposition to Beijing’s claims.

Gill said Brunei, regardless of its silence, was a claimant state in the South China Sea dispute and coordination was crucial if Manila sought to illustrate its intentions of socialising its position with its immediate neighbours in Southeast Asia.

“The MOU will illustrate that, contrary to the region’s misperception that the Philippines only wants to bring in external military powers into the region, Manila wants to deepen intraregional maritime security cooperation with its neighbours to spearhead home-grown solutions,” Gill said.

Manila was probably aware that such an MOU with Brunei had its limitations, given the latter’s proximity with Beijing, but it was still important amid the uncertainties in the region, Gill said.

“In this context, socialising pertains to deepening coordination and diplomatic engagements with Brunei to allow it to become more familiar with Manila’s position. Maritime cooperation is an important prerequisite for deeper talks on maritime security issues. So it is a helpful gateway for closer Philippines-Brunei security cooperation,” Gill added.

Jennifer Parker, associate at the National Security College at the Australian National University, said while Brunei and the Philippines could seek to work together on naval exercises and training under their new maritime cooperation as they had done in the past, it was unlikely Brunei would be comfortable with any of these activities being considered attempts at countering China.

“Brunei and China have significant ties, including a significant amount of Chinese investment in Brunei,” Parker said.

China has become Brunei’s largest source of foreign investment and its third-largest trading partner. In October 2022, bilateral trade between Brunei and China reached US$2.53 billion.

Asked whether the maritime cooperation would fit into Manila’s larger efforts at building a regional coalition to counter Beijing in the South China Sea, Parker said the deal was not only about China and should also be viewed through the lens of a deepening bilateral relationship, which was important given their proximity and dependence on the same maritime domain.

“It is highly unlikely Brunei would choose to be more assertive against China, given the close economic ties between the two countries,” Parker said.

Security analyst Joshua Espeña, a resident fellow and vice-president of the International Development and Security Cooperation, said since Brunei was sensitive to a confrontation with China, it could work based on functional cooperation on maritime security through the Brunei Darussalam-Indonesia-Malaysia-Philippines East Asean Growth Area (BIMP-EAGA) security leg initiatives.

BIMP-EAGA is a regional cooperation initiative aimed at enhancing trade, investment, and tourism in less-developed areas of member countries through infrastructure projects and collaborative efforts in various sectors.

“Brunei cannot be expected to be proactive given its relatively limited capabilities to confront China. However, it can support regional initiatives that uphold the rules-based order pushed by Manila,” Espeña said.

“Brunei hosts British forces, who have reasons to support US leadership in the Indo-Pacific. This can indirectly provide signals to support US presence in the region. While Brunei’s legroom is limited, the Philippines can leverage mini-lateral approaches.”

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PwC faces defections by Hong Kong, mainland China clients amid concerns about China Evergrande accusations

https://www.scmp.com/business/article/3264609/pwc-faces-defections-hong-kong-mainland-china-clients-amid-concerns-about-china-evergrande?utm_source=rss_feed

Shenzhen-listed conglomerate China Merchants Port Group has joined at least four other large corporations that have terminated contracts with auditing firm PricewaterhouseCoopers (PwC) in the last month amid concerns around possible malpractice tied to insolvent property developer China Evergrande.

The Hong Kong headquartered port operator and shipping company said in a Wednesday stock exchange filing that its shareholders have decided to retract a proposal to hire PwC as its auditor for the year, citing “precautionary principles”.

Top retail lender China Merchants Bank, state-backed construction company China Railway Group, Shenzhen-listed Mindray Bio-Medical Electronics and Shanghai-listed Eastroc Super Drink have also scrapped plans to hire or ended contracts with the auditor this month, according to exchange filings.

PwC’s troubles have worsened since a letter from whistle-blowers in April alleged that the firm’s mainland China and Hong Kong branches “turned a blind eye” for more than a decade to the misconduct of property giant China Evergrande, which was ordered by a Hong Kong high court to liquidate in January.

The US firm vehemently denied the allegations and said it was taking measures to investigate the matter. Regulators in mainland China and Hong Kong also began looking into PwC’s practices tied to Evergrande.

PwC declined to comment for this article.

On May 27, China Merchants Bank announced it was replacing PwC with EY’s mainland China and Hong Kong subsidiaries. China Railway Group said on May 25 it had replaced PwC with Deloitte, noting, however, that the reason for the change was its “business operation, development needs, and holistic auditing needs”.

Evergrande, the world’s most indebted developer with more than US$300 billion in total liabilities, inflated its sales by 564 billion yuan (US$79.3 billion) and its profits by 92 billion yuan in the years leading to its downfall in 2021, the China Securities Regulatory Commission said in March.

The watchdog also imposed a 47 million yuan fine on Evergrande founder Hui Ka-yan and barred him from participating in the country’s financial markets for life.

The China businesses of US-linked auditors have taken a hit since Beijing began tightening rules last year around cross-border auditing work that involved cybersecurity. Last January, the finance ministry and other government entities also urged state-owned firms to phase out their contracts with PwC, Deloitte, EY, and KPMG, known collectively as the “big four” accounting firms.

PwC has seen other scandals in recent months. In March, PwC Australia had to cut jobs as part of a major restructuring after a former partner leaked confidential documents in a serious conflict of interest. In December, the company’s affiliates in mainland China and Hong Kong had to pay a combined fine of close to US$8 million for auditing failures tied to US-listed Chinese companies.

Additional reporting by Zhang Shidong

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Chinese foreign vice-minister Ma Zhaoxu to visit US in latest exchange

https://www.scmp.com/news/china/diplomacy/article/3264599/chinese-foreign-vice-minister-ma-zhaoxu-visit-us-latest-exchange?utm_source=rss_feed

Chinese foreign vice-minister Ma Zhaoxu will visit the United States for four days from Thursday, the latest in a string of exchanges between the two sides in recent months.

Ma, who oversees US-China relations, will meet US deputy secretary of state Kurt Campbell and representatives of “various sectors” during the trip, Chinese foreign ministry spokeswoman Mao Ning told reporters in Beijing on Wednesday.

The meeting between Ma and Campbell follows a phone call between the two senior officials in March, when they discussed a range of regional and global issues as part of efforts to maintain communication and cooperation.

Earlier this year, Beijing and Washington also resumed military-to-military talks after communication was suspended in 2022, as relations deteriorated between the two nations. Their defence chiefs are expected to meet during the Shangri-La Dialogue in Singapore later this week.

As a key step to improve strained ties, US Secretary of State Antony Blinken visited China last month and met President Xi Jinping, with the two sides agreeing to continue high-level engagement.

Xi said during the talks that the two countries had made some “positive progress” in various fields since he met US President Joe Biden in San Francisco in November, but that there was room for “further efforts” on problems that remained unresolved.

Beijing and Washington are at loggerheads over a wide range of issues – from China’s manufacturing overcapacity to the US selling advanced military technologies to Taiwan.

Both powers also have a strong military presence in the Indo-Pacific, where tensions have been rising over the Taiwan Strait and contested parts of the South China Sea.

Beijing and Washington agreed to maintain dialogue and manage risks during virtual talks on maritime affairs last week.

But Hong Liang, the Chinese foreign ministry’s director general for boundary and ocean affairs, urged the US to refrain from interfering in China’s maritime disputes with its neighbours.

He also told his US counterpart that Washington should stop supporting “Taiwan independence” – a reference to the island’s ruling Democratic Progressive Party which denies Beijing’s claim of sovereignty over Taiwan.

The meeting coincided with People’s Liberation Army drills that encircled Taiwan following the inauguration of the DPP’s William Lai Ching-te as the island’s new leader.

Washington raised “serious concerns” over the military exercises and urged Beijing to act with restraint. The US said it was closely monitoring the PLA activities.

Beijing sees Taiwan as part of China, to be reunited by force if necessary. Most countries, including the US, do not recognise Taiwan as an independent state, but Washington is opposed to any attempt to take the island by force and is committed to supplying it with weapons.

Tech war: China’s Big Fund III brings US$47.5 billion in fresh outlay for nation’s semiconductor supply chain, analysts say

https://www.scmp.com/tech/tech-war/article/3264612/tech-war-chinas-big-fund-iii-brings-us475-billion-fresh-outlay-nations-semiconductor-supply-chain?utm_source=rss_feed

China’s largest-ever chip investment fund is expected to bolster Beijing’s support for the nation’s leading contract semiconductor manufacturers and other enterprises in the value chain, including equipment and material suppliers, according to analysts.

The third phase of the China Integrated Circuit Industry Investment Fund, also known as the “Big Fund”, was established last week with a registered capital of 344 billion yuan (US$47.5 billion) as part of the country’s efforts to build a self-sufficient semiconductor sector.

The fund is aimed at enhancing the nation’s “ability to supply [semiconductors] internally”, reinforcing Beijing’s goal to “build up the capability and strengths” of this industry, despite mounting US tech sanctions, Randy Abrams, the head of Taiwan research at Swiss investment bank UBS, said on Wednesday.

While mainland chip foundries such as Semiconductor Manufacturing International Corp and Hua Hong Semiconductor are expected to benefit from the latest funding resource, Abrams said: “There will be some [investments] on capacity, equipment and materials, as well as investments tied to advanced packaging.”

The size of the new fund – roughly on par with the US$53 billion in incentives under the Chips and Science Act, which was enacted by US President Joe Biden in 2022 – reflects the massive backing from state-owned enterprises and Beijing’s “whole nation” approach to building a self-sufficient semiconductor industry amid Washington’s tech export restrictions.

Big Fund III has 19 equity investors, led by China’s Ministry of Finance. Other stakeholders include China Development Bank Capital, Shanghai Guosheng Group, China Construction Bank, Bank of China, Agricultural Bank of China, Bank of Communications, Postal Savings Bank of China, Industrial and Commercial Bank of China and China National Tobacco Corp.

The new fund will be managed by Zhang Xin, an official at the Ministry of Industry and Information Technology, which is the principal agency overseeing China’s semiconductor industry. Zhang had replaced Ding Wenwu to oversee the Big Fund after the latter was put under investigation for possible corruption in July 2022.

Launched in 2014, the Big Fund had raised 204.1 billion yuan in 2019, up from its initial financing of 138.7 billion yuan. These two funding rounds highlighted investments in manufacturing, with chip makers comprising about 16 per cent in the first phase and 50 per cent in the second phase, according to calculations made by the South China Morning Post based on data from Qichacha.

In spite of corruption scandals, the Big Fund has been successful in fostering the development of key domestic enterprises, including memory chip giant Yangtze Memory Technologies Corp and top DRAM producer ChangXin Memory Technologies.

Apart from chip makers, Big Fund III is also expected to provide more support for equipment suppliers like Naura Technology Group and Advanced Micro-Fabrication Equipment, as well as raw material providers such as National Silicon Industry Group, according to analysts.

But the jury is still out on whether China can overcome US tech restrictions, which have created “choking points” in the domestic semiconductor industry.

“It’s very challenging to see the gap narrowing because of export controls, which make it very difficult to get the right [chip-making] equipment to operate at the right production yields and cost,” Nicolas Gaudois, UBS head of Asia-Pacific technology research, said.

South China Sea: expect choppy waters when US and Chinese defence chiefs meet

https://www.scmp.com/news/china/diplomacy/article/3264527/south-china-sea-expect-choppy-waters-when-us-and-chinese-defence-chiefs-meet?utm_source=rss_feed

American and Chinese defence officials are expected to meet at a global security forum in Singapore later this week, with rising tensions in the South China Sea likely to dominate the discussion.

The meeting is the latest effort to restore US-China military communication channels that were shut down as ties deteriorated in 2022, and to reduce the likelihood of conflict in the contested waterway.

But analysts do not expect the talks to bring any major change in stance on flashpoints like the South China Sea and the Taiwan Strait.

According to media reports citing US officials, Chinese Defence Minister Admiral Dong Jun will meet his American counterpart Lloyd Austin during the annual Shangri-La Dialogue, which begins on Friday.

The last time defence chiefs from the two nations met in person was in November 2022, when Austin held talks with Wei Fenghe, then China’s defence minister, in Cambodia.

Beijing refused to agree to a meeting at last year’s Shangri-La Dialogue because of US sanctions on Li Shangfu. Li was China’s defence minister at the time, but was ousted a few months later and replaced with Dong in December.

