Mistral点评

• China sanctions US lawmaker Jim McGovern, critic of Beijing’s treatment of ethnic Tibetans
• Will Southern Ocean carbon studies led by China, UK spur climate modelling rethink?
• What are China’s gazelle enterprises, and how do they differ from unicorns?
• China’s live-streamers ready for their close-up as official jobs list updated
• China imposes export controls on drone parts for military and civilian use
• China delegation visits US to discuss fentanyl crisis collaboration amid ‘complex’ ties
• Chinese auto chip designer Black Sesame to raise up to US$143 million in Hong Kong IPO
• China ‘angel’ stops 469 suicidal people jumping off bridge over 21 years
• China condemns killing of Hamas leader Haniyeh, ‘deeply concerned’ about further turmoil
• ‘Long overdue’: India ramps up border connectivity in bid to counter China’s expansion
• Chinese state media warns of privacy risk from selling government data
• ‘Significant anomalies’: China tightens scrutiny over dubious degrees from overseas
• China tenant shocked by grisly past of home after stumbling upon TV crime show
• Is this Chinese AI model a seismic change in earthquake prediction?
• South China Sea row high on Quad agenda with ‘message’ aimed at Beijing
• First Hongkongers with foreign passports receive 5-year permits to visit mainland China
• China used ‘shocking’ bullying tactics ahead of Taiwan Ipac summit, organiser says
• China’s plan for cybersecurity ID could be a path to social control, legal experts say
• South China Sea: Philippines’ hitch-free mission a sign of better days in disputed waters?
• China’s southern megacities dealt contrasting economic fortunes as hi-tech Shenzhen thrives
• China’s cash-strapped small banks face limitatons amid shake-up, no one-size-fits-all fix
• China singing star Jackson Wang lauded for protecting baby at chaotic Malaysia event
• Chinese warship joins Russian navy for Gulf of Finland exercises
• China’s factory activity contracts for third straight month, adding to economic headache
• China’s shipbuilders sailing smooth as wave of demand drives exports
• China’s coastguard faces ‘unprecedented strain’ as tensions rise on 3 fronts

China sanctions US lawmaker Jim McGovern, critic of Beijing’s treatment of ethnic Tibetans

https://www.scmp.com/news/china/diplomacy/article/3272691/china-sanctions-us-lawmaker-jim-mcgovern-critic-beijings-treatment-ethnic-tibetans?utm_source=rss_feed

China sanctioned a US lawmaker on Wednesday for “frequently interfering” in China’s domestic affairs.

The sanctions against representative Jim McGovern include freezing his assets and properties in China, prohibiting any organisation or individual in China from conducting transactions or working with him, and denying him and his family a visa to enter the country, according to China’s Ministry of Foreign Affairs.

It is one of several rounds of sanctions against US lawmakers and companies that China has announced as relations have soured between Beijing and Washington.

China previously sanctioned US representative Michael McCaul and ex-representative Michael Gallagher over their support for Taiwan.

McGovern and McCaul introduced a bill calling for stronger US support for Tibet, a region in China where human rights groups have criticised authorities for the treatment of ethnic Tibetans.

Relations between the US and China have sunk, starting with a trade war in 2018 and then the Covid-19 pandemic. The US has been increasingly critical of Beijing’s human rights record, its handling of the pandemic and its actions towards Taiwan.

China, in response, has accused the US of meddling in its internal affairs and pursuing a containment strategy against China to prevent the country’s rise.

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 self-governed island by force and is committed to arm Taiwan.

Will Southern Ocean carbon studies led by China, UK spur climate modelling rethink?

https://www.scmp.com/news/china/science/article/3272521/will-southern-ocean-carbon-studies-led-china-uk-spur-climate-modelling-rethink?utm_source=rss_feed

Studies by two separate research teams have identified discrepancies in estimates of the vital Southern Ocean carbon sink, highlighting what could be a significant gap in mainstream climate modelling.

The Southern Ocean, also known as the Antarctic Ocean, is crucial to the Earth’s climate as one of its main carbon sinks.

Carbon sinks are areas that absorb more carbon dioxide than they release, and are vital to mitigating increases in carbon emissions due to human activity. The Southern Ocean accounts for around 40 per cent of global ocean uptake of anthropogenic greenhouse gases.

Despite the Southern Ocean’s importance as a carbon sink, there has long been uncertainty about its exact uptake, due to physical conditions like temperature variations and ice cover, as well as seasonally dependent measurement methods.

An international team from Britain, the United States, Germany and Belgium and another from China published new research papers last week taking a closer look at estimates of the region’s carbon sink capacity.

Both papers indicated that widely used carbon mapping models could be inaccurate.

The Chinese team’s paper was published in Communications Earth & Environment, a Nature Portfolio journal, while the international team’s paper ran in the journal Science Advances. Both were published last Wednesday.

Widely used data sets like the Surface Ocean CO2 Atlas (SOCAT) – which collects global data from instruments aboard ships, floats, and sail drones – can be limited due to a lack of winter data.

The Global Carbon Project, an organisation tracking greenhouse gas emissions and their causes, uses the SOCAT model and is the publisher of the Global Carbon Budget – a measure of carbon emissions and sinks worldwide used by the United Nations.

Using data from research ships that sailed in the region in the summer months of 2019 and 2020, the British-led international team found that there was a “25 per cent stronger [carbon dioxide] uptake in the Southern Ocean” than estimated by SOCAT-based models.

The international team identified limited data and the ocean temperature gradient as sources of error in air-sea carbon flux models. Measurements can be sensitive to temperature conditions like the warmth of ships and the cool surface layer of the ocean.

The researchers used eddy covariance, a gas exchange measurement method based on instruments mounted on the foremast of the research ships.

This method is not affected by upper-ocean temperature gradients, allowing researchers to directly measure air and sea carbon dioxide flux, or the movement of carbon dioxide between the air and sea.

The team from China studied another method used to estimate air-sea carbon flux. This involves measuring partial pressure, or the amount of carbon dioxide within the upper ocean, with the help of machine learning. This method helped to reduce uncertainty, the Chinese Academy of Sciences (CAS) team said.

However, they noted that models based on mapping partial pressure with machine learning also tended to overestimate the region’s carbon sink capacity compared to mainstream models.

The researchers discovered that the discrepancy had led to a “16 per cent overestimating of Southern Ocean carbon sink over the past three decades”, due to seasonally uneven measurements.

Accounting for this led to readings more closely resembling the pressure-based estimates used in the carbon budget. However, the CAS team did not indicate that the carbon sink in the region might indeed be stronger than expected, as the international team found.

Both studies indicated continued uncertainty over the carbon sink capacity of this key region.

The international team was led by researchers at the University of East Anglia and Plymouth Marine Laboratory in the United Kingdom.

According to Yuanxu Dong, first author of the team’s paper and a researcher at East Anglia: “Accurate quantification of the Southern Ocean [carbon dioxide] sink is essential for the assessment of the Earth’s climate.

“However, it is the most uncertain region regarding the estimate of its [carbon dioxide] sink capacity.”

SOCAT chairwoman Dorothee Bakker, meanwhile, highlighted “a real need for sustained and expanded funding of surface ocean [carbon dioxide] measurements and their SOCAT synthesis, in order to constrain Southern Ocean [carbon] uptake and to inform climate policy”, according to a statement from the university.

“Changes in the Southern Ocean carbon sink strongly affect the global ocean [carbon dioxide] uptake,” the CAS researchers wrote in their paper.

“It is essential to quantify the global ocean carbon sink and its temporal variability to understand further the response of the carbon cycle to future global change.”

The Chinese researchers said that the melting of sea ice had an impact on the intensity of the Southern Ocean’s carbon sink, and its complete melting would release “a remarkable amount of [carbon dioxide]” into the atmosphere.

“This would weaken the role of the Southern Ocean in the global ocean [carbon dioxide] uptakes, and the role of the global ocean in buffering the rise in atmospheric [carbon dioxide] concentration.”

What are China’s gazelle enterprises, and how do they differ from unicorns?

https://www.scmp.com/economy/economic-indicators/article/3272676/what-are-chinas-gazelle-enterprises-and-how-do-they-differ-unicorns?utm_source=rss_feed

China’s business environment is beginning to sound like the African savannah after central leadership’s comments this week included calls to ensure “survival of the fittest” while warning of “vicious competition” and the need to nurture “gazelle” firms.

In an announcement on Tuesday, China’s Politburo emphasised the importance of “vigorously and efficiently supporting the development of gazelle and unicorn enterprises”.

The “gazelle” designation for companies was coined by economist David Birch in Silicon Valley in 1987.

A gazelle enterprise is characterised by its fast-growing revenue sales, typically generating at least a 20 per cent revenue growth in the span of about four years after starting with a base revenue of at least US$100,000.

While most such firms are in the tech sector, some are in the retail, apparel, food and beverage industries, among others.

But the priority among these gazelle companies is hi-tech start-ups.

A unicorn enterprise is a privately held company with a valuation of at least US$1 billion.

Gazelles tend to be start-ups valued at more than US$100 million and which have experienced fast-growing revenue in the first few years.

China has the second-most gazelle firms in the world, trailing only the United States. Together, they possess more than 70 per cent of all gazelle enterprises.

Examples of thriving gazelles include Elon Musk’s brain-chip firm Neuralink, and FTXT Energy Technology, whose parent company is Great Wall Motor.

The presence of gazelles opens the door for innovation, high-quality regional development and greater employment opportunities at a time when local-level economies across China are struggling.

And added emphasis is being placed on gazelles and unicorns to promote the growth of emerging industries. Frontiers include quantum technology, life sciences and artificial intelligence.

Beijing plans on cultivating future unicorn enterprises from smaller “seeded players” like these gazelle companies.

“This is an admission of the huge gap in the number of unicorns nurtured between China and America,” said a Peking University professor who spoke on condition of anonymity due to the sensitive nature of the issue. “China is lagging in the start-up race, especially since the AI revolution, and as global talent and capital have been flowing to the US in recent years.”

He added that, even with the valuation threshold dropping from US$1 billion to US$100 million as Beijing’s focus shifts to gazelles, leadership needs to help Chinese start-ups grow while also respecting the market, since the valuation of a start-up is determined by the market and capital, not by the government.

“More Chinese unicorns and gazelles will also help Beijing break the West’s tech and trade blockade,” said Zhu Jiangnan, director of the Contemporary China Studies programme at Hong Kong University. “It is also Beijing’s imperative to help young people start businesses and create employment.”

Despite a wide gulf with the West in the start-up race, China’s supersized market and abundant application scenarios are expected to help it catch up.

“China has fewer unicorns and gazelles on a per capita basis than the US, but China can play to the advantages of its market and economy scale and close the gap,” Zhu explained. “China still stands a chance to turn its gazelles into the next Huawei or Tencent.”

China’s live-streamers ready for their close-up as official jobs list updated

https://www.scmp.com/economy/china-economy/article/3272665/chinas-live-streamers-ready-their-close-official-jobs-list-updated?utm_source=rss_feed

Live-streamers and test drivers of smart cars have been added to a list of officially recognised professions in China, a reflection of the country’s growing reliance on its digital sector and smart manufacturing as the economic engines of the future.

Other new professions on the list – 19 in all – include artificial intelligence (AI) system application specialist, planning and operations engineer for cultural products, administrator of intelligent manufacturing systems and bioengineering technician, according to a notice posted by the Ministry of Human Resources and Social Security on Wednesday.

“The release of new occupations is of great significance for developing jobs, guiding vocational education and training, improving the standards of employees and promoting employment and entrepreneurship,” the ministry said.

The updated list arrives after a period of public consultation which began last year, and an initial announcement of the additions in May. The changes were made in response to guidelines from the State Council, China’s cabinet, on building a highly skilled workforce.

