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• Lessons from Red Sea and Ukraine’s Black Sea fight help prep Navy for possible conflict with China
• China sanctions nine Pentagon contractors after US arms deal for Taiwan
• China has raised its retirement age. How does this compare to other countries?
• US ambassador to Singapore hails ties, concerned by China’s ‘unnecessarily provocative’ actions
• China accuses US of shielding Israel, blocking Gaza ceasefire efforts
• Lebanon pager blasts expected to prompt greater caution in China about electronic devices
• China’s growing influence in Middle East carries its own risks
• China-Russia trade inches up as US sanctions and payment issues strain growth
• How China is sharing its development and governance experience with Africa
• US FBI strikes second Chinese hacking group ‘Flax Typhoon’
• Chinese on-demand services giant Meituan’s delivery workers earn US$11 billion in 2023: CEO
• China’s Mid-Autumn mooncake sales fall back to Earth as consumption fails to take off
• China’s economic strategy is change by a thousand adjustments
• China relations ‘a top priority’, Vietnamese leader To Lam tells new Beijing envoy
• South China Sea: Manila says it has a plan if Beijing takes over Sabina Shoal. What is it?
• Chinese diet shift to more meat, fewer grains may cost US$14 billion in health spending
• China’s reign in Spain, Germany lobbies EU members over tariffs: 7 EV reads you missed
• Japanese child stabbed in southern China’s Shenzhen, man detained
• Chinese surveillance fears spur South Korea to remove 1,300 cameras from military bases
• China dog owner pays woman US$12,600 after she has miscarriage because animal startled her
• What lies on the moon’s mysterious far side? China’s Chang’e-6 samples give first signs
• Why China’s ‘no first use’ policy requires more nuclear weapons
• China’s stocks hover around 5-year low as trading resumes after holiday
• China’s tourists hit the road in record numbers as driving tours pick up speed
• China’s Lenovo builds AI servers in India as supply chain shift gathers pace
• ‘Keen to move forward’: India, China signal thaw in ties with diplomatic, border efforts
• Trump pledges tariffs and repeats false claim of Chinese automakers building big Mexican factories
• Agriculture giant Syngenta to grow in China as Beijing seeks food security, sustainability
• US officials head to China for talks amid overcapacity concerns
• Senior US official defends blend of diplomacy and competition with China in Indo-Pacific
• Can China strengthen climate defences before it’s too late?
• China trade tased from all sides, backing Beijing into an economic bind: analysts

Lessons from Red Sea and Ukraine’s Black Sea fight help prep Navy for possible conflict with China

https://apnews.com/article/navy-china-lessons-ukraine-houthis-327713f10c4556467c14c0989f2a4e97FILE - The Arleigh Burke-class guided missile destroyer USS Laboon sails in the Red Sea, June 12, 2024. (AP Photo/Bernat Armangue, File)

2024-09-18T14:24:28Z

WASHINGTON (AP) — The Navy is taking lessons from its combat in the Red Sea over the past year and what Ukraine has done to hold off the Russians in the Black Sea to help U.S. military leaders prepare the service for a potential future conflict with China.

From drones and unmanned surface vessels to the more advanced operation of ship-board guns, the Navy is expanding its combat skills and broadening training. It is also working to overcome recruiting struggles so it can have the sailors it needs to fight the next war.

Adm. Lisa Franchetti, chief of naval operations, is laying out a series of goals, including several that will be highly challenging to meet, in a new navigation plan she described in an interview with The Associated Press. The objective is to be ready to face what the Pentagon calls its key national security challenge — China.

“I’m very focused on 2027. It’s the year that that President Xi (Jinping) told his forces to be ready to invade Taiwan,” Franchetti said. “We need to be more ready.”

The new plan, set to be released Wednesday, includes what she considers seven priority goals, ranging from removing delays in ship depot maintenance to improving Navy infrastructure, recruiting and the use of drones and autonomous systems.

One significant challenge is to have 80% of the force be ready enough at any given time to deploy for combat if needed — something she acknowledged is a “stretch goal.” The key, she said, is to get to a level of combat readiness where “if the nation calls us, we can push the ‘go’ button and we can surge our forces to be able to meet the call.”

The announcement of the goals comes as U.S. leaders are treading a fine line, pledging a commitment to the defense of Taiwan while also working to keep communication open with Beijing to deter greater conflict.

Taiwan, a self-governing island democracy that split from communist China in 1949, has rejected Beijing’s demands that it accept unification. China says it will do so by force if necessary. The United States is obligated under domestic law to help defend Taiwan and give it weapons and technology to deter invasion.

An important element in any Asia-Pacific conflict will be the need to control the seas. Franchetti said the U.S. can learn from how the Ukrainians have used drones, airstrikes and long-range unmanned vessels to limit Russian ship activity in the western Black Sea and keep access open to critical ports.

“If you look at the Ukrainian success in really keeping the Russian Black Sea fleet pushed all the way over into the east, that’s all about sea denial and that’s very important,” Franchetti said. She added that Ukraine has been innovating on the battlefield by using existing systems, such as drones, in different ways.

The Navy’s monthslong battle with the Iran-backed Houthi rebels in Yemen has provided other lessons.

“I think probably no one is learning more than the Navy, because really, this is the first time we’ve been in a weapons engagement zone for this sustained period,” she said.

She said sailors are watching their attacks and analyzing the data as ships respond.

Earlier this year, the USS Dwight D. Eisenhower aircraft carrier was stationed in the Red Sea to respond to help Israel and to defend commercial and military ships from Houthi attacks. The carrier returned home after an eight-month-plus deployment that the Navy said was the most intense running sea battle since World War II.

F/A-18 fighter jets routinely launched off the carrier’s deck to take out Houthi weapons, and Navy destroyers persistently fired rounds of missiles and used on-board guns to shoot down incoming strikes and drones.

On board the USS Mason destroyer, which was stationed with the Eisenhower, Franchetti in August met and promoted one of the destroyer’s fire control sailors who worked on its large, fully automatic artillery gun. Unlike missiles, many of the drones launched by the Houthis were more complicated and challenging to target and shoot down, and he was able to adjust the gun to better defeat them.

“He could see how it was performing against the Houthi threat,” Franchetti said, “and he came up with a different way to use the gun to make it more effective in these engagements.”

She did not identify the sailor and declined to provide details on the exact changes he recommended. But it resulted in new formal military tactics and procedures that were distributed to all other ships.

Another key effort will be to improve Navy development of unmanned and autonomous systems and weapons and integrate them into training and combat. As the military brings on new technologies, including unmanned surface vessels, the Navy needs to ensure it has trained sailors who can use and repair them.

The new navigation plan notes that the Navy is now working on concepts and requirements for larger robotic systems and the artificial intelligence applications they could use to understand and control the battlespace.

Navy leaders also understand the financial restraints they will likely face from Congress — limits that rivals such as China do not have. China outpaces the U.S. in the number of ships and is expected to do so into the future.

Navy officials said that while they would like a bigger naval force, they need to offset that by working more effectively with the Army, Air Force, Space Force and Marines, which is something the U.S. has historically done very well.

A challenge will be eliminating the maintenance overruns that often prevent ships from being able to deploy on time. Getting ships in and out of depots on time, Franchetti said, is critical to having a combat-ready Navy.

“These are the things that we know that we need to be able to do to have the force that’s going to be more ready every single day,” she said.

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China sanctions nine Pentagon contractors after US arms deal for Taiwan

https://www.scmp.com/news/china/diplomacy/article/3279041/china-sanctions-nine-pentagon-contractors-after-us-arms-deal-taiwan?utm_source=rss_feed

The Chinese foreign ministry announced sanctions Wednesday on nine US defence contractors in retaliation for Washington’s approval of arms sales to Taiwan earlier this week.

“Weapons sales by the United States to China’s Taiwan region have seriously violated the one-China principle … seriously infringed upon China’s sovereignty and security interests, and damaged China-US relations,” foreign ministry spokesman Lin Jian told reporters.

“China strongly condemns and firmly opposes this and has lodged solemn representations with the United States,” Lin said.

He urged the US “to immediately stop the dangerous trend of arming Taiwan … stop conniving and supporting Taiwan independence, and stop undermining peace and stability in the Taiwan Strait”.

Beijing was “taking resolute countermeasures”, he said, by imposing sanctions on the US firms.

According to a ministry statement, the sanctioned US companies are: Sierra Nevada Corporation; Stick Rudder Enterprises; Cubic Corporation; S3 Aerospace; TCOM LP; TextOre; Planate Management Group; ACT1 Federal; and Exovera.

All are military contractors for the Pentagon, primarily specialising in aircraft modification, integration and upgrades.

The ministry said that Beijing would freeze their assets and properties in China. In addition, groups and individuals in China are now prohibited from any transactions with the companies.

On Tuesday, the US State Department announced approval of a US$228 million “return, repair and reshipment” package to Taiwan of spare parts and related equipment for F-16V fighter aircraft.

It called the deal consistent with US law and served America’s national interest by boosting Taiwan’s efforts to modernise its military and “maintain a credible defensive capability”.

Taiwan is awaiting deliveries of F-16 fighter jets, Abrams tanks and a range of missiles from the US.

Beijing regards Taiwan as part of China to be eventually reunited, by force if necessary. Most countries, including the US, do not recognise Taiwan as an independent state.

But Washington opposes any attempt to take the island by force and is legally bound to support Taiwan’s military defence capability. It has backed the self-ruled island’s expanded presence in global activities including health, crime prevention and aviation – an involvement Beijing opposes.

China has repeatedly called on the US, Taiwan’s most important international backer and arms supplier, to refrain from formal dealings with the island’s leaders and to stop selling it weapons.

Jake Sullivan, the national security adviser to US President Joe Biden, met high-ranking Chinese military official Zhang Youxia during a trip to Beijing last month.

In the meeting with Sullivan – during the first visit to China by a US national security adviser since 2016 – Zhang reminded him that Taiwan was “the first red line that cannot be crossed in China-US relations”, demanding that the US “halts military collusion with Taiwan”.

In July, Beijing announced similar sanctions on six US military-related companies as well as nd five of their senior executives over arms sales to Taiwan. The five individuals will also be denied visas and entry into China, including the two special administrative regions of Hong Kong and Macau.

Those companies were Anduril Industries, Maritime Tactical Systems, Pacific Rim Defense, AEVEX Aerospace, LKD Aerospace and Summit Technologies.

Beijing has increased political and military pressure on Taiwan since Nancy Pelosi, then the speaker of the US House of Representatives, visited the island in 2022.

The People’s Liberation Army continued to fly jet fighters near Taiwan in a show of force, after William Lai Ching-te, who Beijing has branded as a separatist, became the island’s new leader in May.

In a related move on Wednesday, the Customs Tariff Commission under the State Council said it would suspend zero-tariff treatment for 34 types of agricultural and aquatic products from Taiwan.

The announcement cited Taiwan’s discriminatory trade practices against exports from the mainland as the reason for the suspension, which goes into effect in a week.

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China has raised its retirement age. How does this compare to other countries?

https://www.scmp.com/economy/china-economy/article/3279003/china-has-raised-its-retirement-age-how-does-compare-other-countries?utm_source=rss_feed

In a long-awaited move, China’s top legislative body announced on Friday the country would raise its retirement age by up to five years. The retirement age for all men will go from 60 to 63, and for female office workers from 55 to 58. Female blue-collar workers, who previously retired at 50, will now have to wait until they are 55.

These changes will take place gradually over the next 15 years, starting January 1, 2025. On the same date in 2030, the country’s minimum period for pension contributions will also steadily lengthen, from 15 to 20 years.

China’s previous retirement ages were significantly lower than those in most developed economies, with the average retirement age in Organization for Economic Co-operation and Development member countries recorded at 63.6 years for women and 64.4 years for men in 2022.

Below are the retirement ages of a selection of countries from that bracket, as well as recent changes they have made – all, notably, in the upwards direction.

Starting in 2010, France gradually raised its mandatory retirement age from 60 to 62 for both men and women, with an increase of three months per year until the new retirement age was fully implemented in 2018.

Last year, France further extended the retirement age to 64 for people who were born after 1968, with annual three-month increases starting in September 2023. Under the new plan, the higher retirement age is expected to be reached in full by 2027.

The statutory retirement age in the US – that is, the age at which full Social Security benefits can be received – is 67 for all workers born in 1960 or later. However, several surveys show the actual retirement age of American workers is generally lower than this figure.

In the US, men retire at 65 on average and women at 63, according to data from the US Census Bureau.

The average likelihood of people in the US working full-time beyond age 62 hit a 10-year low of 45.8 per cent in March, per a May report by the Federal Reserve Bank of New York.

Japan raised the full retirement age from 60 to 65 for both men and women in 2013.

In April 2021, Japan passed a law to raise the retirement age to 70. However, this change is not mandatory, and companies are not penalised if they do not make the adjustment.

In Japan, the minimum age for early retirement is 60. Retiring between the ages of 60 and 64 results in a 6 per cent reduction in pension for each year of early retirement, according to a research note by Huatai Securities. Conversely, if a worker retires after the age of 65, the pension increases by 8.4 per cent for each year’s delay.

The full retirement age in Italy is 67 for both men and women. To get pension payments, individuals who enrolled after 1995 must have made at least 20 years of effective contributions.

For individuals who want to retire earlier, women have to pay contributions for at least 41 years and 10 months and men must pay for 42 years and 10 months. After that threshold, either sex can retire regardless of age.

The statutory retirement age is linked to life expectancy. The first adjustment involved increasing the retirement age by three months starting in 2013, with further increases of two to three months every two years.

However, in the midst of the COVID-19 pandemic – which reduced Italy’s life expectancy by 1.2 years – Italy paused these adjustments in 2021. It will resume the original scheme in 2027.

US ambassador to Singapore hails ties, concerned by China’s ‘unnecessarily provocative’ actions

https://www.scmp.com/week-asia/politics/article/3279017/us-ambassador-singapore-hails-ties-concerned-chinas-unnecessarily-provocative-actions?utm_source=rss_feed

US Ambassador to Singapore Jonathan Kaplan says Beijing has been “unnecessarily provocative” in the South China Sea, emphasising the importance of American business investment in the city state and region.