Dong and Austin held their first direct talks by phone in April, when Austin underscored the “importance of respect for high seas freedom of navigation guaranteed under international law, especially in the South China Sea”.

Analysts say the meeting in Singapore is highly likely to go ahead and will be positive for military ties, but they expect the two sides to remain adamant in their positions on the South China Sea and other hot-button issues.

Benjamin Barton, an associate professor at the University of Nottingham’s Malaysia campus, said Beijing and Washington would continue to push for their own visions of the South China Sea.

He expected the US to stress “the need for calm to protect stability and the status quo in light of recent flare-ups between Beijing and Manila”.

“It also represents an opportunity for both sides to size each other up in terms of potential strategic developments in the short and medium term,” he said.

Timothy Heath, a senior international defence researcher at the Rand Corporation, said exchanging views and building trust could “help facilitate efforts to manage tensions” and may “encourage them to work together to de-escalate any situation that may arise”.

“The US message will emphasise the importance of US alliances and partnerships. The US government can also be expected to emphasise US interest in ensuring stability in the Taiwan situation and South China Sea,” Heath said.

“Although China is unlikely to alter its policies in response to the US demands, it is still a good idea to have both sides meet in person and exchange frank views.”

Zachary Abuza, a professor at the National War College in Washington who specialises in Southeast Asia, said that while the Shangri-La Dialogue would be an opportunity for the two countries to address sensitive issues, practical changes to the South China Sea dispute were unlikely given that Beijing had “no incentive to stop” its actions.

“While the US sees China as taking reputational costs from bullying smaller states, Beijing sees it as a sign of strength,” Abuza said, adding that China had faced “few costs for its actions, so why stop?”

“I am more hopeful that the Singapore gathering will be an opportunity for US and Chinese defence ministers to resume their communications, as there are a host of sensitive issues that really need to be addressed.”

That view was echoed by Collin Koh, a senior fellow at the S. Rajaratnam School of International Studies in Singapore, who said the fact that they will meet at all “is a good thing”. It follows an agreement between leaders Xi Jinping and Joe Biden in November to restore military communication channels.

Koh noted there had been a gradual improvement in military-to-military interactions. But he expected both sides to “dig their heels in” on issues they were not prepared to compromise on, and he said Dong’s stance at the forum was likely to be just as tough as his predecessors, Li and Wei.

“The Chinese defence minister isn’t exactly the top military decision-maker. He’s the face of China’s defence establishment,” Koh said, adding that Dong would “have to maintain that tough stance”.

Chinese defence ministers have less direct authority in the military than their counterparts in other countries and instead act mainly as the military’s public representative. The power of command rests with the Central Military Commission, chaired by President Xi.

The three-day Shangri-La Dialogue is likely to see heated debate over the South China Sea, as it has in previous years, as the US and China assert their demands.

China claims much of the resource-rich waterway but the Philippines, Vietnam, Malaysia and Brunei have overlapping claims. An international tribunal dismissed China’s territorial and maritime claims to the South China Sea in 2016 as having no legal basis, but Beijing rejected the ruling and has continued to build outposts on islands and atolls that it controls.

While Washington does not have any territorial claims in the disputed waters, it is committed to upholding the freedom of navigation in the South China Sea and supporting its southeast Asian allies, such as the Philippines.

Philippine President Ferdinand Marcos Jnr’s keynote speech on the first day of the Singapore forum will be closely watched given the mounting tensions between Manila and Beijing.

In recent months there have been frequent run-ins between the Chinese and Philippine coastguards near the disputed Scarborough Shoal, a rich fishing ground, and Second Thomas Shoal, where a rusting warship is used as a Philippine military outpost. These tense confrontations have seen water cannons fired and vessels colliding.

China sent “by far the largest” force to blockade Scarborough Shoal earlier this month, according to former US Air Force official Ray Powell. He said at least four coastguard and 26 large maritime militia ships attempted to “enforce [China’s] claim over the shoal”, which it took control of in 2012.

That took place days ahead of a Philippine civilian-led supply mission to fishing boats near the disputed atoll. The organisers of the convoy said they had to abandon plans to sail close to Scarborough Shoal after being shadowed by a Chinese vessel.

Last month, the Philippines held its first joint naval drills with the US, Japan and Australia in the South China Sea, prompting China to conduct air and naval patrols in response.

The US and the Philippines also wrapped up their annual Balikatan joint military exercise this month – held for the first time beyond the Philippines’ territorial waters. It was followed by an announcement from the Chinese People’s Liberation Army that it had carried out anti-missile and anti-submarine drills in the South China Sea.

Stephen Nagy, a professor of international relations at the International Christian University in Tokyo, said that in his speech at the forum, Marcos Jnr was likely to frame the South China Sea dispute and China’s efforts to “dominate” the region as “highly destabilising”.

Nagy expected Marcos Jnr to point to Beijing’s increasing use of grey-zone, or non-military, activities – such as merchant vessel swarm tactics and the use of water cannons – which he said were aimed at “neutralising Manila’s abilities to demonstrate sovereignty”.

“I expect him to also highlight that through mini-lateral cooperation with the US, Japan and Australia that Manila is using partnerships to resist revisionist behaviour of China to dominate the region,” he said.

Barton from University of Nottingham Malaysia said Marcos Jnr was likely to “stick to the script” in his speech.

That would include repeating the line that the Philippines must “defend what it perceives as its national sovereignty in the face of strategic encroachment and acts of intimidation by the Chinese around the Scarborough Shoal”.

“At this stage of his term, I don’t see how it would make sense for Marcos to deviate from this affirmed stance. It’s important for him to continue to stand up to China both because it plays to his political distinctiveness – especially when compared to his predecessor – and courage at home,” Barton said.

“[Marcos Jnr is] building up his political capital internationally as he is seen as standing up to an emerging powerhouse despite the power asymmetries at stake – including the importance of trade and investments with and from mainland China.”

But Koh with the RSIS in Singapore said Marcos Jnr could use the Shangri-La Dialogue to highlight the South China Sea and other security issues and as a chance to open a dialogue with Beijing.

His speech will likely stress “that the Philippines is willing to engage in dialogue with China and will not foreclose any peaceful means to address the dispute with China”, according to Koh.

“At the same time, I think he’s going to emphasise the importance of working collectively with like-minded countries around the region and abroad. So, of course, he’s going to also likely highlight and emphasise the fact that his foreign policy isn’t, in a way, anti-China per se.”

China ‘pained’ by Gaza situation, President Xi Jinping tells Egyptian leader Sisi

https://www.scmp.com/news/china/diplomacy/article/3264614/china-pained-gaza-situation-president-xi-jinping-tells-egyptian-leader-sisi?utm_source=rss_feed

China is deeply pained by the “extremely serious” humanitarian situation in Gaza, President Xi Jinping told his visiting Egyptian counterpart Abdel Fattah el-Sisi, while reiterating Beijing’s call to prevent a spillover of the conflict.

The comments from Xi came amid growing fears of wider escalation after an Egyptian soldier was killed in a clash with Israeli troops near the Rafah border crossing between Egypt and the Gaza Strip.

Meeting Sisi in Beijing on Wednesday, Xi also vowed more cooperation with Egypt on fields ranging from trade and investment to international affairs, as Beijing eyes closer Middle Eastern and African ties in the shadow of growing China-US rivalry.

Their talks came a day ahead of the 10th Ministerial Conference of the China-Arab States Cooperation Forum. Sisi and three other Arab heads of state will attend the opening ceremony on Thursday, with Xi to deliver the keynote address.

Describing the humanitarian situation in Gaza as “extremely serious”, Xi told Sisi that “an immediate ceasefire” was “imperative” as he called for prevention of a spillover of the conflict.

China would like to cooperate with Egypt in the regional mediation process, Xi added, reiterating Beijing’s long-held support for the “two-state solution” to the Israeli-Palestinian conflict, and Palestine’s full membership at the United Nations.

“China is ready to work with Egypt … to promote an early, comprehensive, just, and lasting solution to the Palestine issue,” Xi was quoted as saying by Chinese state broadcaster CCTV.

Sisi, who earlier this year declared Egypt’s “full support” for the Palestinian cause, said his country “highly appreciated” China’s “just approach and stance” towards Palestinian issues, and would “maintain close communication” with Beijing on the matter.

According to an Egyptian foreign ministry readout, Sisi underscored “the gravity of the Israeli military operations in the Palestinian city of Rafah and their severe humanitarian, security and political consequences”.

During their talks, Xi also vowed closer cooperation with Egypt in fields including medicine, communication and information, and new energy sectors, while maintaining investment links in traditional areas such as infrastructure and industry.

Sisi echoed Xi’s call, adding that Egypt hoped to strengthen exchanges on artificial intelligence, food security and finance.

The official readout from Cairo also said that Sisi “was keen on affirming that the utmost priority is placed on safeguarding Egypt’s water security”.

Egypt faces acute water scarcity and lawmakers in the country have called for cooperation with China on projects aimed to develop and conserve water resources due to its experience in the field.

Xi also said he supported Cairo to play a more important role in “international and regional affairs” through multilateral international platforms and frameworks, citing the Shanghai Cooperation Organisation and Brics, two regional blocs largely led by Beijing.

Egypt became a dialogue partner of the SCO in 2022 and joined the Brics grouping of emerging economies earlier this year.

Sisi’s visit comes with the Gaza war in its seventh month, and with Israeli troops conducting deadly air and ground attacks this week on Rafah, a Palestinian city bordering Egypt.

Israeli tanks mounted a ground offensive into Rafah, in southern Gaza, for a second day on Wednesday, defying an order from the International Court of Justice to end its attacks on Palestinians sheltering there from widespread bombardment.

Israel’s offensive has also triggered clashes with the Egyptian military, with at least one Egyptian border guard shot dead on Monday, sending already tense bilateral relations to a new low.

Yet Egypt – the first Arab country to sign a peace treaty and establish diplomatic relations with Israel 45 years ago – remains one of the most experienced mediators in the Middle East. Cairo has been pushing for a ceasefire deal between Israel and the Palestinian militant group Hamas, whose deadly cross-border raid on October 7 sparked the Israeli offensive.

Egypt, along with the United States, also mediated the Oslo Accords of 1993. Recognised by Israel, the accords allowed the Palestinian Authority – an interim governing body for a future Palestinian state – to control less than 20 per cent of the West Bank region and most of the Gaza Strip. But both Israel and Egypt have upheld a blockade on Gaza since 2007 after Hamas gained control of the strip.

Beijing is a firm supporter of Cairo’s role as a mediator in the conflict and has maintained close communication with it. Foreign Minister Wang Yi called his counterpart Sameh Shoukry a week after the Gaza war erupted in October, and also visited Cairo in January to call for a peaceful solution.

Wang Jin, an associate professor at the Institute of Middle East Studies at China’s Northwest University, said the war in Gaza will certainly be high on the agenda for Xi and Sisi, and they might even “take a new stance”.

“The meetings will certainly be related to the Palestinian-Israeli issue, and also, because the bilateral relations are also very important, so … there might be some new stances on both issues,” he said.

“Egypt is an important partner of China among the Middle Eastern countries and a traditional regional power in the Middle East; therefore, the relationship between China and Egypt is important for stabilising the situation with the whole of the Middle East.”

Egypt is also a key player in the Belt and Road Initiative, a Beijing-led global infrastructure programme.

Several multibillion-dollar deals from Chinese logistics, transport, and energy firms have flowed into Egypt in recent years, especially the Suez Canal Economic Zone.

Between 2017 and 2022, Chinese investment in Egypt increased by 317 per cent, while US investment in Egypt fell by 31 per cent during the same period.

Major agreements signed last year include a US$6.75 billion deal between Egypt’s Suez Canal Economic Zone and state-owned China Energy Engineering Corporation to develop green ammonia and green hydrogen projects, and a US$8 billion agreement with Hong Kong-listed United Energy Group to establish a potassium chloride production site.

Egypt has also joined the electric-vehicle (EV) push by China, the world’s largest new-energy manufacturer, amid accusations of overcapacity from the US and Europe. Egypt’s GV Investments will begin local production of state-owned China FAW Group’s cheapest EV model in the first quarter of 2025.

