Mistral点评

• Canada aims to match US on banning Chinese-made car software
• At UN, Wang Yi expresses China’s support for Lebanon after fatal Israeli strikes
• China and Brazil at UN seek to revive plan to end Ukraine war through mediation
• 7 takeaways from China’s most significant stimulus package since the pandemic
• PLA sends South China Sea commander to US for first time in over 2 years
• Taiwanese suspect in Philippines double murder ‘to be extradited to mainland China’
• Sri Lanka to seek ‘maximum support’ from China under new leader Dissanayake, analysts say
• Chinese artist Ai Weiwei’s sculpture ‘Porcelain Cube’ smashed in Italy, Czech man arrested
• China urges ‘calm, rational’ response from Tokyo after fatal stabbing of Japanese boy
• North Korea eyes membership in China-led Brics, amid growing ties with Russia
• South China Sea: Philippines says record 251 Chinese ships spotted in its waters in 1 week
• Chinese scientists create energy from lotus leaves, opening door to plant power source
• How China’s classroom culture of complaint has turned toxic – and not just for teachers
• China to probe Calvin Klein, Tommy Hilfiger parent firm over Xinjiang cotton
• Biden to focus on foreign policy legacy including China relations in UN speech
• Chinese research ship docks in Hong Kong on return stopover after deep-sea mission
• China’s EV exporters, dealers squeezed at home and abroad as price war rages
• China unleashes boldest stimulus in years to boost ailing economy
• Woman in China choked to death after rejecting step-grandfather’s demand for money
• Nanotechnology pioneer Wang Zhonglin leaves US to work in China ‘full time’
• Michael Kovrig: detention by China amounted to psychological torture, Canadian says
• Constellation CEO says US should copy China to meet AI power use
• China tea shop in hot water after ‘funny’ video of staff wearing paper handcuffs backfires
• China’s car dealers struggle with US$20 billion of losses amid price war
• China to cut rates, reserve ratio to support economy
• For China, a Cambodian canal project shows how Belt and Road Initiative can go only so far
• Trump listens but is mostly quiet at event about China’s influence on US economy
• US-China research has given Beijing’s military technology a boost, House GOP says
• Canadian who was detained by China on spying charges says he experienced psychological torture
• Brazilian officials work with China on details of joining belt and road
• Miner backed by Canadian province vows to compete with China in rare earths
• How China can turn its demographic challenge into economic edge
• US targets China’s rare earths dominance with minerals-security finance network
• Japan, China Reach Deal on Radioactive Water that Led to Seafood Ban

Canada aims to match US on banning Chinese-made car software

https://www.scmp.com/news/world/united-states-canada/article/3279819/canada-aims-match-us-banning-chinese-made-car-software?utm_source=rss_feed

Canada is looking at banning Chinese-made software in vehicles after the US took steps toward doing so, Finance Minister Chrystia Freeland said on Tuesday.

“The short answer is absolutely,” she told reporters when asked whether Canada was considering following the US move. “Our government has made very clear that we take really seriously intentional Chinese overcapacity and we take very seriously the security threat from China.”

Prime Minister Justin Trudeau’s government has already announced a 100 per cent tariff on Chinese EVs, along with 25 per cent tariffs on aluminium and steel. Last month Freeland also launched a consultation on other Chinese goods that could get hit with steep duties, including battery parts and critical minerals.

Freeland has justified those tariffs on the basis that China is engaging in unfair trade practices by overproducing goods using massive state subsidies to undercut industries in other countries.

But it is unclear whether the tariffs will survive a legal challenge through the World Trade Organization. China recently announced it would challenge the levies under WTO provisions that both countries have signed onto.

Banning Chinese-made car software would probably be a more permanent measure to keep the country’s electric vehicles from entering the Canadian marketplace, according to government officials who spoke on condition they were not named. But Canada is also weighing the security and privacy aspects of the software in deciding how to proceed.

The US has said Chinese vehicle software is a national security threat, given the amount of data the connected cars can collect and send. For its part, China has said it respects data privacy and the security of its foreign customers and the principles of fair competition.

If Canada chooses to ban the software on security grounds, it is possible new legislation would be needed first, one government official said. That would complicate the introduction of a ban given an election could be triggered any time within the next year – an election that could result in a change of government, given Trudeau is trailing badly in the polls.

Trudeau’s government has previously banned Huawei Technologies from its wireless networks due to security concerns around the firm’s connections to the Chinese government. However, that ban addressed Huawei equipment installed into the wireless network itself, not individual Huawei phones, making it an imperfect example to apply to electric vehicles.

Alternatively, Canada could use privacy law to put restrictions on Chinese-made software. It has not been decided yet which approach Canada will take on the matter, or how quickly, the official said.

There would be widespread political and industry support in Canada for banning the Chinese software. Ontario Premier Doug Ford, whose province holds the lion’s share of Canada’s vehicle manufacturing, has already called on Trudeau to “stay in lock-step with our American allies” and ban the software.

Flavio Volpe, president of the Automotive Parts Manufacturers’ Association, urged lawmakers in Canada’s Parliament on Monday to ensure there is “no daylight” between American and Canadian measures when it comes to Chinese vehicles.

Currently there are few Chinese-made electric vehicles in Canada, aside from Tesla vehicles made in a Shanghai factory. But at least one major Chinese car producer, BYD Co., has hired lobbyists to look at entering the Canadian market.

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At UN, Wang Yi expresses China’s support for Lebanon after fatal Israeli strikes

https://www.scmp.com/news/china/article/3279821/un-wang-yi-expresses-chinas-support-lebanon-after-fatal-israeli-strikes?utm_source=rss_feed

Chinese foreign minister Wang Yi condemned “indiscriminate attacks against civilians” after deadly Israeli strikes in Lebanon as he began his schedule of meetings at the United Nations General Assembly.

China’s top diplomat issued a strong rebuke of Israel, whose air strikes on Monday killing at least 500 people, as he spoke with his Lebanese counterpart Abdallah Bou Habib on the sidelines of the annual gathering of world leaders in New York on Monday.

“Today, Israel carried out another large-scale air strike on Lebanon, causing heavy casualties. We strongly condemn this violation of the basic norms of international relations,” he was quoted as saying in a foreign ministry statement.

“We will always stand on the side of justice and our Arab brothers, including Lebanon. We pay close attention to the development of the regional situation …[and] firmly oppose indiscriminate attacks on civilians.”

Wang also condemned last week’s explosions of communication devices in Lebanon, which killed at least 37 people and wounded around 3,000. Israel was believed to be behind the detonation of pagers and walkie-talkies that targeted Hezbollah members.

He said the current situation was a spillover from the war in Gaza and urged the international community to have a clearer stance on the conflict while calling for unity of regional powers to speak in a “stronger voice”.

In Gaza, Hamas and Israel have been stuck in stalled negotiations since the US proposed a three-phase ceasefire in May. Beijing has been critical of the US’ supply of weapons to Israel as the source of the conflict’s escalation.

“China’s position is [to support] a permanent ceasefire and a full withdrawal of troops, and the effective implementation of the ‘two-state solution,’” Wang told Bou Habib. “Only in this way can the way be paved for the final resolution of the conflict. China is willing to work with Arab countries and the international community to continue to make efforts to this end.”

Bou Habib, quoted in the Chinese readout, thanked China for its support and said he looked forward to it continuing to play an active role in achieving ceasefires in Gaza and Lebanon.

China has recently brokered peace talks between factions in Palestine and engaged in shuttle diplomacy to promote a joint peace proposal with Brazil that calls for an end to the conflict.

Wang, who has had a flurry of bilateral meetings with top diplomats since Monday, is due to address the UN General Assembly this week and is expected to further promote China’s peacemaker role.

Brazil and China are scheduled to hold a conference on Friday with nearly 20 invited nations from the Global South – a gathering that excludes the US and the EU – to discuss a peace proposal for Ukraine.

Wang also discussed Ukraine in meetings with his German and Hungarian counterparts Annalena Baerbock and Péter Szijjártó amid strained relations with the EU over China’s support for Russia and a dispute over EV tariffs.

Germany and Hungary have distanced themselves from the EU’s proposal to impose up to 35 per cent duties on imported Chinese electric vehicles, which the bloc said is flooding European markets and harming local car manufacturers.

The EU is gathering consensus from member states to impose five years of tariffs starting in November while it continues negotiations with China. No consensus was reached in last week’s talks between the bloc’s trade commissioner, Valdis Dombrovskis, and Chinese commerce minister Wang Wentao.

Germany, China’s biggest trading partner in the bloc, abstained in an earlier advisory vote as it warned against possible retaliation that would affect its own car industry. German carmakers sell around a third of their vehicles in China.

Hungary, home to Chinese EV giant BYD’s first plant in Europe, opposed the tariff plan. It is also often at odds with the EU’s policy on China, including opposing continued funding for Ukraine.