Kaplan, who has been serving as ambassador to Singapore since 2021, expressed the United States’ support for the region and its concerns over China’s maritime activities during a speech on Wednesday at the launch of the Milken Institute Asia Summit 2024.

The ambassador also assured partners at the summit that the US would continue to support the region, regardless of the outcome of its presidential election.

Kaplan, who is also an entrepreneur, stressed the importance of communication between the two competing superpowers, saying: “The United States shares concerns and frustrations like many in the region about some of the PRC [People’s Republic of China] behaviour, especially in the South China Sea where they are being aggressive and, I will argue, unnecessarily provocative.”

He added that his country remained concerned about China’s partnership with Russia’s Vladimir Putin amid his illegal invasion of Ukraine.

“We stand firmly with our allies and our partners, and we fully support a free and open Indo-Pacific and the rules based international order,” the ambassador said to some 200 people including investors, business leaders and government officials.

Kaplan also stressed the need for China and the US to communicate to prevent unintended consequences. “We also believe that together the United States and PRC can tackle many of the significant global challenges that we face, and we can do that [by] progressing and cooperating together.”

His comments come amid escalating tensions between Manila and Beijing over territorial claims in the South China Sea, which have led to frequent maritime clashes.

Most recently, over the weekend the Philippines withdrew the BRP Teresa Magbanua from Sabina Shoal after the vessel’s crew suffered from acute hunger and dehydration, which Manila claimed was exacerbated by aggressive manoeuvres from the Chinese coastguard that blocked a resupply mission.

On Wednesday, Kaplan outlined Washington’s significant investment in Singapore and the Indo-Pacific region, noting that concerts featuring US icons such as pop stars Taylor Swift and Bruno Mars and the Broadway show Hamilton earlier this year made an “enormous contribution” to the regional economy.

Singapore was the only stop in Southeast Asia for Swift’s Eras Tour after government agencies secured an exclusive deal. According to new reports, her six sold-out concerts in March were expected to bring in an estimated US$260 million to US$375 million in tourism receipts.

According to Kaplan, more than 6,000 US companies are headquartered in Singapore, with investments totalling US$424 billion. This amount is more than five times the second-largest investor in the city state and more funding than the US has in Japan, India, South Korea and China combined.

He said such financial support underscored the US$122 billion annual trade between the two countries.

“Think about what that says about America’s economic commitment to Singapore and their being our foremost regional hub and investment gateway,” Kaplan said.

Looking forward, he said both countries were expanding cooperation in areas including sustainable energy, artificial intelligence and quantum computing, and were helping to solve many global challenges.

“Amid all the election year rhetoric, all the media coverage, all the noise, let’s not lose sight of the fact that the US contributions to this region and to Singapore [are] much bigger; much bigger than any politics or anything that happens in Washington.”

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China accuses US of shielding Israel, blocking Gaza ceasefire efforts

https://www.scmp.com/news/china/diplomacy/article/3279020/china-accuses-us-shielding-israel-blocking-gaza-ceasefire-efforts?utm_source=rss_feed

The United States has repeatedly “shielded” Israel over its war in Gaza, China said during a series of statements at the United Nations in New York, where it also urged Israel to immediately end its occupation of Palestinian territories.

Over two days of meetings, Chinese diplomats accused Washington of blocking ceasefire efforts, adding that Israel ending its “unlawful presence” in Palestine was “not an option” but a “legal obligation”.

During a UN Security Council (UNSC) briefing on Monday, China’s deputy permanent representative Geng Shuang questioned why the council, despite being responsible for maintaining international peace and security, had been “unable to stop this human tragedy, the worst of its kind to this day”.

Geng said Israel’s military operations had “never stopped” despite mounting ceasefire calls, as civilian deaths in Gaza surpassed an “alarming” and “unbelievable” 41,000. Most of those killed have been women and children, according to UN High Commissioner for Human Rights Volker Turk.

“Had the US not shielded one side time and again, multiple resolutions of this council would not have been flagrantly rejected and defied,” Geng stated, referring to Washington’s vetoing of three previous ceasefire resolutions at the UNSC.

As Israel’s most prominent defender on the world stage, Washington has transferred billions of dollars worth of bombs and fighter jets to Israel since October 7, when Hamas gunmen attacked southern Israel, as tensions exploded over continued Israeli occupation, the blockade of the Gaza Strip, expanding illegal settlements and rising violence.

“We urge the US to show a responsible attitude, use the significant influence it holds over the party, and take tangible actions to push Israel to cease its military operations without delay, as demanded by the council resolutions,” Geng added.

While Beijing has criticised Washington’s role in prolonging the conflict in almost every speech at the UNSC, its statements appeared to have “limited tangible impact … in the face of American hegemony and its unwavering support for Israel”, said Razan Shawamreh, a Palestinian expert on Chinese policy in the Middle East.

Israel has been the largest cumulative recipient of US foreign aid since its founding, receiving about US$310 billion in total economic and military assistance, according to the Council on Foreign Relations. In August, an additional US$3.5 billion was sent to Israel to spend on US-made weapons and military equipment.

“China should consider engaging more directly with the involved parties rather than relying solely on the UN,” said Shawamreh, a researcher at Eastern Mediterranean University in Northern Cyprus. “This could include exerting pressure on Israel, provided that China possesses both the ability and the willingness to do so.

“To facilitate a ceasefire and peace talks, China might need to pursue more proactive and direct diplomatic measures, such as bilateral or multilateral negotiations with regional stakeholders, engaging in backchannel diplomacy, or offering itself as a mediator in peace talks,” Shawamreh said.

Beijing’s ability to facilitate a ceasefire would remain limited without a strategic approach to counterbalance US influence, as well as direct engagement with both Israelis and Palestinians, Shawamreh said.

Geng also condemned attacks on humanitarian agencies and personnel, which killed 224 staff members of the UN Relief and Works Agency for Palestine Refugees in the Near East, including six killed in an air strike last week.

“We pay highest tribute to all the humanitarian workers who are still hanging in there, and our condolences over the demise of those who have made the ultimate sacrifice,” Geng said. “We call on Israel to investigate in earnest all attacks on humanitarian workers and hold the perpetrators accountable.”

At the UN General Assembly’s emergency special session the day after, China’s permanent representative Fu Cong restated the International Court of Justice’s (ICJ) determination of Israel’s occupation of Palestinian territory as a violation of international law. Israel also faces ICJ accusations of genocide.

“Decades of occupation and oppression have inflicted untold suffering on the Palestinian people, and made the long-cherished dream of independent statehood ever more elusive,” Fu said. “Ending the occupation is not an option, but a legal obligation for Israel.”

Fu said it was “worrying” that Israel has repeatedly rejected the two-state solution, which was agreed to by the international community as “the only viable way to resolve the question of Palestine”. He added that the establishment of an independent state was an “inalienable right” of Palestinians and “unquestionable and undeniable”.

“The prolonged illegal occupation has … given Israel an exclusive veto over Palestine. This is unacceptable,” Fu said. “History offers ample proof that occupation would not make Israel more secure, but would only breed more hatred and antagonism and sow the seeds of instability throughout the Middle East.”

Shawamreh said Beijing’s diplomatic stance on the conflict has, and still adheres closely to, international consensus and agreements, which include condemning Israeli actions and advocating a two-state solution.

“This approach has allowed China to maintain a relatively balanced diplomatic position among all parties involved. Concerning its relationship with Israel, China has avoided direct confrontation … [and] has been more restrained than that of some nations with less global influence,” Shawamreh said.

Lebanon pager blasts expected to prompt greater caution in China about electronic devices

https://www.scmp.com/news/china/diplomacy/article/3279011/lebanon-pager-blasts-expected-prompt-greater-caution-china-about-electronic-devices?utm_source=rss_feed

The deadly pager explosions in Lebanon could prompt increased caution in China about the weaponisation of electric products, analysts have said.

On Tuesday, handheld pagers simultaneously blew up in parts of Lebanon and Syria wounding several thousand people and killing 12, including two children.

Among those injured were Hezbollah fighters and Iran’s ambassador to Lebanon.

Hezbollah has vowed to retaliate against Israel for the attack, while Iran has condemned “Israeli terrorism”. Meanwhile Hamas called the blasts an “escalation” that would only lead Israel to “failure and defeat”.

A New York Times report, citing American and other officials, said that Israel had hidden explosive material in a batch of pagers made by Taiwanese manufacturer Gold Apollo before they were imported to Lebanon.

According to the report, the explosive material was implanted next to the battery, with an embedded switch that could be triggered remotely.

Some 5,000 pagers were ordered from Gold Apollo and distributed to Hezbollah members throughout Lebanon, Reuters reported.

The New York Times said the pagers had received a message that appeared to come from Hezbollah’s leadership, which then triggered the blasts.

Other reports, suggesting the operation was a joint effort between Israel’s intelligence service and its military, said that the pagers were acquired by Hezbollah after the group’s leader limited the use of mobile phones in February, warning they could be vulnerable to Israeli surveillance.

Gold Apollo has denied that it manufactured the pagers that blew up in Lebanon, adding that they were produced and sold by a firm called BAC, which is based in Hungary and has a licence to use its brand.

“We only provide brand trademark authorisation and have no involvement in the design or manufacturing of this product,” the company said.

Hsu Ching-kuang, founder of Gold Apollo, told the media in New Taipei City on Wednesday that he “is considering legal action against BAC”.

Muhammad Faizal Abdul Rahman, a research fellow at the S Rajaratnam School of International Studies in Singapore, said the explosions show that “Israel has the ability to use digital means and covert connections in global supply chains to strike deep within the stronghold of its adversaries”.

He added: “Unconventional yet ingenious, this is a recent example of a blend of digital and kinetic tactics that turns common communications devices into [improvised explosive devices] instead of the usual surveillance purpose.”

He also said mainland China would possibly view electronic and communications products made by the US and its allies – including Taiwan – with greater suspicion.

“There could be hawkish elements in China who assume that Taiwan, as a close ally of the US who in turn is a close ally of Israel, is somehow complicit in this cloak and dagger operation. China might cast an even more wary eye on other Taiwanese industries,” he said.

“At the strategic level, it suggests that military and intelligence agencies of major powers and their powerful allies could exploit or weaponise global supply chains to pre-position tools of asymmetric warfare that would be activated during times of conflict or when the objectives of war changes.”

Dov Levin, associate professor of international relations at the University of Hong Kong, said Israeli intelligence had used a similar method to kill senior Hamas bomb maker Yahya Ayyash in the 1990s, but this time around it had been done on a much larger scale.

Levin said one key question about the incident was when and how these explosives were planted in the pagers, such as whether it was done in the Taiwanese factory, in the shipping process to Lebanon, or in Lebanon after the pagers had arrived.

“In general, the farther away the implantation of the explosives was in the supply chain process from the Taiwanese manufacturer and the closer it was to the eventual customer (for example the Hezbollah), the less significant it will be,” he said.

Francesco Mancini, an associate professor at the National University of Singapore’s Lee Kuan Yew School of Public Policy, said many questions remained to be clarified, but he described the weaponising of devices as “extremely worrying” – not only for China but for all countries.

“It is another step in the direction of ‘automated warfare’ in which technology plays a fundamental role, not only weaponising devices but developing systems that allow [the triggering of] explosions via messaging remotely,” Mancini said.

“It shows how much investment Israel has done in advancing its technological warfare capacity, and it can trigger thoughts that Israel is not alone in this and other countries, including China and the US, could have such technology at disposal.”

Tang Wei, chief marketing officer of Chinese antivirus software company Rising, said the pagers’ batteries could have been remotely controlled to overheat.

“According to information on the internet, the pagers used ultrasonic welding technology, which shows that the forces planning this attack have mature processing technology and can avoid being discovered after modifying the equipment,” he said.

Tang said for most people the risk of explosion caused by a hacked mobile phone or car system was still “very small” as hackers needed to break through a complex battery protection system to do so.

Most of China’s smartphones and new energy vehicles have the “highest level of battery protection … so ordinary people don’t have to worry about battery explosions when using big-brand cars and phones”.

But Tang suggested that the risk could be higher for other battery-powered devices such as high-intensity flashlights and headlamps.

As these products do not resemble a smart device, “once someone has tampered with them in advance and installed a SIM card for remote control, the probability of risk is even higher”, he said.

“I feel that implanting bombs is easy to detect, while the means of hacking into systems are more sophisticated and technically more complex.”

Wei Dongxu, a Chinese military analyst, told state broadcaster CCTV that the pagers must have been tampered with in advance.

“Once Hezbollah determines that Israel is the mastermind behind this incident, the conflict between Lebanon and Israel will continue to escalate,” he warned.

Additional reporting by Lawrence Chung

China’s growing influence in Middle East carries its own risks

https://www.scmp.com/opinion/china-opinion/article/3278814/chinas-growing-influence-middle-east-carries-its-own-risks?utm_source=rss_feed

Premier Li Qiang began his tour of the Gulf region last week with a visit to Saudi Arabia, followed by a trip to the United Arab Emirates. His trip to Riyadh, in particular, was aimed at expanding bilateral trade ties and exploring additional avenues for cooperation within the High-Level Chinese-Saudi Joint Committee.

China’s cooperation with member states of the Gulf Cooperation Council is undeniably growing, with arguably more concrete outcomes than its engagement with Iran. It signals a shift in China’s foreign policy on the Middle East away from one that is largely shaped by trade and economic interests.

China usually manages to maintain close ties with both sides of a conflict, whether it is Israel and Palestine or Iran and Saudi Arabia. Beijing often refrains from taking sides; its political moves are largely driven by its economic interests.

But this approach began to change in the early 2020s for several reasons. One is the wider context of China’s intensified rivalry with the US that is playing out around the world, including the Middle East. Another is the events where Beijing sees an opportunity to elevate its position and possibly erode US influence – its offers of peace mediation in Israel’s war in Gaza and Russia’s invasion of Ukraine should be seen in this light.

It is no surprise that China has made moves in the Middle East where US influence was experiencing setbacks. But while Beijing may not be ready to take over the US role as a provider of security guarantees, its foreign policy in the region is clearly aimed at securing a leading position in the Global South.

This represents a shift from hedging to a posture exploiting differences between the US and its allies across the Middle East. This wedge strategy allows China to increase its regional influence, paving the way for more robust security engagement.