China ranked as the second-largest trading partner of Egypt in 2022, after the United Arab Emirates and followed by the United States.

Egypt’s imports from China nearly doubled from around US$8 billion in 2017 to US$14.4 billion in 2022. Exports to China went up from about US$693 million in 2017 to $1.8 billion.

Xi is also expected to meet Bahrain’s King Hamad bin Isa Al Khalifa, Tunisian President Kais Saied and United Arab Emirates President Sheikh Mohamed bin Zayed Al Nahyan this week

The leaders, who will pay state visits to China, will all attend the opening ceremony China-Arab States Cooperation Forum on Thursday.

Established 20 years ago during a visit to Cairo by then Chinese president Hu Jintao, the forum is a mechanism between China and the 22 Arab League States, which also includes Saudi Arabia, Iraq, Palestine, Kuwait and Qatar.

This will be the first meeting of the forum since the Gaza war began.

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China-Russia alliance is going strong but unlikely to unseat the US

https://www.scmp.com/opinion/china-opinion/article/3264439/china-russia-alliance-going-strong-unlikely-unseat-us?utm_source=rss_feed

China and Russia cemented their 75th year of bilateral relations recently when Russian President Vladimir Putin met President Xi Jinping in Beijing. As Putin said, visiting China for his first foreign trip since being re-elected president was certainly symbolic.

There is more to it. Both leaders signed several agreements to enhance cooperation in trade and technology, and they issued a joint statement on deepening their comprehensive strategic partnership.

Putin’s visit highlights the continuing improvement of Sino-Russian ties since the disintegration of the Soviet Union in 1992. Cooperation on security and the economy was institutionalised through the establishment of the Shanghai Cooperation Organisation (SCO). The formulation of the Belt and Road Initiative, Russian aggression against Ukraine in 2014 and 2022 and subsequent sanctions by the United States and other countries against Russia have brought the two sides closer together.

This relationship is driven by three factors. First, China needs a reliable supply of energy to sustain its economic growth. Russia is one of the world’s major exporters of oil and gas and an energy supplier to China. Its need to diversify its export markets makes each side important to the other.

Second, the two countries have mutual geopolitical interests. While Russia is concerned about Nato’s expansion especially in Eastern Europe and near Russian borders, China casts a wary eye to US-led initiatives such as Nato’s bid to expand into Asia. Accordingly, both countries share the vision of challenging American hegemony and establishing a new world order.

Third, the Ukraine crisis has brought Moscow and Beijing closer. Russia launched its military operation against Ukraine shortly after Putin’s visit to China in 2022, which was perceived as China implicitly recognising the offensive.

Xi and Putin’s vision is clear. They are deepening their strategic cooperation to foster a friendship with “no limits” and cooperation without any forbidden areas. Both countries are targeting the United States and its partners for interfering in the internal affairs of other countries and criticising the US for turning outer space into an arena of conflict. They advocate for a multipolar world that could significantly alter global power dynamics.

However, it is also clear that the Sino-Russian alliance faces some friction and might not achieve its objectives. For example, it is imperative for China that Russia emerges victorious in Ukraine as, if it was to lose, it would deprive China of a stable partner – an outcome Beijing does not look forward to. This alone could undercut the shared goal of challenging the US’ position in the global order.

Also, despite China and Russia attempting to woo countries in the Global South, as seen in their actions within the SCO and the Brics bloc, developing nations are unlikely to disengage from the US whatever problems they might have with Washington. This is because they want to keep their options open and will always welcome the status implications of balancing between the US-led West on the one hand and the China-Russia alliance on the other.

Finally, both China and Russia have their own internal issues to deal with. Russia’s financial resources are growing increasingly strained amid sanctions imposed by the US and other countries, leading to a heavy reliance on China for trade. Meanwhile, China is dealing with a sluggish economic recovery and needs to ensure that no major challenges arise internationally.

The world has witnessed a decline in the US’ appetite for directly engaging in issues outside its immediate circle of influence. This can be seen in its withdrawal from Afghanistan as well as a reluctance to engage in conflicts in the Middle East, beyond selling weapons.

Its waning influence in the region can also be seen in its inability to rein in Israel, whose behaviour of late is akin to a rogue state’s. This has only strengthened the appeal of a multipolar world with new centres of power.

Yet despite the Sino-Russian alliance’s challenge to US leadership, the countries still face several internal and external obstacles. The US is unlikely to be destabilised by them, but will instead keep up its rivalry with them.

France study dream dies as China woman succumbs to malaria in Africa after fleeing abusive family to make money

https://www.scmp.com/news/people-culture/gender-diversity/article/3262752/france-study-dream-dies-china-woman-succumbs-malaria-africa-after-fleeing-abusive-family-make-money?utm_source=rss_feed

A young woman from China who went to work overseas to escape her abusive family and pursue a dream of studying in France has died from malaria in Africa.

Zhou Yanling, 25, was born in a village in Yulin in southern China’s Guangxi Zhuang autonomous region.

She was determined to live in Africa after majoring in French at Guangxi University of Foreign Languages in 2021, despite what many considered the continent’s environment challenging.

Her reasons were straightforward.

The pay was good, so she could save enough money to further her studies in France and get away from close family who made it clear they preferred boys to girls.

Zhou was the eldest daughter with a sister who married at 16, and a younger brother. In China, the official legal age for females to marry is 20, but people in some rural regions still wed without registering.

A secondary school classmate, surnamed Lin, said Zhou’s parents would verbally abuse her and expected her to buy things for her brother as soon as she started working.

Zhou was infected with malaria while working in the Democratic Republic of the Congo in March. She received treatment, but died on April 2.

Shortly before her death, Zhou told her friends she only needed another year to save the one million yuan (US$140,000) required to realise her dream of studying in France. She also said she wanted to be in Paris for the 2024 Olympics.

After she passed away, Zhou’s company contacted her parents and offered to pay for them to travel to the DRC for her funeral and bring her home.

They refused and asked the company and the Chinese embassy to scatter her ashes over the Congo River.

They also asked the embassy to send them her mobile phone, jewellery and bank cards.

Zhou’s friends told Chinese magazine People that her parents had agreed on a compensation plan with the company.

Chinese people usually believe that “fallen leaves should return to their roots”.

However, an online observer from the rural Guangxi region said they have a superstitious belief there that unmarried women are “rootless”, so Zhou could not be buried properly even if her ashes were brought back.

Zhou’s friends found it difficult to say goodbye, so as a memorial, they bought a spirit tablet for her at a Buddhist temple in Ningbo in eastern China’s Zhejiang province, where she had spent happy times.

A university classmate, surnamed Zou, said she checked Zhou’s social media posts regularly and she had expressed desire for “happiness” and “freedom” repeatedly.

“Life is too ridiculous. She lived and worked so hard to run away from her family, and her family harvested all her savings in the end,” said one online observer on Weibo.

“She was so close to her dream, but I believe she is free as a bird now in another world, away from the land that once trapped her,” another said.

Japan’s Kishida meets senior Chinese diplomat, pledges to ‘fully utilise’ all available dialogue platforms with China

https://www.scmp.com/news/china/diplomacy/article/3264583/japans-kishida-meets-senior-chinese-diplomat-pledges-fully-utilise-all-available-dialogue-platforms?utm_source=rss_feed

Japanese Prime Minister Fumio Kishida pledged to “utilise all available dialogue platforms” to resolve issues of concern with China, as he met a senior Chinese diplomat in Tokyo on Wednesday in the latest bilateral exchange to bolster ties.

Liu Jianchao, head of international liaison for China’s ruling Communist Party, is currently leading a delegation to Japan, his first visit since taking up the post in 2022.

His trip comes shortly after Japan, China and South Korea wrapped up a trilateral summit in Seoul, aiming to boost cooperation on various fronts and seek greater regional balance of power.

“Japan would like to enhance high-level communications with China, fully utilise all available dialogue platforms, address some issues of concern through dialogue, and collaborate on mutually beneficial projects,” Kishida said, according to a readout of their meeting from Liu’s office, the International Department of the Central Committee.

Kishida did not elaborate on what exactly those pending issues might be, but Tokyo is keen for Beijing to lift its ban on Japanese seafood and has also expressed “serious concerns” about People’s Liberation Army manoeuvres in the Taiwan Strait.

China, a top importer of Japanese seafood, slapped the ban last August after Japan went ahead with releasing treated radioactive water from its damaged Fukushima nuclear plant, despite opposition from Beijing over environmental concerns.

Japan has repeatedly requested that the ban be lifted, including during Kishida’s bilateral meeting with Premier Li Qiang on Sunday, a day ahead of their three-way talks with South Korean President Yoon Suk-yeol.

Kishida also raised the issue when he met Chinese President Xi Jinping in San Francisco last November, on the sidelines of the Asia-Pacific Economic Cooperation summit.

Other points of contention, including Tokyo’s deepening military alliance with Washington, the territorial dispute over the Diaoyu Islands in the East China Sea – controlled and claimed by Japan as the Senkakus, and the detention of Japanese nationals in China, have also cast a shadow over bilateral ties.

Liu acknowledged that the Xi-Kishida meeting in San Francisco had set a positive tone for future engagement. The bilateral relationship was headed towards stability, he said, while pointing out that “challenges remain”.

He also urged Tokyo to adhere to the one-China principle – that Taiwan is a part of China – and “appropriately” handle sensitive issues like the discharge of “nuclear-contaminated water”.

“Both sides need to implement the consensus reached by the two leaders, enhancing interactions across all levels, and fostering an objective and accurate mutual understanding,” Liu said.

Beijing sees Taiwan as part of China to be reunited by force if necessary, and most countries, including the US and Japan, do not recognise Taiwan as an independent state. But Washington is opposed to any attempt to take the self-governed island by force and is committed to supplying it with weapons.

During talks with Japanese Foreign Minister Yoko Kamikawa later on Wednesday, Liu called for more exchanges among strategic, academic, local, and civil society sectors to “establish a correct mutual understanding”.

Kamikawa said Japan would strengthen high-level diplomatic and cultural dialogue and collaborate with China on global issues such as climate change, so as to jointly address global challenges, according to the Chinese statement.

In its annual diplomatic blue book released last month, Japan pledged to pursue a “mutually beneficial relationship based on common strategic interest” with China, reinstating the reference after five years. The reference has also been frequently picked up in recent bilateral exchanges.

But the report also said that China posed significant challenges to Japan’s security environment.

Tokyo’s annual defence report last July said the military balance across the Taiwan Strait was “rapidly tilting” to Beijing’s favour, a matter of concern to Japan given the proximity of its southwestern airspace and waters to Taiwan.

Meanwhile, China’s concerns have grown as security ties deepen between the United States and Japan and South Korea, major US allies in the Asia-Pacific region. Beijing sees such efforts as the forming of small coalitions by the US to encircle China.

At Sunday’s bilateral meeting with Kishida, Premier Li expressed hopes that the neighbours would “manage their differences” and build “constructive and stable” ties, as the two countries agreed to launch a new round of high-level economic dialogue.

Hailing their interlinked economies, Li said the complementary economic strengths of the two countries were expected to persist in the long term.

“Both sides should support each other’s success and jointly maintain the stability and smooth functioning of supply chains and the global free trade system,” he said.

The remarks also reflected Beijing’s concerns about Tokyo joining US-led efforts last year to restrict exports of advanced chipmaking equipment to China.

The second meeting of the China-Japan dialogue mechanism on export controls was held on Monday in Shanghai, where both sides discussed issues of concern, the Chinese commerce ministry said.

“Both sides agreed to continue close communication, deepen understanding of each other’s export control systems, enhance the transparency of export control measures, and ensure that normal trade is not hindered,” the Chinese readout published on Wednesday said.

Liu also held meetings on Wednesday with Japan’s opposition leaders, Kenta Izumi of the main opposition Constitutional Democratic Party of Japan, and Mizuho Fukushima of the Social Democratic Party.

TikTok ban: Shark Tank’s Kevin O’Leary wants to buy Chinese-owned app, sets up crowdfunding campaign

https://www.scmp.com/news/world/united-states-canada/article/3264584/tiktok-ban-shark-tanks-kevin-oleary-wants-buy-chinese-owned-app-sets-crowdfunding-campaign?utm_source=rss_feed

Kevin O’Leary has put himself on the notably short list of people who say they want to buy TikTok – and he is making it a group effort.