China has said that skilled professionals will account for no less than 30 per cent of the working population by 2025.

Recognising emerging professions can “enhance the sense of belonging felt by people in these positions in the workplace” and allow them to “enjoy related national policy benefits”, an unnamed human resources official was quoted as saying by the official Xinhua news agency in May.

Localities like the southern province of Guangdong have already introduced subsidies for the housing and training of certain types of skilled workers.

According to a report by the China Netcasting Services Association, a unit under the National Radio and Television Administration, by the end of 2023 around 15 million people were working in live-streaming in some capacity.

Live-streaming is a profession which carries appeal for military veterans, migrant workers and students struggling to find employment, according to a February research report by Renmin University of China.

The authors found that live-streaming e-commerce – selling products online via live broadcast – has a significant impact on the job market, with every 100 million yuan increase in gross merchandise value creating 1,100 new jobs.

China’s jobless rate for the 16-24 age group, excluding students, dipped to 13.2 per cent in June from May’s 14.2 per cent, according to the National Bureau of Statistics (NBS).

The jobless rate for the 25-29 age group, also excluding students, was 6.4 per cent in June, marking a third consecutive month of decline. The rate for the 30-59 age group remained unchanged from May at 4 per cent.

However, the job market remains a source of pressure in some parts of China.

The employment sub-index of the official purchasing managers’ index edged up to 48.3 in July from 48.1 in June, but has now been in contraction for 18 consecutive months – indicative of persistent challenges for the overall labour market in the manufacturing sector, per a Wednesday research note by Nomura.

China imposes export controls on drone parts for military and civilian use

https://www.scmp.com/news/china/military/article/3272636/china-imposes-export-controls-drone-parts-military-and-civilian-use?utm_source=rss_feed

China on Wednesday imposed export controls on a range of drone parts for both military and civilian use.

The list was rolled out by a range of agencies, such as the commerce ministry, China’s customs and the People’s Liberation Army’s equipment department.

The controlled parts include high-precision inertial measuring units, synthetic-aperture radar and engines with an output above 16 kilowatts as well as wireless communication able to work beyond the range of 50km (31 miles).

Beijing also listed drone jammers for civilian use with an effective range of more than 5km among the export controlled items.

The directive issued on Wednesday said Chinese exporters would face a penalty for exporting items not listed in the ban if they knew they would be used for military means or terrorism.

“The Chinese government firmly supports Chinese companies conducting international trade and cooperation of drones in the civilian area [and] oppose civilian drones to be used for non-peaceful means,” a statement from the Ministry of Commerce said in explaining the ban.

“[We] oppose certain countries’ conduct sanctions on Chinese companies or individuals using drones as an excuse,” it said.

The statement said the move would better safeguard China’s security and interests, and better serve Beijing’s obligation regarding the non-proliferation of weapons while benefiting global supply chain security.

More to follow …

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China delegation visits US to discuss fentanyl crisis collaboration amid ‘complex’ ties

https://www.scmp.com/news/china/article/3272549/china-delegation-visits-us-discuss-fentanyl-crisis-collaboration-amid-complex-ties?utm_source=rss_feed

A delegation of senior officials from Beijing is visiting Washington on Wednesday to carry forward discussions on the rival superpowers’ collaborative efforts in counternarcotics.

Describing the bilateral relationship as “complex” and “complicated”, a senior American government official on Tuesday said the US was “encouraged by the continued commitment and conversations”.

China of late has taken concerted action trying to disrupt the global supply chain of synthetic substances that are used to make fentanyl.

The momentum follows a period of stalled cooperation that was broken after Chinese President Xi Jinping and US President Joe Biden vowed during their summit in San Francisco last year to join efforts combating America’s deadly fentanyl crisis.

Beijing in recent months has shut down 14 key websites and suspended more than 330 business accounts and over 1,000 online shops that were engaged in the sale and distribution of illicit drugs and precursor chemicals.

Chinese law enforcement also issued a notice to the chemical industry, warning companies against the illicit trade and precursor chemicals as well as acted against entities of concern.

In June, Beijing added 46 new psychoactive substances to its controlled-substances list.

The same month, Chinese police, acting on information shared by American intelligence agencies, arrested a suspect the US claimed was laundering money for Mexico’s powerful Sinaloa cartel.

While noting Washington constantly seeks to verify any claims about Beijing’s actions, the senior American official on Tuesday said it was known that “these kinds of arrests reverberate” throughout the Chinese system and “send an important message”.

However, there continued to be a significant supply of precursor chemicals out of China and “there’s obviously a whole lot more to do” and “that’s why these ongoing conversations and engagements are so important”, the official added.

The meeting with the Chinese delegation is meant to address several key issues, such as urging Beijing to classify all substances identified as controlled chemicals by international bodies and discussing enhanced information exchange regarding companies involved in shipping drugs to the US.

Preliminary federal data released in May revealed a slight decrease in overdose deaths in the US for 2023, marking the first reduction in five years.

The estimated total number of drug overdoses for the year was 107,543, down from 111,029 in 2022 – a 3 per cent decline. Overdose deaths, driven predominantly by fentanyl, surged past 100,000 annually by 2020 and continued to rise.

The talks on Wednesday will coincide with the American president making two major announcements described as taking the fight against synthetic drugs to the “next level”.

Biden, who earlier this month opted out of the 2024 American presidential race, is to issue a new national-security memorandum that calls on US federal departments and agencies “to do even more than they have already been doing” to stop the supply of illicit fentanyl into the country.

According to the senior American official, this approach would enhance intelligence collection, improve coordination and cooperation as well as boost disruption efforts.

It would also facilitate collaboration with the private sector, recognising the vital role of public-private partnerships in effectively tackling this challenge.

Separately, Biden is set to urge the US Congress to pass legislation that integrates several ideas put forward by lawmakers to address key loopholes exploited by drug traffickers.

One bill includes several key initiatives aimed at combating drug trafficking. It seeks to establish a nationwide pill press and tabletting registry to help law enforcement monitor machines and prevent their illicit use in producing counterfeit fentanyl pills.

Additionally, the legislation will require importers of small packages to furnish more detailed information to Customs and Border Protection officials, enhancing the ability to track these shipments and better detect and identify packages containing illicit fentanyl precursor chemicals and related paraphernalia.

The proposal also calls on Congress to pass the Bipartisan Border Security Agreement, which allocates funding for additional border agents and advanced drug-detection equipment.

In the last five months, US border officials have seized more than 442 million potentially lethal doses of fentanyl.

On Tuesday, the senior American official said more fentanyl had been seized over the past two years than in the previous five years combined.

In detailing the government’s commitment to addressing the crisis, the official said Biden’s successful negotiation with China to resume counternarcotics cooperation had resulted in enhanced law-enforcement collaboration.

This includes ongoing efforts to shut down companies involved in illicit fentanyl and synthetic-drug trafficking, both of which contribute to American fatalities.

Last year, the US launched a global coalition to address synthetic drug threats, uniting more than 150 countries in the effort. However, China chose not to join the group.

Speaking separately at a Senate Foreign Relations committee hearing on Tuesday, US Deputy Secretary of State Kurt Campbell said the report card on China’s efforts to curb exports of precursor chemicals had so far been “incomplete”.

“The best grade I could give on the fentanyl [pledge] … would be an incomplete,” said Campbell.

“There are some modest steps that the Chinese have taken. There are some criminal prosecutions they’ve undertaken. They’ve wrapped up a few of the companies involved.”

“Synthetic opioids are not just affecting the United States,” the long-time diplomat added. “Europe and parts of Asia and China as well. This is a global scourge.”

“I think, increasingly, the Chinese recognise that since so much of that is coming from manufacturers in China that they have to take more steps.”

Additional reporting by Robert Delaney in Washington

Chinese auto chip designer Black Sesame to raise up to US$143 million in Hong Kong IPO

https://www.scmp.com/tech/tech-trends/article/3272655/chinese-auto-chip-designer-black-sesame-raise-us143-million-hong-kong-ipo?utm_source=rss_feed

Black Sesame International Holding, a Chinese system-on-a-chip (SoC) designer focused on autonomous-driving systems, aims to raise more than US$140 million from its initial public offering (IPO) in Hong Kong under the city’s relaxed listing rules for hi-tech firms.

Based in Wuhan, capital of central Hubei province, Black Sesame plans to float 37 million shares at a price range of between HK$28 and HK$30.3 per share, according to its latest filing with the Hong Kong stock exchange. The company’s listing could raise HK$1.12 billion (US$143 million) at the top of that price range.

The firm’s IPO falls under Chapter 18C of the city’s listing rules that took effect on March 31 last year. This enables companies with at least HK$10 billion in valuation to sell shares in Hong Kong even if they have yet to earn a single dollar in sales. For companies with at least HK$250 million in sales in the financial year before their IPO, the minimum valuation was slashed to HK$6 billion from HK$8 billion.

Black Sesame’s prospectus showed that its 2023 revenue reached 312.4 million yuan (US$43 million), nearly double that of 2022. Its losses, however, widened to 4.86 billion yuan from the previous year.

Black Sesame’s IPO initiative shows that Hong Kong’s listing reform for specialist technology firms via Chapter 18C is paying off in terms of attracting more hi-tech investments in the city. In November 2023, the firm said it plans to establish a research and development centre in the Hong Kong Science Park. In 2023, Black Sesame said it was working with Baidu on its intelligent car systems.

Also benefiting from that reform, Tencent Holdings-backed QuantumPharm raised HK$989.3 million in June to become Hong Kong’s third-largest listing of the year.

Black Sesame is considered one of the mainland auto chip designers that can compete with the likes of Nvidia and Qualcomm, boosting the country’s technological self-sufficiency efforts. The company has already raised US$695.8 billion through 10 rounds of funding from investors that include Nio Capital, the investment arm of electric vehicle maker Nio, as well a venture capital fund under smartphone giant Xiaomi.

Still, high investments and limited revenue have weakened the profitability of SoC start-ups like Black Sesame, according to Canalys analyst Ceyuan Liu.

Black Sesame has designed two series of products, the Huashan high-computing power SoCs and the Wudang cross-domain SoCs, which can cover diverse functionalities of intelligent vehicles, such as a smart cockpit, with a single chip.

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China ‘angel’ stops 469 suicidal people jumping off bridge over 21 years

https://www.scmp.com/news/people-culture/china-personalities/article/3272585/china-angel-stops-469-suicidal-people-jumping-bridge-over-21-years?utm_source=rss_feed

A suicide prevention volunteer who has stopped 469 people from jumping off a bridge in China over the past 21 years has been dubbed the “Angel of Nanjing”.

Chen Si, 56, patrols the Yangtze River Bridge in Nanjing, the capital city of Jiangsu province in eastern China.

Chen engages in conversations with people lingering or wandering aimlessly on the bridge, to prevent them from jumping.

He has also pulled people back from the edge and assisted in rescuing those who have already jumped into the river.

Wearing a red volunteer’s uniform with “cherish life every day” written in Chinese on it, he patrols the bridge 10 times a day and has done so for more than two decades.

In 2000, Chen saw a desperate-looking girl wandering on the bridge.

Worried she might be in trouble, he approached her and began chatting to try and lift her spirits. He bought her water, food and a ticket home because she had no money.

Chen said it was the first time he had considered someone would commit suicide by jumping off the bridge.

“I realised that these people could be saved,” he said.

Since September 2003, Chen has saved hundreds more people, according to New Weekly.

He said he has learned to ascertain whether someone is feeling down by their posture.

“People with an extreme internal struggle don’t have relaxed body movements, their bodies look heavy,” said Chen.

“I want to tell these people that as long as you have breath, you have hope to start your life over,” he told New Weekly.