China is starting to pick sides and align with countries that find themselves the focus of geopolitical concerns, such as Saudi Arabia. This evolving position helps Beijing to openly push against the US-led order in the Middle East, but the shift is also fraught with risks.

To begin with, it requires China to take sides, something that will do damage to its traditionally good relations with regional actors. Israel has grown increasingly disillusioned with China even though it was pursuing its own version of “multi-vector foreign policy” – balancing between the US and China – before the Hamas attack in October last year. Israeli Prime Minister Benjamin Netanyahu even planned a visit to China, much to the dissatisfaction of the US.

Beijing’s close ties with the Gulf Cooperation Council also run the risk of generating discomfort in Iran. China will have to make choices and perhaps even build its own hierarchy of relations. Just as it is for other nations, balancing in the Middle East is proving difficult for China.

China’s changing stance is further exemplified by Beijing’s apparent willingness to take acts not in keeping with its economic interests, such as in its lukewarm reaction to the crisis in the Red Sea. China refused to participate in military operations against the Houthis – an Iran-backed Shiite group – or even condemn them for actions that threatened a significant part of China’s trade with Europe.

Geopolitical considerations might now be taking precedence over purely economic thinking for China in the Middle East. Meanwhile, moving beyond hedging is likely to bring greater engagement in the security sphere.

China has already taken some notable steps in that area, such as its military base in Djibouti and reported building of military facilities in the UAE. However, it is joint naval counterterrorism exercises and cooperation in missile and drone development which will make the most difference.

It is easy to see China’s place in the Middle East through a binary lens, either aiming to replace the US as the major power or being unwilling to assume a larger role, but reality is more nuanced. Beijing’s shift towards greater security engagement in the region is undeniable and influenced by both its rivalry with the US and its desire to reshape the world order along lines closer to its interests.

China will face many challenges along the way during this transition, but the simple geopolitical logic of an emerging power vacuum being filled by a rising power applies to the Middle East as well. China still has to build a full picture of its security thinking for the Middle East, but the process already seems to have begun.

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China-Russia trade inches up as US sanctions and payment issues strain growth

https://www.scmp.com/economy/global-economy/article/3279018/china-russia-trade-inches-us-sanctions-and-payment-issues-strain-growth?utm_source=rss_feed

Trade growth between China and Russia has continued to slow after a year of rapid expansion, as settlement becomes a bigger obstacle amid secondary sanctions from the United States over Russia’s war in Ukraine.

In the first eight months of the year, trade volume between the two countries was US$158.5 billion, a year-on-year increase of 1.9 per cent, according to data released by China Customs this month.

The slowing pace has occurred as some Chinese financial institutions signalled plans to limit their connections with Russia amid pressure from Washington, which alleges that China is helping Russia in its war through their closer trade ties.

Since Russia was cut off from the Swift financial messaging system in February 2022 following its invasion of Ukraine, trade with China and the Chinese yuan have become crucial for its economy.

However, in contrast to a boom last year, China’s exports to Russia were valued at US$71.91 billion in the first eight months of the year – a slight increase of 0.4 per cent from the same period in 2023.

And the value of its imports from Russia was US$86.56 billion, up 3.2 per cent.

The slowing growth was mainly the result of issues in payment amid sanctions from the United States over Russia’s war in Ukraine, said Chen Fengying, a researcher with the China Institutes of Contemporary International Relations (CICIR) – a think tank with ties to the Ministry of State Security.

“It’s not about relations between China and Russia, but rather settlement challenges due to the US’ long-arm jurisdiction,” she said.

China is Russia’s largest trading partner, accounting for a third of Russia’s foreign trade last year. China also offers a lucrative market for many Russian exports, from oil and gas to agricultural products.

The total trade value last year hit US$240 billion, marking a historic increase of 26.3 per cent from a year earlier.

However, energy trade, which accounts for the bulk of their bilateral transactions, started to slow this year.

Imports of crude oil, the most important part of China-Russia trade, saw a year-on-year decline for three months in a row, from May to July, compared with double-digit growth in most of the year prior to May, customs figures showed.

China imported about 7.46 million tonnes of the product from Russia in July, marking a drop of 7.47 per cent from a year earlier, following a slump of 19.66 per cent in June.

Exports of transport equipment, including vehicles that have comprised China’s major goods sold to its northern neighbour, declined by 11.32 per cent in July from the prior year and marked the year’s third month that saw negative growth. That came after three-digit surges during most months in the second half of last year.

China has been under pressure from the US for its enlarging trade volume with Russia, with Washington alleging that the trade involves dual-use goods that have both civilian and military applications and could be helping Russia in its war.

Chinese banks were warned in June by US officials at a meeting of G7 leaders in Italy that they could receive secondary sanctions for facilitating payments.

Prior to that, major banks, including the Bank of China, the Industrial and Commercial Bank of China, and two Chinese-led development banks – the New Development Bank and the Asian Infrastructure Investment Bank – had all reportedly reduced Russia’s access to their funding.

Chen said the drop so far this year was “quite significant”, and she expected total trade volume between the two countries to return to US$200 billion this year.

“A volume of US$200 billion would be a normal level, and it’s quite impossible to go below that unless [former US president Donald] Trump wins the [November presidential] election and resolves the Ukraine war,” she said.

If that happens, it could lead to a normalisation of economic ties between Russia and European nations, and the broader trade of Russian oil could resume, offsetting its dependence on China.

“It’s certain that Russia will go west if the US cuts it some slack,” she said.

He Zhenwei, head of the China Overseas Development Association, agreed that settlement problems between Russia and China were largely responsible for the lost momentum in their trade.

Despite the US’ targets moving to smaller Chinese banks, there are still several local small and medium-sized enterprise banks operating to facilitate transactions, he was quoted as saying in an interview with Russian news agency Sputnik in June.

The increase in trade between the two nations, albeit smaller, still proves that settlements are continuing, and there are more channels to push it forward, he said.

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How China is sharing its development and governance experience with Africa

https://www.scmp.com/news/china/diplomacy/article/3278987/how-china-sharing-its-development-and-governance-experience-africa?utm_source=rss_feed

The Herbert Chitepo School of Ideology in Harare stands tall as a symbol of China’s soft power. The ruling Zimbabwe African National Union-Patriotic Front (ZANU-PF) party school reopened last year after a China-funded refurbishment.

The school not only conducts training and seminars for ZANU-PF cadres, students and politicians, it also attracts regular visits by lecturers from China’s ruling Communist Party.

In December, the Chinese party donated 1,300 books to the school, covering China’s history, financial reforms and development, as well as foreign affairs and culture as part of deepening party-to-party exchanges.

The bonds between the two countries were forged decades ago. Zimbabwe was one of several African countries that received Chinese ideological and military support during their liberation struggles.

Zimbabwe’s President Emmerson Mnangagwa – who took over from former leader Robert Mugabe after a coup in 2017 – was among those to undergo military training in China in the 1960s.

Zimbabwe continues to benefit from Chinese economic assistance, especially since the US and other Western countries imposed sanctions over the seizure of land from white farmers while Mugabe was in power.

As China-Africa ties have grown closer, Beijing has also stepped up training of the continent’s political elites and exchanges in governance as part of a joint pursuit of modernisation.

China’s ambition to export its governance model to Africa was evident in President Xi Jinping’s opening speech at the ninth Forum on China-Africa Cooperation (FOCAC) summit on September 5, as well as in talks with Mnangagwa and other leaders.

In bilateral talks with Xi on the FOCAC sidelines, Mnangagwa said Harare was “ready to strengthen experience exchange with China on state governance and party administration”.

The issue of “sharing governance experience” also came up during talks between Xi and leaders from Namibia, Mozambique and Tanzania.

In his speech, Xi flagged that Beijing would increasingly deploy soft power through a “platform for governance experience sharing, a China-Africa knowledge network for development, and 25 centres on China and Africa studies”.

China will also invite 1,000 members of African political parties to “deepen exchanges of experience”, he said.

While China has built and supported a number of party schools in Africa since the 1960s, the Mwalimu Julius Nyerere Leadership School in Tanzania is noteworthy because of its support for multiple African political parties.

The Communist Party of China provided US$40 million for construction of the school, which opened its doors in 2022 to trainees from Angola, Mozambique, Namibia, South Africa, Tanzania and Zimbabwe.

The intake represents the coalition of the Former Liberation Movements of Southern Africa – made up of parties that have all prevailed in every election since their countries’ independence.

The school – in Kibaha, 40km (25 miles) outside Dar es Salaam – is modelled on China’s Central Party School and parallels the China-Africa Institute, a Chinese initiative to train African leaders.

But there are other, less noticeable – and non-bricks-and-mortar – schools associated with China’s National Academy of Governance (CAG), the party school’s external name, according to a study by China specialist Paul Nantulya published in July.

“China’s party exchanges have increased alongside this expanding training,” said Nantulya, from the National Defence University’s Africa Centre for Strategic Studies in Washington.

According to Nantulya, China is expected to receive more than 50 African party delegations this year – double the number of comparable visits that were hosted in 2015.

Beijing has active relationships with 110 African ruling and opposition parties, 35 parliaments, and 59 politically oriented organisations, including party think tanks, Nantulya’s study found.

China-Africa specialist David Shinn, a professor at George Washington University’s Elliott School of International Affairs, said Xi’s speech represented an expansion of his goal to export China’s governance model to Africa – or at least, elements of it.

The invitation for 1,000 African political party members to visit China over the next three years and learn about state and party governance is another part of this effort, as party-to-party exchanges resumed after the pandemic, he said.

However, these “exchanges” beg the question of whether China is really interested in learning about African governing models, according to Shinn. “It seems that the CPC already has a fixed idea about its governance policies.”

Observers said China’s aim is not only to promote the development model that helped it to become an economic giant. Beijing is also hoping that its governance model will counter Western liberal norms.

Nantulya pointed out that while China’s political model is popular with African ruling parties intent on extending their longevity, it has not been something to which many African citizens aspire – despite widespread admiration for its economic model.

“It should be recalled that Africa’s experience with single-party rule was almost uniformly negative [and explains] the popular groundswell of pro-democracy movements that spearheaded the collapse of one-party states during the 1990s transition to multiparty politics,” he said.

According to Nantulya, political parties from Burundi, the Republic of the Congo, Equatorial Guinea, Morocco, Uganda and Kenya have approached Beijing for help with building their schools and strengthening their party base.

There have also been numerous visits to Africa by Chinese party officials and vice versa.

In August, Liu Jianchao, head of the Communist Party of China’s international department, led a delegation to South Africa for talks with President Cyril Ramaphosa and officials from his ANC party.

The two sides agreed to strengthen inter-party exchanges and deepen exchanges on governing experience.

According to Yun Sun, co-director of the East Asia Programme and director of the Washington-based Stimson Centre’s China Programme, Beijing’s goal is to give Africa the opportunity to understand and utilise the Chinese experience of governance and development.

“For China, it is a contribution as a responsible stakeholder, to help developing countries to stabilise and develop,” Sun said.

The sharing of governance and development experience does not constitute interference in internal affairs because it is not imposed and Africa has the liberty to choose other countries’ options, she added.

Benjamin Barton, an associate professor at the University of Nottingham Malaysia, said the trend in recent years of China funding and building communist party schools was basically following in a long line of policy endeavours emanating from FOCAC.

“This is designed to build long-lasting relations with the African elite, present and future, as well as build long-term inroads into African political scenes,” he said.

“Clearly, the underlying motive is not simply about spreading influence but also about countering Western liberal norms through the promotion of China’s own interpretation of themes such as governance and development.”

In the context of its ties with Africa, China prefers to frame governance as etched around economic development, in contrast to Western interpretations, which traditionally put political development and democratisation on a par with modernisation, he said.

According to Barton, economic development carries less baggage than political development and because China does not have a colonial legacy, Beijing’s proposed interpretation of governance would be seen as non-intrusive in most cases.

Nevertheless, if China does build a platform – physically and figuratively – to spread its governance model in Africa, the level of participation in the continent will not really say much, Barton said.

“African elites, future leaders, students and activists may attend training, workshops and other activities held under the banner of this platform but whether they actually agree and take on board Chinese prescriptions is a different matter altogether.”

US FBI strikes second Chinese hacking group ‘Flax Typhoon’

https://www.scmp.com/news/world/united-states-canada/article/3279037/us-fbi-strikes-second-chinese-hacking-group-flax-typhoon?utm_source=rss_feed

US law enforcement has disrupted a second major Chinese hacking group nicknamed “Flax Typhoon”, FBI Director Christopher Wray said on Wednesday, wresting thousands of compromised devices from its grasp.

Speaking at a cybersecurity conference in Washington, Wray said Flax Typhoon was being run by a Chinese company called the Integrity Technology Group that posed as an IT firm but also “collected intelligence and performed reconnaissance for Chinese government security agencies”.

A previously known hacking group dubbed “Volt Typhoon” has been the subject of increasing concern by Western officials since it was first identified last year as the cyber sabotage group focused on establishing a foothold in critical US infrastructure.

US officials have said it is a China-backed group, while Beijing has said it is a ransomware gang.

Representatives for China’s embassy in Washington did not immediately respond to a request for comment on the latest Federal Bureau of Investigation statement.

Chinese on-demand services giant Meituan’s delivery workers earn US$11 billion in 2023: CEO

https://www.scmp.com/tech/big-tech/article/3278990/chinese-demand-services-giant-meituans-delivery-workers-earn-us11-billion-2023-ceo?utm_source=rss_feed

Meituan, China’s largest on-demand local services provider, said its 7.45 million delivery workers drew 80 billion yuan (US$11.3 billion) in total income from the platform last year, company co-founder and chief executive Wang Xing said in an internal letter on Tuesday.

About 4.5 million of those delivery workers are also covered with insurance for occupational injury, a nationwide pilot programme that was initiated in 2022 for people in gig-economy jobs, according to the letter.

The internal announcement by Wang – with a net worth of US$10.4 billion as of September 18, according to Forbes – reflects Meituan’s efforts to address mainland policymakers’ concerns over the welfare of the country’s gig-economy workers, which include freelancers, food delivery riders, live-streaming broadcasters and ride-hailing drivers.

The number of gig-economy workers on the mainland stood at around 200 million over the past three years, representing about 23 per cent of the country’s working population, according to the National Bureau of Statistics.