Szijjártó, in a Facebook post after his meeting with Wang, said Hungary appreciated China’s peace efforts for Ukraine.

“It is sad for the Chinese and for us to see that some American and European politicians are constantly fuelling the tension in the transatlantic region, constantly adding fuel to the fire, which is accompanied by the pro-war mood,” he wrote.

Wang told the Hungarian diplomat that he hoped the EU will adopt a “more pragmatic and rational policy towards China”.

“China has always believed that China and the EU are partners, not rivals,” he told Szijjártó.

China and Brazil at UN seek to revive plan to end Ukraine war through mediation

https://www.scmp.com/news/china/diplomacy/article/3279822/china-and-brazil-un-seek-revive-plan-end-ukraine-war-through-mediation?utm_source=rss_feed

China and Brazil are expected to hold a meeting on the sidelines of the United Nations General Assembly in New York on Friday to advance their long-running proposal for mediation in the conflict between Russia and Ukraine, the Post learned on Tuesday.

At least 20 countries have declared an intention to send representatives to the meeting, including Azerbaijan, Colombia, Egypt, Kenya, Mexico, Saudi Arabia, Thailand, the United Arab Emirates and Vietnam.

Neither the United States nor the European Union is expected to take part, and, according to Brazilian newspaper Folha de S. Paulo, it is unclear whether the meeting will be attended by heads of state, foreign ministers or lower-level diplomats.

In a speech before the UN General Assembly on Tuesday, Brazilian President Luiz Inacio Lula da Silva addressed the Ukraine war, saying “it is now evident that neither side will be able to fully achieve its objectives through military means”.

Lula described the armed conflict between the two countries, under way since Russia invaded Ukraine in February 2022, as evoking “memories of the darkest days of the Cold War’s futile stand-off”.

“At this critical moment, creating conditions conducive to the resumption of a direct dialogue between the parties is essential,” he continued.

“This is the message conveyed by the six-point framework that China and Brazil are proposing to initiate dialogue and bring an end to hostilities.”

A source with the delegation accompanying Lula to New York told the Post they sought to “lay the groundwork for a peace conference that finds ways to stop the conflict” between Russia and Ukraine.

Brasilia’s proposal envisioning peace has been put forward since Lula won back the Brazilian presidency in 2022.

The issue was informally raised with mainland diplomats ahead of Lula’s state visit to Beijing in 2023 but was eventually put aside due to China’s lack of interest.

A restart came in May this year when Chinese Foreign Minister Wang Yi met in Beijing with Celso Amorim, the Brazilian presidency’s special adviser on international affairs, and endorsed a six-point plan to end hostilities.

Their proposal included allowing humanitarian aid to enter war-affected areas, protecting civilians, exchanging prisoners of war and halting the conflict.

In August, Li Hui, China’s special envoy for Eurasian affairs, met Amorim in Brasilia and said “more than 110 countries” supported the peace plan proposed by the two.

But Ukraine, the EU and the US rejected the plan, believing it would “reward” Russia and authorise its president, Vladimir Putin, to annex occupied territories.

Ukrainian President Volodymyr Zelensky last week criticised the Sino-Brazilian plan as “destructive”.

“We were not asked anything,” said Zelensky in an interview with Brazilian website Metropoles. “And Russia comes out and says that it supports the proposal of Brazil and China. What is the point of these theatrics?”

“It’s definitely not about justice, it’s not about values,” the Ukrainian leader added. “It’s definitely a lack of respect for Ukraine. We are not fools.”

Although the Chinese foreign ministry has yet to comment publicly on the planned meeting in New York, it highlighted the Sino-Brazilian plan.

In a statement on Tuesday, the ministry called on the warring parties to “de-escalate the situation and create the conditions for the resumption of direct dialogue until a comprehensive ceasefire is achieved”.

Some observers voiced scepticism about the Sino-Brazilian initiative yielding concrete results.

Bruna Santos of the Brazil Institute at the Wilson Centre, a Washington-based think tank, believed Ukraine lacked a “strong level of trust” in any of the countries so far confirmed to attend Friday’s meeting.

What is more, Santos said, Kyiv has been defying Washington’s request to confine its armed campaign within Ukrainian borders and appeared to regard attacking Russian territory now as its best strategic option.

The Sino-Brazilian initiative could prove a significant show of influence for Lula, she added, even if it had no direct impact on the conflict.

“While it won’t significantly affect Brazil’s position on the UN Security Council, for example, the effort reflects the type of reforms Brazil and other nations would like to see.”

7 takeaways from China’s most significant stimulus package since the pandemic

https://www.scmp.com/economy/policy/article/3279756/7-takeaways-chinas-most-significant-stimulus-package-pandemic?utm_source=rss_feed

People’s Bank of China governor Pan Gongsheng, minister of the National Administration of Financial Regulation Li Yunze and China Securities Regulatory Commission chairman Wu Qing held a joint press conference in Beijing on Tuesday.

The slew of measures announced were “bold by historical standards”, analysts said, as they represented the first time the central bank had offered a combination of rate cuts, reserve requirement ratio (RRR) cuts and structural monetary policies at the same time.

Specifically, analysts hailed the measures announced by the PBOC as the “most significant stimulus package since the early days of the pandemic”, but said greater fiscal support would still be needed to drive a turnaround in growth, with the world’s second-largest economy struggling to show an obvious rebound.

The move to lower the benchmark seven-day reverse repo rate – regarded as the most important benchmark rate following a change to the PBOC’s policy – from 1.7 per cent to 1.5 per cent, was hailed by Lynn Song, chief economist for Greater China at ING, as the “most important move”.

“Given previous patterns, markets had been leaning toward expecting multiple 10-basis-point rate cuts, so a 20-basis-point cut represents a slightly stronger than expected move,” he said.

“However, the net impact will depend on whether we see further cuts ahead, or whether the PBOC falls into a wait-and-see mindset after today’s policy package.”

The seven-day reverse repo is a type of short-term loan that the central bank uses to increase liquidity and influence other rates in the banking system.

Pan said the cut could effectively lower the one-year medium-term lending facility by 0.3 of a percentage point, and the loan prime rate by between 0.2 and 0.25 of a percentage point.

Existing mortgage rates would also be reduced by around half a percentage point on average, according to Pan.

Betty Wang, lead economist at Oxford Economics, said the move would narrow the interest-rate gap between new and existing mortgages, which has been a key motivation for homebuyers to repay home loans in advance over the past couple of years.

“The announced cuts to existing mortgage rates are smaller than what had previously been reported. And although the PBOC says the cuts will lower interest payments for homeowners by 150 billion yuan, the net transfer to households will be offset by the planned reduction in deposit rates. As such, it is unlikely to provide much support to consumption,” said Julian Evans-Pritchard, head of China economics at Capital Economics.

Song at ING said the cut “could offer some support for consumption in the coming month”, but that given the current propensity to save, the “effect certainly will not come through on a 1:1 basis”.

With the “most significant measures” announced by the PBOC, according to Evans-Pritchard, the central bank also announced a cut of half a percentage point to the RRR – the amount of cash that commercial banks must hold as reserves.

“The RRR cut will help reduce pressure on bank profitability by reducing the share of their assets that are locked up at the PBOC earning a low rate of return,” Evans-Pritchard said.

“But it won’t directly translate to stronger lending, especially since the move to a narrower rate corridor means the liquidity injected by the RRR cut will be quickly mopped up by the PBOC’s repo operations.”

Pan said that, with the RRR for the banking sector around 6.6 per cent, the PBOC still had more room to cut compared with the international level, and that the central bank may lower the rate by a quarter or half a percentage point by the end of the year.

The “well-signalled move” would bring the RRR for major banks from 10 per cent to 9.5 per cent, according to Song at ING.

“This move, in our view, is mostly to help buoy sentiment, as the current issue is not banks lacking the funds to lend, but rather a lack of high-quality borrowing demand amid downbeat sentiment,” he said.

“As we saw with the February RRR cut, this is unlikely to have a major impact on credit activity by itself, but in conjunction with the rate cut could help support credit activity.”

The cut to the RRR is expected to provide liquidity of about 1 trillion yuan (US$141 billion) into the market, according to Pan.

Pan also said the down payment ratio on second-home purchases would also be reduced from 25 per cent to 15 per cent following a similar move for first-home purchases in May.

But Song said that, due to the downbeat sentiment, the move is expected to have a limited impact, as households are unlikely to be swayed by the prospect of taking on a larger mortgage to acquire a second property when the overall price momentum is still trending downward.

Pan also reiterated support for a 300 billion yuan (US$42.5 billion) fund to encourage local governments to buy up unsold homes and convert them into subsidised housing.

The loan, of which 60 per cent was funded by the central bank, would see the ratio lifted to 100 per cent.