Once, he saved a woman who was intending to jump because her husband cheated on her.

He told her: “If the sky falls, I’ll be your big brother and hold it up for you.”

Another time, he dissuaded a girl from jumping who had been admitted to university but could not afford tuition, raising more than 10,000 yuan (US$1,400) with friends to help her.

“Over the years, I’ve realised that simply pulling someone back from the brink on the bridge doesn’t completely lift them out of their predicament,” he said.

Chen has used his savings to rent rooms for people he has persuaded not to jump, and personally covered all other expenses.

His heart-warming story has also been turned into a documentary called Angel of Nanjing.

“I saw him on the news more than 20 years ago. I didn’t think he would still be saving lives,” one online observer wrote on Weibo.

“Giving those in despair hope and a chance to live, Chen is truly an angel,” said another.

China condemns killing of Hamas leader Haniyeh, ‘deeply concerned’ about further turmoil

https://www.scmp.com/news/china/diplomacy/article/3272659/china-condemns-killing-hamas-leader-haniyeh-deeply-concerned-about-further-turmoil?utm_source=rss_feed

Beijing has strongly condemned the assassination of Hamas leader Ismail Haniyeh in a strike in Tehran, warning that the killing could plunge the region into deeper chaos a week after China helped to broker a Palestinian unity deal.

Chinese foreign ministry spokesman Lin Jian said on Wednesday that Beijing strongly opposed the assassination of Haniyeh.

“China has always advocated resolving regional disputes through negotiation and dialogue,” Lin said, adding that Beijing was “deeply concerned” that the incident could lead to further turmoil in the region.

He also repeated a call for a comprehensive and permanent ceasefire in Gaza to avoid further escalation of the conflict.

Hamas said on Wednesday that Haniyeh was killed in an Israeli strike in Iran, where he had been attending the inauguration of the country’s new president.

Haniyeh’s death is a major setback for Hamas and casts a shadow over future negotiations with Israel, as tensions escalate across the Middle East due to the devastating war in Gaza. Iran and Hamas have blamed Israel for the assassination, but Israel has not yet officially commented.

The attack has drawn sympathy from Middle East countries, with Iran’s new president, Masoud Pezeshkian, saying the assassination would only cement the bonds between Iran and Palestine.

“The Islamic Republic of Iran will defend its territorial integrity and honour, and would make the terrorist occupiers regret their cowardly action,” he said in a statement posted on X.

Mousa Abu Marzook, a member of the Hamas Political Bureau, has vowed to avenge the martyrdom of Haniyeh, asserting that the “cowardly” assassination would not go “unanswered”.

As the political leader of Hamas, Haniyeh played a crucial role as a key interlocutor with Egyptian and Qatari mediators during the stalled hostage and ceasefire negotiations between Israel and Hamas.

The attack occurred less than 24 hours after Israel claimed to have killed Hezbollah’s top military commander, Fuad Shukur, in an air strike on a southern Beirut suburb, sparking fears of wider conflict in the region. Israel had blamed Shukur for a deadly attack in the Israeli-occupied Golan Heights.

The Lebanese government expected Hezbollah to retaliate over the Israeli strike, reports said. A Lebanese minister said a plan was in place to address the potential large-scale displacement of people in Lebanon.

The foreign ministry in Qatar, which has also condemned the killing, called the attack “a dangerous escalation”.

The Qatari ministry added that Haniyeh’s assassination and Israel’s “reckless targeting of civilians in Gaza are likely to lead the region into chaos and undermine the chances of peace”.

China has historically supported the Palestinian cause and advocated for a two-state solution to the Israeli-Palestinian conflict.

Last week, China hosted rival Palestinian factions, including Hamas and Fatah in Beijing, where they signed the Beijing Declaration to form a national unity government in post-war Gaza.

Additional reporting by Reuters

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‘Long overdue’: India ramps up border connectivity in bid to counter China’s expansion

https://www.scmp.com/week-asia/politics/article/3272667/long-overdue-india-ramps-border-connectivity-bid-counter-chinas-expansion?utm_source=rss_feed

India has accelerated its plan to boost infrastructure and connectivity in the volatile Ladakh region, a move seen as countering China’s rapid development along the disputed border.

The latest action centres on the third phase of the strategic India-China Border Project (ICBR) in eastern Ladakh, with observers saying the aim is to boost road networks and enable quicker movement of Indian troops along the Line of Actual Control (LAC) to counter China.

According to media reports, the Border Roads Organisation, with the Central Public Works Department and the National Projects Construction Corporation, has begun the third phase of the ICBR project.

M.S. Prathibha, an associate fellow at the Institute for Defence Studies and Analyses, told This Week in Asia that India had been increasingly concerned about the rapid expansion of infrastructural and dual-use capabilities that would help Chinese troops be deployed faster in the border areas.

“India’s vulnerability in even maintaining a strategically defensive posture has been challenging due to the gaps in logistics and troops mobility,” Prathiba said, adding that the ICBR projects were aimed at plugging such vulnerabilities should India face any military action from the Chinese side.

“It is to improve the overall capabilities of the Indian military that has been long overdue, especially involving logistics,” she added.

India’s border with China spans 3,488km across Ladakh, Arunachal Pradesh, Himachal Pradesh, Uttarakhand and Sikkim.

In the third phase of the ICBR, out of 37 roads five new ones have been identified to be constructed in eastern Ladakh while nearly 70 per cent of the roads will be built in the state of Arunachal Pradesh.

Under the first phase, 73 roads of nearly 4000km in length were identified as strategic in the states of Ladakh, Himachal Pradesh, Uttarakhand, Sikkim and Arunachal Pradesh.

In phase two, the construction of 104 roads of more than 6,700km long was approved in the 2020-21 financial budget. In Arunachal Pradesh under the same phase, apart from building 57 roads, the Indian government is also building 32 helipads, 47 border outposts and 12 staging camps for the Indo-Tibetan Border Police.

According to Atul Kumar, a fellow in Strategic Studies Programme at Observer Research Foundation, a think tank based in New Delhi, ICBR aims to develop crucial border roads and provide connectivity along the LAC.

“Initially, progress was slow but gained momentum after the Depsang, Doklam, Galwan and Yangtse incidents. The urgency was further driven by China’s massive infrastructure build-up on the Tibetan side of the LAC, which includes numerous roads, rail connections, and aviation facilities. Strategically placed xiaokang [well-off villages] sustain this build-up, with the latest one coming up in Demchok,” Kumar said.

India and China have been in a military stand-off at the border since the 2020 Galwan Valley clash, which killed 20 Indian soldiers and four Chinese troops.

In June 2017, a two-month stand-off occurred between Indian troops and Chinese People’s Liberation Army in Tibet’s Doklam region after China attempted to build a road near a tri-junction border.

Another face-off in January 2021 near Sikkim resulted in injuries on both sides, while in December 2022, the two armies clashed again at Yangtse near Tawang in Arunachal Pradesh.

Indian External Affairs Minister S. Jaishankar acknowledged on Monday that India-China relations were “not doing very well” at the moment.

Kumar said India had followed up on the first ICBR phase with its second and third phases, resulting in visible and substantial gains.

“Local connectivity, last-mile feeder roads, and connections from LAC outposts to the hinterland have improved, facilitating the provision of logistics, medical services and social goods,” Kumar said, adding that the construction of new tunnels was transforming the northern mountains.

Prime Minister Narendra Modi recently inaugurated the 4.1km-long Shinku La tunnel, part of the ICBR initiative in Himachal Pradesh. The tunnel will ensure all-weather connectivity between Manali and Leh, improving the movement of armed forces and equipment.

In March this year, Modi opened the strategically significant Sela tunnel in Arunachal Pradesh, sparking a war of words between Beijing and Delhi.

Kumar, however, said a paradigm shift in Indian border connectivity required rail infrastructure.

“Ladakh and Arunachal Pradesh’s northern regions urgently need railways, attracting tourists to the less-explored hills, significantly boosting the local economy, and providing the armed forces with easier access to remote outposts and crucial military locations,” he said.

The government has more than doubled the pace of road construction since 2017 and also stepped up building of villages along the border with China, including in key states such as Arunachal Pradesh and Ladakh.

Defence expert Rakesh Sharma told This Week in Asia that the Chinese incursions in 2020 had changed the entire geometry of the borders.

“The Chinese have worked on their infrastructure at a feverish pace – on highways, extending runways, creating heliports, and military habitat. These are also in Aksai Chin, creating a serious threatening posture. Providing impetus to infrastructure development in India was a natural response,” said Sharma, a distinguished fellow at Delhi-based think tank Centre for Land Warfare Studies.

Since 2019, China has been building villages along the LAC with more than 600 xiaokang along India’s borders with the Tibet autonomous region.

Sharma said India had dovetailed with other infrastructural development companies in the civil sector for projects such as the Zojila tunnel connecting Srinagar and Kargil, and an alternative road to Tawang to boost year-round connectivity.

B.R. Deepak, a professor of Chinese and China Studies at Jawaharlal Nehru University, said while it was good that India had picked up the pace on border infrastructure development, the government should also prioritise railway connectivity, particularly in the eastern sector.

“ICBR projects are important for revamping our border infrastructure. A survey on railway connectivity to the LAC was done, but so far, no action plan has been implemented on the ground,” said Deepak, adding that India had a lot to do to match China’s modernisation.

Deepak noted there could be more friction in eastern Ladakh given the developments in the area.

“The latest developments like construction of roads, and especially the tunnels, will facilitate the connectivity for the transporting and mobilising of troops. Seeing these developments, China could open up more friction points in eastern Ladakh,” Deepak said, adding that with the Shinku La tunnel, India now had access to Ladakh from Himachal Pradesh via two routes, in addition to the traditional Srinagar route.

Chinese state media warns of privacy risk from selling government data

https://www.scmp.com/news/china/politics/article/3272658/chinese-state-media-warns-privacy-risk-selling-government-data?utm_source=rss_feed

Chinese state media has warned that selling government data risks privacy breaches and could even put national security at risk.

“Government data is characterised by a large sample size, high sensitivity, and strong aggregation, making it highly susceptible to breaches of privacy data,” said a report published on Tuesday by Xinhua Daily Telegraph, an outlet owned by the state news agency. “If different data sets are widely leaked, it could pose a risk to national security.”

It continued: “It is important to be vigilant about the risks of certain administrative agencies purely seeking profit and engaging in administrative monopolies in the process of managing public data.

“Public data should not simply become a tool or means for the government to increase fiscal revenue; it should maintain a focus on public welfare and uphold the social public interest.”

The report said local governments were increasingly tempted to sell data because the slump in the property market was hitting land sale revenue, adding to their debts.

“In some areas, the decline in land-based finance and the significant pressure of debt repayment are increasing the possibility of an impulse towards a data-driven economy,” it said. “Some are even suggesting that local governments explore a transition from land-based finance to a data-driven economy.”

It also said possessing government and public data had “significant social and economic value” because of the extensive and comprehensive information available and clear sourcing.

The Chinese authorities have stepped up their focus on national security risks in recent months by issuing a series of warnings, including in the recently concluded third plenum, a key Communist Party policy meeting.

In late June, the National Audit Office published a submission to the country’s top legislative body, the Standing Committee of National People’s Congress, which criticised the “new trend of using government data for profit”.

It said its 2023 audit had found that four government departments illegally profited from selling government data for an overall gain of 248 million yuan (US$34 million).

It did not name the departments or release other details, but blamed “lax supervision” for allowing them to make money from 13 government data systems by “determining the data content, service formats and fee standards all without approval”.

Last year the local government in Hengyang, a city in Hunan province, was forced to suspend an online bidding process for government data resources and a smart city project. State broadcaster CCTV reported that it had been seeking to raise 1.8 billion yuan from the auction.