Officially tagged as “flexible employment”, gig work is not bound by formal employment contracts and includes part-time and temporary jobs.

Employment as a food delivery rider is seen as a last-resort job for the mainland’s middle-aged workers amid the country’s sputtering economy.

Beijing has rolled out a slew of measures to support gig workers over the past few years, including an instruction issued in December to standardise the 6,900 gig-job markets.

That has put pressure on platforms like Meituan and rival Ele.me to provide sufficient income and security to gig workers. Ele.me is the on-demand local services platform of Alibaba Group Holding, owner of the South China Morning Post.

Meituan and Ele.me employ a combined 11 million delivery riders on the mainland, according to data from the two firms. Fierce competition among the country’s on-demand delivery platforms has led to a decline in per-delivery commission for riders.

Despite the country’s sluggish economy, Meituan has hired more than 5,000 new graduates annually over the past three years, according to the company. The Beijing-based firm plans to recruit 6,000 graduates from the mainland’s class of 2025. Meituan had 114,731 employees at the end of last year.

Wang’s internal letter also pointed out Meituan’s efforts to support the development of China’s so-called low-altitude economy. He said the company has already completed delivery of more than 300,000 orders in major cities, including Shenzhen and Shanghai, using its self-developed drones.

Meituan has also moved to stimulate consumption on the mainland via services like Pinhaofan, a feature on its main app that supports “group-buying for cheap meals”, and Shenhuiyuan, a membership programme offering discount coupons across various market segments including food delivery, travel booking and group buying.

In August, Meituan reported stronger-than-expected financial results in the second quarter. Revenue rose 21.2 per cent year on year to 82.3 billion yuan, while profit surged 142 per cent to 11 billion yuan.

The company recently expanded its international service Keeta to Al-Kharj, a central city in Saudi Arabia, after making a major foray into Hong Kong in May 2023.

The Hong Kong-listed shares of Meituan closed up 1.66 per cent to HK$128.60 on Tuesday.

China’s Mid-Autumn mooncake sales fall back to Earth as consumption fails to take off

https://www.scmp.com/economy/economic-indicators/article/3279002/chinas-mid-autumn-mooncake-sales-fall-back-earth-consumption-fails-take?utm_source=rss_feed

China’s falling sales of mooncakes – a must-have product when families reunite for the Mid-Autumn Festival – has spelled more worries about the country’s weak consumption and also the national economy.

The volume of mooncake sales this year had dropped about 6 per cent from a year earlier to 300,000 tonnes, according to a market trend report released by the China Association of Bakery and Confectionery Industry last month.

The sales revenue was estimated to have declined by about 9 per cent to 20 billion yuan (US$2.82 billion), it added.

Mid-Autumn Festival, which fell on Tuesday, is usually an important occasion to gauge national consumption, including retail goods sales, travel, box office and catering.

This is the second straight year that the mooncake market has gone cold.

According to retail monitoring agency BrandCT.cn, the major sales price range of mooncakes was 70-200 yuan this year, compared with 80-280 yuan in 2023. Also, those priced above 500 yuan, often distributed as gifts, largely disappeared this year.

The top three bestselling mooncakes on Douyin Mall, TikTok’s sister app in China, were all priced below 30 yuan: 9.9 yuan for 10 pieces (300g), 29.9 yuan for 10 pieces (800g), and 19.9 yuan for eight pieces (300g).

Meanwhile, the question “why aren’t mooncakes selling?” has gained traction on Chinese microblogging platform Weibo since Tuesday, attracting more than 7,500 posts for discussion, with more than 81 million reads.

“Our company’s mooncake purchases this year are down by two-thirds compared with last year,” a netizen commented on Weibo.

Shanghai-listed Guangzhou Restaurant’s stock fell more than 3 per cent in Wednesday’s morning trading session, while Zhejiang Wufangzhai, another major mooncake producer, dropped 4 per cent.

The falling mooncake figures came amid dwindling consumption confidence because of economic uncertainties and also quality concerns - mooncakes promoted by a Chinese internet influencer were investigated by authorities for allegedly being mislabelled as high-end products from Hong Kong.

Beijing has increasingly counted on consumption, which contributed to 60.5 per cent of GDP growth in the first half of this year, to help stabilise the national economy, with a trade-in scheme taking place with government subsidies across the country.

January-August retail sales grew 3.4 per cent, year on year, including a 2.1 per cent rise last month.

During the Mid-Autumn Festival, domestic tourism was dominated by provincial tours, with hotel and airfares falling back to off-season levels, according to Huatai Securities.

The Baidu Migration Index data, reflecting the population flow across the country, also showed that cross-regional travel on the first day of the three-day holiday was lower than during the Dragon Boat Festival in June and Ching Ming Festival in April.

According to a report released by Trip.com, booking data showed that prices for domestic and outbound flights for the upcoming National Day holiday next month have dropped by more than 20 per cent compared with the same period last year, and hotel prices have also seen a decline.

China’s economic strategy is change by a thousand adjustments

https://www.scmp.com/opinion/china-opinion/article/3278951/chinas-economic-strategy-change-thousand-adjustments?utm_source=rss_feed

In the wake of China’s exit from its zero-Covid strategy, the government has recognised the need to address the economic risks arising not only from supply shocks but from weakening aggregate demand. Doing so will require a shift in macroeconomic policy, which previously focused on the supply side.

At the same time, after examining the financial risk and environmental costs of the real estate sector, Chinese leaders have doubled down on their commitment to achieving the long-term goal of structural transformation. As a result, policymakers are seeking to increase the flow of resources to more productive sectors such as emerging technologies.

To be sure, the government has implemented a set of policies to boost domestic demand. But the package is more muted than the aggressive stimulus of 2009, reflecting the dilemma facing Chinese policymakers: how to encourage household and business spending without further inflating the real estate bubble?

The Chinese government would obviously not allow turmoil in the real estate market to morph into a systemic crisis, and would instead introduce increasing support measures to help stabilise it. More importantly, though, the sector’s downturn serves as a reminder that China must urgently establish a long-term mechanism to ensure a more robust housing market.

This is likely to prompt China to accelerate the transformation of the real estate market to adapt to the new stage of growth that the economy is entering.

Looking back over the past decade, the Chinese economy has already undergone considerable structural change as part of official efforts to shift towards higher-quality growth. Apart from the damage brought about by the pandemic, much of the economic landscape has fundamentally changed. Sectors and individuals who had grown accustomed to stability and easy profits are increasingly finding themselves in a less certain and more unfamiliar environment.

Throughout this period, the Chinese government has been assessing the challenges facing the economy and systematically changing development policies to promote structural adjustment. Policymakers were able to reach a consensus on abandoning massive stimulus policies to curb asset bubbles, and on striving to maintain a relatively stable monetary environment at the macro level to bolster the real economy.

This explains why China has consistently favoured a “cross-cyclical” approach to macroeconomic management, which means taking action sooner, in smaller steps, and with a view to the long term.

As former People’s Bank of China governor Yi Gang noted in an April 2023 speech, China’s interest-rate policy had already shifted before the pandemic, with the PBOC adhering to the golden rule savings rate and the attenuation principle, which calls for caution in the face of uncertain circumstances. Avoiding volatile or overshooting interest rates is crucial to suppressing bubbles and creating conditions for balanced growth.

To be sure, maintaining a positive real-interest-rate environment is not without short-term costs. But China escaped the massive shocks that can arise from the accumulation of asset bubbles.

Moreover, despite any short-term setbacks, the government always seems to emphasise upgrading its policies to promote long-term economic development. This is important to bear in mind when trying to understand many of China’s current economic phenomena.

Fortunately, China has not suffered a depression in the past three decades, largely because its leadership has remained highly vigilant about the possible systemic risks of rapid economic growth. The government is also wary of taking big risks out of a desire to protect vested interests.

China has confronted innumerable challenges while pursuing economic growth in recent decades, but the government has largely overcome them by encouraging market agents constantly to adapt and adjust. China’s accession to the World Trade Organization in 2001, for example, did not cause large-scale unemployment, as some had expected. Instead, fears that “the wolves are coming” spurred many sectors of the Chinese economy to become stronger and more competitive.

Seen from this perspective, the Chinese government’s insistence on combining efforts to expand domestic demand with supply-side structural reforms does not come as a surprise.

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China relations ‘a top priority’, Vietnamese leader To Lam tells new Beijing envoy

https://www.scmp.com/news/china/diplomacy/article/3278989/china-relations-top-priority-vietnamese-leader-lam-tells-new-beijing-envoy?utm_source=rss_feed

Vietnam’s developing relations with China are “a strategic choice and a top priority” for Hanoi’s foreign policy, the country’s top leader, To Lam, said on Tuesday as he received credentials from China’s new ambassador, He Wei, according to state-owned Vietnam News Agency.

Lam stressed the importance of traditional friendship and Vietnam’s comprehensive strategic cooperative partnership with China.

He added that recent visits by the top leaders of both countries, including his trip to China last month and President Xi Jinping’s state visit to Hanoi in December, “established a new positioning for the bilateral relationship … contributing to bringing about practical benefits for the two countries and maintaining peace, stability and development in the region and the world”, the agency said.

He, who arrived in Hanoi last week, “pledged to contribute to stepping up regular high-level exchanges to reinforce political trust, expanding substantive cooperation in defence and security, elevating socio-economic and cultural cooperation, promoting friendly people-to-people exchanges … and jointly controlling and better resolving disagreements at sea”, Vietnam News Agency reported.

China’s foreign ministry did not mention the South China Sea disputes in its statement, but it did say He hoped the “ship of friendship” would “sail steadily and far”.

He replaced Xiong Bo, who left Hanoi at the end of last month after nearly six years in the position.

The two neighbours hope to strengthen economic and political ties despite ongoing tensions in the South China Sea. Beijing’s expansive claims in the disputed waters have been challenged by Vietnam, which has dramatically accelerated land reclamation in recent months on several contested reefs in the Spratly Islands – known as Nansha in China.

Earlier this month, Vietnam’s coastguard held a rare live-fire drill focused on responding to security threats “in the new situation” in the waters off its southeast coast in the South China Sea.

Under its pragmatic “bamboo diplomacy”, Hanoi upgraded its ties with the United States and Japan last year to a comprehensive strategic partnership, the country’s highest designation for a diplomatic relationship.

Lam is expected to travel to the US next week, where he will attend the annual United Nations General Assembly session that starts on Tuesday.

Leaders and senior officials from both China and Vietnam have repeatedly pledged to make bilateral ties a diplomatic priority and manage their differences at sea.

After arriving in Hanoi last week, He called for “patience” on both sides to manage their differences.

Lam, Vietnam’s former top police chief who oversaw a sweeping anti-corruption crackdown, was named president in May following a series of leadership upheavals.

Lam travelled to China for his first overseas visit as a top leader last month, two weeks after being named as general secretary of the Communist Party of Vietnam. During the visit, he met Xi and held separate meetings with members of the powerful Politburo Standing Committee.

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South China Sea: Manila says it has a plan if Beijing takes over Sabina Shoal. What is it?

https://www.scmp.com/week-asia/politics/article/3278997/south-china-sea-manila-says-it-has-plan-if-beijing-takes-over-sabina-shoal-what-it?utm_source=rss_feed

The Philippines is weighing several options to respond should Beijing attempt to take control of the Sabina Shoal in the South China Sea, analysts say, including reconsidering a US offer to escort its resupply missions.

Their comments came in response to the Philippine Navy declaring it has plans to respond to a potential takeover attempt of the shoal, which has been the site of two collisions between Philippine and Chinese vessels in recent months.

In a press briefing on Tuesday, navy spokesman Rear Admiral Roy Vincent Trinidad told reporters, “I would not like to speculate on the possible security impact of China taking control of the Sabina Shoal. Nevertheless, we are prepared and we have our contingency plans.”

His statement came shortly after the Philippines from the Sabina Shoal over the weekend, citing bad weather, depleted supplies and the need to evacuate personnel requiring medical care.

The coastguard ship had been deployed at the shoal – located 146km from Palawan and around 1,200km from mainland China – for five months in order to deter China from pursuing land reclamation and island-building activities in the area.

Trinidad noted that 65 Chinese vessels had been observed swarming around Sabina Shoal even before the BRP Teresa Magbanua had been recalled, while around 157 Chinese vessels in total had been monitored in the West Philippine Sea – Manila’s term for the portion of the South China Sea that lies within its exclusive economic zone – from September 10 to 16.

Don McLain Gill, a political analyst and lecturer at the Department of International Studies at De La Salle University, said that there was a real chance China could attempt to take over Sabina Shoal in the same way they seized control of the Scarborough Shoal – another contested feature in the West Philippine Sea – in 2012.

“They will surround it. Then they will convert it into a base for offensive military capacity,” Gill said.

China has engaged in extensive land reclamation efforts and built military bases on artificial islands throughout the South China Sea – including those on Subi, Mischief, and Fiery Cross reefs – to enhance its ability to project power and assert its territorial claims.

Mainland China claims almost the entire South China Sea, including parts claimed by the Philippines, Brunei, Malaysia, Taiwan and Vietnam.

In 2016, an arbitration tribunal at The Hague ruled in favour of the Philippines territorial claims in the South China Sea, dismissing China’s broad claims over the maritime area as having no legal basis. Beijing has consistently rejected and denounced the ruling as illegitimate.

Escort offer

Sherwin Ona, a political-science professor at De La Salle University, said that the Philippines would likely use its navy to maintain a presence at Sabina Shoal in the short-term since its coastguard’s capacity has been weakened by repeated incidents involving Chinese vessels ramming and damaging its ships.

Beyond that, Ona suggested Manila might take up a previous offer from the US to have its forces escort Philippine missions to resupply their personnel stationed at outposts in the West Philippine Sea.

“I think this is the best option because it does not require the activation of the Mutual Defense Treaty (MDT),” Ona said.

The MDT between the Philippines and the United States, signed in 1951, requires either side to come to the defence of the other in the event of aggression by an external power.

Last month, US Indo-Pacific Command chief Admiral Sam Paparo said during his visit to Manila that American ships could escort Philippine vessels on resupply missions to its outpost on the Second Thomas Shoal as part of its obligations to its treaty ally.

In response, Philippine military chief general Romeo Brawner Jnr said Manila would not take up the offer unless it was unable to deliver critical provisions to its personnel stationed at the outpost.