The Shark Tank investor said on Tuesday that he set up a crowdfunding website to gauge interest in collectively buying the social media platform. The site allows anyone to “reserve” spots to become investors in the potential US version of TikTok. It’s not accepting any payments yet, and reservations are only a way to indicate interest.

If the crowdfunding campaign kicks off, it would be subject to US rules that limit investors to people who earn over US$200,000 or have specific finance qualifications.

“I’d like to democratise TikTok and turn it into a platform where the user data is protected from the prying eyes of foreign adversaries,” O’Leary said in a video he posted on Instagram.

The announcement follows a decision by US lawmakers last month to ban Chinese-owned TikTok from US app stores unless it is sold in less than a year. TikTok’s parent company, ByteDance, sued the federal government over the ban earlier this month. TikTok has already said it has no plans to sell the platform.

O’Leary, a Canadian investor, first raised his hand to buy the platform in March, saying that TikTok is “not going to get banned because I’m gonna buy it.” He said that he didn’t think Google or Meta would be able to purchase it because of antitrust concerns. The same month, he said his starting bid would be US$20 billion to US$30 billion – a 90 per cent cut in valuation based on the company’s last funding round.

The new website, however, did not share details of how much money he plans to raise or whether his project is already in talks with TikTok.

Representatives for O’Leary did not immediately respond to a request for comment.

O’Leary joins a list of investors who said they are keen to buy the viral short-form video platform. His potential bidding competitors include former Los Angeles Dodgers owner Frank McCourt, former Treasury Secretary Steven Mnuchin, and Bobby Kotick, the former CEO of gaming giant Activision.

There is very little consensus on TikTok’s price. One valuation pegs the US business at US$100 billion, but another says it is immaterial to ByteDance’s revenue. The platform may also be less attractive if it is sold without its “For You Page” algorithm, which has been credited for its success.

In March, O’Leary said that it is unlikely that the Chinese government will sell TikTok with its algorithms, and a potential buyer would have to “re-emulate” the platform.

Before he joined Shark Tank at the show’s 2009 outset, O’Leary bought and consolidated software businesses in the late 1980s and 1990s.

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Tencent sharpens focus on ‘evergreen’ video games in mainland China as domestic industry matures

https://www.scmp.com/tech/big-tech/article/3264602/tencent-sharpens-focus-evergreen-video-games-mainland-china-domestic-industry-matures?utm_source=rss_feed

Tencent Holdings is looking to sharpen its focus on “evergreen” video games that generate steady revenue, instead of rushing out new titles, as the domestic market continues to mature.

“We are more focused now, and we tend to cancel many products with intermediate positioning,” Tencent senior vice-president Steven Ma Xiaoyi said in a report published on Tuesday by Chinese digital news outlet Youxiputao. “For those projects that will never have the opportunity to challenge the first or second place in their own genre … it is better not to do them.”

Ma said this strategy takes into account the broad transformation in mainland China’s video gaming market, which is maturing.

The shift in focus for Tencent, which operates the world’s largest video gaming business by revenue, shows how the Shenzhen-based internet giant is adapting to the domestic gaming market, which experienced slower growth owing to the country’s uneven post-pandemic economic recovery that affected consumption, and regulatory scrutiny.

That slow growth was reflected in Tencent’s latest financial results, which saw its domestic video gaming business post a 2 per cent year-on-year drop in the first quarter to 34.5 billion yuan (US$4.8 billion). By contrast, overseas revenue for this business rose 3 per cent to 13.6 billion yuan in the same period.

In 2023, mainland video game sales increased 14 per cent year on year to 303 billion yuan, according to data from the Game Publishing Committee of the China Audio-Video and Digital Publishing Association. That was in stark contrast 10 years ago, when the industry saw a nearly 40 per cent annual growth amid the rapid expansion of mobile internet users in the country.

Tencent’s acquisition strategy in the video gaming sector has also changed as a result, according to Ma, who is also responsible for video game publishing unit Tencent Games’ international distribution.

“In 2007, when China was still an emerging market … everyone paid more attention to the short term, and the companies we invested in basically achieved [good] results within two or three years,” Ma said. “Today, we’ve extended the timeline, and I am very open to plans which last five to 10 years.”

“When the industry pays more attention to long-term opportunities, you need to have faith, believe in it, love it and persist with it for a long time to reap the fruits,” he said. “This can discourage some [industry players], but the benefit here is that we can see who really has faith over the long term.”

Tencent has found it more difficult to develop new blockbusters, especially those that attract more than five or even 10 million daily active users. The company’s most lucrative domestic titles remain , which was released in 2015, and – known overseas as – released in 2018.

Still, the video gaming giant received a much-needed shot in the arm from its newly released title, . This has become a runaway hit on Apple’s mainland China App Store, surpassing the daily revenue of its two flagship titles in the just the second day of its release on May 22, according to data from Chinese app analytics platform Qimai.

DnF Mobile has already achieved US$9.86 million in weekly revenue to rank as the No 3 top-selling game on the China App Store, behind Honour of Kings and Peacekeeper Elite with revenue of US$12.96 million and US$12.15 million, respectively, according to Qimai’s estimates.

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China’s EV sector could offset looming EU tariffs with detours via ‘friendly’ tracks, but be prepared for countermeasures

https://www.scmp.com/economy/global-economy/article/3264560/chinas-ev-sector-could-offset-looming-eu-tariffs-detours-friendly-tracks-be-prepared-countermeasures?utm_source=rss_feed

Firms could mitigate the potential impact of the European Union finalising its investigation into China’s electric vehicle (EV) sector by building production facilities in the likes of Turkey, Serbia and Hungary, but analysts also warned Beijing to look out for stricter countermeasures from the bloc.

Following proposed tariff increases on a wide range of EVs, batteries, semiconductors, cranes, graphite and other critical minerals from China unveiled by the United States earlier this month, Brussels is expected to conclude its investigation into subsidies in China’s EV sector by June 6, with provisional tariffs to be applied in early July.

“Chinese EV makers are likely already working out plans to mitigate potential EU high import tariffs, replicating the Japanese model used in the US in the 1970s and 1980s,” said Sebastian Contin Trillo-Figueroa, a Hong Kong-based geopolitical analyst who specialises in EU-Asia relations.

Trillo-Figueroa noted that Honda, Nissan and Toyota established manufacturing facilities in the United States in the 1970s and 1980s, employing local workers and integrating into the supply chain.

But should similar moves by Chinese EV makers have the “sole intention” of bypassing EU import tariffs, the bloc “might interpret tariff circumvention via Turkey as an attempt to undermine its trade regulations”.

“[And it] could enforce more stringent rules of origin for vehicles [that] could complicate and increase the cost of compliance,” Trillo-Figueroa added.

Wang Yiwei, a professor of international relations at Renmin University in Beijing, also said that the EU may respond by combining old protectionism accusations – such as bundling up concerns over forced labour and the Xinjiang Uygur autonomous region – if investment decisions by Chinese firms are interpreted as attempts to sidestep import tariffs.

BYD, China’s largest EV manufacturer, announced in December that it planned to build its first passenger car facility in Europe in southern Hungary, which would form the centre of its European production operations. It already has a plant in the north of the country where it assembles electric trucks and buses.

Sanja Arezina, a senior counsellor with the Serbian government, said that “at the request of the Hungarian and Serbian leadership”, China helps make its partner countries “more visible on the global investment map”.

Chinese carmaker Chery Automobile confirmed in April it had also sealed a deal to build its first European factory in Spain in a joint venture with Ebro-EV Motors.

French Finance Minister Bruno Le Maire also said earlier this month that France would welcome BYD if the Chinese company decided to build a factory.

And as one of the “friendly” partners for China, a report by Automotive News Europe earlier this month said that Turkey was in advanced talks with BYD and Chery over factory investment as part of a move seen to help boost sales in Europe.

Wang believes Turkey’s close connection with the Middle East and its Customs Union with the bloc make it “a good option” for Chinese companies entering the EU market.

The EU Customs Union, formally known as the Community Customs Union, provides free movement of covered goods within the bloc which are either wholly produced within a member state, or have been imported from a third country.

Li Lifan, a Russia specialist with the Shanghai Academy of Social Sciences, said that China would not only rely on Turkey and also increase investment in Hungary and Serbia.

Arezina added that China’s investment in the production of EVs in Hungary and Serbia would help obtain “free access” into the EU market.

Hungary is also an EU member state that belongs to the European single market, she added, while Serbia has signed the Stabilisation and Association Agreement with the EU that enables duty-free access on imports of Serbian products to the EU market as it is being considered for full membership of the bloc.

President Xi Jinping visited Serbia and Hungary after a stopover in France during his first tour of Europe in five years earlier this month.

China became the largest source of direct investment for Serbia in 2022, with bilateral trade soaring from US$596 million in 2016 to US$4.35 billion in 2023.

“Chinese companies, by expanding their production chains in Europe, in fact at the same time help … shift from internal combustion engines to electric engines in vehicles – in order to reach zero carbon dioxide emissions by 2035,” Arezina said, referring to EU rules that state all new cars entering the market as of 2035 should have zero carbon dioxide emissions.

European firms, she added, do not have sufficient capacity, knowledge and production chains to realise the EU green transition.

“China is actually operating on several different tracks in the European arena, while at the same time helping the development of a new model of Chinese market growth based on hi-tech manufacturing,” Arezina said.

China-Africa relations: Xi Jinping vows to help Equatorial Guinea diversify economy away from heavy oil and gas reliance

https://www.scmp.com/news/china/diplomacy/article/3264591/china-africa-relations-xi-jinping-vows-help-equatorial-guinea-diversify-economy-away-heavy-oil-and?utm_source=rss_feed

China has pledged to support Equatorial Guinea to diversify its economy away from a heavy reliance on oil and gas – which accounts for 80 per cent of total exports – as the two countries elevated bilateral ties to a “comprehensive strategic partnership of cooperation”.

Chinese President Xi Jinping held talks with Equatoguinean counterpart Teodoro Obiang Nguema Mbasogo in Beijing on Tuesday, where he promised that “China supports the economic and social development of Equatorial Guinea and its efforts to promote economic diversification and industrialisation”.

Xi said Beijing would encourage Chinese companies to invest and start businesses in Equatorial Guinea and allow more agricultural products from the tiny Central African nation to enter the Chinese market.

Equatorial Guinea, which has a population of about 1.6 million, is heavily dependent on crude petroleum and gas, which provides about 90 per cent of government revenue and leaves it susceptible to price shocks. But Malabo has identified agriculture, fisheries, finance and tourism to boost the economy.

Xi said China would “share its experience in agricultural and rural development with Equatorial Guinea and continue to carry out agricultural technical assistance projects”. After the talks, the two leaders announced the elevation of bilateral ties to a comprehensive strategic partnership of cooperation.

A joint statement said China and Equatorial Guinea had agreed to expand trade and investment cooperation and deepen cooperation in agriculture, fisheries, energy, mining and infrastructure, and that China supported Equatorial Guinea’s higher-quality agricultural and fishery products entering the Chinese market.

China agreed to support the building of Equatorial Guinea’s public health system and would continue to send medical teams, carry out “light trips” and conduct other free clinics.

Equatorial Guinea promised to improve the business environment for Chinese companies in the country.

Obiang Nguema termed China “a reliable strategic partner” and said that since the establishment of ties more than five decades ago, “bilateral relations have always maintained friendly development”.

“Equatorial Guinea is willing to open its doors to China and welcome Chinese companies to invest and cooperate in Equatorial Guinea,” Obiang Nguema said, according to a readout from China’s foreign ministry. He said this would help his country reach economic diversification and industrialisation and achieve sustained and healthy national development.

The two leaders witnessed the signing of bilateral deals in investment, economic development, the digital economy, green development and global development initiatives.

Obiang Nguema’s trip to China comes amid speculation that China plans to set up a military base on the Atlantic coast of Equatorial Guinea, which China has denied. Washington has variously said China has been wooing Malabo to build a military base, especially at a Chinese-built, deep-sea port in the city of Bata.

But China has repeatedly denied Washington’s assertions it planned more military bases. Beijing has only one base on the continent, in Djibouti in the Horn of Africa.