China has attached increasing importance to official data in recent years, and set up the National Data Administration last year to improve management at all levels of local government and advance the building of a data infrastructure system.

In a document issued by the State Council, China’s cabinet, in December 2022, Beijing urged party and government organs at all levels to improve the management of data and promote interconnectivity.

It also encouraged the public sector to break down “data silos” and protect personal privacy and public safety when using data.

‘Significant anomalies’: China tightens scrutiny over dubious degrees from overseas

https://www.scmp.com/news/china/politics/article/3272610/significant-anomalies-china-tightens-scrutiny-over-dubious-degrees-overseas?utm_source=rss_feed

China has ratcheted up scrutiny of degrees from lower-ranked universities overseas in a bid to crack down on academic short-cuts often taken to boost careers.

A total of 13 universities in the Philippines, Mongolia and India have been singled out for more stringent verification of master’s and PhD degrees, the Chinese Service Centre for Scholarly Exchange (CSCSE), under the Ministry of Education, announced last week.

The centre is responsible for certifying academic qualifications obtained overseas, which many Chinese students use to get an edge in the highly competitive domestic job market, or to apply for further studies or household registration, known as hukou, in big cities.

Usually the verification process takes 10-20 working days but the centre said it would take at least 60 days to assess qualifications from those universities, citing “significant anomalies” found in application data for master’s and doctoral degrees from those institutions.

The centre said six of the universities were in the Philippines, five in Mongolia and two in India.

In the World University Ranking 2024 published by Times Higher Education, all but one of the 13 institutions identified by the CSCSE ranked lower than 1,500 on the list, or were not listed.

In recent years, many Chinese have looked to non-elite universities in Western and developing countries that have no entrance exams to upgrade their skills on a budget to better compete in tighter job markets.

However, doubts have been raised about the quality of the higher education degrees and career development programmes offered by such institutions.

At the end of 2022, it was estimated that nearly 100,000 Chinese students were studying in Southeast Asia, and the number was rising, according to the 2022 White Book for Chinese Students of Overseas Education, published by Chinese education services company EIC Education.

A 38-year-old woman from China said she enrolled in a distance learning master’s programme from a university in Manila because there were no entrance requirements and she did not need to take time off work to do the course.

She said she needed the qualification to improve her chance of retaining her job.

“I have the lowest level of education in my company, putting me at high risk of being fired,” she said.

Some of those enrolled in the affected colleges have already been told of new requirements.

A first-year Chinese postgraduate student majoring in educational management at the Philippine Women’s University said she had been taking online classes while living in the Philippines. However, the school told her earlier this month that she would have to attend classes in person next semester, in line with the college’s new requirements.

The woman’s boyfriend, who is also living in the Philippines and taking online classes for a doctorate in performing arts at another one of the 13 universities on the verification list – St Paul University Philippines – was also notified earlier this month that he would have to attend classes in person next semester to meet the new requirements.

In an email to the student, the university said it had been informed earlier this month by China’s Ministry of Education that Chinese students were now required to take 90 per cent of their classes “face-to-face” to be eligible for verification.

George Ji, an overseas study consultant, said about 10 per cent of his clients – most of them on limited budgets and with weak English skills – asked about overseas studies in countries such as the Philippines, Mongolia and India.

“The cost of studying in these countries is less than one-fifth of what it costs in popular countries for overseas studies,” Ji said.

This is not the first time the CSCSE has stepped up verification measures for overseas studies at lower-ranked universities.

In July 2021, the CSCSE said it tightened degree scrutiny over some Belarusian institutions, which the centre said had leveraged Covid-19 restrictions to target the Chinese market with low-quality online courses.

The centre has issued four other warnings against institutions and programmes, most of which are in developing countries such as Malaysia, Thailand, the Philippines and Indonesia.

In July 2022, state-run China News Service reported that a college in Hunan province spent more than 18 million yuan (US$2.5 million) to subsidise 23 junior teachers so they could obtain PhDs in philosophy from Adamson University in the Philippines within 28 months, a far shorter time frame than it would otherwise take. The institution was put on an enhanced verification list in November 2021.

Some non-elite universities or vocational colleges in China have had difficulty recruiting people with PhDs, so they tried to boost their proportion of teachers with the qualifications by encouraging their instructors to study in Southeast Asia, where doctoral degrees were easier to obtain.

Ji said a surge of verification applications, caused by the massive expansion of enrolment during the pandemic, may also be a reason for the extra scrutiny.

“For example, if there were only 30 verification applicants from a certain university in the previous year but this year the number surged to 300, the centre would use extra caution to ensure that the university does not sell diplomas or shorten the duration of its programmes,” he said.

Another reason for the added scrutiny could be a disproportionate share of online instruction, Ji said.

Many universities – in China and overseas – began conducting online classes during the pandemic, when the CSCSE said that it could certify degrees obtained through online classes.

But after China lifted its zero-Covid controls and reopened its borders in January 2023, the CSCSE said foreign diplomas and certificates obtained through online classes would no longer be certified.

Another Chinese student taking an online course from the Philippines said that even though her institution was not on the verification list, she was worried that it could be added to the list in the future.

“I should have chosen to do an MBA in China while working,” she said. “Now I regret my decision.”

China tenant shocked by grisly past of home after stumbling upon TV crime show

https://www.scmp.com/news/people-culture/trending-china/article/3272566/china-tenant-shocked-grisly-past-home-after-stumbling-upon-tv-crime-show?utm_source=rss_feed

An unsuspecting rental tenant in a modest property in China was shocked to discover from a short video that his home was the scene of a grisly murder 10 years ago.

The revelation surfaced on July 22 when a Douyin blogger, who specialises in analysing criminal cases, posted a video detailing a bizarre murder that took place in March 2014 in Jilin city, Jilin province in northeastern China.

It involved the disappearance of a woman who was showing the rental property to prospective tenants on behalf of her friends.

Her body was later found inside the property, covered by a patterned red pillow.

Crucial evidence, including shredded paper found in the toilet that was pieced together into a rental agreement – along with elevator surveillance footage – helped the police identify the suspects as two prospective tenants the woman had shown the property to.

The video featured a detailed look at the crime scene, all sourced from a legal programme on the state television broadcaster CCTV.

Hours after the video was posted, an online observer called Xingxinzhe shocked viewers by posting a message under the video saying that he was living in the property.

Xingxinzhe added that he and his younger brother who lived there together were unaware of its dark history .

He filmed a walkthrough video of the duplex, titled “Come to See If You Don’t Believe”, which showed the decor and layout of the flat.

Internet sleuths quickly noted striking similarities between the murder scene and the tenant’s home.

For example, the refrigerator, patterned red sofa cushions, spiral staircase, and other furniture, were all the same as the murder scene outlined in the video.

One online viewer said: “Ten years later, they haven’t even replaced the pillow that covered the body.”

Another asked humorously: “What brand is that refrigerator? It is still working after 10 years.”

The tenant disclosed that the rent had not been reduced despite the property’s history.

“It’s not cheap. It was initially priced at 1,200 yuan (US$165) a month, then negotiated down to 1,100 yuan.”

After finding out about the property’s gruesome past, the tenant was unable to contact its owner and has since moved out.

Yi Xu, a partner at the Hunan King Zone Lawyer Office, told Xiaoxiang Morning Herald that the tenant could demand compensation if the homeowner and agent failed to disclose the property’s history during the rental agreement process.

The story has left many people on mainland social media stunned.

One person said: “Of all things, the pillow used to cover the victim’s face wasn’t thrown away but continued to be used by tenants. The owner is so frugal!”

While another added: “Imagine this guy coming home to relax after a hard day’s work, scrolling through Douyin, and realising that the crime scene looks familiar. Then he realised someone was killed right next to where he sleeps every night. This is crushing. Imagine the psychological impact on this guy.”

A third person criticised the owner: “You can rent it out, but you must be upfront about the murder. It should be up to the tenants whether they want to rent it or not. Renting out a house with a murder history without disclosure is fraud.”

Is this Chinese AI model a seismic change in earthquake prediction?

https://www.scmp.com/news/china/science/article/3272568/chinese-ai-model-seismic-change-earthquake-prediction?utm_source=rss_feed

China has developed its first large artificial intelligence model to mine troves of data to help predict earthquakes.

The model, called “DiTing”, is based on one of the biggest data sets of its kind in the world and can be used to spot earthquake signals, monitor seismic activity and support rapid responses to earthquakes, according to its developers.

“DiTing relies on massive amounts of data from the China Earthquake Observation Network and advanced artificial intelligence technology and has significantly improved the accuracy and speed of seismic signal recognition,” Chen Shi, deputy director of the China Earthquake Administration’s Institute of Geophysics, said at the model’s launch in the southwestern city of Chengdu on Sunday.

The launch of the model on Sunday coincided with the 48th anniversary of the devastating earthquake in Tangshan in northern China, which killed at least 300,000 and levelled the city.

The project is a joint effort by the National Supercomputing Centre in Chengdu, the institute and Tsinghua University.

It takes its name from a divine beast in Chinese Buddhism that can pick up signals from across the universe.

The supercomputing centre said it was the first time seismic information had been amassed on such a scale to train artificial intelligence in China, overcoming the limits of conventional or smaller models.

In all, the model can already assess 100 million parameters – or variables – to make predictions or decisions – and that total is expected to reach a billion in August, state-run Science and Technology Daily quoted the centre’s chairman, Guo Li, as saying.

The more parameters a model has, the more adept it is in capturing details in a data set and the better it can improve the overall performance.

The model has been trained on seven years worth of seismic reports from the China Earthquake Networks Centre, according to a paper from the research team published in Earthquake Science, the flagship journal of the Seismological Society of China.

The team said the information could be used as a foundation for a range of earthquake-related research, setting a “benchmark for machine learning model development and data-driven seismological research” in areas such as earthquake detection, earthquake magnitude prediction, and ground-motion prediction.

The model could also be used in fields such as mine seismic monitoring, shale gas exploitation, urban underground space structure detection and underwater earthquake monitoring.

“More than 95 per cent of oil and gas fields discovered in the world mainly rely on seismic exploration. DiTing can deduce whether the underground contains oil and gas by learning the waveform characteristics of oil storage areas,” Wang Jianbo, deputy director of the supercomputing centre, said.

South China Sea row high on Quad agenda with ‘message’ aimed at Beijing

https://www.scmp.com/week-asia/politics/article/3272604/south-china-sea-row-high-quad-agenda-message-aimed-beijing?utm_source=rss_feed

Foreign ministers from Australia, India, Japan and the United States met this week to express serious concerns over intimidating and dangerous manoeuvres in the South China Sea in a move seen as “sending a message” to China.

Observers point to encouraging initiatives relating to cyberspace, artificial intelligence and maritime security that also emerged from the talks, particularly a maritime legal dialogue to build expertise on international law.

During the meeting between the Quad countries in Tokyo attended by Australia’s Penny Wong, India’s Subrahmanyam Jaishankar, Japan’s Yoko Kamikawa and Antony Blinken from the US on Monday, the four countries pledged to bolster maritime security in the region.

Without naming China, the joint statement said the Quad was “seriously concerned about the situation in the East and South China Seas”, reiterating its “strong opposition to any unilateral actions that seek to change the status quo by force or coercion”.

The foreign ministers voiced serious concern about the militarisation of disputed features and coercive and intimidating manoeuvres in the South China Sea, including the dangerous use of coastguard and maritime militia vessels.

China and the Philippines have clashed on several occasions in the disputed waterways in recent months, with Chinese personnel deploying water cannons, boarding Philippine vessels armed with axes and machetes and destroying equipment to disrupt Manila’s resupply missions to the Second Thomas Shoal.