Given that the Philippines withdrew the BRP Teresa Magbanua from Sabina Shoal due to China blocking efforts to resupply its personnel, Ona said it was likely that Manila would reconsider the US offer of escort.

However, he said the Philippines should not rely solely on US assistance to deal with the potential takeover threat.

“In parallel, the country may now go on a diplomatic and legal offensive. File a case against China regarding the ramming of our vessels, engage international and local media, and counter disinformation by creating and consolidating digital content,” Ona explained.

“As part of the diplomatic and military approach, the Philippines can also ask other allies to do joint patrols with our navy and coastguard. The purpose of this is to show solidarity and indirectly enforce the 2016 arbitral award,” he added.

Deterrence or diplomacy

Gill agreed that Manila could respond to a takeover attempt by fast tracking negotiations, strengthening partnerships with allies and going through different diplomatic channels.

“What China is doing is a huge infringement on our sovereignty. It is not only vessels that we are putting on the shoals. It’s the extension of Philippine sovereignty. I think the steps that the Philippine military should take would be robust,” Gill told This Week in Asia.

“The Philippines has been patient in dealing with China. And we have to understand that Manila does not discredit a more hardline response against China. So, if China continues to test our patience, even a middle power like ourselves has limits,” he added.

However, Gill said the MDT would likely only be activated in extreme circumstances, such as a Filipino sailor dying during a potential Chinese takeover attempt, which President Ferdinand Marcos Jnr had previously said would be a redline.

“If that were to happen, I don’t think we would do nothing. Surely, we would expedite the negotiation process with the US for the MDT. I don’t think we would just downplay it,” he noted.

He also explained that invoking the MDT is not like switching a light switch on and off.

“It is subject to bilateral consultation between the US Department of State and our Foreign Affairs. They will determine what is the right steps to take, especially if one of the concerned parties feels that it is a provocation of sovereignty and survival,” Gill explained.

Lucio Blanco Pitlo III, president of the Philippine Association of Chinese Studies and Research fellow at Asia Pacific Pathways to Progress, said the MDT was an option but argued the US would be reluctant to get dragged into a dispute involving China and the Philippines.

“It’s our prerogative to invoke the MDT if we see our actions to deter China are not working. But I think we will not reach the point of invoking it. That’s only our last resort,” he said.

“The US, for its part, is also concerned with the situation in the South China Sea. Through its channels of communication with China, they will try to fix the problem,” he added.

Pitlo noted that US National Security Adviser Jake Sullivan travelled to China last month, where he stressed the importance of “intense diplomacy” with President Xi Jinping.

“The recent incidents are certainly worrisome. But on the other side of the equation, diplomacy is very important. I think the US will exhaust all means of communication, not to mention political channels,” he said.

Chinese diet shift to more meat, fewer grains may cost US$14 billion in health spending

https://www.scmp.com/news/china/science/article/3278963/chinese-diet-shift-more-meat-and-fewer-grains-cost-us14-billion-health-spending?utm_source=rss_feed

By 2030, Chinese residents’ spending on medical services is projected to increase by almost 100 billion yuan (US$14 billion) because of a shift in diet towards consuming more animal products.

Researchers found that between 1992 and 2021 Chinese dietary changes – characterised by moving from a primarily grain-based diet to incorporating more animal products – were associated with greater food-borne health expenditure.

And this trend, which is also reflected globally, is only expected to continue over the coming decades, according to their paper published in Nature’s Humanities and Social Science Communications peer-reviewed journal on September 14.

“With China’s population shifting toward a high-protein, high-fat dietary structure, food-borne personal medical cash expenditures will increase by 95.28 billion yuan in 2030,” the team from the Chinese Academy of Sciences and Central China Normal University wrote.

While food-related per capita healthcare spending is projected to fall, state financial and total healthcare expenditure is expected to rise by 18.76 billion yuan and 17.67 billion yuan respectively, according to the paper.

The increased investment in healthcare as a result of dietary burden was “hindering the economic progress of the country and its residents toward affluence,” the researchers wrote.

China is the world’s largest consumer market for meat, however in per capita meat consumption it still significantly lags behind countries such as the United States and Australia.

However, meat consumption is rising in China, making it not only a concern for meeting demand and protecting the environment but also for the health and medicine sectors.

A projected increase in medical spending is not only because of meat consumption, but also due to a drop in individuals’ intake of grains – which includes cereals, beans and potatoes.

The shift, which is reflected globally, is associated with more nutritional health issues and disease outcomes.

“Research showed that 26 per cent of global preventable deaths are attributed to poor diet, surpassing other risk factors such as smoking,” the researchers wrote.

“Our findings reveal that plant-based foods, such as grains and vegetables, contribute significantly to healthcare savings, whereas animal-based foods, including meat and oil, are generally linked to higher healthcare costs.”

To project future healthcare costs in China, the team first examined the evolution of the Chinese diet and its effect on health spending over the past 30 years.

The researchers used food consumption data classified into eight categories – grains, vegetables, fruit, eggs, dairy products, aquatic products, meat and oilseeds – as well as national healthcare spending.

Medical expenditure from 2020 and 2021 were not included in the analysis because of the influence of the Covid-19 pandemic.

“Compared to the balanced dietary pattern recommended by the Chinese Dietary Guidelines 2022, the Chinese dietary structure exhibits limited variety in grain intake, insufficient vegetable and fruit consumption, and excessive intake of livestock and meat,” the team wrote.

Alongside comparisons with other countries with similar characteristics, such as Japan, to estimate China’s rate of change, the team then projected the future diet healthcare model for China.

The projections showed that the Chinese diet would continue to shift towards eating fewer grains and more oil and meat, which would lead to increased disease burdens and, therefore, healthcare expenditure.

“In the context of China’s healthcare system development and reform, transitioning to a plant-based diet will be crucial for reducing personal costs and optimising medical expenditure,” the researchers wrote.

China’s reign in Spain, Germany lobbies EU members over tariffs: 7 EV reads you missed

https://www.scmp.com/news/world/article/3278958/chinas-reign-spain-germany-lobbies-eu-members-over-tariffs-7-ev-reads-you-missed?utm_source=rss_feed

We have put together stories from our coverage on electric and new energy vehicles from the past two weeks to help you stay informed. If you would like to see more of our reporting, please consider .

1. China’s low-priced EVs reign in Spain, make gains in Europe’s lanes

By beating competitors on price, China’s electric vehicles have made headway in Europe – but tariffs and trade scrutiny may slow their advance.

2. Germany lobbies fellow EU members to vote against tariffs on Chinese EVs

Germany and China are actively working to convince European Union members to oppose electric vehicle tariffs during a vote next week, senior EU sources say.

3. US House votes to restrict tax credits for EVs with Chinese battery tech

The US House of Representatives passed a Republican bill restricting electric vehicle tax credits on Thursday that could jeopardise licensing deals between American car makers and Chinese EV battery companies.

4. EVs outsold oil-guzzlers in China last month, boosting take-up rate

Electric vehicle adoption rate in mainland China exceeded 50 per cent for the second consecutive month in August, even as overall vehicle sales fell in the world’s largest automotive market.

5. Beijing urges EV makers to avoid investing in India and Turkey

Chinese electric vehicle makers’ drive to go global hits a snag after Beijing urged them to avoid investing in countries like India and Turkey.

6. Moscow fuel giant EuroTrans may equip China-Russia expressway for charging EVs

A major Russian operator of petrol stations is laying plans to help drivers of electric vehicles cross the vast country into China – without running out of power – and in turn stoke imports of Chinese EVs to Russia.

7. Alibaba’s Taobao puts Xiaomi car buyers behind virtual wheel

A new feature on Alibaba Group Holding’s Taobao app lets potential car buyers test drive Xiaomi’s SU7 electric vehicle virtually through Apple’s Vision Pro headset, the latest example of Chinese tech companies employing cutting-edge technology to compete for customers.

Japanese child stabbed in southern China’s Shenzhen, man detained

https://www.scmp.com/news/china/diplomacy/article/3278968/man-detained-southern-china-after-stabbing-japanese-child-shenzhen?utm_source=rss_feed

A boy is in hospital after he was attacked by a man with a knife on the way to his Japanese primary school in Shenzhen, southern China on Wednesday morning.

A Japanese government source has told Kyodo News that the boy – whose condition is unknown – was the victim of a stabbing. Earlier reports from Japan said only that a man had been detained for questioning by local authorities after an attack.

A spokesperson with Japan’s embassy in Beijing confirmed that the boy was attacked and is receiving treatment in hospital. No details were released of the victim’s identity, or how seriously he was injured.

The incident occurred on the anniversary of the 918 Incident – also known as the Manchurian Incident – which many Chinese regard as the start of Japan’s invasion of China in 1931 and a day of national humiliation.

“From the perspective of protecting Japanese nationals, we have made requests to local authorities for measures to prevent a recurrence and to share detailed information,” government spokesman Hiroshi Moriya said at a press conference in Tokyo.

The Japanese consulate-general in Guangdong province has sent its own staff to the scene of the incident to gather information and provide necessary help, he said.

September also commemorates the normalisation of diplomatic relations between China and Japan. However, despite decades of bilateral ties, anti-Japanese sentiment occasionally surfaces.

In June, a Japanese mother and her small child were injured when a man armed with a knife attacked them as they waited at a bus stop in Suzhou, eastern China to catch a bus used by a Japanese school.

Hu Youping, the Chinese female bus attendant, was killed trying to stop the attacker from boarding the vehicle. Her death sparked a national outpouring of grief, but also triggered a wave of anti-Japanese sentiment on Chinese social media.

Chinese surveillance fears spur South Korea to remove 1,300 cameras from military bases

https://www.scmp.com/news/asia/east-asia/article/3278970/chinese-surveillance-fears-spur-south-korea-remove-1300-cameras-military-bases?utm_source=rss_feed

South Korea’s military has been forced to remove more than 1,300 surveillance cameras from its bases after learning that they could be used to transmit signals to China, Yonhap news agency reported.

The cameras, which were supplied by a South Korean company, “were found to be designed to be able to transmit recorded footage externally by connecting to a specific Chinese server”, the outlet reported an unnamed military official as saying.

Korean intelligence agencies discovered the cameras’ Chinese origins in July during an examination of military equipment, Yonhap said.

While some of the cameras were near the border with North Korea, they weren’t monitoring it and were instead focused on training bases and fences, the official said.

“No data has actually been leaked,” they added.

Around 100 of the cameras have been replaced with locally-produced equipment, Yonhap reported.

The announcement comes amid a crackdown in many Western countries on Chinese-made surveillance equipment, amid fears of loose security practices and ties to the Chinese state.

Two Chinese manufacturers, Dahua and Hikvision, were blacklisted by the Trump administration in 2019 after being tied to human rights abuses of China’s Uygur population.

Since then, seven more Chinese or Chinese-backed telecommunications and video surveillance companies have been added to the Federal Communications Commission’s ban list.

Britain has also barred Hikvision cameras from some sensitive government sites, while in February last year Australia began removing hundreds of Hikvision and Dahua products from its government buildings.

Even so, a Radio Free Europe investigation revealed in May that a large number of European countries remain dependent on inexpensive Dahua and Hikvision security cameras – even at sensitive sites like military bases and police headquarters.

The Chinese manufacturer of the equipment used at the Korean military bases wasn’t named, but according to Yonhap, the military is considering legal action against the supplier, which is suspected of falsifying paperwork on the cameras’ origins.

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China dog owner pays woman US$12,600 after she has miscarriage because animal startled her

https://www.scmp.com/news/people-culture/article/3278716/china-dog-owner-pays-woman-us12600-after-she-has-miscarriage-because-animal-startled-her?utm_source=rss_feed

A dog owner in Shanghai was ordered by a court to pay 90,000 yuan (US$12,600) in compensation to a pregnant woman who suffered a miscarriage after the pet jumped up at her.

The 41-year-old woman became pregnant after undergoing multiple in vitro fertilisation (IVF) surgeries over three years, according to the Shanghai Morning Post.

The incident occurred earlier this year while the expectant mother, surnamed Yan, was walking through her residential community to collect a package from the courier station.

Suddenly, a golden retriever bolted out of a building and bounded towards her.

Yan was startled and stepped back, injuring her back in the process. She also immediately felt something in her waist and lower abdomen.

The police were called, and officers responded to the dispute between Yan and the dog’s owner, whose surname is Li.

Yan visited the hospital later that day and was kept overnight. The following morning, doctors could not detect a heartbeat from the fetus.

“I’ve been pregnant for nearly four months. After the dog frightened me, I felt pain in my belly. I went to the hospital, but sadly my baby could not be saved,” Yan said.

“It’s really hard for me to have this baby. I’ve had IVF treatment for three years. Now I have miscarried. I am heartbroken,” she added.

Following the incident, Yan filed a lawsuit against Li. The court ruled in her favour, ordering him to pay 90,000 yuan for the physical and emotional distress caused during the encounter.

Li acknowledged that his golden retriever was not on a leash at the time, but asserted that the dog, being an assistance animal for the visually impaired, would not harm anyone. He also placed some blame on Yan, claiming that she should have exercised more caution knowing the risks associated with her pregnancy through IVF.

Under China’s Animal Epidemic Prevention Law, pet owners are required to keep their dogs on leashes in public areas. Penalties for violations can include fines of up to 200 yuan (US$28), and if a dog injures someone, the owner is legally accountable for the damages.

The court said it was reasonable for a woman more than 15 weeks pregnant to walk near her home.

The court determined that Yan’s miscarriage resulted from being frightened by Li’s dog, which should have been on a lead. As a result, Yan’s request for compensation from Li was upheld.

The case garnered significant attention, being viewed 110 million times on Weibo, igniting a heated online debate about the issue of dogs not being leashed in public spaces.

One internet user expressed disbelief, stating: “It astounded me that this pet owner remained indifferent when seeing his dog jump on a pregnant woman.”

Another commenter sympathised with Yan, saying: “Poor woman. It will be difficult for her to get pregnant again.”

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What lies on the moon’s mysterious far side? China’s Chang’e-6 samples give first signs

https://www.scmp.com/news/china/science/article/3278905/what-lies-moons-mysterious-far-side-chinas-change-6-samples-give-first-signs?utm_source=rss_feed

For the first time in history, Chinese scientists have revealed what kind of material lies on the far side of the moon – a mixture of basalts and foreign ejecta largely different from the previous Chinese-collected near side samples of mostly basaltic volcanic rocks.