“This is a move that should ease the reticence of some banks to provide property-related loans and should help to accelerate property acquisition,” added Song at ING. “It will be worth closely monitoring how housing inventories develop in the coming months, and how proactive state-owned enterprises are in this process.”

As for the capital market, a structural monetary policy facility of 500 billion yuan (US$70.9 billion) would be established to allow security houses, fund-management firms and insurance companies to tap liquidity when purchasing stocks via a swap line of pledging their assets for high-quality assets.

A relending facility of 300 billion yuan, with an interest rate of 1.75 per cent, would be established to guide banks to support listed companies’ stock buy-backs and purchases.

PLA sends South China Sea commander to US for first time in over 2 years

https://www.scmp.com/news/china/military/article/3279769/pla-sends-south-china-sea-commander-us-first-time-over-2-years?utm_source=rss_feed

The People’s Liberation Army has sent its commander responsible for the South China Sea to the United States for the first time since Beijing shut down military ties more than two years ago.

China’s defence ministry on Monday confirmed that General Wu Yanan, who heads the PLA Southern Theatre Command, held a meeting with US Indo-Pacific commander Admiral Samuel Paparo during the Indo-Pacific Chiefs of Defence Conference in Hawaii last week.

It follows a video call between the commanders earlier this month, as the two militaries start to re-engage after communication channels were cut.

During last week’s meeting, “both sides had a candid and in-depth exchange of views on issues of common concern, focusing on implementing the consensus reached by the two heads of state”, the Chinese ministry said in a statement on Monday.

The US Indo-Pacific Command said Paparo had “underscored the importance of sustained lines of communication between the US military and the PLA to reduce the risk of misperception or miscalculation”.

The annual gathering of Indo-Pacific defence chiefs took place from Wednesday to Friday last week. Wu led the Chinese delegation to Hawaii, holding bilateral talks and exchanges with representatives of other nations including Thailand, Singapore, the Philippines, the United Kingdom and France.

At last year’s conference, in Fiji, China was represented by General Xu Qiling, deputy chief of staff in the Joint Staff Department of the Central Military Commission.

Zhou Bo, a retired PLA senior colonel and senior fellow with the Centre for International Security and Strategy at Tsinghua University, said it was natural that Wu would travel to the US to attend a multilateral conference now that the two militaries had resumed ties, and following the first call between the two commanders.

Beijing halted some key military-to-military communication channels – including at the theatre command level – in protest over Nancy Pelosi’s visit to Taiwan in August 2022, when she was US House speaker.

Zhou said that while Wu had not made a bilateral visit to the United States, his attendance at the conference was “helpful for both sides to deepen understanding”.

The world’s two largest militaries began re-engaging after the Chinese and US presidents agreed in San Francisco in November to restart communications between the PLA and the Pentagon, among other agreements to ease tensions in the relationship.

That was followed by a Chinese military visit to the Pentagon in January, when Song Yanchao, deputy director of the CMC Office for International Military Cooperation, met Michael Chase, US deputy assistant secretary of defence for China affairs.

Earlier this month, Chase led a delegation to the Xiangshan defence forum in Beijing, followed by a meeting with Chinese counterparts from the CMC office.

The US raised concerns during those talks over “China’s support for Russia’s defence industrial base and the impact that support is having on European and transatlantic security”, as well as China’s “ongoing aggressive harassment against lawfully operating Philippine vessels in the South China Sea”, according to the US Department of Defence.

Taiwanese suspect in Philippines double murder ‘to be extradited to mainland China’

https://www.scmp.com/news/china/diplomacy/article/3279803/taiwanese-suspect-philippines-double-murder-be-extradited-mainland-china?utm_source=rss_feed

A woman allegedly involved in the kidnapping and murder of a Chinese national in the Philippines will be extradited to China after being detained in South Korea, according to China’s state-affiliated media.

Chen Yu-hsuan, a 44-year-old from Taiwan believed to be working in the Philippines, was arrested in Seoul on Sunday, Hongxing News reported.

She is suspected of being behind the deaths of a Chinese citizen, surnamed Xia, and a Chinese-American businessman who had also been kidnapped.

The Taiwanese Criminal Investigation Bureau said on Tuesday that the suspect, identified by her surname Chen, was born in Taipei. It would “continue to pay attention to the matter, and the foreign ministry will assist in handling the matter in the future”, the bureau added.

Upon learning of the kidnappings, Beijing urged the Philippines in early July to find and “severely punish” those responsible.

The two victims were believed to have travelled together from Beijing to the Philippines on a business trip around June 20, and were found dead four days later.

Xia’s family reportedly paid a ransom of 3 million yuan (US$412,600).

A Chinese foreign ministry briefing in July cited “evidence provided by a friend” of the Chinese-American victim – who was surnamed Sun – showed he “had travelled to the Philippines at the invitation of the Philippine company Medev Medical Devices”.

Xia, 39, was an international marketing director of Hong Kong-listed Raimed Medical, and Sun, 45, was a distributor for a cardiovascular medical device company.

“Chat records provided by Sun’s assistant” showed he made the trip after a woman named ‘Li Na’ invited him to the Philippines to discuss overseas distribution business, ministry spokeswoman Mao Ning said.

Hongxing News cited the passport information of “Li Na” to claim she was in fact Chen Yu-hsuan from Taiwan. She would be sent to mainland China to stand trial as it had an extradition treaty with South Korea, the report said.

A joint investigative team involving workers from the Chinese and US embassies in Manila, the FBI and the Philippine police had been set up to investigate the crime.

The case caused a storm on Chinese social media after it was discovered that both men had been killed.

Beijing sees Taiwan as part of China to be reunited by force if necessary and most countries – including major backer the United States – do not recognise the self-governed island as independent. Washington, however, is opposed to any attempt to take Taiwan by force and is committed to supplying it with weapons.

Mainland Chinese courts have in the past tried and sentenced people from Taiwan who had committed crimes in foreign countries.

Kenya and Spain each extradited Taiwanese cyber fraud suspects to mainland China in the 2010s, and some were subsequently sentenced. Taipei lodged protests with Kenya and Spain about the extraditions.

There have been many cases in recent years of Chinese citizens being kidnapped in the Philippines, most related to illegal gambling and telecoms and internet fraud.

In June, four police officers assigned to the Philippine capital region were arrested for kidnapping three Chinese and one Malaysian tourist for ransom. In 20 kidnapping cases recorded since January last year, most of the victims were Chinese, according to the Philippine authorities.

Last year, six Chinese nationals were kidnapped from their home in Manila, four of whom were killed.

Sri Lanka to seek ‘maximum support’ from China under new leader Dissanayake, analysts say

https://www.scmp.com/news/china/diplomacy/article/3279800/sri-lanka-seek-maximum-support-china-under-new-leader-dissanayake-analysts-say?utm_source=rss_feed

Sri Lanka’s left-leaning president-elect Anura Kumara Dissanayake has yet to declare a precise China policy, but was expected to seek “maximum support” from Beijing through foreign direct investment, technology and tourism, according to analysts.

On Monday, Chinese President Xi Jinping congratulated Dissanayake on his election victory on Saturday, hailing bilateral ties as “a good example of friendly coexistence and mutually beneficial cooperation between countries of different sizes” while committing to work with his new counterpart to boost relations.

China’s foreign ministry said it anticipated “new progress” in the strategic cooperative partnership between the countries, based on “sincere mutual assistance and everlasting friendship”.

Dissanayake emerged as the election winner after a second round count with 42.3 per cent of the vote, while his closest rival, opposition leader Sajith Premadasa, won 32.7 per cent.

His election campaign promised tough anti-corruption measures and policies to help the poor, as the debt-ridden South Asian state continues to grapple with a massive economic crisis that has fuelled nationwide unrest.

Dissanayake, 55, leads a socialist electoral coalition – the National People’s Power (NPP) – as well as its main party, the Janatha Vimukthi Peramuna (JVP), a left-wing political group founded six decades ago to spearhead a communist revolution in the postcolonial South Asian state.

Dissanayake has appointed former air vice-marshal Sampath Thuyacontha, who was educated in China, as the new defence secretary.

Observers expected Dissanayake to be pragmatic in dealing with China during his five-year term, during which he is expected to help resuscitate an economy crushed by major policy errors, under-taxation and weak exports. Public debt has also surpassed US$83 billion and inflation soared to 70 per cent.

Dissanayake did not lay out a specific foreign policy position during his election campaign, but it is “highly probable” that he would prefer to work with China over its rival India, according to Priyanga Dunusinghe, an economics professor at the University of Colombo.

“President Dissanayake wants to get maximum support from China to develop Sri Lanka,” Dunusinghe said. “[He] may try to attract Chinese foreign direct investment and tourists to Sri Lanka and look for market opportunities for Sri Lankan exports.”