However, John Calabrese, a senior fellow at the Middle East Institute in Washington, said it was possible that establishing a military base was on the agenda, and that the elevation of relations was a prelude to China providing more help for Malabo’s economic diversification efforts.

That might be in exchange for agreeing to further, incremental consolidation of the military relationship, including a “facility” that might not initially look like or serve as a base, but could become one, he said.

Sub-Saharan geoeconomic analyst Aly-Khan Satchu said: “I think China is becoming very agile at picking up where the US and others have left off.”

“[The] critical point with Equatorial Guinea is that China is going to build a military base on the Atlantic coast there, and hence the upgrade”.

Obiang Nguema has been in power since 1979 when he overthrew his uncle Francisco Macías Nguema in a military coup. He has travelled to China on 10 previous occasions.

According to the International Monetary Fund (IMF), the country’s economic outlook will be challenging in coming years because of a shrinking oil output from ageing wells, inadequate investment in the sector and declining commodity prices.

“They [Equatorial Guinea] intend to accelerate plans to boost non-hydrocarbon growth, implement a credible arrears repayment plan and establish a modern macroeconomic governance framework,” according to an IMF report in February.

China is a key destination for Equatorial Guinea’s crude petroleum, gas and rough wood – importing goods worth US$1.3 billion in 2022. Equatorial Guinea imports from China special purpose ships, gas turbines and ceramic bricks.

According to Calabrese, China has over the years provided project financing for a number of infrastructure projects, from road building to the port construction at Bata.

“The loans piled up, contributing to Equatorial Guinea’s debt burden. That’s not an anomaly either, situating China-Equatorial Guinea relations in the broader context of China’s engagements with other sub-Saharan African countries,” he said.

According to Boston University’s Loans to Africa Database, Equatorial Guinea borrowed US$3.1 billion between 2000 and 2022, most of which funded its energy industry and social housing.

Calabrese said China National Petroleum Corporation (CNPC) had been involved in Equatorial Guinea for nearly two decades, managing the oil supply flows that were the bedrock of Sino-Equatorial Guinea ties.

Further, layered on to this was the creation of a special economic zone in Equatorial Guinea related to the Belt and Road Initiative. Calabrese said it was a standard structure of relations – China importing large volumes of natural resources, with energy security and diversification of suppliers consistently high priorities.

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US trade policy towards China is dangerously incoherent

https://www.scmp.com/opinion/world-opinion/article/3264505/us-trade-policy-towards-china-dangerously-incoherent?utm_source=rss_feed

The United States does not have a coherent trade policy. It has a political strategy masquerading as trade policy that has taken aim at China, and China has responded in kind. With the two superpowers drawing on their allies for support, economic decoupling is the least of our problems.

It is easy to blame US presidents Donald Trump and Joe Biden for this unfortunate turn of events – Trump for firing the first shot in the Sino-American trade war and Biden for doubling down on protectionism, yet the problems predate both presidents. They stem largely from a decades-long misunderstanding of the role foreign trade plays in open economies.

Politicians tend to see trade balances in black and white: surpluses are good, deficits are bad. For the US, trade is viewed as bad – a source of leakage in an otherwise strong economy that puts pressure on jobs, companies, communities and incomes.

From this perspective, the US sees itself as the victim of others’ transgressions. Japan was the culprit in the 1980s. Now it’s China. US leaders also blame the World Trade Organization, which they have effectively neutered by blocking appointments to its Appellate Body for the past five years.

Blame is about politics, not economics. Students of economics are taught almost immediately to respect a basic premise of national income accounting: that a country’s trade balance is equal to the difference between investment and saving. It follows that any savings-short economy wanting to invest and grow must borrow surplus savings from abroad, which requires balance-of-payments and trade deficits with the rest of the world.

This conceptual framework fits the US economy to a tee. In 2023, the US net domestic savings rate – the combined depreciation-adjusted savings of individuals, businesses and the government sector – was negative, at minus 0.3 per cent of national income. This has happened across multiple quarters only once before: during and immediately after the global financial crisis of 2008-09.

This leads to a politically uncomfortable verdict on trade: in keeping with national income identities, a savings-short US runs massive external deficits. In 2023, the current-account deficit was equivalent to about 3 per cent of GDP, and the merchandise trade deficit was 3.9 per cent of GDP.

Blaming others for this problem is a cop-out. Without a shortfall of domestic savings, there would be no trade deficit. That shortfall is largely made at home – the result of outsize federal budget deficits which are counted as negative savings in the national income accounts.

After ballooning during the Covid-19 pandemic to more than 14 per cent of GDP, the budget deficit remained stuck at more than 5 per cent of GDP in 2022-23, nearly double the average from 1962 to 2019. Moreover, the Congressional Budget Office’s baseline projections suggest that the deficit share will remain around its current level for the next decade.

This outcome is not China’s fault. It is a result of conscious decisions by US politicians. Yet Trump pinned the blame for the widening US merchandise trade deficit squarely on China during the 2016 presidential campaign, seizing on the point that China’s share of the deficit had soared from 20 per cent to nearly 50 per cent between 1999 and 2015. Tariffs quickly followed Trump’s victory.

On one level, this strategy appeared to work. The tariffs shrunk China’s share of the US merchandise trade deficit by US$138.8 billion from 2018 to 2023. However, over the same period, the overall deficit grew by US$181 billion – precisely what one would expect from a country with a falling savings rate. Excluding China, the US merchandise trade deficit widened by US$319 billion from 2018 to 2023.

In other words, notwithstanding US leaders’ efforts to convince voters that they are fixing the country’s trade problems, the notion of a “China fix” rings hollow. By targeting China, all the US is doing is diverting trade away from a low-cost producer to higher-cost countries.

That is the equivalent of a tax increase on American consumers that exacerbates the added costs of Chinese tariffs. At the same time, Washington is perfectly content to run massive budget deficits that will depress domestic savings even further, leading to increased trade diversion.

If only the story stopped there. The trade conflict has allowed Washington to launch a full-throttle political campaign against China. Not only have national security concerns given rise to a tech war, the US has announced another round of Section 301 tariffs on Chinese goods, targeting electric vehicles, solar panels and batteries, all sectors where the US has little comparative advantage.

This will compromise US green-energy objectives at a time when the effects of climate change are increasingly apparent. Meanwhile, US complaints about China’s unfair subsidisation of its alternative energy initiatives overlook the generous US subsidies that have long benefited companies such as Tesla.

Free trade and globalisation have made the world a better place. That conclusion, which became accepted wisdom in the post-war period, is now considered heresy. The resulting incoherence of US trade policy – flailing at savings-driven trade deficits and steeped in national security fears – risks making the world a worse place.

Global stewardship is in tatters, and the dangers of superpower conflict are now painfully reminiscent of the 1930s.

Xi Jinping Boulevard in Phnom Penh a ‘new milestone’ in Chinese-Cambodian relations

https://www.scmp.com/news/china/diplomacy/article/3264539/xi-jinping-boulevard-phnom-penh-new-milestone-chinese-cambodian-relations?utm_source=rss_feed

Cambodia’s capital has renamed a major road after Chinese President Xi Jinping in recognition of the country’s friendly relationship with China.

At the request of the Cambodian government, Beijing has allowed Phnom Penh to name the city’s third ring road “Xi Jinping Boulevard”, Cambodian Prime Minister Hun Manet said on X on Tuesday.

“The relationship between Cambodia and China has a long history and has grown to an inseparable level. This relationship is worthy of the values of mutual trust, especially political trust,” Hun Manet said in his post.

He also mentioned China’s huge infrastructure investment in Cambodia, including nearly 4,000km (2,486 miles) of road construction.

Wang Wentian, Beijing’s top envoy in Phnom Penh, said at the inauguration ceremony on Tuesday that the road would be a “new milestone” in bilateral relations, according to an article posted on the official WeChat account of the Chinese embassy in Cambodia.

Hun Manet, who also attended Tuesday’s ceremony, said the naming of the road, which began construction in 2019 and went into service last August, was intended as thanks to Xi for his “historic contribution” to Cambodia’s development, the article said.

The 48km boulevard, which cost US$273 million and was built by Shanghai Construction Group, was financed on concessional terms by Beijing, with contributions from the Cambodian government, the Phnom Penh-based Khmer Times reported on Wednesday.

It is the second road in Phnom Penh to be named after a Chinese leader. In 1965, Cambodia’s late King Norodom Sihanouk named a boulevard after Mao Zedong as a show of gratitude for Beijing’s economic and military aid to the country.

Neither late leaders Deng Xiaoping nor Jiang Zemin were given similar honours.

During a visit to Cambodia late last month amid tensions in the South China Sea, Chinese Foreign Minister Wang Yi said China would be Cambodia’s “most reliable friend and firmest supporter” regardless of the international environment.

Wang also promised more Chinese investment in Cambodian infrastructure.

Hun Manet said Phnom Penh would firmly support China’s positions on Taiwan, Hong Kong and Xinjiang and continue to participate in the Belt and Road Initiative, a Beijing-led infrastructure project.

China’s relationship with Cambodia remains one of the closest in the Association of Southeast Asian Nations (Asean). There are no territorial disputes between the two countries, and Phnom Penh is heavily dependent on Chinese trade and investment.

Trade between the two countries reached US$12.26 billion in 2023, up 5 per cent from 2022, according to Cambodian customs figures.

Beijing is also helping Cambodia upgrade its Ream naval base in the Gulf of Thailand after Phnom Penh dismantled a US-built facility at the same base in 2020. Washington is concerned that the Chinese military could use the base as an overseas outpost, a claim denied by Cambodia’s defence ministry.

Hong Kong considers investing in incineration, upcycling facilities in mainland China as it hunts for ways to handle waste

https://www.scmp.com/news/hong-kong/health-environment/article/3264541/hong-kong-considers-investing-incineration-upcycling-facilities-mainland-china-it-hunts-ways-handle?utm_source=rss_feed

Hong Kong authorities are considering investing in incineration and upcycling facilities in mainland China to handle part of the city’s waste, the environment minister has said.

Secretary for Environment and Ecology Tse Chin-wan said on Wednesday a proposal the government was currently looking into could see Hong Kong take advantage of the mainland’s space and cheaper labour. He added the city could provide technology and funding.

He also said the government and its counterpart on the mainland were exploring integrated waste handling within the Greater Bay Area and how to ultimately achieve the “Zero Waste Bay Area” goal.

“Hong Kong has technology, funding and investment, and the mainland has land and cheaper labour,” Tse told a radio show.

“Their green products can also make use of Hong Kong as a window and be sold to other countries.

“If the entire Greater Bay Area collaborates, we can handle not just waste but also resource recycling. This will be a great benefit in developing the green industry.”

The Greater Bay Area is a national scheme that aims to integrate Hong Kong, Macau and nine cities in Guangdong province into an economic and development powerhouse.

Tse said that sending some waste from Hong Kong to the mainland for incineration was currently under review, pointing to the advantages of cost-effectiveness and encouraging the development of the green industry.

Hong Kong currently collects around 1,000 to 2,000 tonnes of waste paper every day and sends them to factories on the mainland to be recycled, according to Tse.

Without going into detail on how to go through the mainland’s strict restrictions against importing non-local waste, Tse said it would require discussions from administrations of both sides of the border.

Hong Kong has been aiming to reduce waste as officials vowed to stop relying on landfills by 2035.

One measure that was being pushed by authorities was a waste charging scheme, but the controversial plan was shelved on Monday after facing widespread public opposition.

“Landfills in Hong Kong have caused quite a lot of nuisance,” Tse said. “Lands in Hong Kong are very precious. Using land as landfill has a huge economic cost.”

He said that in the long run it would not be possible for Hong Kong to rely on landfills to handle waste.

The city’s first waste-to-energy incinerator, located on an artificial island at Shek Kwu Chau, south of Lantau Island, is expected to be ready for operation next year.

The second such facility would be built in Tsang Tsui in Tuen Mun, with Tse saying he would reveal further details in a Legislative Council session next month.

Officials are also looking into the possibility of setting up the third one in the Northern Metropolis, a mega development project that transforms the north of the city into lands for innovation and technology.

Tse said having three incinerators could enable Hong Kong to completely stop using landfills.