Asked about the statement at a regular news briefing on Monday, Chinese foreign ministry spokesman Lin Jian said the Quad was “artificially creating tension, inciting confrontation and containing the development of other countries”.

Satoru Nagao, a non-resident fellow at the Hudson Institute based in Washington DC, said the South China Sea issue was mentioned in the fifth paragraph of the joint statement, in contrast to the 29th paragraph in the statement issued after last May’s Quad leaders’ summit.

“This is a message to China that Quad is concerned about escalating China’s activities against the Philippines,” Nagao said. The first-ever mention of the 2016 arbitral tribunal in the fifth paragraph was an important development, with its mention of “a significant milestone and the basis for peacefully resolving disputes between the parties”, he added.

adding that the first-ever mention of the 2016 arbitral tribunal in the fifth paragraph was “a significant milestone and the basis for peacefully resolving disputes between the parties”.

The Permanent Court of Arbitration in The Hague ruled in 2016 that China’s claim of historic rights to resources within its so-called nine-dash line in the contested waters had no basis in law.

All four Quad countries are also providing military support to the Philippines, Nagao said, noting that the US was increasing deployment to the Philippines, including intermediate-range Tomahawk missile launchers, while Australia had deployed military forces in the Southeast Asian country.

Under a recently signed treaty, Japan will deploy fighter jets and naval ships to Manila. With the delivery of India’s Brahmos supersonic missiles to the Philippines in April, Chinese naval ships also faced a threat from these weapons, said Nagao, adding that such pressure on China would be a good deterrent.

On Tuesday, the US pledged to modernise the Philippines’ military with US$500 million in funding, a move Defence Secretary Lloyd Austin described as a “once-in-a-generation investment”.

Troy-Lee Brown, a research fellow at the University of Western Australia’s Defence and Security Institute, said there were several encouraging initiatives on cyber and artificial intelligence.

The Quad will appoint cyber ambassadors to meet and discuss capacity-building projects and responsible state behaviour in cyberspace, according to the joint statement. The projects include an international conference on such cyber capabilities to be held in the Philippines and a cyber boot camp in India.

Quad countries also commit to further deepening international cooperation on artificial intelligence systems and interoperability between artificial intelligence governance frameworks, the statement added.

But the most encouraging outcome was the creation of a Quad legal dialogue to boost international law expertise on maritime issues, Lee-Brown said.

The dialogue was aimed at supporting the Quad’s efforts in upholding the rules-based maritime order in the Indo-Pacific region, the statement noted.

The Indo-Pacific Partnership for Maritime Domain Awareness (IPMDA) also continued to expand, with stronger links forged with the Information Fusion Centre-Indian Ocean Region (IFC-IOR), Lee-Brown said.

Announced in May 2022, the IPMDA is a forum for sharing maritime information aimed at combating illegal fishing and strengthening the maritime surveillance capabilities of countries in the Pacific and Southeast Asian region.

The IFC-IOR is a regional maritime security centre hosted by the Indian Navy tasked with boosting maritime security and safety in the Indian Ocean.

Eleanor Shiori Hughes, a non-resident fellow at Chicago-based economic research think tank EconVue, said the joint statement’s language expressed Quad members’ concerns about China’s “relentless muscle-flexing across the region” and how the global security environment was becoming more “perilous”.

However, it was important that “the Quad continues to promote a narrative that it has not lost sight of its origin story of providing public goods and resources to those who truly need it in the Indo-Pacific”, Hughes said.

Originally focused on security cooperation to counter China’s influence, the Quad has over the past few years added initiatives such as delivering vaccines and test kits during the pandemic, building infrastructure, bolstering cybersecurity and providing humanitarian help and disaster relief.

The discussions in Tokyo have set the stage for the Quad’s leaders to meet, Hughes said. Should such a meeting take place, it is likely to be scheduled after the US elections in November, according to Hughes.

“Now that US President Joe Biden officially dropped out of the 2024 presidential race, his attention span is fixated on domestic agenda items and ensuring that he lays the groundwork for [Vice-President] Kamala Harris to carry on his legacy,” she added.

This year’s Quad leaders’ summit was originally slated to be held in India in January but did not occur as Biden was unable to attend.

University of Western Australia’s Lee-Brown said it was unlikely that Indian Prime Minister Narendra Modi’s meeting with Russian leader Vladimir Putin in Moscow earlier this month would have dampened the outcome of this week’s Quad meeting or the chances of any future leaders-level meeting.

“Australia, Japan and the US are diplomatically agile enough to work closely with India on issues where they align and express concern on issues where they don’t,” Lee-Brown added.

Despite Russia’s international isolation and sanctions against it over its invasion of Ukraine, India has refrained from criticising the Kremlin, continued to pursue diplomacy with Moscow and bought Russian oil, prompting concerns that New Delhi’s moves are not in line with the positions of other Quad members.

First Hongkongers with foreign passports receive 5-year permits to visit mainland China

https://www.scmp.com/news/hong-kong/hong-kong-economy/article/3272617/first-hongkongers-foreign-passports-receive-5-year-permits-visit-mainland-china?utm_source=rss_feed

The first five-year multi-entry travel permits to enter mainland China have been granted to Hong Kong permanent residents holding foreign passports, with some planning to head across the border as early as next week.

The successful applicants, who collected their permits on Wednesday, said the easier access would encourage them to visit the mainland more often for both business and leisure.

Among them was Gan Khai Choon, chairman of the Malaysian Chamber of Commerce in Hong Kong and Macau, who picked up his permit at the Sheung Wan centre of China Travel Service (Hong Kong).

Gan said he had been to various parts of the mainland since the early 1980s and would now visit more often, once or twice a month.

The Malaysian planned to go to the city of Wuxi in Jiangsu province next week, where he had some investments in real estate, hotels and manufacturing.

“With this travel card, we are very happy because we can easily visit [mainland] China and we don’t have to apply for a visa or Apec card, which takes a long time and is very inconvenient, and also the ease of travel into mainland China will become more convenient,” he said.

Gan added the new arrangement would allow “superconnector” Hong Kong to be more effective as an international and financial centre.

Other members of his chamber were excited about the policy measure, and dozens of them had also applied for the permit, he said.

Alfred Buchner, a former committee member of the Austrian Chamber of Commerce in Hong Kong and Macau, also collected his permit on Wednesday morning with his wife and daughter.

The 57-year-old businessman said the arrangement would encourage him to travel to the mainland more often, and not only for work.

“Travelling back and forth will be absolutely easy and of course, as a family, we also will now have easier access as tourists spending some money in [mainland] China, looking around at the beautiful landscapes,” he said.

Buchner planned to head to Shenzhen with his family next weekend, a city he last visited seven years ago.

“We will regularly go there starting with Shenzhen, and of course Guangzhou,” he said. “We look forward to spending a lot of time over there and [doing] a little bit of shopping of course.”

Buchner added that he believed the European community and Western businesses in the city were optimistic about the new travel arrangement and would pursue opportunities to expand across the border.

“There will be, I would say, a big expansion of each business and there’s a lot of opportunities there,” he said.

Gary Lim Boon Yew, a committee member of the Singapore Chamber of Commerce in Hong Kong, was another in the first batch of successful applicants.

He said he would visit neighbouring Shenzhen and other mainland cities in the Greater Bay Area, which connects Hong Kong, Macau and nine Guangdong province cities.

The Singaporean said he would visit the mainland in the middle of August.

“Right now I don’t have to line up through immigration any more. I just go straight and click in. It’s just like using an Octopus card or the usual Hong Kong [identity] card,” he said.

Announced on July 1, the permit allows non-Chinese nationals with permanent residency in Hong Kong and Macau to enter the mainland for purposes such as short-term investment, visiting relatives, tourism, business, seminars and exchanges multiple times for a period of up to five years.

Permit holders can spend up to 90 days for each stay on the mainland and enjoy self-service clearance at control checkpoints once they have their fingerprints taken at ports of entry.

China used ‘shocking’ bullying tactics ahead of Taiwan Ipac summit, organiser says

https://www.theguardian.com/world/article/2024/jul/31/china-taiwan-ipac-summit-taipei-bullying-tactics

China’s attempts to stop foreign parliamentarians from attending a summit in Taiwan were “massively overstepping” acts of bullying, the organiser has said at the end of the gathering that saw the group – designed to counter China – expand.

The Inter-parliamentary Alliance on China (Ipac) held its fourth annual summit in Taipei this week, attended by about 50 parliamentarians from 23 countries.

The coalition is aimed at countering threats from China and shifting domestic China policies in members’ respective countries. This year’s location was always bound to aggravate China’s ruling Communist party (CCP), which considers Taiwan to be its own territory. In the days leading up to the meeting, reports emerged of some delegates being contacted by Chinese diplomats in what they said was a “clear attempt to intimidate and dissuade” them from attending.

Luke de Pulford, executive director of Ipac, said some had received calls or demands for meetings scheduled at the same time as the summit to “express to them why they shouldn’t wade into the Taiwan question”, or were offered trips to China instead, “as if they could be bought off”.

De Pulford said Beijing had only targeted countries “where they thought they could bully them”.

“I mean, it’s just really remarkably bullish stuff that’s seriously assertive, massively overstepping,” he told the Guardian. “They were all global south countries and I just think it’s a really shocking way to behave.”

Chinese ambassadors have called Ipac members in the past to demand that they remove their signatures from communiques. They have also been sanctioned or targeted by Chinese cyber-attacks.

Miriam Lexmann, a Slovak member of the European parliament, said she was among those targeted by local Chinese diplomatic officials.

“I was born into Communist Czechoslovakia and I remember this kind of behaviour when my relatives were called to Communist party headquarters, for intimidation and questioning because they wanted to travel abroad … or had concerns about the Communist regime,” Lexmann told the summit.

On Tuesday afternoon, Ipac introduced new members representing seven world parliaments, including from Taiwan for the first time, and Solomon Islands which switched diplomatic recognition from Taiwan to China in 2019.

Peter Keniloria, an opposition MP and son of Solomon Islands’ first prime minister, said his country’s decision created “complexities and challenges” that should be reversed.

“Historically, the relationship that once was held between the Solomons and Taiwan was strong and deeply rooted in partnership and mutual collaboration,” he said. “Nowadays I’m afraid I cannot say the same. I acknowledge the complexities and challenges that both our nations now face as a result of these actions, and state that it is my personal desire to see this relationship return to the strength that once was held.”

Ipac has been vocal in condemning the CCP’s human rights abuses in Xinjiang, and has lobbied in support of Hong Kong’s pro-democracy movement, in particular the jailed activist and media mogul, Jimmy Lai. It calls itself a “project for lawmakers by lawmakers”, to promote democracy and address threats to the rules-based and human rights systems posed by the rise of China.

On Tuesday the summit endorsed plans to “curb PRC [People’s Republic of China] distortion of UN resolution 2758”. That resolution was passed in 1971, formally recognising the CCP-led PRC as “the only lawful representatives of China” at the UN, and expelling the Chiang Kai-shek-led government of the Republic of China (ROC).

Chinese officials and media frequently claim the resolution affirms the CCP’s one-China principle (which includes their claim over Taiwan), and use state media to attack analysts and others who dispute it. Taiwan’s government, analysts and others have accused the CCP of mischaracterising the resolution, which does not mention Taiwan or the ROC.

De Pulford said countering China’s mischaracterisation of the resolution was partly to address “thorny” topics that often turned people away from the issue of Taiwan.

“It’s very complicated. And for most people it just becomes like, ‘eh, it’s too complicated a territory to speak’.”

Two MPs from Taiwan also joined for the first time, in what the Guardian understands was a late announcement. One of the pair, Chao-Tzu Chen, was unclear on the details of the organisation but said the event was “in line with my philosophy”.