Since Sri Lanka is a member of China’s Belt and Road Initiative, Dissanayake may try to follow China’s development model, Dunusinghe said, adding that the president-elect might seek support from Beijing to develop digital infrastructure in the country.

Colombo joined the trillion-dollar infrastructure strategy in 2017, with both sides agreeing to cooperate to develop and invest in projects. The belt and road has played a significant role in port projects in Colombo and Hambantota, which Dissanayake has shown “greater interest” in, according to Dunusinghe.

“Dissanayake will be cautious given Indian concerns over closer ties between China and Sri Lanka, and amid recent political developments in the region,” Dunusinghe said, adding that Dissanayake’s predecessor, Ranil Wickremesinghe, applied a balanced approach towards both countries.

However, Colombo-based journalist and researcher Rathindra Kuruwita expected that Dissanayake would “treat China much more warmly” than the previous administrations of Wickremesinghe and Gotabaya Rajapaksa, who he said cosied up to India “at the expense of China”.

“Dissanayake and the NPP have pledged a non-aligned foreign policy, which had served Sri Lanka well in the 1960s and 1970s,” Kuruwita said, adding that Colombo needed Chinese investment to drive its exports and boost its manufacturing industry.

The JVP traces its origins to the pro-China faction of the Sri Lanka Communist Party in the 1960s and, historically, Beijing had tended to strengthen engagement with Sri Lanka when centre-left parties or politicians held power, Kuruwita said.

While increased engagement between Beijing and Colombo was expected, Dissanayake has also stressed maintaining strong ties with New Delhi, with increasing Indian investment a key part of his economic strategy, according to Kuruwita.

“Dissanayake has consistently denied any financial ties to China and reassured both Washington and New Delhi that Sri Lanka will not be used to undermine their security interests,” Kuruwita said.

Kalinga Seneviratne, a Sri Lanka-born researcher at Shinawatra University in Bangkok, said it was “too early to assess” Dissanayake’s diplomacy objectives.

“The main issues for his rural and working-class base was the cost of living, which has skyrocketed, and corruption, which people thought was not sorted out after the Aragalaya in 2022,” Seneviratne said, referring to eight months of protests that erupted as the economy collapsed.

But a widely circulated suggestion that Sri Lanka’s debt crisis was caused by China was not accurate, Seneviratne said.

“About 45 per cent of Sri Lanka’s debts were owed to [international sovereign bond holders] mainly based in the US,” Seneviratne said, adding that Wickremasinghe was pressured by the International Monetary Fund to increase the value-added tax while cutting government subsidies – moves that “hit people hard”.

Kuruwita said China had remained “largely disengaged” from Sri Lanka in terms of investments since the Covid-19 pandemic. The administrations of Wickremesinghe and Rajapaksa had both reneged on commitments under the influence of India, while Beijing shifted its focus to the Maldives, he said.

Chinese artist Ai Weiwei’s sculpture ‘Porcelain Cube’ smashed in Italy, Czech man arrested

https://www.scmp.com/news/world/europe/article/3279797/chinese-artist-ai-weiweis-sculpture-porcelain-cube-smashed-exhibition-italy?utm_source=rss_feed

A man smashed a sculpture by Chinese artist and activist Ai Weiwei during the private opening of his exhibition in the northern Italian city of Bologna, in an act of vandalism that the show’s curator described on Tuesday as a “reckless and senseless act.”

The large blue and white “Porcelain Cube” was part of the exhibition “Who am I?” inaugurated at Bologna’s Palazzo Fava on Saturday.

Italian media reported that local police arrested a 57-year-old Czech man, who said he was an artist. He was known for targeting important works of art in the past.

It is still unclear how the man gained access to Friday’s invitation-only event, but the museum confirmed that the exhibition opened to the public as planned on Saturday.

According to the artist’s wishes, the work’s fragments were covered with a cloth and removed. They will be replaced by a life-size print and a label explaining what happened.

Ai shared CCTV footage of the attack on his Instagram account, which showed the man hanging around the work before moving suddenly behind it and pushing it so that it smashed on the gallery floor.

The man then held a broken fragment in a gesture of triumph, before the museum’s security blocked him, pulling him onto the floor.

“The act of vandalism against Ai Weiwei’s work ‘Porcelain Cube’ is even more shocking when we consider that several of the works on display explore the theme of destruction itself,” said the exhibition’s curator Arturo Galansino.

“The destruction that Ai Weiwei depicts in his works is a warning against the violence and injustice perpetrated by those in power, and has nothing to do with this violent, potentially dangerous, reckless and senseless act,” he added.

Galansino described the attacker as “an habitual troublemaker seeking attention by damaging artists, works, monuments and institutions.”

“Unfortunately, I know the author of this inconsiderate gesture from a series of disturbing and damaging episodes over the years involving various exhibitions and institutions in Florence,” said Galansino.

Additional reporting by Reuters

China urges ‘calm, rational’ response from Tokyo after fatal stabbing of Japanese boy

https://www.scmp.com/news/china/diplomacy/article/3279763/china-urges-calm-rational-response-tokyo-after-fatal-stabbing-japanese-boy?utm_source=rss_feed

China’s top diplomat Wang Yi called for Tokyo to remain “calm and rational” during a meeting with his Japanese counterpart on Monday, following the fatal stabbing of a 10-year-old Japanese boy in the southern Chinese city of Shenzhen last week, adding that the attack should not be politicised.

Speaking with Japan’s Foreign Minister Yoko Kamikawa on the sidelines of the UN General Assembly in New York, Wang reiterated that the stabbing was an “accidental and individual” case.

“China will investigate and handle the case in accordance with the law, and will, as always, ensure the safety of all foreign nationals in China … while the Japanese side should see the case in a calm and rational manner, avoiding politicisation and amplification,” Wang said, according to China’s foreign ministry.

The attack last Wednesday, in which a boy was stabbed while on his way to his Japanese school, has added to divisions between the two countries, which are at odds over long-standing issues such as wartime history and territorial disputes, as well as Japan’s increasing alignment with the US.

It was the second attack against a Japanese student in China within three months, and has ignited a wave of anger in Japan that critics blamed on anti-Japanese sentiment in China through the education system and state-controlled media.

In June, a Japanese woman and her child were attacked with a knife in the eastern city of Suzhou. A Chinese bus attendant was killed in that incident.

Beijing has rejected claims that China promotes anti-Japanese education.

Kamikawa demanded that Beijing “clarify the facts, including the motive of the perpetrator, as soon as possible and provide a clear explanation ... and strictly punish the perpetrator and prevent similar incidents”, according to Japan’s foreign ministry.

During the nearly one hour meeting, she also urged China to take concrete measures to ensure the safety of Japanese nationals.

“The minister strongly urged an immediate and thorough crackdown on baseless, malicious and anti-Japanese social networking posts, including those related to Japanese schools, as they directly affected the safety of children and are absolutely unacceptable,” the Japanese ministry said.

Both sides did agree on efforts to improve bilateral ties.

Monday’s meeting came days after Beijing and Tokyo reached a deal under which China would gradually resume imports of Japanese seafood, one year after a trade ban imposed in response to Japan’s release of treated radioactive water from the damaged Fukushima Daiichi nuclear plant into the Pacific Ocean.

According to the agreement, the two sides would expand monitoring of the treated waste water under the supervision of the International Atomic Energy Agency with participation from China.

Beijing has repeatedly said it was one of “the most important stakeholders” regarding Japan’s discharge plan and has “merited reasons” to oppose what it called Tokyo’s “irresponsible move”.

In New York, Wang urged Japan to “keep its word and not to further complicate” the issue, the Chinese readout said.

Kamikawa said additional monitoring would be carried out soon to ensure that “visible progress towards the removal of the restrictions could be showed”, the Japanese statement said.

She also expressed “serious concerns about the situation in the East China Sea, including deployments of buoys, recent Chinese military activity around Japan – including an airspace intrusion in August and sailings by aircraft carriers around Japan’s territorial waters – as well as cases of Japanese nationals being detained”, according to the statement.

In Beijing, during a meeting with his visiting Japanese counterpart Yoshifumi Tsuge, Chinese foreign vice-minister Sun Weidong expressed condolences to the family of the stabbing victim and repeated that the attack was an “individual” case.

According to China’s foreign ministry, Sun also expressed “serious concerns” over Japan’s “recent negative moves”, which included attending the fourth in-person summit of the leaders of the , or Quad, which comprises the United States, , and

Sun also urged Japan to “be careful with its words and actions on Taiwan and sea-related issues … to stop telling China what to do on the South China Sea issue”, the Chinese statement said.