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Meet the Malaysian Chinese man who adopted 3 Malay sons: ‘I’m a grandfather now and will never be lonely’

https://www.scmp.com/news/asia/southeast-asia/article/3264520/meet-malaysian-chinese-man-who-adopted-3-malay-sons-im-grandfather-now-and-will-never-be-lonely?utm_source=rss_feed

When Michael Tong Wai Siong was 39, he never expected to become a father figure to three Malay boys and have his life transformed by their presence.

“I’ve never been married … Suddenly I had to take care of three children who weren’t mine,” said Tong, who is 55-years-old and ethnic Chinese. “However, I felt this was a task given to me by God and I had to accept the challenge.”

About 16 years ago, the event manager visited an orphanage in Gombak, Malaysia’s Selangor state, where he noticed a young boy sitting alone.

That boy was Rafie Ahmad Fauzi, now a 29-year-old entrepreneur.

“He was just sitting alone, avoiding everyone. I learnt from a caretaker named Umi that Rafie refused to go to school,” Tong recalled. “After visiting Rafie at school and meeting with his teachers, I discovered he had learning difficulties. So I enrolled him at a tuition centre.”

Rafie began to show improvement and interest in learning.

One day, while visiting the orphanage, Tong found a note written by Rafie that questioned why he had lost his parents so early in his life and why he was separated from his two younger brothers.

“It tugged at my heart. Umi suggested it would be better if I adopted Rafie and had him stay with me, as he only listened to me. So I did,” Tong said.

After locating Rafie’s brothers, Rasyid and Abdul Rahman, now aged 28 and 24, in an orphanage in Klang, Selangor, Tong decided to bring them to live with him in Bandar Sri Damansara.

“My mum was concerned,” Tong said. “Why would her second child, who is unmarried, decide to adopt these boys? While she was supportive, she did advise me that it wouldn’t be easy. But she promised to stand by me all the way.”

“The boys are very respectful towards the elderly, so having them in our family is not awkward at all,” Tong added. His sons call his mother popo, a Mandarin term for grandmother, he said.

All of them have their own lives and businesses and I’m proud of them

To ensure the boys continued receiving Islamic teachings, Tong sought advice from his Muslim friends.

“During Ramadan, I would fast with them,” he said. “When they were younger, waking up for sahur (predawn meal) was hard. I remember spraying water on them to wake them up.”

For Hari Raya, Tong would take the boys to his Muslim friend’s house in Selayang, where they prayed together. “We even celebrate Chinese New Year together. Every year during the reunion dinner, my sons would join us,” he said.

Despite raising the boys alone with support from family and friends, Tong never intended to replace their biological father.

“I’m not Ahmad Fauzi; I’m still ‘Uncle Mike’,” he said. “I did it sincerely to ensure that the boys grow up to be valuable members of the community.”

Though he has not found a life partner, Tong said the “three Rs” were a godsend and he never regretted taking them into his life.

“Rafie is now married with two children. I’m a grandfather now and will never be lonely,” Tong said.

“All of them have their own lives and businesses and I’m proud of them.”

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China EV wars: BYD mounts ‘big challenge’ to petrol-guzzling rivals with its new fuel-efficient hybrid technology

https://www.scmp.com/business/china-business/article/3264523/china-ev-wars-byd-mounts-big-challenge-petrol-guzzling-rivals-its-new-fuel-efficient-hybrid?utm_source=rss_feed

BYD has unveiled a new and improved version of its plug-in hybrid technology that it hopes will encourage more widespread adoption of electric vehicles (EVs) in the world’s largest automotive market, ratcheting up pressure on traditional carmakers like Volkswagen and General Motors.

The world’s bestselling EV builder, backed by Warren Buffett’s Berkshire Hathaway, said two brand new models to be fitted with the new technology will become pioneers that help propel a transition to electrification on China’s roads.

“They will mount a big challenge to petrol-powered cars, becoming the new benchmarks for mid-size models,” the Shenzhen-based company said in a statement on Wednesday. “They will bring young consumers a new option as they pursue high-quality new-energy cars.”

The two new models fitted with the latest DM (dual model) technology – the Qin L and the Seal 06 – can go as far as 2,100km on a single charge with a full tank of petrol, BYD claims. The batteries used to power the basic versions offer a driving range of up to 80km.

The fuel consumption per 100km, when the batteries are depleted, is a record low 2.9 litres, the statement said. In comparison, a typical plug-in hybrid car uses 3 to 5 litres of petrol for every 100km travelled.

BYD said the new models can save owners an annual 9,682 yuan (US$1,336) in fuel costs compared to petrol cars.

DM is the fifth generation of the technology developed by BYD since it launched its first plug-in hybrid car, the F3, in 2008.

Both the Qin L and Seal 06 are mid-sizes sedans that will compete with the likes of VW’s Sagitar and Toyota’s Corolla, which are powered by petrol engines.

Entry-level versions of the Qin L and Seal 06 are both priced at 99,800 yuan, compared to the Sagitar’s 127,900 yuan and the Corolla’s 116,800 yuan.

“BYD’s new models will be a big threat to established carmaking giants in China,” said Eric Han, a senior manager at Suolei, an advisory firm in Shanghai. “An increasing number of budget-conscious consumers will view [BYD’s] pure-electric and hybrid models as top choices since they are attractive in pricing and fuel efficiency.”

At present, four out of every 10 new cars taking to the roads of mainland China, the world’s largest EV market, are powered by batteries.

VW, the mainland’s bestselling carmaker, handed 3.2 million vehicles – the vast majority petrol-powered – to Chinese customers last year, up 1.6 per cent from 2022.

It narrowly beat BYD which delivered nearly 3 million battery-powered cars on the mainland last year.

BYD posted a record net profit of 30.04 billion yuan for 2023, up 81 per cent from a year earlier.

Its founder and chairman, Wang Chuanfu, told an investors’ conference in March that the carmaker is targeting sales of 3.6 million units in 2024, up 20 per cent from last year.

The projected year-on-year increase would represent just a third of the 62.3 per cent jump recorded in 2023.

In February, BYD fired the first salvo in an EV price war on the mainland, slashing the prices of nearly all of its cars by 5 to 20 per cent.

Since then, the prices of 50 models across a range of brands have dropped by 10 per cent on average, Goldman Sachs said in a report last month.

IMF ups China’s 2024 GDP forecast, urges focus on market-oriented reforms at July’s third plenum

https://www.scmp.com/economy/economic-indicators/article/3264538/imf-ups-chinas-2024-gdp-forecast-urges-focus-market-oriented-reforms-julys-third-plenum?utm_source=rss_feed

China’s leaders should strive to ensure that economic growth is more demand driven, according to officials from the International Monetary Fund, as they also emphasised the need for Beijing to underscore market-oriented reforms at a highly anticipated political gathering in July that will set the tone for the country’s development trajectory in the next decade.

At a press conference in Beijing on Wednesday, the IMF revised its projection for China’s growth this year to 5 per cent – a 0.4 percentage point increase from the projection in April, bringing the financial agency’s estimate in line with the full-year target set by Chinese authorities in March.

In justifying its revision, the IMF pointed to strong economic data in the first quarter and property stimulus measures that Beijing recently announced.

“Risks are tilted to the downside, including from a greater- or longer-than-expected property sector adjustment and increasing fragmentation pressures,” Gita Gopinath, the IMF’s first deputy managing director, said after meeting in the past week with finance officials in the Chinese government – including People’s Bank of China governor Pan Gongsheng.

China’s GDP grew 5.3 per cent in the first quarter of 2024, outpacing most economists’ expectations. Two weeks ago, Beijing announced a slew of measures to rescue its staggering property sector, including 300 billion yuan (US$41.4 billion) worth of funding to help clear excess housing inventory.

To achieve high-quality growth in the medium and long term, Beijing should conduct structural reforms to counter headwinds and address underlying imbalances, Gopinath said.

“Key priorities include rebalancing the economy towards consumption by strengthening the social safety net and liberalising the services sector to enable it to boost growth potential and create jobs,” she said.

Steve Barnett, the IMF’s senior resident representative in China, said Beijing should continue with economic reforms to boost productivity as it rolls out plans for the next decade at the Central Committee of China’s Communist Party’s third plenum in July.

“If we think of the third plenum as a time to look at medium- and long-term reforms, if I could pick just one [pressing issue to focus on], it’s to boost productivity,” Barnett said at the press conference. “The way to do that is to continue with economic reforms.

“And this takes us to things like giving the market a decisive role in the economy – which actually featured prominently for the first time in the 2013 third party plenum – and levelling the playing field between all types of firms – state-owned firms, private firms, foreign firms.”

He added that China’s GDP level could be 18 per cent higher over a 15-year period with “good reforms”.

Also on Wednesday, the Washington-based organisation raised its projection for China’s economic growth in 2025 to 4.5 per cent, up from 4.1 per cent in an April forecast.

Inflation is expected to rise but stay relatively low as output remains below potential, with core inflation increasing only gradually to average 1 per cent in 2024, the IMF said.

Over the medium term, China’s annual economic growth is expected to decelerate to 3.3 per cent by 2029, it added, citing factors related to an ageing population and slower productivity growth.

Currently, China should prioritise mobilising central government resources to protect buyers of pre-sold unfinished homes and accelerate the completion of unfinished pre-sold housing, paving the way for resolving insolvent developers, Gopinath said.

“Excluding the one-time property sector package, a neutral fiscal stance in 2024 would balance the trade-offs between supporting domestic demand, mitigating deflation risks, and managing unfavourable debt dynamics,” she said.

There is room for further easing in terms of monetary policy, given the subdued inflation and output below potential in the country, and greater exchange-rate flexibility would reduce deflation risks and help absorb external shocks, Gopinath added.

To tackle elevated financial stability risks, Chinese authorities have appropriately focused on addressing vulnerabilities in the property sector, local government debt, and smaller financial institutions, she said.

“Strengthening the bank resolution framework and strictly applying prudential standards will help enhance financial stability and mitigate risks.”

She added that China’s use of industrial policies to support priority sectors can lead to a misallocation of domestic resources and potentially affect trading partners, echoing recent concerns voiced by Western politicians on China’s industrial overcapacity.

“Scaling back such policies and removing trade and investment restrictions would raise domestic productivity and ease fragmentation pressures. In this context, China should continue its efforts to strengthen the multilateral trading system, particularly the [World Trade Organization].”

Chinese astronauts complete record-breaking spacewalk to protect Tiangong space station from debris

https://www.scmp.com/news/china/science/article/3264510/chinese-astronauts-complete-record-breaking-spacewalk-protect-tiangong-space-station-debris?utm_source=rss_feed

Two Shenzhou-18 astronauts on board China’s Tiangong Space Station set a new spacewalking record for the country on Tuesday.

During their 8½-hour extravehicular activity (EVA), mission commander Ye Guangfu and crew member Li Guangsu finished installing space debris protection devices and inspected equipment and facilities outside Tiangong, according to the China Manned Space Agency (CMSA).

The spacewalk broke previous records of about 8 hours set by Shenzhou-16 and 17 astronauts, and approached the limit allowed by the spacesuits they were wearing. The second-generation Feitian (“flying to space”) spacesuit is designed to provide up to eight hours of support during a single walk, according to state broadcaster CCTV.

“The astronauts had a lot to do this time, including taking pictures of various equipment they were checking on, and that’s why their walk took so long,” Zhang Wanxin, from the China Astronaut Research and Training Centre, told CCTV on Tuesday.

“The entire process went smoothly, and their operations were very accurate and successful,” Zhang said.

Li Xuedong, lead designer of the space station system from the China Aerospace Science and Technology Corporation, said the protection shields were installed because of debris impact on Wentian, one of Tiangong’s three major modules.

“They will be able to reduce damage caused by space debris and micrometeoroids in the long run,” Li told CCTV.

Chinese state-owned media previously reported a partial loss of power supply on Tiangong after the Tianhe core module solar array was struck by debris.

Tuesday’s EVA started at 10.35am Beijing Time when Ye Guangfu and Li Guangsu opened the hatch of the Wentian experiment module. Ye stepped outside and then onto a robotic arm, while Li handed him the debris protection devices to be installed, CMSA said.

The robotic arm then transferred Ye to the work site, where he put up power supply protection racks and other facilities. After that, Li joined Ye at around 12.20pm and the two inspected extravehicular equipment on patrol together.