Bolivian opposition senator and summit co-chair, Cecelia Requena, told the Guardian there were major concerns about China’s influence over the Bolivian government, and commercial involvement in infrastructure building and environmentally destructive projects. She said China and Russia were taking control of resources in Latin America without much resistance, but local politicians were scared to push back.

“The way we relate to China has to be improved in order for our national interests to be respected,” Requena said.

In a statement, China’s foreign ministry told the Associated Press that it opposed any form of official exchanges between its diplomatic partners and Taiwan, and that Ipac had “no credibility”.

Additional reporting by Chi-hui Lin

China’s plan for cybersecurity ID could be a path to social control, legal experts say

https://www.scmp.com/news/china/politics/article/3272577/china-plan-cybersecurity-id-could-be-path-social-control-legal-experts?utm_source=rss_feed

China is considering a national cyberspace ID to safeguard data security and personal information, raising concerns among legal experts about tighter monitoring and social control.

Draft regulations issued last week by the Ministry of Public Security and the Cyberspace Administration would enable users to verify their identities online without disclosing sensitive personal information to internet service platforms.

According to the draft National Network Identity Authentication Public Service Management Measures, two forms of digital ID would be available through a national authentication app. The initiative is open for public comment until August 25.

The initiative aims to “protect citizens’ personal information, regulate the public service for authentication of cyberspace IDs, and accelerate the implementation of the trusted online identity strategy”.

The 16-article initiative proposes a unified network number, composed of letters and numbers, and a digital authentication credential, both corresponding to a user’s identity, so that no personal details would be revealed.

The system will be voluntary and “maximally reduces the over-collection and retention of citizens’ personal information by internet platforms under the pretext of implementing real-name registration”, the draft said.

Legal experts have expressed concerns over the proposal’s implications for privacy and government oversight. They warn that while it ostensibly aims to enhance privacy, the initiative could also intensify surveillance over individuals’ online activities.

Shen Kui, a law professor at Peking University, acknowledged that a unified network identity could simplify the authentication process during online transactions and make the misuse of personal information less likely.

“The fewer entities that collect actual personal identity information, the smaller the possibility of being asked to provide personal information beyond the necessary scope,” he said.

Shen said the initiative would also “lower the likelihood of those entities that collect and store user information leaking or illegally using that information”, in an article published on the WeChat account of the university’s Centre for Constitutional and Administrative Law.

But he cautioned that the notion of mandating a uniform network identity raises fears of a centralised surveillance system that could comprehensively track and analyse an individual’s online footprint.

At the moment, traces of a person’s online activities are fragmentally stored in “multi-centred, commercial service-providing platforms”, he wrote. Each platform can only capture “part of one’s identity”, such as shopping preferences and political opinions.

However, a unified network ID could connect all online activities to real identities via a centralised system, risking “complete exposure,” which would make users hesitant to express opinions, engage in discussions and explore freely online, Shen wrote.

“The vibrancy of the digital economy and internet society relies on a multi-centred system rather than centralised monopolies.”

Shen was also sceptical about the feasibility of the “voluntary” principle, suggesting that official promotion of the initiative is likely to lead to widespread adoption and user choice could eventually be eliminated if platforms mandate real-name registration using the credentials.

Lao Dongyan, a criminal law professor at Tsinghua University, had similar concerns. The network certificate system implies that accessing the internet or online services will effectively become “a privilege that requires permission to enjoy”.

Without the certification services provided by authorities, individuals will struggle to access internet services to comment and express opinions, she wrote on her Weibo account.

“The measures will bring significant social risks,” Lao said. As departmental regulations, they would “obviously lack a legal basis from higher laws,” she added.

According to the notice, the draft regulation is grounded in several national laws, including those relating to cybersecurity, data security, and personal information protection, as well as telecommunications and online fraud.

Lao questioned the necessity of a standardised network identity, noting that more than a billion internet users in China have already registered under existing real-name policies.

Weibo users were first asked to register their real names by the platform in 2011.

Since then, the rules have been updated several times as Beijing intensifies efforts to clean up the nation’s cyberspace and tighten its grip on the internet.

According to Lao, implementation of the new rules will be similar to the Cyberspace Administration’s real-name registration policy in 2017, covering instant messaging programmes, microblogs, online forums and other communication websites.

“The true intention is to regulate people’s behaviour online. The claim of protecting personal information is merely a facade, at least not the primary goal,” she wrote.

Lao said the system will act like “a monitor for everyone’s online activities” and likened it to China’s health code app that was introduced during the Covid-19 pandemic.

The new system essentially “normalises and regularises social control”, just like the health code during the pandemic, she said.

South China Sea: Philippines’ hitch-free mission a sign of better days in disputed waters?

https://www.scmp.com/week-asia/politics/article/3272556/south-china-sea-philippines-hitch-free-mission-sign-better-days-disputed-waters?utm_source=rss_feed

Tensions in the South China Sea seemed to have cooled for the moment after the Philippines’ first resupply mission to a military outpost on the disputed Second Thomas Shoal under a new deal with Beijing took place without incident.

While analysts call it a positive development, they warn Manila to “stay vigilant” against attempts by Beijing to manipulate the narrative for its own gain, potentially undermining the fragile peace.

Don McLain Gill, a geopolitical analyst and lecturer at De La Salle University’s Department of International Studies, told This Week in Asia that Manila “should not rule out active escalation, which is still very much within the utility belt of China”.

Gill said Saturday’s RORE (rotation and resupply mission) mission was a “positive sign”, but cautioned that the Chinese would “try to misconstrue this success” to “illustrate itself in a dominant position”.

The Philippines’ foreign affairs department announced in a statement on Saturday that the first resupply mission to the BRP Sierra Madre – a World War II warship that was intentionally grounded on the Second Thomas Shoal as a military outpost since 1999 – took place “without any untoward incidents”.

It was the Philippines’ first RORE mission to the shoal since officials from Manila and Beijing announced they had brokered a “provisional arrangement” during bilateral talks on July 2 to allow such operations to take place peacefully. The details of the agreement were not made public.

Previously, Chinese coastguard vessels had attempted to disrupt numerous RORE missions to the Second Thomas Shoal, which Beijing also claims, based on accusations the Philippines was bringing building materials to reinforce the BRP Sierra Madre, violating an agreement that no new infrastructure be built on the contested territory.

A RORE mission on June 17, the last before the bilateral talks, culminated in a clash that led to several Filipino sailors being injured, including one who suffered a severed thumb.

After Manila’s statement regarding Saturday’s mission, Beijing’s foreign affairs ministry said that the “China Coast Guard let the [Philippine] vessel through” based on the provisional arrangement both countries had agreed on the week prior, “after being informed by the Philippines before its resupply for the warship grounded at China’s Ren’ai Jiao [Beijing’s term for the Second Thomas Shoal] and confirming on-the-scene that the vessel carried living supplies only”.

However, Philippine officials refuted Beijing’s version of events, saying that no such inspection took place.

“Instead of acknowledging how two countries were able to manage differences in order to avoid miscalculation and misunderstanding, [China’s foreign affairs] spokesperson chose to misrepresent what has been agreed between the Philippines and China regarding RORE missions in Ayungin Shoal,” foreign affairs secretary Enrique Manalo said in a statement, referring to the Second Thomas Shoal by its Filipino name.

“Let us make it absolutely clear: the understanding between the Philippines and China was concluded in good faith, with the explicit agreement that it will not prejudice national positions. It is not helpful to keep giving false notions about what has been agreed on and how they were implemented,” he added.

McGill advised Manila to remain on guard, saying: “While this agreement may have worked, I’ve always cautioned against being overly complacent when it comes to confidence-building measures with China because of its track record of being highly inconsistent in this regard.”

He added that observing Beijing’s pattern of behaviour for each RORE mission would help verify China’s commitment towards the agreement.

He also urged Manila to be vigilant about Beijing’s narratives, which could determine the success of future RORE missions.

“It’s still very early to say that this agreement will be a success, because China is definitely still trying to alter the narrative. It’s part of that disinformation that China continues to push to forward its interests.

“And this is something that I believe our Philippine Coast Guard and our Philippine military are very much steadfast in countering such disinformation along with pursuing their objectives at sea.”

Sherwin Ona, a visiting fellow at the Institute for National Defence and Security Research in Taiwan, said although the Chinese ministry of foreign affairs’ statement seemed to undermine the agreement that Manila and Beijing had reached, he believed the comments were “meant for China’s domestic audience”.

Ona said that if China was really sincere in de-escalating tensions, “it should refrain from issuing provocative statements and stay true to the spirit of the agreement”, adding that both Manila and Beijing should avoid providing statements that would undermine their positions as part of their confidence-building measures.

He also said Philippine officials needed to develop a stronger narrative to explain why a mutual agreement with China was beneficial for the country and why there was a need to sustain diplomatic conversations with China without compromising its maritime position.

“We are also optimistic, but we must always be vigilant and critically engage China … We need to express our strong resolve to preserve our rights and defend our sovereignty,” he said.

Ona added that Beijing and Manila could explore other confidence-building measures, such as framing the RORE agreement as a humanitarian mission, with Philippine vessels pursuing its resupply efforts through civilian measures using Philippine Coast Guard ships.

Meanwhile, Gill said it was essential to recognise that the agreement was “still raw”, and the Philippines would need to ensure that Beijing would hold its end of the bargain before exploring other potential agreements.

“Until then, the Philippines will continue to consolidate its efforts to secure its interests. Manila has signalled its willingness to de-escalate. The ball is now in Beijing’s court,” he said.

Gill added that the Philippines showed “it was the bigger country” by pursuing negotiations with China.

“This was always consistent with Philippine foreign policy towards China – that yes, we will be more than ready to stand up to your belligerent activities at sea, but at the same time we will ensure that we would also exhaust all measures to de-escalate and to negotiate more diplomatically,” he said.

Ona said he remained “optimistic” about future resupply missions, “but we must always be vigilant and critically engage China”.

China’s southern megacities dealt contrasting economic fortunes as hi-tech Shenzhen thrives

https://www.scmp.com/economy/economic-indicators/article/3272497/chinas-southern-megacities-dealt-contrasting-economic-fortunes-hi-tech-shenzhen-thrives?utm_source=rss_feed

The economic divergence between the two megacities of the Greater Bay Area – Guangzhou and Shenzhen – could not be starker in the first half of this year, despite being just 100km (62 miles) apart in the southern province of Guangdong.

Guangzhou’s gross domestic product grew by a mere 2.5 per cent year on year – a rate lower than Guangdong’s and the national average – to 1.43 trillion yuan (US$197 billion).

It also lagged other first-tier cities of Shanghai, Beijing and Shenzhen in terms of GDP and growth.

The tech hub of Shenzhen, though, revealed a glowing report card as its economy expanded by 5.9 per cent to 1.73 trillion yuan, ranking only after Shanghai and Beijing.

A divergence in economic performance was cited as one of the major challenges facing China’s economy in an official readout of July’s Politburo meeting, which was convened by President Xi Jinping on Tuesday to discuss boosting the economy and executing the reforms discussed during the third plenum.

“The adverse effects of the current external environment shifts are increasing, domestic effective demand is insufficient and economic operation is showing differentiation,” said the readout released by the official Xinhua News Agency.

Beijing has signalled its resolve to attain the around 5 per cent economic growth target for 2024.

Analysts, meanwhile, attributed the yawning gap between Guangzhou and Shenzhen to China’s mixed economic reality of an export boom, weak domestic demand and a slowdown in traditional manufacturing.

Guangzhou residents are now anxiously discussing if the city, the capital of Guangdong, would drop out of China’s top-tier cities.