North Korea eyes membership in China-led Brics, amid growing ties with Russia

https://www.scmp.com/news/asia/east-asia/article/3279765/north-korea-eyes-membership-china-led-brics-amid-growing-ties-russia?utm_source=rss_feed

North Korea appears to be stepping up efforts to join the Brics bloc, a multinational group led by Russia and China, with its top diplomat notably skipping the UN General Assembly in favour of attending a Brics-related event.

However, experts said on Tuesday that North Korea’s membership remains unlikely, as the isolated regime’s desire to join may not gain the consent of all Brics member states.

Choe Son-hui, North Korea’s foreign minister, returned from Russia after attending the Eurasian Women’s Forum in Saint Petersburg from September 18 to 20, according to the Russian Embassy in Pyongyang. The triennial event included the Brics Women’s Forum and other Brics-related meetings.

Choe was notably absent from the UN General Assembly, currently under way in New York, as South Korean intelligence and observers had initially speculated that she might attend.

Her decision to participate in the Brics event reflects North Korea’s growing alignment with the Russian-led global order, according to South Korea’s Ministry of Unification.

“Although we have not witnessed any decisive moves so far, North Korea’s Foreign Minister Choe Son-hui recently attended an international event led by Russia, and the regime has been issuing official statements opposing the United States. Such actions suggest that North Korea likely intends to actively cooperate with the new global order being spearheaded by Russia in the future,” a ministry official said on Tuesday.

In June, a North Korean delegation led by Vice Sports Minister Kim Yong-gwon attended a Brics Plus meeting in Kazan, Russia, held alongside the multisport competition Brics Games.

Later that month, the North’s state-run Korean Central News Agency (KCNA) published an article endorsing Brics and its potential expansion, which, according to the report, could challenge the dominance of the US dollar. The article, written by North Korean analyst Jong Il-hyon, criticised the US for leveraging its military power and the dollar to assert global hegemony.

Cho Han-bum, a senior researcher at the state-run Korea Institute for National Unification, said these moves reflect North Korean leader Kim Jong-un’s broader strategy of fostering a new Cold War dynamic.

“Aligning with Brics fits Kim Jong-un’s efforts to escape diplomatic isolation by positioning North Korea as an active member within emerging global alliances. North Korea seems to be laying the groundwork to make a formal application,” Cho said.

Also, discussions within Brics about introducing a new currency to reduce reliance on the US dollar could be appealing to North Korea, as it might help the regime evade economic sanctions.

Brics, comprising Brazil, Russia, India, China and South Africa, expanded its membership at the 2023 Johannesburg summit by accepting Egypt, Ethiopia, Iran, Saudi Arabia and the United Arab Emirates.

This rare expansion seems to have encouraged North Korea to ramp up its efforts, especially given its growing ties with Russia.

However, Cho said Pyongyang’s economic size and international standing make its Brics membership unlikely.

“North Korea lags far behind other members in terms of economic strength and population size. Furthermore, the regime’s international sanctions and rogue state status would make it difficult for Brics members to agree on its inclusion unanimously,” the researcher commented.

“Being too close to North Korea risks severing relations with the US and European countries, which may not be a big issue for Russia, but it’s a stance not all Brics members are likely to embrace.”

Lim Eul-chul, a North Korea expert at Kyungnam University’s Far Eastern Institute, highlighted North Korea’s relationship with China as a key factor influencing its potential membership in anti-US blocs.

“While I wouldn’t completely rule out the possibility of North Korea joining Brics or the Shanghai Cooperation Organisation in the future, it’s unlikely to happen any time soon. China’s influence is pivotal in these decisions, but relations between Beijing and Pyongyang are currently strained,” Lim said.

Should North Korea eventually join the Russian-led multilateral grouping, this would further cement Brics as an anti-Western bloc, the professor said.

However, he suggested that such a scenario might not be entirely negative.

“If North Korea joins a formal multinational group, it could potentially alter its decades-long isolation and lead to more international engagement. In doing so, the regime might even begin to behave more responsibly like a normal state, so to speak,” he said.

South China Sea: Philippines says record 251 Chinese ships spotted in its waters in 1 week

https://www.scmp.com/news/asia/southeast-asia/article/3279781/south-china-sea-philippines-says-record-251-chinese-ships-spotted-its-waters-one-week?utm_source=rss_feed

The Philippine Navy on Tuesday said the number of Chinese ships in the West Philippine Sea – an area in the South China Sea the Philippines claims as its territorial waters – reached a record high for this year at 251.

This is the highest concentration of Chinese ships in the West Philippine Sea so far this year, Philippine Navy spokesman Rear Admiral Roy Vincent Trinidad said in a press briefing.

Trinidad said 28 Chinese coastguard ships, 16 People’s Liberation Army Navy warships, 204 Chinese maritime militia vessels and three Chinese research and survey vessels were recorded in the weeklong monitoring from September 17 to 23.

This was higher than China’s deployment of 157 vessels in the preceding week from September 10 to 16.

Trinidad said the highest number of Chinese vessels were sighted in Sabina Shoal, following the departure of Philippine coastguard ship BRP Teresa Magbanua, and in Second Thomas Shoal, where the Philippines has grounded an old navy ship serving as a navy outpost.

Several supply missions by the Philippine coastguard and the navy to Second Thomas Shoal have been blocked, rammed or harassed by Chinese vessels in the recent past.

Trinidad added that Chinese vessels usually leave during bad weather but return once the area is clear.

The navy official was not surprised by the increase as he said it remains within the force projection capability of China’s South Sea Fleet, the maritime force that Beijing maintains in the entire South China Sea.

He stressed that the presence of Chinese vessels in the Philippines’ exclusive economic zone remains “illegal.”

Chinese scientists create energy from lotus leaves, opening door to plant power source

https://www.scmp.com/news/china/science/article/3279733/chinese-scientists-create-energy-lotus-leaves-opening-door-plant-power-source?utm_source=rss_feed

Chinese scientists have created an energy generator that harnesses the transpiration of plants to create electricity, which could transform almost all leaves on Earth into a sustainable and continuous energy source.

The team said its leaf transpiration generator – which they demonstrated using a lotus leaf – was able to power small electronic devices, and could be used to create plant-powered electricity networks.

“This study not only uncovers the unprecedented hydrovoltaic effect of leaf transpiration but also provides a fresh perspective for advancing green energy technologies,” the team wrote in a paper published in peer reviewed journal Nature Water on September 16.

Hydrovoltaic electricity relies on the movement and interaction of water with solid surfaces. Current devices often require a consistent water supply, creating geographic limits as devices must be near bodies of water, such as rivers or dams.

“However, the natural transpiration of plant leaves, as the largest water flux on land accumulating immense latent energy, has rarely been directly harvested,” the researchers from the Fujian Agriculture and Forestry University said.

“Herein, we pioneered the development of a living lotus leaf transpiration generator (LTG) prototype device to demonstrate a viable electricity generation via leaf transpiration.”

Transpiration is the process of water movement through a plant’s roots to tip, and the evaporation of water through its leaves or flowers. The researchers estimated electricity generation through transpiration from plants across the globe could produce 67.5 terawatt-hours of electricity a year.

“Through further research and technical optimisation, leaf transpiration power generation has the potential to become a widely used and commercially viable technology. Its core advantages are sustainability, eco-friendliness and low cost,” said Hu Qichang, first author of the paper and a professor at the university.

A transpiration-based generator could offer distinct advantages over traditional hydrovoltaic generators, such as simple equipment, low costs and not need for a large-scale water source.

It could also function as a power source for scattered areas, such as farmland, without requiring large-scale infrastructure, Hu said.

The team created the LTG by placing a titanium mesh electrode on the upper surface of a lotus leaf to act as a cathode, while a titanium needle electrode was inserted into the leaf stalk to act as the anode.

As transpiration occurs, a water potential gradient is created between the stomata openings on the surface of the leaf and the plant’s roots. The upwards capillary action of water creates an electrical potential difference between the electrodes.

“Plants continuously exchange water with the environment through transpiration, so transpiration power generation can continue throughout the day, especially when there is sufficient sunlight,” Hu said.

The team found that several factors affected transpiration and performance of their device. A thicker stem diameter allowed for higher water transport rates, improving performance. A higher environmental temperature improved electricity generation, however increased relative humidity decreased generation.

“To achieve widespread commercial application, some challenges need to be overcome, such as improving the power generation efficiency of a single leaf, optimising the energy collection and storage system, and expanding its application scenarios,” Hu said.

“Currently, the power generation of a single leaf is relatively small. Our research shows that by connecting multiple plants and leaves, a distributed power network can be formed, thereby improving the overall energy output,” he said.

“In the future, this technology has broad application prospects in the fields of energy internet, smart grids, Internet of Things and sensing.”

While the performance of the LTG and understanding of its mechanisms are still in the early stages, Hu said the team would explore different methods to advance this technology.