The astronauts returned safely to the Wentian module at 6.58pm, according to CMSA. Before returning, Li also practised getting on and off the robotic arm. Li Cong, the third member of the Shenzhou-18 mission, stayed inside Tiangong to monitor his colleagues’ status.

The EVA was the first for Li Guangsu and the second for Ye, who also worked outside Tiangong in 2021 for about six hours as part of the Shenzhou-13 crew.

CMSA said more tasks were planned for the Shenzhou-18 crew, who arrived at Tiangong about a month ago, including additional EVAs and the installation of payloads outside the space station, as well as a large number of scientific experiments and technical tests.

Chinese astronauts have carried out a total of 16 spacewalks, 15 of which were at Tiangong. The country’s first EVA took place in 2008 when Zhai Zhigang became the first Chinese to walk in space, spending about 19 minutes outside the Shenzhou-7 capsule.

By comparison, there have been 270 spacewalks at the International Space Station since December 1998, according to Nasa. The longest ISS EVA was by US astronauts James Voss and Susan Helms in 2001, which lasted 8 hours and 56 minutes.

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China hands death sentence to senior banker for taking US$151 million in bribes

https://www.scmp.com/news/china/politics/article/3264499/china-hands-death-sentence-senior-banker-taking-us151-million-bribes?utm_source=rss_feed

A court in eastern China delivered a rare death sentence on Tuesday, after finding that a former senior banker accepted bribes worth more than 1.1 billion yuan (US$151 million) in his role with one of the country’s top four state asset managers.

Bai Tianhai, former general manager of China Huarong International Holdings (CHIH), took advantage of his position to aid others in the acquisitions and financing of projects in exchange for the huge sums, the court found.

A report on the Secondary Intermediate People’s Court of Tianjin’s ruling by state broadcaster CCTV, did not say how Bai pleaded nor if he would be appealing the sentence.

While numerous officials have been caught up in China’s sweeping anti-corruption campaign since President Xi Jinping took power more than a decade ago, death sentences that are not suspended remain a rarity in corruption cases.

CHIH is an offshore unit of China Huarong Asset Management (CHAM). It was taken over by the Citic Group and renamed China Citic Financial Asset Management in January.

Bai is the second China Huarong official to receive a death sentence for corruption. In January 2021, the same court sentenced Lai Xiaomin, former chairman of CHAM – and Bai’s former boss – to a similar fate.

Lai, who was executed a month after his sentencing, was found guilty of taking 1.79 billion yuan (US$247 million) in bribes, embezzlement of public assets worth more than 25.13 million yuan (US$3.46 million), and bigamy.

Lai was the first official to receive the ultimate penalty for corruption since Xu Maiyong and Jiang Renjie – former mayors of the eastern cities of Hangzhou, in Zhejiang province, and Suzhou in Jiangsu, respectively, who were put to death in 2011.

According to the CCTV report, Tuesday’s court ruling also permanently stripped Bai of his political rights and ordered that all his personal property be confiscated.

The court acknowledged that Bai had volunteered information leading to other arrests and convictions. However, the bribes he had taken were “particularly huge” and the impacts of his crimes on society “particularly pernicious, causing … serious losses to the interests of the state and the people”.

“Taking all these [factors] into account, [the court] ruled that [Bai] does not deserve a lighter sentence. Hence the death penalty verdict,” the ruling said.

Four other senior Huarong executives, including former chairman of Huarong Real Estate Wang Pinghua, and Qin Ling, who was chairman of Huarong Investment, are awaiting trial.

Guo Jintong, former deputy general manager of Huarong International Holdings, and Zhao Zichun, who held the same position at Huarong Guiyang Real Estate, are also expected to appear in court on charges of corruption.

A Beijing-based criminal lawyer, who declined to be named, said that he expects Bai to appeal on grounds of precedent, citing cases where defendants were given lesser sentences for similar offences.

Zhang Zhongsheng, former deputy mayor of Luliang in northern China’s Shanxi province, was sentenced to death in March 2018 for accepting 1.17 billion yuan (US$161 million) in bribes – later suspended for two years and commuted to life imprisonment after an appeal in October 2021.

China’s top corruption watchdog, the Central Commission for Discipline Inspection (CCDI) launched a sweeping crackdown on the finance sector this year, in response to Xi’s call to make China a “financial superpower” and contain risks.

According to a tally by the South China Morning Post, the CCDI has detained more than 30 Chinese state regulators, bankers and senior financial executives since January, in response to Xi’s order to focus its efforts on the sector.

In a speech to the CCDI’s third plenary session in January, Xi warned about “prominent problems” such as “repeated financial disorders and corruption, and weak financial supervision and governance capacity”.

There should be “absolutely no mercy” in rooting out the “severe and complex” problem of corruption and fraud, Xi said.

Also in January, Xi laid out a road map for China to become a financial superpower with a focus on the real economy, while highlighting more urgent tasks in its efforts to defuse financial risks.

US sanctions Chinese individuals over Covid-related fraud and bomb threats

https://www.scmp.com/news/world/united-states-canada/article/3264485/us-sanctions-chinese-individuals-over-covid-related-fraud-and-bomb-threats?utm_source=rss_feed

The US Treasury on Tuesday sanctioned three Chinese individuals and three Thai companies for involvement in a cybercrime network that it said made bomb threats and fraudulent applications for Covid-related aid, costing the government billions of dollars.

The individuals and the Thai-based companies were sanctioned for activities related to the 911 S5 botnet, a service that compromised computers and resulted in cybercrimes being traced back to victims’ computers instead of the perpetrators’ devices, the Treasury said.

“These individuals leveraged their malicious botnet technology to compromise personal devices, enabling cybercriminals to fraudulently secure economic assistance intended for those in need and to terrorise our citizens with bomb threats,” said the Treasury under secretary for terrorism and financial intelligence, Brian Nelson.

The IP addresses compromised were linked to a number of bomb threats made across the United States in July 2022, according to the release.

Reuters was not immediately able to seek comment from the sanctioned entities or individuals.

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Climate change: China aims to introduce nationwide corporate ESG disclosure standards by 2030

https://www.scmp.com/business/china-business/article/3264437/climate-change-china-aims-introduce-nationwide-corporate-esg-disclosure-standards-2030?utm_source=rss_feed

China aims to establish a national standard for corporate sustainability disclosure by 2030 as part of efforts to improve economic sustainability, tackle climate change and catch up with its global peers when it comes to environmental, social and governance (ESG) reporting.

The Ministry of Finance has started seeking public opinion on a set of draft guidelines that aims to monitor such disclosures by companies and push ESG development in China, according to a notice on its website.

“At present, most disclosures of sustainable information by Chinese enterprises are voluntary, and they rely on inconsistent standards, which is not conducive to the verification, rating and supervision process, and for the supporting role sustainability disclosures play in investment decision-making and economic development,” the ministry wrote in a statement published on Monday that explains the background to the draft guidelines.

According to the proposal, China will introduce basic regulations for corporate sustainability disclosure and climate-related disclosure by 2027, with the aim of establishing a nationwide standard by 2030.

The release of the draft measures during the International Organization of Securities Commissions’ annual meeting taking place in Greece this week sends a strong message to global investors that China is committed to aligning with international reporting standards and taking ESG issues seriously, according to Bon Cheung, assistant manager of Civic Exchange, a Hong Kong public policy think tank.

In February, the Beijing, Shanghai and Shenzhen stock exchanges published their first climate and sustainability disclosure guidelines. These mandate that some 400 listed companies, which account for more than half of the market value of China’s bourses, must publish sustainability reports covering their emissions and decarbonisation plans by 2026.

The companies must report on the impact their activities have on the environment as well as the risks and effects of environmental factors on their business, the so-called double materiality. They are also encouraged to disclose the indirect carbon emissions in their value chains, known as scope 3 emissions.

Although aimed at listed companies, these guidelines could have a knock-on effect on the country’s privately owned companies as well, prompting them to make decarbonisation plans and improve their ESG efforts, according to analysts.

The guidelines targeted at introducing unified disclosure standards in China will be a “game-changer”, said Yuan Yuan, a Beijing-based climate and energy campaigner at Greenpeace East Asia.

“When we talk about ambition, accountability, or even climate leadership – transparency is central to all of it,” she said. “Chinese financial institutions frequently claim that a lack of unified standards for corporate disclosure and poor data availability hinders their ability to assess risk when it comes to climate change. This extends to becoming a hurdle in developing transition plans.”

The set of proposed guidelines released on Monday is the highest-level document to emerge so far on sustainability disclosure in China. It adopts the principles and structure of global disclosure benchmarks set by the International Sustainability Standards Board while tailoring them to its own context, according to Cheung.

“Notably, the draft avoids a one-size-fits-all approach, proposing a step-by-step expansion of coverage,” he said.

According to the finance ministry, Monday’s guidelines would gradually expand from listed companies to privately-owned enterprises, from large firms to small and medium-sized ones, from qualitative requirements to quantitative requirements, and from voluntary disclosure to mandatory disclosure.

There were 5,346 listed companies on the Chinese domestic stock market at the end of 2023, according to the China Association for Public Companies (CAPCO), a non-profit organisation under the China Securities Regulatory Commission, the markets watchdog. Of those, 2,115 companies, or roughly 40 per cent, had released their sustainable development reports, an increase of nearly 300 companies from 2022, according to CAPCO.

The financial industry had the highest proportion of companies to have published their sustainable development reports, at over 90 per cent last year, while most other industries had a rate of around 40 per cent, according to CAPCO.

The number of sustainability funds had tripled in mainland China to 246 as of June 30 last year from 78 as of December 2020, the year when the world’s largest greenhouse gas emitter announced its dual carbon goals of reaching peak emissions by 2030 and net-zero emissions by 2060, according to US financial services firm Morningstar.

These funds received a net inflow of 31.7 billion yuan (US$4.38 billion) in the first half of 2023, a 6 per cent increase from a year earlier despite the challenging Chinese stock market, Morningstar said, while pointing out more needs to be done in terms of disclosure requirements and educating investors.

“Recognising this, Hong Kong should seize the opportunity to leverage its extensive experience and ESG advisory services to accelerate the adoption of sustainability reporting standards in China,” said Cheung of Civic Exchange.

Hong Kong crypto exchange licence applicants with ties to mainland China withdraw from city

https://www.scmp.com/tech/blockchain/article/3264451/hong-kong-crypto-exchange-licence-applicants-ties-mainland-china-withdraw-city?utm_source=rss_feed

Stringent regulatory requirements and an inability to serve mainland investors is pushing global cryptocurrency exchanges out of Hong Kong, with several major firms having withdrawn their licence applications a year after scrambling to set up shop ahead of new regulations meant to transform the city into a virtual asset hub.

The local affiliates of major mainland China-linked crypto exchanges – including OKX, Gate.io, KuCoin, Binance and HTX, formerly Huobi – have all withdrawn their applications for a virtual asset trading platform (VATP) licence in Hong Kong that were submitted over the past several months, according to the Securities and Futures Commission (SFC) website.

These firms, which started in China but now have sprawling global operations, are among the largest crypto industry players to have shown interest in Hong Kong’s new virtual asset regulatory regime that started last June, which requires exchanges to be licensed in the city. Those with a pre-existing presence were granted a one-year grace period, but those that have withdrawn their applications must now shut down their Hong Kong operations.

Exacting demands from the SFC appear to have contributed to the drop-outs, which now comprise seven of the original 24 applicants. However, an inability to serve mainland customers may have been another major contributor.

In a notice reminding exchange operators that they must be “deemed to be licensed” by June 1 to continue operating in Hong Kong, the SFC said VATPs must “comply with all applicable laws and regulations, including … preventing mainland Chinese residents from accessing any of their virtual asset-related services”.

The rule regarding mainland investors was included in a list of requirements issued directly to applicants, dampening enthusiasm for operating in Hong Kong, according to an industry insider familiar with the matter, who declined to be named because the discussions were private.

In 2021, the People’s Bank of China warned that offering cryptocurrency services to people in mainland China would be a violation of the law. Chinese crypto investors who have managed to find workarounds remain important for many exchanges that have moved offshore.

Other licence applicants might have been directly instructed by the SFC to withdraw, said Angela Ang, senior policy adviser at blockchain research firm TRM Labs.

“Businesses do not invest time and money into a licensing process only to withdraw,” Ang said. “For those that are already operating, the stakes are especially high, as withdrawal means they need to shut down.”