Guo Wanda, vice-president of the China Development Institute – a government-backed think tank to the Greater Bay Area – said cities faced a combination of sluggish traditional industrial growth and rapid development of new sectors.

“Shenzhen’s new industries and hi-tech investment are growing rapidly, but Guangzhou and Foshan still rely heavily on traditional manufacturing and they need to expedite transformation,” Guo said.

“Shenzhen’s private enterprises are very dynamic and technology iteration is fast.

“The industrial chains surrounding Shenzhen’s hi-tech manufacturing, like electric vehicles, are very long, driving other industries such as electronics and information.”

Guangzhou, meanwhile, is grappling with headwinds on many fronts from investment, manufacturing, consumption to foreign trade.

Its fixed-asset investment in the first half grew by just 2 per cent, 1.9 percentage points below the national average, while its industrial output fell by 0.8 per cent, its exports declined by 4.1 per cent and its retail sales growth flatlined.

Shenzhen, though, fared better as it derived strong momentum from its sprawling manufacturing sector as industrial output grew 12 per cent.

Manufacturing-related fixed-asset investment, meanwhile, soared by 49.2 per cent in the first six months of the year.

Shenzhen, which has nurtured the likes of Huawei Technologies, Tencent and BYD, unseated Shanghai as China’s largest manufacturing city in 2022.

Already China’s largest exporting city, burgeoning foreign trade also propelled Shenzhen’s growth as its import and export volume soared by 31.7 per cent year on year in the first half of the year to 2.2 trillion yuan.

And as Shenzhen charges ahead, officials in Guangzhou are reflecting on the economic woes, blaming slow industrial upgrades and insufficient demand.

Guangzhou’s automobile industry provides a microcosm of the city’s challenges as its output – which is made up of more petrol-powered cars than electric vehicles – fell by 16.4 per cent in the first half of the year as major carmakers from Toyota to Honda have slashed production in Guangzhou.

“Many people in our casual chats mentioned the news that Honda is closing factories in Guangzhou. That was a big manufacturing base for the city that we used to be proud of,” a Guangzhou taxi driver said.

Honda announced in July it would close some production lines in Guangzhou in October.

Terence Chong Tai-leung, an associate professor of economics at the Chinese University of Hong Kong, said Guangzhou had been affected by domestic demand problems, while Shenzhen was more export-oriented.

“Shenzhen is exporting mainly hi-tech products at a time the world is buying more from China,” he said.

“Guangzhou’s manufacturing sector is more anchored at the domestic market and is thus not immune to China’s overall weak consumption.

“Guangzhou can expect recovery in demand as Beijing’s supporting measures, rolled out after the third plenum, that range from rate cuts to fiscal policies, will stimulate consumption.”

Mounting export uncertainties may also alter the fortunes of Shenzhen and its hi-tech exports.

“Export growth in the second half could still maintain a certain speed. But the worries of American tariffs in an election year will rise,” said Ding Shuang, chief economist for Greater China at Standard Chartered.

“The uncertainty is increasing because new trade frictions are already there.”

In May, Washington proposed increasing tariffs on imports of Chinese semiconductors, electric vehicles, steel and batteries, drawing a swift rebuke from Beijing.

Additional reporting by Alice Li

China’s cash-strapped small banks face limitatons amid shake-up, no one-size-fits-all fix

https://www.scmp.com/economy/china-economy/article/3272501/chinas-cash-strapped-small-banks-face-limitatons-amid-shake-no-one-size-fits-all-fix?utm_source=rss_feed

China’s attempt to clean up its small and cash-strapped banks is being challenged by the limitations of its local economies, analysts said.

The central Henan province announced its consolidation plans on Sunday, naming 25 institutions to be merged into a provincial-level rural commercial bank.

The announcement is the first detailed plan published since the restructuring was approved in 2022.

The reorganisation is intended to “coordinate and clear non-performing assets under small and medium-sized banks, clean up problem shareholders, and replenish capital from multiple sources”, the Henan government said last week.

The merger came as Beijing has called for consolidation of indebted and feeble local banks, with local-level debts presenting some of the biggest systemic risks to China’s already slowing economy.

Six provincial-level rural commercial banks in Liaoning, Shanxi, Henan, Sichuan, Guangxi and Hainan have been established since 2023 amid Beijing’s push for a clean up of regional banks.

There are also four municipal-level rural commercial banks in Beijing, Shanghai, Tianjin and Chongqing.

The National Financial Regulatory Administration said the number of registered banking and financing institutions in China fell by 77 last year, bringing the total down from 4,567 in 2022 to 4,490 at the end of last year.

And China’s banking clean up is poised to proceed with a faster momentum than the previous year, with the number of registered banking and financing institutions having already fallen by 51 since the start of the year.

As China tackles its property crisis, China’s small banks have appeared to show more vulnerability than larger banks as they are often closely connected to local governments.

Since 2019, several mid-tier banks have collapsed, and in 2022 in Henan province, protests followed a rural banking scandal that involved 40 billion yuan (US$5.5 billion) of savings.

However, Zhao Xijun, a professor of finance at Renmin University in Beijing, said the success of the reorganisation and mergers depended on a range of factors as local governments have the authority to restructure banks according to respective financial situations.

“There does not seem to be a plan that fits all. But in general, regions that are more economically developed and experienced in their financial operations appear to be able to find more success in such restructuring, as they have better foundations and capital for their financial institutions, so risks can be better controlled after these mergers,” he said.

“However, for local governments that are already struggling with their economies, it is hard for them to garner new capital to fund bank operations even after merging … there is even a risk that these small banks with poor finances would drag those better operating ones after such reorganisation.

“Therefore, the target from these mergers may not necessarily be met.”

A group of analysts from Moody’s Ratings shared a similar view, noting while the process of consolidation had improved credit quality as the new entities underwent disposal of impaired assets and often received fresh capital, it also increased local and central government’s expenditure at a time when there is weakened capacity to provide support.

“Regional banks are limited by the local economies they operate in because regulations restrict them from establishing branches and offering online services to clients registered outside their home provinces,” the analysts said in a report published on China’s regional banks last month.

There are 125 city commercial banks and 1,607 rural commercial banks in China’s regional banking system, which took up 24.8 per cent of total banking assets at the end of 2023, according to the report.

Over 2,100 other rural banking financial institutions, including village banks and rural credit operatives, take up between 2 to 3 per cent of the total banking system assets, the report added.

China singing star Jackson Wang lauded for protecting baby at chaotic Malaysia event

https://www.scmp.com/news/people-culture/china-personalities/article/3272324/china-singing-star-jackson-wang-lauded-protecting-baby-chaotic-malaysia-event?utm_source=rss_feed

Entertainment idol and global luxury brand ambassador Jackson Wang has been lavished with online praise after he protected a baby during a chaotic event in Malaysia.

The 30-year-old Hong Kong-born singer and rapper has built a reputation for being kind and thoughtful.

At 17, Wang became a K-pop trainee with JYP Entertainment in South Korea. He debuted in 2014 as a member of the boy band Got7.

In 2017, he started releasing solo material in and began attending more mainland variety shows as his fame in China grew, it was around this time he began earning respect for his gentlemanly conduct.

He has since amassed 31 million followers on Weibo.

On July 24, Wang attended the opening of a Louis Vuitton store in Kuala Lumpur, Malaysia, where he was welcomed by fans waiting at the entrance.

A video posted on Xiaohongshu shot inside the shop shows a woman holding a baby in the crowd who wants to take a photo with him.

While Wang took selfies with other people, the baby’s head brushed against his arm.

He noticed the child and immediately used his arm to shield the woman, protecting the baby from over enthusiastic fans.

As the woman tried to squeeze out of the crowd after taking the photo, Wang anxiously told fans and staff: “Be careful of the baby! Be careful!”

The person who posted the video praised Wang’s kindness, and said: “Details reveal a person’s character.”

One online observer said: “When Jackson saw the mother wanting him to hold her baby’s hand, he didn’t immediately do so. Instead, he touched the baby from a distance, probably worrying about potential bacteria.”

“He looked more concerned about the baby’ safety than the mother,” said another.

At the same event, Wang helped a woman in high heels down the stairs, and she was so excited that she kept filming him with her phone, paying no attention to her steps.

Earlier on a mainland variety show, the idol gave his bag to a woman celebrity wearing a short skirt so she could protect her modesty.

Whe he was younger, Wang became a Youth-Olympic level sabre fencer and won Asian Junior and Cadet Fencing Championships.

He is the son of Chinese fencer Wang Ruiji, who competed in two summer Olympics, and a Shanghai-born world champion gymnast Sophia Chow.

Growing up and being educated in Hong Kong, Wang has always been proud of his Chinese roots.

In January last year, he delivered a seven-minute patriotic speech during a concert in London in which he publicly denounced anti-China media coverage as “propaganda bullsxxx” to an audience of thousands.

“If you travel to China one time, you’ll feel like this is a dope place,” he told the crowd.

When asked if he “was a Hongkonger” during a South Korean variety show, Wang simply answered: “I’m Chinese”.

Chinese warship joins Russian navy for Gulf of Finland exercises

https://www.scmp.com/news/china/military/article/3272527/chinese-warship-joins-russian-navy-gulf-finland-exercises?utm_source=rss_feed

A Chinese warship has joined an exercise in the Baltic, a day after it took part in Russia’s navy day celebrations in St Petersburg.

Russia’s Tass news agency reported that the Jiaozuo, a Type 052D guided-missile destroyer, took part in simulated anti-mine and search and rescue operations in the Gulf of Finland with the Russian corvette Soobrazitelny.

The Jiaozuo, accompanied by the Type 903A support ship Honghu,arrived in the Baltic 10 days ago.

One of the People’s Liberation Army’s advanced warships, the Jiaozou is comparable to the US Navy’s Arleigh Burke Class destroyers and is armed with hypersonic missiles.

The Gulf of Finland separates Finland and Estonia, both Nato member countries, though can also be accessed from St Petersburg. Finland, which has a 1,330km (830-mile) shared border with Russia, joined the alliance last year in the wake of Russia’s invasion of Ukraine.

Nato has been closely monitoring China’s military cooperation with Russia, including recent joint naval patrols near South Korea’s Jeju Island early this month and an exercise near the southern Chinese port city of Zhanjiang.

This month Chinese troops also took part in an “anti-terrorist” exercise with Belarus, a key partner of Russia. The exercise near Brest was just across the border with Poland and 28km from Ukraine.

The drill, featuring air-ground exercises, came just days after the Washington Summit Declaration issued by Nato leaders, which said China’s deepening partnership with Russia was a matter of “profound concern”.

The alliance criticised China’ stance over the war in Ukraine and cited its “no-limits partnership” with Moscow and its “large-scale support for Russia’s defence industrial base” as other concerns.

China has called for direct peace talks between Russia and Ukraine, but Beijing has never condemned the invasion and its ties with Moscow have deepened since the start of the war.

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China’s factory activity contracts for third straight month, adding to economic headache

https://www.scmp.com/economy/economic-indicators/article/3272557/chinas-factory-activity-contracts-third-straight-month-adding-economic-headache?utm_source=rss_feed

Factory activity in China remained in contraction for a third consecutive month in July, adding to Beijing’s economic concerns.

The official manufacturing purchasing managers’ index (PMI) – a survey of sentiment among factory owners – stood at 49.4 in July, down from a reading of 49.5 in June, the National Bureau of Statistics said on Wednesday.

The reading was in line with a forecast of analysts from Reuters, which had predicted a reading of 49.4.

A reading above 50 typically indicates expansion of economic activity, whereas a reading below implies a contraction.

Elsewhere, the non-manufacturing PMI – a measure of sentiment in the service and construction sectors – stood at 50.2 in July compared to 50.5 in June, remaining in expansion territory for the seventh straight month.