Researchers said the Chang’e-6 mission samples “may result from the mixing of mature lunar soil with freshly ejected materials” given the existence of fresh impact craters around the landing site.

In China’s first analysis of far side lunar samples – published less than three months after the mission brought the material to Earth – the authors said the material showed “distinct characteristics compared to previous lunar samples”, all of which have been collected from the near side of the moon since 1969.

For example, the far side samples contain significantly more light-coloured particles such as glass and feldspar compared to the Chang’e-5 samples from the moon’s near side. The researchers said the material likely originated from ejections or impacts.

The new samples also have a lower density, meaning it “is more loose and porous than previous lunar soils”.

“The lunar sample is quite loose and would be even fluffier in its ‘natural’ state on the lunar surface,” they wrote in an article published in the peer-reviewed journal National Science Review on Monday. The English-language journal is published under the auspices of the Chinese Academy of Sciences (CAS).

The researchers are from the Key Laboratory of Lunar and Deep Space Exploration at the CAS, the Lunar Exploration and Space Engineering Centre, and the Beijing Institute of Spacecraft System Engineering.

The team said the Chang’e-6 samples were “highly significant for scientific research”.

“These local mare basalts document the volcanism history of the lunar far side, while the non-basaltic fragments may offer critical insights into the lunar highland crust, [South Pole-Aitken] impact melts and potentially the deep lunar mantle.”

China this year became the first, and so far only, country to have retrieved samples from the far side of the Earth’s only natural satellite. It collected just over 1.9kg (4.26 pounds) of lunar samples from the South Pole-Aitken basin – the largest, deepest and oldest impact basin on the moon.

The far side, which constantly faces away from us because the moon is tidally locked to the Earth, had remained unexplored, while a total of 10 missions by the United States, the former Soviet Union and China all retrieved samples from the near side.

“Nearside samples alone, without adequate sampling from the entire lunar surface, especially from the far side, cannot fully capture the geologic diversity of the whole moon. This limitation hampers our understanding of the moon’s origin and evolution,” the team said.

“The landing site [of Chang’e-6] holds great scientific value for studying the early impact history of the moon, understanding the composition of the deeper material and exploring the asymmetry between the moon’s near side and far side.”

Natural samples have played a vital role in planetary science research, and new lunar samples often improve existing scientific knowledge.

In 2021, scientists realised that the Chang’e-5 mission had retrieved the youngest rocks ever found on the moon, which had been formed from magma from a volcanic eruption about 2 billion years ago. The discovery updated knowledge gained from the Apollo missions that showed lunar magmatism stopped 3 billion years ago.

The team said this new analysis aimed to “provide foundational data for future in-depth scientific research to be carried out on these newly returned far side samples”.

They said that improving our understanding of areas such as the early evolution of the moon, the lunar magnetic field, and how volcanic activity differs from the near side to the far side could lead to “new concepts and theories of the origin and evolution of the moon”.

Why China’s ‘no first use’ policy requires more nuclear weapons

https://www.scmp.com/opinion/china-opinion/article/3278704/why-chinas-no-first-use-policy-requires-more-nuclear-weapons?utm_source=rss_feed

This really is an eye-opener. According to The New York Times, US President Joe Biden approved a classified document in March called the “Nuclear Employment Guidance”. Sources familiar with the situation say that the strategy laid out in the document emphasises the need for US forces to prepare for possible coordinated nuclear confrontations with Russia, China and North Korea.

My first question is this: where is a China-Russia-North Korea alliance, let alone nuclear alliance? China-Russia relations are close, but Beijing not having provided any direct military assistance to Moscow in its invasion of Ukraine suggests their relationship is not an alliance.

Meanwhile, in spite of a decades-old treaty between Beijing and Pyongyang that calls for mutual military assistance in time of war, China’s military interactions nowadays with North Korea are perhaps fewer than its interactions with most African countries. So how could the three countries coordinate these nuclear strategies or operations against the United States?

The US has no clear advantage in terms of nuclear weapons over Russia, which has more warheads, and it won’t in the future. Precisely because its conventional forces have drastically declined since the dissolution of the Soviet Union, Russia now relies more than ever on nuclear weapons.

This explains why Moscow has made several thinly veiled threats of using nuclear weapons during its war in Ukraine and will continue to play with nuclear ambiguity in the decades to come.

China’s nuclear capabilities, including the number of nuclear warheads, are considered state secrets. Therefore, it is unlikely that anyone in China will publicly confirm the accuracy of the Stockholm International Peace Research Institute’s estimates. The think tank released a report in June indicating China’s nuclear arsenal had increased from 410 warheads in January 2023 to 500 this January and that for the first time China could be deploying a small number of warheads on missiles during peacetime.

In a 2019 defence white paper, China said it would “keep its nuclear capabilities at the minimum level required for national security”. Evidently this “minimum level” cannot be quantified because national security needs vary in different times and environments.

Even if China’s nuclear arsenal has grown to 500 warheads and could grow as large as 1,500 by 2035, according to Pentagon estimates, Beijing can still argue that it is still much smaller than Russia’s roughly 6,000 warheads and the 5,400 of the US. At the height of the Cold War, the Soviet Union had more than 40,000 nuclear warheads while the US had more than 23,000 – enough to destroy the whole planet. Why would China choose to become involved in such madness?

In my understanding, “minimum level” refers to a threshold that no other nuclear power would dare to cross with a pre-emptive nuclear strike on China, even if China maintains a policy of “no first use” of nuclear weapons. Precisely because of this policy, China has to build adequate strength for deterrence. It requires China to have sufficient nuclear warheads to resist an enemy’s first strike and ensure China has second-strike capability.

With such nuclear capabilities, China’s military could have a better chance of emerging victorious over the US in the event of a conventional war, such as one in the Taiwan Strait. Given that the gap between the conventional military forces of China and the US is already closing, China having a large enough nuclear arsenal would force the US to give up any ideas of using nuclear weapons first.

China call for a “no first use” policy might look to some people like wishful thinking at a time when nuclear weapons seem to be growing in importance amid the ongoing wars in Ukraine and Gaza, but it isn’t. Nuclear weapons are not an omnipotent force, and having them is no guarantee of success in a conflict. If China, the US, Russia, Britain and France can all agree that a nuclear war cannot be won and therefore should never be fought, then why can’t they commit to their own “no first use” policy?

Much has been written about whether the world has entered a new cold war. If the US really is poised to resume conducting nuclear tests, as some reports suggest, this would be tantamount to an official announcement of a new cold war.

The sight of renewed US nuclear testing would almost certainly usher in tests by other nuclear powers, spelling doom for nuclear non-proliferation efforts. This would likely swell the number of states with nuclear weapons beyond the current nine, resulting in a considerable reduction in the conventional force superiority of the US and its allies.

Furthermore, if all the world’s nuclear powers increase the readiness of their nuclear forces, it could increase the chances of false alarms, like those seen during the Cold War. During the early days of long-range radar, even a rising moon could be misinterpreted as a missile attack. One can easily conclude that with more nuclear weapons states on high alert, there could be more false alarms or significant incidents.

The Biden administration’s nuclear strategy is a shame, not least because the president spent so much of his political career advocating for nuclear non-proliferation. We have had no significant wars between global powers for some 80 years since World War II.

If this is a solace, it is also disturbing to think we might enter into another cold war some 30 years after the first. I can only concur with these words attributed to Isaac Newton: “I can calculate the movement of the stars, but not the madness of men.”

China’s stocks hover around 5-year low as trading resumes after holiday

https://www.scmp.com/business/china-business/article/3278947/chinas-stocks-hover-around-5-year-low-trading-resumes-after-holiday?utm_source=rss_feed

China’s stocks traded near their lowest levels in more than five years after a holiday break, as investors await a rate decision from the US Federal Reserve.

Hong Kong’s market is shut for a public holiday and will resume trading on Thursday.

The CSI 300 Index dropped less than 0.1 per cent to 3,158.03 as of 10.06am local time. On Friday, it closed at its lowest point since January 24, 2019. The Shanghai Composite Index rose less than 0.1 per cent and the Shenzhen Composite Index retreated 0.9 per cent.

Caution prevailed ahead of the Fed’s rate decision on Thursday and Chinese traders digested some key economic data for August that fell short of expectations. A Fed rate cut could lift China’s stocks and economy, as it is set to reduce the interest-rate spread between the two nations and leave the People’s Bank of China more room for policy easing.

The probability of a 50-basis-point cut is now 65 per cent and that of a quarter-point reduction is 35 per cent, according to the data compiled by CME Group.

Among the CSI 300’s industry groups, energy producers gained and consumer staples declined on weak consumer spending. Coal producer Shaanxi Coal Industry added 2.3 per cent to 22.79 yuan, while liquor giant Kweichow Moutai lost 2.1 per cent to 1,276.30 yuan.

Other major Asian markets were mixed. Japan’s Nikkei 225 climbed 0.8 per cent and South Korea’s Kospi rose 0.1 per cent, while Australia’s S&P/ASX 200 was little changed.

China’s tourists hit the road in record numbers as driving tours pick up speed

https://www.scmp.com/economy/china-economy/article/3278888/chinas-tourists-hit-road-record-numbers-driving-tours-pick-speed?utm_source=rss_feed

China has a near-unlimited set of options for the budding traveller to get from place to place – high-speed trains, buses and ride sharing, to name a few – but to reach the picturesque mountains of Shangri-La in Yunnan province, Bryce Linden prefers to venture onto the expressway in a car he has rented himself.

“One thing that’s nice is you don’t have to coordinate with a driver,” the 25-year-old said. Born in the United States, he now lives in the province’s Dali, about four hours from the rugged tracts where his parents have built boutique hotels.

Linden is one of a growing group opting to drive themselves to must-see spots, as they are so far from urban centres that ride-shares are unlikely to pick them up after an outing. Analysts pointed to improved rural infrastructure and shifting preferences among youth as reasons for the upswing in popularity.

Rental car bookings increased more than 60 per cent in July and August this year over the same months in 2023, the Chinese travel platform Fliggy said on September 5.

The platform said bookings have grown by more than 200 per cent in far-flung tourist destinations in northern and western China, naming as examples Heihe along the Russian border, Alar in the Xinjiang Uygur autonomous region and the city of Bijie in Guizhou province, known for its nature reserve.

The trend became more evident after China’s Labour Day holiday in May, China Daily reported. Chinese rental service CAR Inc saw a “surge” in bookings that month, with more than 90 per cent of its vehicles rented out, according to the state-run media outlet.

“The domestic car rental market in China is experiencing significant growth, driven by changing travel preferences and demographics,” said Simon Song, CEO for car rentals and ride hailing for the tourism service provider Trip.com.

“These trends underscore a shift towards more flexible, personalised travel experiences, with car rentals playing a pivotal role in facilitating diverse journeys across the country.”

Trip.com attributes the change in habit to younger travellers taking longer sojourns and growing interest in “off-the-beaten-path” destinations and second-tier cities, Song said. It classified 64 per cent of trips this past summer as “long-distance” travel.

Daily order volumes at car rental agencies reached record highs this past summer, up 50 per cent year-on-year, and average spending per rental increased by one-fifth, Trip.com found.

Travellers born in the 1980s and 1990s account for 76 per cent of car rental customers, Song said, adding people born after 2000 make up the fastest-growing segment with a 77 per cent increase in rentals this past summer compared to the same months of 2023.

More than 60 per cent of CAR’s customers were born in or after the 1990s, China Daily said.

In western China’s high-elevation Qinghai province, domestic tourists fly to the capital Xining and rent a car at the airport for the 180km (112 miles) trip to Qinghai Lake, said Qiu Yu, who was in Hong Kong on September 12 representing a group of the province’s produce sellers at a trade and transport show.

Her industry has been helped by the surge of self-driving tourists, as motorists can stop at will when traversing the 720,000 sq km (278,000 square miles) province – making them likelier to buy fruits and vegetables from sellers on the road.

Firdavis Yasin, a 27-year-old fitness coach from Xinjiang, has his own car and drives it for fun whenever he can. “Because the routes you take yourself are not set, you can change destinations as you wish,” he said. “And of course trains and planes can’t change course in mid-trip.”

Improved road conditions are making car travel to remote locations more convenient, Fliggy said, with “well-maintained” highways in large and sparsely populated regions making exploration “both easy and enjoyable”.

China went on a road improvement binge from 2006 to 2015, with the World Bank supporting work on 1,299 rural roads for a total length of 5,402km over the period. The number of cars per 100 households, meanwhile, went from 35.3 in 2019 to 43.5 in 2022, per data analytics firm Statista.

The country’s expressways can make driving fun, said Ivan Theodoulou, a Hong Kong denizen who went through the process to get a licence covering the entire Pearl River Delta region. He said he has driven a combined 6,000km over the past two years, including many 160km trips between Zhuhai and Foshan in Guangdong province.

“If you’re a car owner in Hong Kong and you’ve been driving around Hong Kong the whole time you’ve been here, suddenly having the option to drive across the border is exciting,” Theodoulou said. “The highways are absolutely superb.”

Tolls add up, however, and new drivers may find the unwritten rules of the road hard to follow, Linden said.

A four-hour drive from Dali to Kunming using major highways costs 200 yuan (US$56) in tolls plus 7 yuan per litre of petrol, Linden said, adding a basic four-door car costs 60 yuan per day to rent.

Average car rental expenditures booked via Fliggy came to 726 yuan this past summer, the platform said, usually for trips lasting two days or less.

But whether for drivers or their passengers who are used to long-distance buses, Theodoulou said, “nothing beats getting into your own car and driving and stopping wherever you want to go”.

Additional reporting by Mia Nulimaimaiti

China’s Lenovo builds AI servers in India as supply chain shift gathers pace

https://www.scmp.com/tech/tech-war/article/3278950/chinas-lenovo-builds-ai-servers-india-supply-chain-shift-gathers-pace?utm_source=rss_feed

Lenovo Group started building artificial intelligence (AI) servers in India’s south, the latest boon for the rapidly growing country’s push to become a hi-tech powerhouse.