This includes improving the contact between plant and electrode, exploring the physiological factors of plant transpiration on power generation, and combining the LTG with other green energy forms, such as wind and solar, to produce a multi-source generation system.

To show the universality of their device, they also used a number of plant species, and found they all had the capacity to drive electricity generation.

“This evidence firmly supports the universality of plant-based transpiration-induced electricity generation in nature, carrying profound implications for practical applications,” the team wrote.

How China’s classroom culture of complaint has turned toxic – and not just for teachers

https://www.scmp.com/news/china/politics/article/3279795/how-chinas-classroom-culture-complaint-has-turned-toxic-and-not-just-teachers?utm_source=rss_feed

For anybody unfamiliar with China, it might have sounded like an odd thing to say.

In the lead-up to September 10, the day recognised by the central government as Teachers’ Day, President Xi Jinping underlined the rights of teachers and the need protect their high social status.

As it suggested ways to implement Xi’s directions, the Ministry of Education said: “[We should] unswervingly deal with any action that fabricates rumours and smears teachers, to make sure teachers enjoy a high social reputation.”

To the unknowing observer, the comment could have come across as suggesting there are challenges to the dignity of teachers and their rights to punish students.

However, the remarks are more likely to be a veiled reference to the tide of tip-offs and complaints by parents and students against teachers, which according to mainland media, has dampened the morale of those professionals in the classroom and deterred others from taking up the job.

This culture of complaint is known as jubao, and is a constant threat to teachers in the classroom.

In an editorial in January, Shanghai-based news outlet The Paper ran an editorial saying the complaints had gone beyond legitimate concerns about misconduct to illegitimate ones such as students not getting enough homework or teachers being too soft on their classes.

The Ministry of Education has already been fairly explicit about what constitutes misconduct. In 2018 it released regulations saying the authorities had zero tolerance for physical punishment, sexual harassment, academic fraud, bribery, and payments from students for teaching.

The Paper reported that while many teachers supported the exposure of bad behaviour such as bribery or sexual harassment, many were troubled by endless complaints on trivial matters or fabrications.

Some of these trivial matters can erupt into consequential ones, given the ministry’s list of misconduct also includes making “wrong comments”.

In one case, an economics lecturer at Nanjing University of Aeronautics and Astronautics was suspended and investigated last year after students accused him of “hurting national pride” with wrong comments.

His error was apparently to suggest that more than half of the people in China would starve to death if Western countries imposed an economic blockade on China because its economy relied heavily on exports to these nations.

There are many other examples, and in some cases, teachers have lost their jobs.

This toxic culture of hasty complaints has left teachers very wary of what they say, fearful that a remark could be deemed politically incorrect.

It also extends beyond the country’s campuses, with the authorities reliant on tip-offs to clamp down on corruption, extravagances and dereliction of duty.

For example, inspection teams sent from the upper tiers of government often use tip-offs to help identify corruption at lower levels.

The growth of this kind of culture is partly because severe censorship limits the role mainland media have as a check on power. It is also partly due to the controls over non-governmental organisations, which restrict the independence of nominal watchdogs.

In these absences, the tip-off system has gone some way to exposing official misconduct of all kinds, but it has come at a heavy social cost: the breakdown of trust in the society.

In some cases, people have been motivated by their own interests to expose the wrongdoing of others. That self-interest can range from a student exposing the plagiarism of another to improve their chances of a place at graduate school, or a civil servant looking to rise up the career ladder by revealing a marital affair of a colleague.

Some mainland residents have compared today’s tip-off culture to the Cultural Revolution, when family members, neighbours and classmates turned on and reported each other.

However, there is a key difference between then and now. In the Cultural Revolution, reporting another for an infraction was for the greater goal of class struggle while now tip-offs are meant to substitute for an independent watchdog.

Nevertheless, the damage to the society through the spread of fear and mistrust is real. It is the last kind of environment that we should be creating to shape the next generation.

China to probe Calvin Klein, Tommy Hilfiger parent firm over Xinjiang cotton

https://www.scmp.com/economy/global-economy/article/3279760/china-probe-calvin-klein-tommy-hilfiger-parent-firm-over-xinjiang-cotton?utm_source=rss_feed

China has launched an investigation into the parent company of clothing brands Calvin Klein and Tommy Hilfiger for “discriminatory measures” related to products from its far western Xinjiang Uygur autonomous region, a move likely to compound already fraught trade tensions with the United States.

The Ministry of Commerce revealed on Tuesday it has initiated an investigation of PVH Group under the framework of its Unreliable Entity List (UEL) – a blacklist which could ban the firm from trade with China and prevent the flow of associated investment or people into the country.

After reports from various agencies to the UEL office, the ministry said, the American firm is suspected of “violating normal market transaction principles by arbitrarily boycotting Xinjiang cotton and other products,” an action the ministry said “severely undermines the legitimate rights and interests of Chinese enterprises” and “threatens China’s sovereignty, security and development interests.”

Per the ministry’s statement, PVH must submit written materials related to the case from the past three years within 30 days. During the period, PVH may present its defence, while the UEL office will conduct its own investigation, including inquiries and document reviews.

The ministry said its reactivation of the UEL mechanism was not taken lightly, and its use is intended only for “a small number of foreign entities that undermine market rules and violate Chinese law.

“Honest and law-abiding foreign entities need not worry at all.”

Biden to focus on foreign policy legacy including China relations in UN speech

https://www.scmp.com/news/china/diplomacy/article/3279737/biden-focus-foreign-policy-legacy-including-china-relations-un-speech?utm_source=rss_feed

President Joe Biden will focus on his foreign policy record during his final speech to the United Nations General Assembly on Tuesday, including the importance of UN reform, international coalitions and his efforts to manage relations with China, White House officials said.

“An important part of the president’s legacy has been thinking about how we responsibly manage our competition with China, and that includes many facets, economic, security, and those will be addressed,” one official said in the Monday night briefing.

The senior administration official declined to specify whether Biden would discuss peace and stability in the Taiwan Strait. “I won’t get into the details on specifically what he will mention on individual issues,” he said.

Biden’s speech is expected to reference themes emphasised throughout his administration, which has seen tensions with China intensify and closer ties between Beijing and Moscow following Russia’s February 2022 invasion of Ukraine.

The Biden presidency has featured greater cooperation with allies and a more pronounced distinction between democracy and authoritarianism.

“The president’s engagements this week reflect his vision for a world where countries come together to solve big problems,” the official said.

“This stands in contrast to some of our competitors, who have a more cynical and transactional world view and where countries interpret their self interest very narrowly and don’t work together for the common good.”

Biden is also scheduled to host a summit on fentanyl and other synthetic drugs later on Tuesday. China remains the main source of fentanyl and precursor ingredients trafficked into the United States.

Biden and his Chinese counterpart Xi Jinping pledged to address the problem at a summit in California last November, but US officials say China has not been cooperative, prompting the administration to take a more collective approach.

A US official said in July last year that by involving other countries in the effort, Washington hoped to indirectly spur the Asian giant to act.

“Part of the reason we’re trying to bring this coalition together is to engage other countries in their efforts against these supply chains and part of their responsibility is going to be engaging with China,” said Todd Robinson, an assistant secretary for the US State Department’s Bureau of International Narcotics and Law Enforcement Affairs.

Since the July 2023 launch of the Biden initiative, known as the Global Coalition to Address Synthetic Drug Threats, it has grown to include 158 countries and 15 international organisations.

The group aims to halt manufacturing, detect new threats and promote effective public health measures. China has opted not to join.

Also on Monday, a second White House official touted the administration’s progress. When Biden came into office, drug overdose deaths were increasing by more than 30 per cent annually, but the latest US provisional data shows an “unprecedented decline” in overdose deaths of roughly 10 per cent, she said.

Critics have strongly criticised the UN for failing to significantly slow climate change, address global poverty or stop wars rage in Ukraine, Sudan and the Middle East, with some 490 people reported dead and more than 1,600 injured by Israeli attacks on Lebanon this week, just as leaders gathered.

UN Secretary General Antonio Guterres organised a “summit of the future” on Sunday and Monday in a bid to lay out a road map on the institution’s 75th anniversary.

But many of the problems are intractable, and efforts to reform the UN Security Council are easily thwarted by the five permanent members – China, France, Russia, Britain and the United States – that wield veto power.

“If you follow the UN in the media, you basically just hear about vetos and failures and very little progress on the big crises of the day,” said Richard Gowan, UN director with the International Crisis Group. “We really need some good news out of the UN right now.”

Chinese research ship docks in Hong Kong on return stopover after deep-sea mission

https://www.scmp.com/news/hong-kong/society/article/3279755/chinese-research-ship-docks-hong-kong-return-stopover-after-deep-sea-mission?utm_source=rss_feed

A Chinese research ship with one of the most advanced submersibles in the world has made a stop in Hong Kong for the first time after finishing a mission exploring seamounts in the Western Pacific.