“They will typically only withdraw if it’s clear they will not meet the bar for approval, perhaps as clear as being directly told by the regulator,” she added.

The SFC declined to comment on the withdrawals.

Some of the exchanges that have withdrawn include local operations affiliated with overseas crypto firms, including HKVAEX, a Binance affiliate, and Huobi HK, which uses the former name of HTX. Both Binance and HTX have said those exchanges operate independently.

Only HashKey Exchange and OSL have been approved to serve retail investors in Hong Kong. There are now 18 VATP applicants left on the SFC’s official list, with Crypto.com, Bullish and Bybit, another exchange founded on the mainland, among the largest.

This month, the SFC saw a new licence applicant for a platform called bitcoinworld, which used HTX’s logo as its own according to Google search results and the website’s source code. HTX said the company is neither a “subsidiary nor related company”.

“We will investigate the issue and reserve the legal right [to take action] for the misuse of HTX’s logo,” a company representative said.

With the upcoming deadline for a decision on who can continue operating exchanges in the city, the number of applicants left is being taken by some as a demonstration of Hong Kong’s progress in becoming a virtual asset hub.

“These withdrawals should be seen as a barometer of the SFC’s regulatory expectations, and the type of crypto hub they want to be,” Ang said.

Additional reporting by Matt Haldane.

Anger as China couple let daughter urinate near Thai palace, follows case of ‘Chinese tourists, please keep clean’ sign

https://www.scmp.com/news/people-culture/trending-china/article/3262746/anger-china-couple-let-daughter-urinate-near-thai-palace-follows-case-chinese-tourists-please-keep?utm_source=rss_feed

A photo of two tourists allowing their child to urinate on a path near a sacred site in Thailand has sparked an online debate.

The Chakri Maha Prasat Throne Hall is a part of the Royal Grand Palace in Bangkok, a former residence of the Thai Royal family, which is now frequently used for ceremonies and national events.

It is one of the country’s most popular and most important tourist attractions.

The image, which went viral on Douyin as well as Facebook and TikTok, shows a little girl of about four or five years old, squatting in front of a low concrete wall and lifting her dress to urinate.

Her parents were standing closely behind her, and the father was carrying a backpack with the logo of the Chinese smartphone brand Xiaomi.

The photographer believed the family was from China, according to Thailand’s Morning News TV3.

“This is truly the nature of this nation. I saw it when I went there. Letting a child pee on the roadside like a dog,” an online observer in Thailand wrote.

On May 8, the newly appointed Tourism and Sports Minister, Sermsak Pongpanit, described what happened as “inappropriate”.

Previously, a 24-year-old local man was arrested for spray-painting on the wall of the Temple of the Emerald Buddha in Bangkok. He was later charged with two offences.

One offence was violating the Cleanliness Act, which carries a penalty of up to one month in prison and/or a fine of 10,000 baht (US$270). The other was under the Ancient Monuments Act, which can bring a prison term of up to seven years and/or a fine of up to 700,000 baht (US$19,000).

One online observer suggested the family’s behaviour could also be punished under section 112 of Thailand’s penal code, which states that anyone convicted of insulting the monarchy could be imprisoned for between three and 15 years.

The incident follows an earlier controversy about a “racist” sign in a Thai temple toilet.

The sign, in Thai and English, said: “Please keep clean” but the Chinese version read: “Chinese tourists, please keep clean”.

Some online observers viewed this as discriminatory, while others said they understood the necessity for specific wording.

“As a Chinese person, I also despise some of our tourists who do not flush toilets, spit on the ground, speak loudly and litter everywhere,” said one.

Tourists from China have a reputation abroad for uncouth behaviour.

In mid-March, an incident in which a Chinese tourist swapped a used water bottle for a new souvenir flask at the British Museum, disgusted some people on Chinese social media.

Chinese tourists have also been accused of kicking ancient bells at Thai tourist sites to hear the sound, spitting on pavements or jumping queues, as reported by Thai news media in 2015.

China’s Foreign Ministry has frequently issued notices to remind citizens to pay attention to their manners while travelling abroad.

World first: living cancer patient in China receives pig’s liver transplant

https://www.scmp.com/news/china/science/article/3264247/world-first-living-cancer-patient-china-receives-pigs-liver-transplant?utm_source=rss_feed

In a world first, Chinese doctors said they transplanted a gene-edited pig’s liver into a living patient, the latest milestone in a record-setting year for researchers into animal-to-human transplants, known as xenotransplantation.

In a post on its WeChat account on Friday, seven days after the operation, Anhui Medical University’s First Affiliated Hospital said a 71-year-old man with severe liver cancer received the organ on May 17.

As of May 24, “the patient was able to walk freely, no hyper-acute or acute rejection reactions were found, the coagulation system was not impaired, and liver function had returned to normal”, the university said.

The achievement follows another breakthrough in March, by a Chinese team from Air Force Medical University that transplanted the first gene-edited pig’s liver into a patient who had suffered brain death.

Also in March, a patient in the United States became the first in the world to receive a genetically modified pig’s kidney transplant, a procedure previously performed only on clinically dead patients.

The patient, who had been suffering end-stage kidney failure, died suddenly earlier this month. Massachusetts General Hospital in Boston, where the procedure was carried out, said there was “no indication” that his death was due to the transplant.

A second US patient, who received a gene-edited pig’s kidney in April, is still alive and “brings hope for the development of xenotransplantation from pigs to humans”, Anhui Medical University said.

But the complexity of the liver – which plays a role in major bodily functions like metabolism and immunity – poses a greater challenge than kidneys and hearts, leading US researchers to suggest that its function “is too powerful” for xenotransplantation, Anhui Medical University said.

The latest feat indicated that “Chinese scientist’s xenotransplantation technology has reached the forefront of the world and will become one of the most important breakthroughs in the medical field”, it said.

China’s organ transplant ethics committee approved the study because the patient had a large tumour in the right lobe of his liver that was not responding to other treatment and posed a rupture risk.

The 514 gram (18 oz) pig’s liver, which contained 10 gene edits to prevent organ rejection and dysfunction, was transplanted into the patient after doctors confirmed the left lobe of his liver was unable to provide sufficient function on its own.

“Currently, the transplanted pig liver secretes about 200ml (nearly 7 fl oz) of golden bile every day,” said the hospital’s director Sun Beicheng, according to a report by People’s Daily.

Sun said that scans confirmed “the blood flow in the hepatic artery, portal vein and hepatic vein of the transplanted pig liver is completely normal” a week after the surgery.

According to the university, the success of this operation will make it possible “for xenotransplantation of pig liver to enter the clinic”.

The recent successes of Chinese and US researchers have raised hopes that transplants of genetically edited organs from pigs could offer a solution to global organ shortages, with demand greater than the supply of human organs.

But despite the progress in xenotransplantation of recent years, there are still ethical concerns surrounding the practice, including the possibility of organ rejection and the potential for disease transmission.

Philippines urged to tap South China Sea reserves to ease energy costs despite Beijing tensions

https://www.scmp.com/week-asia/economics/article/3264463/philippines-urged-tap-south-china-sea-reserves-ease-energy-costs-despite-beijing-tensions?utm_source=rss_feed

Debate has resurfaced over the Philippines’ energy options in the South China Sea after influential billionaire Ramon Ang urged the government to harness untapped oil and natural gas reserves to help lower energy prices for struggling Filipinos.

While some analysts agreed that now was the right time to “quickly develop” the maritime region’s resources, others warned that “political considerations” must be taken into account given Manila’s territorial disputes with Beijing and the failure of prior joint energy agreements.

Ang, owner of Malaysian petroleum firm Petron and president of the Philippines’ largest conglomerate by sales Top Frontier Investment Holdings, Inc., said on Monday that oil prices were cheaper in neighbouring countries due to government subsidies.

Malaysia, for instance, was able to subsidise oil prices because it had its “own oil production”, he said.

“We have a very big reserve in the West Philippine Sea. That’s why they are very interested in the Philippines. So let us not let go of it. We should protect our territory,” Ang said, seemingly referring to China.

China not only has competing claims with the Philippines in the South China Sea, but also with Malaysia, Brunei, and Vietnam. The West Philippine Sea is Manila’s name for part of the disputed waterway within its exclusive economic zone.

Ang noted that Manila’s oil production capabilities were dwarfed by that of neighbouring countries.

“Our own oil production is only 6,000 barrels per day, compared to our neighbouring countries’ average of 1 million barrels a day,” he said.

“If you look at it on an equal basis, our prices without the subsidy and without taxes are even lower than in Indonesia, Malaysia and Thailand. It’s the same with power. Our power generation is lower, but we impose taxes on the power sector and fuel, and we don’t give subsidies on power. That’s why our power prices are higher.”

Edmund Tayao, a political analyst and political-science professor at the San Beda Graduate School of Law in Manila, said that while there might be economic pressures to expand energy production in the West Philippine Sea, there were other risk factors to take into account.

“This is not just an economic and business issue. Since suspected sources are in disputed areas, political considerations must be factored in, making it a challenging situation,” Tayao told This Week in Asia.

Two weeks ago, former Supreme Court associate justice Antonio Carpio told ABS-CBN News that the Philippines could explore the oil and gas at Reed Bank, located to the north-east of the Spratly Islands, if it had help from the US to prevent harassment from China’s coastguard.

According to a March 2023 report by the United States Energy Information Administration, Reed Bank could hold up to 10 billion barrels of petroleum products and 6.7 trillion cubic feet of liquefied natural gas. Once developed, this could help lower the prices of fuel and power costs in the Philippines.

“To do that, we have to follow the formula adopted by Indonesia and Malaysia. When Malaysia sent their survey ships, the US and Australia conducted naval drills, so the Chinese coastguard could not act despite China’s threats,” Carpio said.

“Indonesia [also] sent their survey ships with their navy while the US aircraft carrier Ronald Reagan was nearby, so the Chinese coastguard could not interfere.”

According to Carpio, joint maritime patrols with the US would be necessary for Manila to prevent harassment from China during energy exploration.

“The formula is to send our survey ships and have a joint patrol. In Malaysia and Indonesia’s case, there was no formal patrol announcement. The US and Australia conducted naval patrols, orchestrated behind the scenes. Since we have the Mutual Defence Treaty with the US, we can announce the patrol,” he added.

The US-Philippines treaty, signed in 1951, calls on both countries to aid each other in times of external aggression. The Pentagon has stated that it is prepared to assist Manila if the treaty is invoked amid threats from other nations.

Chester Cabalza, president of the Manila-based International Development and Security Cooperation think tank, told This Week in Asia that delays in exploring underwater energy resources had resulted from previous conflicting agreements with China.

“Now that Manila has its own means and wants, the Philippine government and related agencies should quickly develop a blueprint to secure our energy sources in the West Philippine Sea,” Cabalza said.

“Manila must optimise and prioritise exploring and exploiting our maritime energy sources within our internal waters and exclusive economic zones, now with strong economic backing.”

Carpio said a memorandum of agreement had been reached between Manila and Beijing in 2018 to establish an intergovernmental joint steering committee for potential energy cooperation in the West Philippine Sea.

However, he said China’s demand for the “removal of phrases stating the oil and gas belonged to the Philippines and the service contract would be handled by the Philippines” led to the termination of the agreement.

President Ferdinand Marcos Jnr suggested earlier this year that he was open to the idea of cooperating on an energy project with Beijing, but emphasised that the Philippines’ sovereign rights and territorial jurisdiction must be considered if the government were to revive any joint exploration deal with China.

“We cannot, at any point, compromise the territorial integrity of the Philippines,” Marcos Jnr said. “That is the guiding principle behind any talks we might have.”

Given the maritime dispute in the West Philippine Sea, Cabalza advised against jointly exploring and developing resources with China, as this was likely to lead to future conflict.

“Manila should stand on its own. There is a high demand for oil and gas as the Philippines sustains its economic development. It is pragmatic to use and extract our natural resources within our borders,” he said.

Asked if there was still a possibility for a joint exploration and development deal with China, Tayao said any such agreement would imply recognising China’s competing claim.

“There is a disadvantage that seems to have been overlooked. A joint venture with a Chinese company might be considered, but not joint exploration, especially with China as a state,” Tayao said.