The company said Tuesday it has started making the large, powerful computers in Pondicherry, southeastern India, moving beyond products such as laptops and smartphones. The Chinese company will also build out its facilities in the Bengaluru region, including a research lab with a focus on AI.

Those decisions form part of a broader shift as Lenovo positions itself for an anticipated boom in AI-empowered personal computers and devices. The company will invest US$1 billion globally over the next two years researching and developing AI platforms and hardware, said Amar Babu, Lenovo’s Asia-Pacific president.

Lenovo’s plans also mark another win for India as Prime Minister Narendra Modi tries to attract more technology investment into the country. While India’s tense relationship with China has suffered setbacks in recent years, global tech companies see it as an attractive option to build out operations as Beijing and Washington are mired in a trade war.

The servers perform the computations needed to run services including generative AI, made famous by apps such as ChatGPT. The addition of AI servers means Lenovo will make its entire stack of hardware in India for the domestic as well as export markets, underscoring the country’s importance for the company.

While India’s tech manufacturing sector is still small compared with China, it has been catching up and now makes increasingly sophisticated products such as Apple’s iPhones. AI servers represent another milestone, showing India can offer an alternative to regions with more established high-end manufacturing industries.

The country is also a fast-growing market in its own right. India AI demand is currently US$17 billion and growing 25 per cent to 30 per cent annually, Babu said.

Taiwan currently produces the bulk of the world’s AI servers, which are used by technology giants such as Amazon.com, Microsoft and Nvidia. But with geopolitical tensions on the rise between mainland China and the West, companies are under pressure to shift manufacturing outside Taiwan.

Demand for generative AI tools and applications has sent the need for related hardware soaring, with electronics manufacturer Foxconn Technology Group last year predicting that annual sales of AI servers could touch US$150 billion by 2027.

‘Keen to move forward’: India, China signal thaw in ties with diplomatic, border efforts

https://www.scmp.com/week-asia/politics/article/3278940/keen-move-forward-india-china-signal-thaw-ties-diplomatic-border-efforts?utm_source=rss_feed

After years of heightened border tensions, India and China are showing signs of de-escalation, with recent diplomatic talks offering a hopeful glimpse into improved economic ties and future cooperation.

Both nations released statements indicating positive progress following discussions between India’s National Security Adviser Ajit Doval and Chinese Foreign Minister Wang Yi at a Brics meeting in St Petersburg on Thursday last week.

The Indian Ministry of External Affairs noted that the meeting provided a platform to review efforts toward resolving outstanding issues along the Line of Actual Control, the pair’s de facto border – essential for stabilising and rebuilding relations.

Just hours before the gathering in Russia, Indian External Affairs Minister S. Jaishankar announced at a Geneva Centre for Security Policy talk that roughly 75 per cent of India’s “disengagement problems” with China had been resolved.

Earlier that week, he had emphasised his country’s openness to economic engagement with China during his discussions in Berlin with German Foreign Minister Annalena Baerbock on September 10, saying India is not “closed to business from China”.

The day after the Brics meeting, Chinese Foreign Ministry spokeswoman Mao Ning confirmed that both countries’ militaries had achieved “disengagement in four areas in the Western sector of the China-India border, including the Galwan Valley”.

“The China-India border situation is generally stable and under control,” she said.

China and India have long been keen to resolve their issues through diplomacy “so that broader cooperation is not affected”, said M.S. Prathibha, an associate fellow at the Institute for Defence Studies and Analyses think tank in New Delhi.

“It is one of the reasons why both countries have persisted with many rounds of boundary talks. The development of both countries is a priority to both,” she told This Week in Asia.

The two nations have been locked in a military stand-off since the deadly 2020 clash in the Galwan Valley, which left 20 Indian soldiers and at least four Chinese troops dead. Other recent tensions have spanned the 2017 Doklam stand-off and confrontations at the border in Sikkim and Arunachal Pradesh.

“For China, resuming economic ties is an immediate priority,” Prathibha said. “They want positive development in the bilateral relationship, especially in trade and investment.”

On July 31, India and China held their 30th meeting of the Working Mechanism for Consultation and Coordination on China-India Border Affairs in Delhi, where both sides reportedly agreed to maintain momentum through diplomatic and military channels.

Positive diplomatic progress suggests that “further rapprochement” may be possible “at Depsang and Demchok”, according to Rakesh Sharma, a distinguished fellow at the Delhi-based Centre for Land Warfare Studies think tank. He cautioned, however, that this does not eliminate the risk of Chinese incursions elsewhere along their 3,488km (2,167-mile) disputed border.

Recent reports indicate that India may ease restrictions on Chinese investments in non-sensitive sectors such as solar panels and battery manufacturing to boost domestic production in areas where it lacks expertise.

Natasha Agarwal, an independent research economist based in India, said that Chinese multinationals would have to carefully assess the Indian investment landscape.

“The disillusionment that Chinese businesses are waiting in anticipation for India to open its borders needs a reality check,” she said, highlighting India’s need for a more strategic approach to Chinese foreign direct investment (FDI).

Agarwal argued that India should not only cautiously welcome foreign investment but actively negotiate for a larger share in Chinese firms’ portfolios.

“The bargaining chip here is a robust and resilient domestic ecosystem, which also helps multinationals in managing their international risk exposure,” she said, adding that “essential reforms” such as streamlining visa processes, can help alleviate labour shortages and “encourage FDI spillovers”.

The Indian government’s latest annual economic survey, released in July, suggested prioritising FDI from China to bolster exports and manage the growing trade deficit. India is also contemplating reducing visa delays for Chinese technicians and resuming direct flights to China after a four-year hiatus.

Agarwal criticised the Indian government’s plan to operationalise a portal for short-term business visas as shortsighted.

“India must invest time, money and effort in structural and institutional reforms … [that] need to start delivering high-quality development rather than just ticking government boxes,” she said, adding that Delhi should “encourage joint ventures between Indian and Chinese firms, with technological transfers as the fulcrum of such partnerships”.

To attract Chinese FDI effectively, India may need to adopt a more open stance, according to Srividya Jandhyala, an associate professor at ESSEC Business School in Singapore.

“There are mutually beneficial opportunities for companies from the two countries,” she noted, emphasising that Indian firms could gain “from Chinese capital, technology, and know-how”.

“Foreign investment can also create jobs [and] Chinese companies will have access to the large Indian market,” she said.

Jandhyala also highlighted the intense global competition for FDI, as many emerging markets vie for foreign investment.

“For India to be a competitive destination for Chinese firms, an attractive investment climate is necessary,” she said. “Trust and stability in investment policy will be important, especially in India where Chinese companies have faced challenges in the past.”

B.R. Deepak, a professor of Chinese and China Studies at Jawaharlal Nehru University in Delhi, said that frequent diplomatic meetings signalled a favourable environment for both nations.

“India perhaps has come to realise that it is important for a rising country to balance [its] relationship” with China to capitalise on strategic opportunities,” he said. Especially “when trade between India and China has registered a robust growth trajectory”.

Given India’s reliance on China in critical sectors such as electronics, pharmaceuticals and solar panels, Deepak argued that restricting Chinese visas could hinder local industries and supply chain development.

A meeting between Indian Prime Minister Narendra Modi and Chinese President Xi Jinping at next month’s Brics summit in Kazan is expected to further “send a positive signal of recalibration” in their relationship, Deepak said.

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Trump pledges tariffs and repeats false claim of Chinese automakers building big Mexican factories

https://apnews.com/article/trump-auto-industry-tariffs-false-chinese-factories-0f024d98e25a361db35761b2fb740e3bRepublican presidential candidate former President Donald Trump speaks during a town hall event at the Dort Financial Center in Flint, Mich., Tuesday, Sept. 17, 2024. (AP Photo/Paul Sancya)

2024-09-18T01:38:50Z

DETROIT (AP) — Former President Donald Trump on Tuesday repeated false claims that Chinese automakers are putting up large factories in Mexico, vowing during a stop in the automaking state of Michigan to slap 200% tariffs on any vehicles the unbuilt plants make and ship to the United States.

Trump also claimed during an event in Flint that if Democratic Vice President Kamala Harris is elected in November, there will be no more auto industry in the U.S., because work building electric vehicles will go to China.

That statement came even though automaking employment has grown since President Joe Biden took office in January 2021, after dropping during Trump’s first term.

“If I don’t win, you will have no auto industry within two to three years,” Trump said, calling any increases under Biden and Harris temporary. “You will not have any manufacturing plants. China is going to take over all of them because of the electric car.”

He told the crowd he would make foreign automakers build factories in the U.S. by imposing tariffs on imported autos, saying it “will be like taking candy from a baby.”

Foreign automakers already have multiple U.S. factories, mainly in southern states.

Auto jobs dipped 0.8% during Trump’s term to just over 949,000 in January 2021, when he left office, according to the Bureau of Labor Statistics. Since Biden took office that month, auto and parts jobs rose 13.6% to 1.07 million in August, so there’s no evidence of the industry disappearing. Auto sales were up 2.4% in the first half of this year.

Trump said his tariffs would make Chinese vehicles built in Mexico unsellable in the U.S., forcing automakers from China and elsewhere to set up factories in the U.S.

“They’re owned and built by China in Mexico, and there are a number of them going up right now,” Trump said of Chinese factories.

Although some Chinese automakers aspire to sell in the U.S., industry analysts say there are no large Chinese-owned auto factories under construction in Mexico, and there’s only one small Chinese auto assembly factory operating there. It’s run by a company called JAC that builds inexpensive vehicles from kits for sale in that country.

Trump also promised to charge tariffs on vehicles made in other countries if those countries tax U.S.-made vehicles. But often tariffs end up being passed on to consumers in the country that assesses them.

The Harris campaign issued a statement from Michigan Sen. Gary Peters saying that a second Trump term would crush auto jobs, “ceding Michigan’s global auto manufacturing leadership to the Chinese government.” He said Harris has a plan to bring good-paying manufacturing jobs home “and ensure Michigan workers continue to lead the world in auto manufacturing.”

Agriculture giant Syngenta to grow in China as Beijing seeks food security, sustainability

https://www.scmp.com/business/china-business/article/3278895/agriculture-giant-syngenta-grow-china-beijing-seeks-food-security-sustainability?utm_source=rss_feed

Syngenta Group, one of the world’s largest agricultural technology firms, aims to boost its sales and service network in China by two-thirds in four years as the nation strives to achieve food-security and sustainability objectives.

The company has set a target to expand its “modern agricultural platform” service centres in the country to 1,000 by 2028 from just over 600 currently, said Petra Laux, chief sustainability officer of the Basel, Switzerland-based company.

“In China, which has a fifth of the global population and just 9 per cent of the arable land, there are still many gaps in productivity [compared] with other major growing nations for soybeans and corn,” she told the Post.

“At the same time, there is a need to promote farming practices that help preserve biodiversity, improve water retention and reduce greenhouse-gas emissions.”

With limited land and water and an ambition to boost food self-sufficiency, China must greatly increase farming productivity through technology, including genetically modified seeds and advanced crop protection products.

In April, China’s Ministry of Agriculture and Rural Affairs issued a report projecting that self-sufficiency in staple food crops would rise to 92 per cent by 2033, with annual production growth of 1.1 per cent exceeding consumption growth of 0.3 per cent.

The report also outlined big reductions in grain imports by 2033 as compared with last year: 75 per cent to 6.8 million tonnes for corn, 60 per cent to 4.85 million tonnes for wheat and 21 per cent to 78.7 million tonnes for soybeans.

The projections align with President Xi Jinping’s goals, laid out last year, for the nation to achieve agricultural modernisation by 2035 and to become a power in the field by mid-century.

A unit of Sinochem Holdings, Syngenta Group comprises assets acquired by fellow state-owned firm ChemChina in 2017 through its US$43 billion acquisition of Switzerland’s Syngenta AG, plus the merged fertiliser and crop-protection businesses of ChemChina and Sinochem. The company withdrew an application to list on the Shanghai exchange earlier this year.

More efficient farming methods are important not only for China but also for the world. The global population is expected to surpass 10 billion by 2057, according to the United Nations, while at the same time the global community needs to achieve carbon neutrality to contain global warming below 2 degrees Celsius.

“We must not let up on productivity, because there will be more people, and people want more protein,” Laux said. “We also need more biomass for low-carbon fuel production and biodegradable plastics, so agricultural land must remain highly productive.”

Agriculture contributes a quarter of global greenhouse-gas emissions and accounts for 70 per cent of water usage, she added.

Syngenta’s 600 training and service centres and its mobile app can reach more than 100,000 farmers in China, according to the company. They can learn about productive and sustainable farming practices that suit the soil conditions and crops of their farms, as well as purchase fertiliser, pesticides, herbicides, seeds and equipment from Syngenta and its partners.

Sustainable practices include crop rotation, evidence-based use of farming inputs, no-till farming and planting of cover crops. These techniques help reduce water loss, soil erosion, carbon emissions, fertiliser run-off and loss of soil biodiversity.

“Typically, if the yield doesn’t come, farmers believe they need more fertiliser,” Laux said. “This is dangerous, since often it is not the fertiliser that is missing, but there is probably a problem with soil acidity or salt concentration. Adding more fertiliser would compound the problem rather than addressing it.”

A Syngenta survey last year covering 3,860 mainland farmers found that 56 per cent had received training at its service centres. And those who adopted the practices they learned there achieved yield boosts of 8 to 15 per cent compared with those who had not received training. They also used water, fertiliser and pesticides 26 to 30 per cent more efficiently, the company said.

US officials head to China for talks amid overcapacity concerns

https://www.scmp.com/news/world/united-states-canada/article/3278931/us-officials-head-china-talks-amid-overcapacity-concerns?utm_source=rss_feed

Senior US and Chinese economic officials will meet for discussions in Beijing this week as the Biden administration seeks to – once again – make its case for Beijing to avoid roiling the rest of the world with an industrial policy that has stoked manufacturing exports.

During the talks of the so-called Economic Working Group, due to take place September 19-20, the US Treasury will lay out its concerns about China’s economic trajectory, especially its macroeconomic imbalances and industrial overcapacity, an official from the department said.

The Treasury official added that the US is concerned about Chinese policymakers’ preference to push manufacturing even further as China’s growth driver, with significant spillovers to American firms and workers.