Shenhai Yihao, the mother ship of the Jiaolong submersible, docked at the Ocean Terminal in Tsim Sha Tsui on Tuesday, where it will remain for two days.

Scientists on the mission are scheduled to give four lectures at the Hong Kong Science Museum and hold a seminar to present their latest findings.

“This is not only an opportunity to exchange scientific research results, but also allows more Hong Kong citizens, especially young people, to realise the country’s outstanding development in deep-sea research,” Deputy Chief Secretary Warner Cheuk Wing-hing said at a welcome ceremony.

The ship recently concluded a 45-day research mission to explore seamounts – underwater mountains that are among the least-surveyed places on Earth. It collected more than 600 biological samples and found a dozen potential new species.

The 60 crew members included three scientists from Hong Kong, seven from mainland China and eight from other countries, making this the first time international researchers took part in a Chinese mission’s design, sampling, and scientific research.

The non-mainland scientists were led by Qiu Jianwen, a professor and associate head of the biology department at Baptist University. He was part of the crew in one of Jiaolong’s test dives in 2013 and completed another dive during recent mission.

Zhang Shan, a postdoctoral researcher at the Hong Kong University of Science and Technology (HKUST), took part in the first all-female crew to carry out the dive with Jiaolong.

She was amazed to witness the ocean water transition from bright blue to complete darkness at a depth of 1,270 metres (4,166 feet). To minimise disturbance to marine life, the submersible turned off its lights during its descent.

“When we turned on the lights at the deepest point, the entire seabed was suddenly right in front of me,” Zhang said, recalling her most unforgettable moment of the dive.

Xu Xuewei, the mission’s lead scientist and deputy director of the National Deep Sea Centre under the China Ministry of Natural Resources, said the team would continue looking into the samples it had collected and aimed to publish several research papers.

Eunice So Ka-yu, an 11-year-old pupil at Fukein Secondary School Affiliated School, was among three Hong Kong students selected to take part in a tour of the ship with officials and researchers on Tuesday.

“I feel I am one step closer to my dream of becoming an undersea life researcher,” she said.

Earlier this month, she and another 79 students from Hong Kong and mainland city Qingdao participated in an online video conference with the Shenhai Yihao crew, as part of a science education event organised by HKUST.

The Jiaolong submersible set a record in 2012 by diving to a depth of 7,062 metres during tests in the Mariana Trench. Although this record was later broken by another Chinese submersible, Jiaolong has completed more than 300 diving missions, making it one of the most advanced submersibles in service.

It has been more than 17 years since the last time a mainland deep-sea research ship, Dayang Yihao, visited Hong Kong in August 2007.

In April, another mainland-built ship, polar research icebreaker Xue Long 2, visited Victoria Harbour. It was open for public visits and attracted 7,200 Hongkongers.

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China’s EV exporters, dealers squeezed at home and abroad as price war rages

https://www.scmp.com/economy/china-economy/article/3279748/chinas-ev-exporters-dealers-squeezed-home-and-abroad-price-war-rages?utm_source=rss_feed

As a domestic price war has brought vehicle prices so low embattled dealers have urged the government to intervene, customs data shows Chinese carmakers are also slashing prices in overseas markets to stay competitive.

While China’s exports in August were at their highest in 2024, prices for electric vehicles (EVs) have been steadily declining.

The export value of Chinese EVs rose year on year last month, but the 3.73 per cent registered was below the 10 per cent growth rate observed in the number of units exported.

This translates to an 5.74 per cent year-on-year decline in EV prices, and an 11.67 per cent drop for the first eight months. The trend is particularly evident in the European Union, where a hotly contested trade investigation over imported EVs from China continues to play out.

Although China’s EV export prices to the EU saw a slight year-on-year increase in August due to provisional tariffs, overall prices dropped by 10.56 per cent compared to the previous month.

At home, the downward spiral is even more pronounced.

Chinese dealers have lost US$19.55 billion in the first eight months of the year, largely due to deep discounts offered in a desperate effort to stimulate sales, the China Automobile Dealers Association (CADA) said on Monday.

“Dealers are facing significant losses in new car sales, with widespread cash flow deficits and heightened risks of capital chain ruptures, making it increasingly difficult for them to survive,” CADA said in a post on its WeChat account.

The association attributed the downturn to weak consumer demand and inventory backlogs, which have forced dealers to sell at a loss to ease financial pressures.

“Existing liquidity has been squeezed to the limit,” it added.

In August, CADA said, the overall discount rate for new cars and light trucks reached 17.4 per cent, a slight easing from the 19 per cent recorded in the previous month.

The association has urged Beijing to promptly implement relief measures to head off systemic risks in the sector, including encouraging financial institutions to enhance funding and loan support for showrooms.

In an unwelcome omen for the world’s largest vehicle market, Grand Automotive Services Group – one of the country’s biggest car dealers – was removed from the Shanghai Stock Exchange effective August 28, after shares traded below their par value for 20 consecutive days.

China unleashes boldest stimulus in years to boost ailing economy

https://www.theguardian.com/world/2024/sep/24/china-economy-stimulus-package-measures-yuan-pbc

China’s central bank unveiled its strongest suite of economic stimulus measures since the start of the Covid pandemic, underlining the difficulty it faces in reviving an economy grappling with a prolonged property crisis and strong deflationary pressures.

Governor Pan Gongsheng said the People’s Bank of China will cut the amount of cash that banks must hold as reserves – known as reserve requirement ratios (RRR) – by 50 basis points. The People’s Bank of China will also cut a key policy rate by 0.2 percentage points to 1.5%.

Interest rates on existing mortgages will also be reduced by 0.5 percentage points on average, Pan said, in a move that could provide some relief to households but may raise concerns about bank profitability. Pan did not specify when the moves would come into effect.

“The move probably comes a bit too late, but it is better late than never,” said Gary Ng, senior economist at Natixis. “With an elevated real interest rate, poor sentiment and no rebound in the property market, China needs a lower-rate environment to boost confidence.“

The moves represent “the most significant ... stimulus package since the early days of the pandemic”, Julian Evans-Pritchard, Head of China economics at Capital Economics.

But “it may not be enough”, he warned, adding a full economic recovery would “require more substantial fiscal support than the modest pick-up in government spending that’s currently in the pipeline”.

China’s economy has struggled to rebound from harsh pandemic-era lockdowns, and previous piecemeal efforts to support the economy have failed to arrest a slowdown that risks the government missing its annual economic growth target.

China’s economy grew much slower than expected in the second quarter, weighed down by a protracted property crisis and consumers’ worries about job security. August economic data broadly missed expectations, adding urgency for policymakers to roll out more support.

The government is aiming for economic growth of around 5.0% for 2024, but some investment banks including Goldman Sachs, Nomura, UBS and Bank of America have recently lowered their forecasts for China’s growth rate this year.

Stocks rose and the onshore yuan opened at its strongest level since May 2023 on Tuesday’s news.

The yield on China’s benchmark 10-year government bond fell four basis points to 2.036%, close to the record low hit last week, while 30-year treasury futures for December delivery rose to a record high.

Pan said further monetary policy easing, including another RRR cut, was on the cards later this year.

The latest Chinese policy measures come after the US Federal Reserve last week delivered a hefty rate cut, which many analysts viewed as providing more head room for China’s central bank to ease monetary conditions without putting too much pressure on the yuan.

With Reuters and Agence France-Presse

Woman in China choked to death after rejecting step-grandfather’s demand for money

https://www.scmp.com/news/people-culture/trending-china/article/3279221/china-woman-20-choked-death-after-rejecting-step-grandfathers-demand-money?utm_source=rss_feed

A 20-year-old woman in China was strangled to death by her step-grandfather after refusing his demands for money.

The shocking case was heard by the Yuncheng Intermediate People’s Court in northern China’s Shanxi province on September 12, according to Jimu News.

The verdict had not been reached at the time of reporting.

The defendant, a 62-year-old man surnamed Zhang, was accused of committing intentional homicide after he murdered his step-granddaughter at her home in February.

According to the victim’s younger sister, surnamed Bai, Zhang came to their house early in the morning on February 22 to ask for money.

After his request was refused, Zhang beat the young woman and used an electric wire to deliver shocks to her mouth and chest. He then strangled her with the wire, causing her death.

“After killing my sister, Zhang waited at our home for over 10 minutes before he left,” her 18-year-old sister said.

The young women’s parents are both deceased.

Bai noted that there were messages on her sister’s mobile phone from Zhang demanding tens of thousands of yuan the week before the attack, claiming he needed money to buy a farm.

“My mother died in a road accident three years ago. There is a compensation fund available for me and my sister as living allowances, which was coveted by my step-grandfather,” Bai said.