The reading in July fell short with the forecast from Reuters, which had predicted a reading of 50.3.

The world’s second-largest economy grew by 4.7 per cent in the second quarter compared to a year earlier, but weak consumption and a declining property market remain concerns for Beijing.

And on Monday, Citi revised down its annual gross domestic product growth rate forecast from 5 per cent to 4.7 per cent, citing the lower than expected second quarter growth as well as weak economic momentum.

More to follow …

China’s shipbuilders sailing smooth as wave of demand drives exports

https://www.scmp.com/economy/china-economy/article/3272515/chinas-shipbuilders-sailing-smooth-wave-demand-drives-exports?utm_source=rss_feed

China’s ship exports for the first half of the year reached their highest level since the coronavirus pandemic- attributed to supply chain disruptions from the Red Sea crisis as well as global fleet renewals – with container exports reaching a new high since the country’s reopening in late 2022.

China’s container exports were up 155 per cent year-on-year in June, with the value of exports up 85.97 per cent according to customs data.

In the first half of the year, China exported US$6.8 billion in value via container – up 71.67 per cent year-on-year – and the volume of exports also went up 113.16 per cent in the same period.

Another major increase was seen in China’s ship exports. In the first six months of 2024, the country completed vessels with a cumulative 25.02 million deadweight tonnes of cargo capacity, representing 55 per cent of the global total, the Ministry of Industry and Information Technology said July 16.

The country also took 54.22 million deadweight tonnes of new orders with 171.55 million deadweight tonnes in orders on hand, accounting for a respective 74.7 per cent and 58.9 per cent of the world’s market share.

China’s ship exports reached US$20.7 billion in the first half of the year, an increase of 85.2 per cent year-on-year – the highest level of ship exports over the first half of any year since the start of the pandemic. Container exports, meanwhile, have reached a new peak after a sustained spike in 2021.

Since November 2023, Yemen’s Houthis have attacked and intercepted merchant ships in the Red Sea in response to the war in Gaza, leading to several international shipping giants suspending their routes through the inlet.

Instead, many have opted to use the Cape of Good Hope as a diversion, increasing demand for ships as well as containers for global maritime transport.

“The Red Sea crisis has led to longer journeys and reduced idle capacity,” said Gary Ng, senior economist with Natixis investment bank. “There is also a structural demand for new ships to replace the old fleets and meet new green regulations.”

The strong maritime demand is likely to continue to support robust exports of containers and ships, especially LNG carriers, for the rest of the year, Ng added.

As the average age of the global fleet has reached 13.7 years, a peak of ship renewal and replacement is imminent, according to a report by Soochow Securities in June, and China’s ship makers are expected to continue to benefit from the wave.

Since April, global shipping prices have continued to rise due to supply chain disturbances brought by the Red Sea crisis. China’s container exports have exceeded US$1 billion since April, up 53.9 per cent from a month earlier, according to customs data.

In the first six months, 36.2 per cent of its container exports went to Hong Kong, while 16.2 per cent were bound for the United States.

The Shanghai Containerized Freight Index, a gauge of container shipping rates compiled by the Shanghai Shipping Exchange, has stood above the 3,000-point level since June, following an earlier peak in August 2022.

Spot offers for 40-foot containers departing from China’s Shanghai or Qingdao to the port of Rotterdam in the Netherlands were generally around US$8,000.

This is about double the price observed in mid-May – and more than five times the cost last November, before the crisis began – according to a July report by the Securities Times, a Chinese state financial outlet.

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China’s coastguard faces ‘unprecedented strain’ as tensions rise on 3 fronts

https://www.scmp.com/news/china/military/article/3272448/chinas-coastguard-faces-unprecedented-strain-tensions-rise-3-fronts?utm_source=rss_feed

Tensions are mounting in the South China Sea – a hotly contested and globally significant waterway that’s become a flashpoint for conflict. In the second instalment of a four-part series we look at whether the Chinese coastguard can maintain pressure on multiple fronts.

China’s coastguard has found itself embroiled in a series of intense confrontations in three major hotspots – with tensions simultaneously coming over a head in a two-week period in late June.

In one of the most dramatic incidents, the Philippines accused China of acting like “pirates” and carrying out “aggressive and illegal” operations after one Philippine sailor lost a thumb when coastguards armed with axes and knives boarded resupply vessels.

The clash near the disputed Second Thomas Shoal followed a string of other confrontations in the South China Sea that have included collisions between ships and the use of water cannons and lasers.

Meanwhile, the mainland coastguard seized a Taiwanese fishing vessel for the first time in 17 years as tensions continued to mount around the island of Quemoy – also known as Kinmen – following the death of two fishermen from Fujian earlier this year in a chase with the Taiwanese coastguard.

The long-running dispute with Japan over the Diaoyu Islands, also known as the Senkakus, has been less intense, but in June Tokyo said it had spotted ships armed with cannons in the area for the first time.

Meanwhile Beijing said its coastguard had driven Japanese vessels away from the disputed waters as part of the daily “rights protection patrols”, which ran for 215 straight days until they were halted last week by the advent of Typhoon Gaemi.

Some observers say such incidents are becoming the new norm and have prompted regional allies of the United States to step up cooperation to counter what they see as an increasing threat.

While observers have downplayed the risk of any of these fronts escalating into a wider conflict, Chen Xiangmiao, an associate research fellow at the National Institute for South China Sea Studies, said it was an increasing challenge for China’s coastguard to manage these tensions.

He cited US support for the Philippines, Taiwan, and Japan and Manila’s efforts to strengthen its own coastguard forces, saying: “If they increase their forces and intensify their provocations, we also need to enhance our capabilities, including the number of law enforcement vessels, personnel, and maritime intelligence sensing capabilities.”

This growing assertiveness has followed a series of measures from Beijing to build up the coastguard’s resources and powers to act against foreign ships in disputed waters.

The laws allow China’s coastguard to detain people it deems to have been trespassing for 60 days without trial.

Diane Desierto, professor of law and global affairs at the University of Notre Dame in the US, said these steps had allowed the force to carry out “military operations with no territorial limits”.

In recent years, the China Coast Guard has become one of the largest and best-armed forces of its kind in the world. It was brought under the command of the People’s Armed Police and placed under military leadership in 2018 and since then it has been given a number of old warships by the navy as it expands its fleet.

It has been further strengthened by large purpose-built coastguard vessels, which the Pentagon says can operate further offshore and remain on station longer than the older models.

The exact strength of China Coast Guard is not known, but a Pentagon report published last year said that open-source reporting and commercial imagery counts indicated it had more than 150 regional and oceangoing patrol vessels of more than 1,000 tonnes.

These include more than 20 corvettes transferred from the PLA Navy and modified for coastguard operations.

But Chen said: “Even though China has larger-tonnage vessels, the United States Coast Guard has more vessels compared with China. Japan also possesses large patrol ships, and its radar technology is on par with China’s.”

Colin Koh, a senior fellow at the S. Rajaratnam School of International Studies in Singapore, said the force had seen a “rapid” build-up of vessels in the past decade, giving it a “very consistent and steady increase in offshore capacity.”

He said coastguard vessels had to be “offshore capable, meaning they are large” – with a displacement of up to 1,000 to 4,000 tonnes “especially in the case of the East China Sea and South China Sea”.

“They have to be at least more than 1,000 tonnes displacement, because they have to deal with the high sea,” Koh said.

Despite the coastguard’s growing strength, some analysts say it could struggle to sustain the increasing intensity and frequency of its operations across multiple fronts indefinitely.

Isaac Kardon, a senior fellow for China studies at the Carnegie Endowment for International Peace, said Beijing’s willingness to engage on three fronts showed a “level of confidence in the training, readiness, and law enforcement capabilities” of the coastguard but these were “extensive but not limitless”.

He described the force as “head and shoulders above” its regional counterparts, but added: “Sustaining intense stand-offs in multiple locations will inevitably strain CCG [China Coast Guard] crews, vessels, and command and control processes, especially if the situation continues to deteriorate in one or more of the key sites of contestation.

“There is little doubt that this heavy employment of CCG forces will place unprecedented strain on the organisation, including for maintenance of vessels and management of personnel.”

Koh also warned the high level of activity risked creating a “drain on manpower” that will lead to “challenges to do with retention and recruitment”.

“The operational tempo is so high, you might not get to go home, you might not get to enjoy a lot of leave, and pay is considered not so competitive. The tendency of making mistakes and getting punished is also high,” he said.

However, Hu Bo, director of the South China Sea Strategic Situation Probing Initiative, a Beijing-based think tank, said: “In terms of the strength of China’s coastguard, dealing with tensions in three directions simultaneously is not a major issue.”

Hu said the situation with Japan was “relatively stable” despite occasional frictions, but the confrontation with the Philippines was a bigger challenge.

“The Philippines is more provocative, and its policies are extremely unstable. The coastguard faces greater pressure in the South China Sea,” he said.

Since the clash in late June, China and the Philippines have been working to defuse tensions. Earlier this month, the Philippine foreign ministry said the two sides had “reached an understanding” on a “provisional arrangement” about resupplying troops stationed on the Second Thomas Shoal.

But within days the agreement appeared to be unravelling as the two sides framed it in very different ways, with Manila saying the Chinese interpretation was “inaccurate”.

Tensions in the Taiwan Strait are also running high, with the mainland coastguard saying it would stage regular patrols near Quemoy and other Taiwanese-held islands off the coast of Fujian province.

At present six Taiwanese who entered mainland waters are being detained, including the five crew members who were held when coastguard officers boarded their fishing boat earlier this month. .

In a similar incident in March, two other men were detained after straying into mainland waters while out fishing. One was released at the time but the other, a serving soldier, remains in detention.

Taiwanese media has reported that the six are expected to be returned within weeks after the two sides reached a settlement this week over the deaths of two fishermen from the mainland whose boat capsized in February while being chased by the Taiwanese coastguard.

Beijing regards Taiwan as part of its territory and has never renounced the use of force to reunify it. Most countries, including its main international partner the US, do not recognise Taiwan as independent, but Washington and its allies oppose a forcible change in the status quo.

Despite these tensions, Hu said: “At present, it is unlikely that these frictions will escalate into larger-scale conflicts.”

A further challenge to Beijing comes from the increasing US presence in the region, not just in terms of military activity but also maritime law enforcement.

In recent weeks the US coastguard has taken part in three-way drills with Japan and South Korea in the Sea of Japan, also known as the East Sea, and a search and rescue exercise with the Philippines.

The US allies in the region are also working together more closely. Earlier this month, Tokyo and Manila signed a defence pact allowing them to deploy troops on the other’s territory for training exercises.

Chen, from the National Institute for South China Sea Studies, said: “Facing common challenges, I believe that policy coordination and interaction between the Philippines and Japan on maritime disputes will be further enhanced.

“In terms of actions, the two countries might create hotspots both in the northern Diaoyu Islands and in several islands and reefs in the South China Sea simultaneously.”

Timothy Heath, a senior international defence researcher at the Rand Corporation think tank, said cooperation between Washington and its allies would help create a balance against China’s strength.

“[Japan and the Philippines] are at a severe disadvantage if they operate alone against China, which is what Beijing prefers. If Japan, the Philippines, and the USA cooperate, however, then China is at a disadvantage,” he said.

“This is a major reason Beijing is so opposed to multilateral cooperation between the United States and its allies.”

However, Gregory Poling, a fellow with the Southeast Asia programme at the Washington-based Centre for Strategic and International Studies, said increasing these partnerships would not have an immediate impact on China’s coastguard activities.

“This agreement will be geared toward training and capacity building for the Philippines, not direct Japanese involvement in any potential armed contingencies in the South China Sea,” Poling said.