US Treasury Secretary Janet Yellen has repeatedly warned that China’s overcapacity threatens to flood global markets with artificially cheap goods, killing off industries in the US and globally.

In May, the US increased tariffs on a range of Chinese-made products, and Yellen has been at the forefront of urging US allies also to act on the issue.

The US delegation will be made up of officials from the Treasury and Federal Reserve Board, and will be led by Treasury Undersecretary for International Affairs Jay Shambaugh.

“During our trip we will further our discussions on China’s macroeconomic imbalances and industrial policies that risk causing significant harm to workers and firms in the US and around the world,” Shambaugh said.

It’s important to have a “resilient channel” for talks, “especially in areas where we disagree,” he said.

The meetings are part of an effort by the Biden administration to maintain channels of communication with its key geopolitical rival, especially on shared challenges, while also pursuing policies to protect national security.

Yellen has met her counterpart, Chinese Vice-Premier He Lifeng, three times since last July – twice in Beijing and once in San Francisco.

The two countries agreed to set up two working groups to discuss economic and financial issues last September, shortly after Yellen’s first visit to China in her current role.

Senior US official defends blend of diplomacy and competition with China in Indo-Pacific

https://www.scmp.com/news/china/diplomacy/article/3278934/senior-us-official-defends-blend-diplomacy-and-competition-china-indo-pacific?utm_source=rss_feed

A senior American diplomat responsible for the US policy of a “free and open” Indo-Pacific defended the approach Tuesday of combining “intense diplomacy” with Beijing while pursuing “intense competition”.

“Let’s not underestimate the achievement of making sure that we have channels of communication between Washington and Beijing,” Daniel Kritenbrink, the US assistant secretary of state for East Asian and Pacific affairs, said during an event at the Stimson Centre think tank.

Reducing the risk of an accidental conflict between the two superpowers, he added, was “our top priority”, saying that US President Joe Biden and his administration were doing “everything possible” to defuse tensions.

Kritenbrink contended, in fact, that the most dangerous period in the relationship had already passed. He said that point occurred more than a year ago, when the transit of a Chinese balloon over US territory led Secretary of State Antony Blinken to cancel his trip to Beijing in February 2023.

China declared it was merely a weather balloon that had strayed off course; the US called it a spy balloon and downed it off the coast of South Carolina.

“We barely had any channels of communication whatsoever,” Kritenbrink recalled. “Now, if we fast-forward a year and a half from there, this relationship is as complicated as ever.”

As a result, he said, diplomacy with China was “more important than ever” and the high-level engagement would continue.

Kritenbrink said that the US was “approaching” and “dealing” with China from a “position of confidence”, adding that “we do recognise that intense competition” with China required “intense diplomacy”.

After Chinese President Xi Jinping travelled to San Francisco in November and met with Biden on the sidelines of the Apec conference there, several senior US officials have held face-to-face talks with their counterparts in Beijing.

In February, Blinken met with Chinese Foreign Minister Wang Yi in Germany on the sidelines of the Munich Security Conference. The two also held talks in Beijing in April and again in Vientiane, Laos, in July during the Asean ministerial meetings.

In August, National Security Adviser Jake Sullivan met with Xi in Beijing.

Both sides have renewed cooperation in areas like counternarcotics and resumed direct military-to-military dialogue. Even so, tensions over the South China Sea, Taiwan and trade persist.

This week a group of US officials, led by Jay Shambaugh, the Treasury Department’s undersecretary for international affairs, is travelling to Beijing to raise Washington’s concerns about Chinese manufacturing overcapacity flooding global markets.

The US will continue its China strategy, Kritenbrink said, focused on three aspects: investing domestically on manufacturing and infrastructure; aligning with allies and partners in addressing Chinese aggression and economic coercion; and competing in areas including cutting-edge technologies like AI.

Kevin Rudd, the former Australian prime minister who is now his country’s ambassador to the US, followed Kritenbrink at Stimson, and alluded to the impact the current presidential election campaign season played on US foreign policy.

“I know how deep the tides of protectionism now are flowing within this country for a whole range of reasons,” he said. “If you ask me how what needs to be addressed by whichever side of politics provides within that election, it’s bringing more and more of your allies within the economic tent.”

Asked what the US was lacking in its bid to counter China, Rudd said that the next administration should recognise an effective Indo-Pacific strategy must not be limited to geopolitics and military: “It must equally be about the economy, trade and investment.”

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Can China strengthen climate defences before it’s too late?

https://www.scmp.com/opinion/china-opinion/article/3278671/can-china-strengthen-climate-defences-its-too-late?utm_source=rss_feed

Super Typhoon Yagi’s significant impact on southern China and Typhoon Bebinca’s lashing of Shanghai are more reminders of the country’s vulnerability to the effects of climate change, particularly extreme weather events.

According to the 2023 China Climate Bulletin, extreme weather set temperature records last year. Notably, temperatures in a township in Xinjiang Uygur autonomous region reached a record high of 52.2 degrees Celsius in July 2023.

The consequences are costly. In July this year, extreme weather events caused China around 76.85 billion yuan (US$9.9 billion) in economic losses, with 88 per cent of the losses due to heavy rains and floods, according to the country’s Ministry of Emergency Management. Nearly 26.4 million people were affected.

Managing extreme weather events has long been critical to maintaining political legitimacy and stability in China. Tied to the “mandate of heaven”, failures in this area, particularly flooding, have historically signalled a dynasty’s loss of authority. This practice dates back over 4,000 years to Yu the Great of the Xia dynasty, who is said to have tamed the Yellow River.

Chinese central authorities have emphasised the need for effective climate adaptation and mitigation strategies. They have released documents, such as the National Climate Change Adaptation Strategy 2035, to help guide national efforts. But there’s more that can be done.

As climate-related disasters increase, integrating climate change into water management is key for effective response planning. Flood forecasting, climate change modelling, hazard mapping and climate risk assessments must be strengthened across China to refine hydrological projections and identify vulnerable areas. Enhanced data collection and forecasting allow authorities and communities to take preventive measures earlier.

There are clear benefits. The United Nations highlights that an US$800 million investment in early warning systems could prevent annual economic losses between US$3-16 billion a year in developing countries. Meanwhile, giving just 24 hours’ notice of impending hazardous events could reduce economic damage by 30 per cent.

The success of this approach was seen in 2023 when Myanmar’s improved disaster management for Cyclone Mocha, including domestic early warnings, resulted in significantly fewer casualties compared to Cyclone Nargis in 2008, which caused up to 140,000 deaths.

The lack of a weather radar network that could predict cyclones and the lack of an early warning system were major factors in the high death toll from Cyclone Nargis. Analysts at the time speculated that it could precipitate significant political change in Myanmar, including the destabilisation of the country’s military regime.

Investing in artificial intelligence (AI) and advanced satellites could also significantly enhance climate monitoring and data collection. China could look to Australia, which has made major developments in this area, and which has recently signed a climate change cooperation memorandum of understanding with Beijing.

For example, the Flood and Storm Intelligence Sensing project in the Australian state of New South Wales is trying out the use of AI and mobile networks to predict flooding impacts by integrating localised real-time weather data and historical Bureau of Meteorology data to predict the expected impact of flooding on communities. These advancements could greatly support China’s climate resilience efforts.

Challenges lie ahead. Beyond the costs of upgrading infrastructure and managing land use, other key issues like fragmented policies and poor coordination between municipalities and regional governments must be addressed. In the case of the Yangtze and Pearl River deltas, according to a recent study in the journal Nature, a lack of delta-wide plans that “systematically zone land and prioritise investments within one unified hydrological system” has resulted in a fragmented approach to disaster management.

In the aftermath of the severe summer flooding in Beijing in 2023, for instance, experts pointed out that government bodies often look after their own jurisdiction. By aiming to move the problem and divert the floods quickly, even more pressure was placed on the downstream areas, worsening the situation.

To avoid similar incidents, cooperation across jurisdictions between central and local governments and across different departments is necessary. Doing so can enhance the effectiveness of climate adaptation measures while also acknowledging that climate impacts and infrastructure needs may vary across different areas.

Funding initiatives to address extreme weather events in China is another challenge due to potentially high costs. The sponge city concept, rolled out in 2015 to manage stormwater, exemplifies these challenges. Although the central government allocated 400-600 million yuan (US$56.4-86.6 million) per city for initial sponge city projects, total spending has reportedly exceeded US$12 billion. Beijing covers only 15-20 per cent of these costs. Local governments and the private sector are responsible for the rest.

However, local governments burdened by substantial debt may struggle to prioritise such expensive projects. Concerns are compounded by the ongoing efforts of local governments to address revenue shortfalls by liquidating state-owned assets in a process described as “smashing iron pots and selling the steel”.

Amid a national economic slowdown, local governments facing soaring debt may understandably prioritise immediate needs over long-term climate resilience programmes. To this end, local governments may seek loans from the central government, private sector investment or even enter public-private partnerships.

The rising frequency, duration and intensity of extreme weather events in China has already led to substantial economic losses and widespread impact. While some significant steps have been made to address these concerns, major hurdles lie ahead. To better support the country’s resilience to future extreme weather events, China must strengthen both cooperation across jurisdictions and invest more in advanced technologies.

China trade tased from all sides, backing Beijing into an economic bind: analysts

https://www.scmp.com/economy/global-economy/article/3278902/china-trade-tased-all-sides-backing-beijing-economic-bind-analysts?utm_source=rss_feed

China’s export growth faces increasing risks as pressure to raise import tariffs spreads beyond advanced countries to less-developed ones amid tit-for-tat retaliations and concerns about excess capacity, according to analysts.

The world’s second-largest economy, long seen as the so-called workshop of the world, has been on the receiving end of measures targeting its solar panels, electric vehicles (EVs), steel, aluminium and even low-value retail goods.

Mounting tariffs on Chinese exports could pressure growth because trade is so crucial to the world’s second-largest economy, said Christopher Beddor, deputy China research director with Gavekal Dragonomics in Hong Kong.

“Strong exports are papering over severe weaknesses in the Chinese economy,” Beddor said. “If external demand starts to flag because of tariffs, officials will suddenly need to start making some very uncomfortable trade-offs between controlling debt and maintaining relatively high growth.”

The list of countries raising tariffs includes the US, the EU and Canada, as well as emerging markets such as Brazil, Mexico, Turkey and India. Japan has also launched an anti-dumping investigation into a type of rubber product.

US President Joe Biden’s administration intends to impose a raft of new and raised tariffs on China on September 27, vowing to protect strategic industries from its state-driven industrial practices.

These tariffs include a 100 per cent duty on EVs, 50 per cent on solar cells and 25 per cent on steel, aluminium, EV batteries and key minerals. The duties follow US tariffs targeting US$550 billion in Chinese goods as part of a trade dispute that has festered since 2018.

The Biden administration also said on Friday that it was moving to curb low-value shipments entering the US duty-free under the US$800 “de minimis” threshold that Chinese e-commerce firms such as Shein and Temu have taken advantage of.

Meanwhile, the European Commission is ready to place 35.3 per cent tariffs on EVs built in China, on top of its standard 10 per cent car-import duty. The commission suspects that Chinese government subsidies are keeping EV prices cheap.

“The risk of intensifying trade wars is very real,” said Stephen Olson, a visiting fellow with the Institute of Southeast Asian Studies.

He said Chinese exports, for their part, will grow only more competitive as China grooms its “new quality productive forces”, a term coined by President Xi Jinping a year ago to underscore the need for economic development based on innovation in advanced sectors.

“China’s commitment to boosting new quality productive forces is rock-solid, and that will almost certainly lead to a surge in highly cost-competitive exports,” Olson said.

Beyond Western countries, India said last week that it would impose tariffs of between 12 per cent and 30 per cent on some steel products imported from China and Vietnam in a bid to boost local industry. In June, Turkey announced a 40 per cent additional tariff on vehicle imports from China that became effective from July.

Mexico in April levied temporary tariffs between 5 and 50 per cent on 544 items such as steel and aluminium, from countries with which it lacks trade agreements – China included. The Mexican government cited the pursuit of “fair market conditions” for its own industries.

And Brazil anticipates raising tariffs on electric vehicles from the current 18 per cent to 35 per cent in July 2026 to encourage growth of a domestic industry. Year on year, exports of Chinese cars to Brazil from January to May jumped more than sixfold to 159,612 units, according to the China Association of Automobile Manufacturers.

Analysts said that, as advanced economies such as the US and European Union have slapped tariffs on Chinese goods, there are concerns from less-developed countries that they will get an increasing share of China’s excess capacity because other markets are effectively blocking those shipments.

“There is a real possibility of a domino-type effect taking place, where other countries also raise their tariffs against China,” said Jayant Menon, a senior fellow at the ISEAS-Yusof Ishak Institute in Singapore. “This is more likely to be driven by national concerns than any political sympathy for allies.”

China has filed an appeal with the World Trade Organization over Europe’s EV tariffs, calling them unfair, and has urged the US to reverse its decision to expand tariffs on Chinese goods. Chinese officials have downplayed overseas fears of overcapacity.

The Ministry of Commerce in Beijing has said it would take necessary measures to safeguard the rights and interests of Chinese companies from “discriminatory” measures.

The surge in tariffs from so many nations threatens to dim income from Chinese exports – a bright spot in an economy struggling with reluctant consumer spending and real estate issues, analysts say.

Exports rose 8.7 per cent in August from a year earlier to US$308.65 billion, beating the July growth rate.

“The tariffs mean risks to China’s export growth are clearly tilted to the downside going forward,” Beddor said.

Olson, who is also a former trade negotiator with the Office of the United States Trade Representative (USTR), said China has been restrained thus far.

“As trade actions against China mount, my view is that China will not hesitate to respond forcefully when it believes it is warranted,” he said.

China’s tariffs imposed on other countries are meant to “reciprocate” and signal that it can keep fighting back if needed, said Stephen Nagy, a visiting fellow with the Japan Institute for International Affairs think tank in Tokyo.

Meanwhile, not all world leaders are keen on targeting China. Spanish Prime Minister Pedro Sanchez, for example, has called on the EU to rethink plans to impose tariffs on Chinese-made EVs.

Olson anticipates “a continued lively debate with the EU over the EV tariffs”.

“And some sort of a managed trade agreement with China to avert or reduce the tariffs is entirely possible,” he said.