The report did not provide details regarding how their father died.

“I don’t understand why he wanted money from us when he has his own child,” she said.

Bai mentioned that Zhang still had a key to their house because he and their grandmother lived there and cared for them many years ago, and the locks had not been changed.

She said she collapsed after her sister’s death because they depended on each other following their parents’ passing.

Bai shared that her sister was a second-year university student in northeastern Heilongjiang province.

“My sister’s beautiful life had only just begun, but it was abruptly and brutally ended,” said Bai. “I hope Zhang is sentenced to death.”

The news report sparked outrage on mainland Chinese social media.

“How cruel he is. I cannot find words to describe his atrocity,” one netizen commented on Weibo.

“The poor younger sister. She has no relatives left. Her parents died, and now she has lost her sister,” another user added.

Nanotechnology pioneer Wang Zhonglin leaves US to work in China ‘full time’

https://www.scmp.com/news/china/science/article/3279730/nanotechnology-pioneer-wang-zhonglin-leaves-us-work-china-full-time?utm_source=rss_feed

A world-leading nanoscience and nanotechnology scientist – known as “the father of nanogenerators” – has left his decades-long career in the US to focus his research efforts in his native China.

Wang Zhonglin is credited with developing the field of nanoenergy. His work in developing nanogenerators and self-powered systems opened up the technological potential for wireless devices that can be self-powered without a battery.

Multiple Chinese media sources, as well as a professor at the Georgia Institute of Technology – Wang’s faculty since 1995 – confirmed that he had resigned from his position and is working “full-time” in Beijing at the institute that he helped to found.

The council of the Beijing Institute of Nanoenergy and Nanosystems, under the Chinese Academy of Sciences (CAS), held its first meeting in July to establish its board and charter, along with Wang’s official role as director and inaugural chief scientist.

Neither Wang nor Georgia Tech – where he served as Regent’s Professor and Hightower Chair for the School of Materials Science and Engineering (MSE), and director of the Centre for Nanostructure Characterisation – responded before publication.

Wang took first place in this year’s Stanford/Elsevier ranking of the top 2 per cent of scientists – based on more than 40 parameters for millions of scientists worldwide – for the fifth consecutive time, but his listed affiliation switched from Georgia Tech to CAS in 2023.

The latest Stanford/Elsevier ranking also rates Wang – who was born in Shaanxi province, northwest China and became a US citizen – ahead of all other American scientists in terms of career-long scientific impact.

Wang is listed among emeritus and retired faculty on the Georgia Tech MSE website, where his profile describes him as “a pioneer and world leader in nanoscience and nanotechnology for his outstanding creativity and productivity”.

At time of publication, the link to Wang’s Georgia Tech research website was redirecting to the MSE School’s homepage. His personal research homepage also did not load, although both were operational a week earlier and showed details of Wang’s research group.

Georgia Tech is one of the US universities scrutinised by Congress for its collaborations with Chinese entities that are alleged to have military links.

Earlier this month, it ended research ties with Tianjin University and the jointly established Georgia Tech Shenzhen Institute, because of their continuing inclusion on the US Commerce Department’s export restrictions list, Reuters reported.

Wang’s fellow nanoscientist Charles Lieber – who was targeted by the Trump administration’s China Initiative in 2021 – also featured in this year’s Stanford/Elsevier ranking, coming in at 52nd place for career-long impact.

Lieber, former chairman of Harvard University’s chemistry and chemical biology department, was convicted for failing to disclose ties to a Chinese talent recruitment programme. Last month, he told the Post that he is exploring opportunities “in Hong Kong, mainland China and elsewhere”.

The China Initiative, which ended in 2022, left a lasting impact on the US research community, particularly on scientists of Chinese origin, and many have chosen to leave the country in its wake.

The fields of nanoscience and nanotechnology are of vital interest to both Beijing and Washington because of their wide applications in energy, medicine and industry, as well as military technology.

Both governments have identified them for research and development funding and the Beijing Institute of Nanoenergy and Nanosystems is one of several institutions established over the past decade to help China meet its development goals.

Wang, who was born in 1961 and graduated from what is now Xidian University in Xian, moved to the US in 1982 when he was selected for the first international student exchange programme after China’s opening up.

He received a PhD from Arizona State University in 1987, as one of more than 900 students to take part in the China-US Physics Examination and Application Programme (CUSPEA), initiated by renowned Chinese-American physicist Tsung-Dao Lee.

Wang was attending a conference in China at the end of 2010 when Bai Chunli, then CAS vice-president, asked him if he would be interested in taking the lead on the setting up of an institute focusing on nanoenergy and nanosystems.

According to a China Science Daily report published in 2022, Wang did not hesitate and made a proposal to Georgia Tech soon after his return to the US. After receiving approval to work on the project in China, he began immediately, it said.

Construction started in 2012 and the Beijing Institute of Nanoenergy and Nanosystems is now an international leader in its field, with a number of its scientists featured in this year’s Stanford/Elsevier single year ranking alongside Wang.

According to the institute’s website, its total number of people had reached nearly 700 by the end of 2022, with 30 research groups and six major specialised research units established.

Wang mentored a large number of young scientists, many of whom returned to work in China, according to his Georgia Tech profile.

“Among those he has supervised, 10 of them are faculty in US research universities, 10 are faculty in Taiwan, and over 80 are faculty in China, four in Korea and one in Canada, and four in Europe,” it said.

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Michael Kovrig: detention by China amounted to psychological torture, Canadian says

https://www.theguardian.com/world/2024/sep/24/michael-kovrig-canadian-china-detention-torture

A former Canadian diplomat detained by China for more than 1,000 days said he was placed in solitary confinement for months and interrogated for up to nine hours every day, treatment he said amounted to psychological torture.

Michael Kovrig, speaking to the Canadian Broadcasting Corp in his first major interview since his release, also said he had missed the birth of his daughter and met her for the first time when she was two-and-a half years old.

Kovrig and fellow Canadian Michael Spavor were taken into custody in December 2018 shortly after Canadian police detained Meng Wanzhou, the chief financial officer of Chinese telecoms equipment giant Huawei, on a US warrant. Both men were accused of spying.

“I still carry a lot of pain around with me and that can be heavy at times,” Kovrig said in his first substantial comments since he and Spavor were released in September 2021.

Kovrig noted that UN guidelines say prisoners should not be put into solitary confinement for more than 15 days in a row.

“More than that is considered psychological torture. I was there for nearly six months,” said Kovrig, who had been working as an adviser with a thinktank when he was arrested.

Kovrig said there was no daylight in the solitary cell, where the fluorescent lights were kept on 24 hours a day. At one point, his food ration was cut to three bowls of rice a day.

“It was psychologically absolutely, the most gruelling, painful thing I’ve ever been through,” he said. “It’s a combination of solitary confinement, total isolation, and relentless interrogation for six to nine hours every day,” he said. “They are trying to bully and torment and terrorise and coerce you … into accepting their false version of reality.”

Kovrig and Spavor were released on the same day the US justice department dropped its extradition request for Meng and she returned to China.

The Chinese embassy in Ottawa, responding to Kovrig’s interview, said he and Spavor had been suspected of engaging in activities endangering China’s national security.

Chinese judicial authorities handled the cases in strict accordance with the law, it said in a statement.

Bilateral ties remain chilly. China this month opened a one-year anti-dumping investigation into imports of rapeseed from Canada, just weeks after Ottawa announced 100% tariffs on Chinese-made electric vehicles.

Kovrig’s partner was six months pregnant at the time of his arrest. She played their daughter recordings of his voice and showed pictures of her father so she would recognise him when they finally met.

“I’ll never forget that sense of wonder, of everything being new and wonderful again and pushing my daughter on a swing that had her saying to her mother ‘Mummy, I’m so happy’,” Kovrig said.

Constellation CEO says US should copy China to meet AI power use

https://www.scmp.com/tech/tech-trends/article/3279692/constellation-ceo-says-us-should-copy-china-meet-ai-power-use?utm_source=rss_feed

To meet the surging demand for electricity to run artificial intelligence, the US should emulate China, according to the head of the power company that just inked a deal with Microsoft to reopen the shuttered Three Mile Island nuclear plant.

Big technology companies are proposing data centres so massive that they could only function if they are built alongside power plants, Joe Dominguez, Chief Executive Officer of Constellation Energy, said Monday in an interview with Bloomberg News. China is already taking that approach in the AI projects it is planning, Dominguez said.

That is a significant shift from the current models that rely on miles and miles of long-distance transmission lines to carry electricity. But there is a shortage of wires in the US and utilities say it can take years to connect facilities to the grid. The delays are a hurdle for data centre operators that need power as soon as possible – and AI’s importance to national security is compounding the urgency, Dominguez said.

“Constellation has been part of discussions with customers that are looking at multi-gigawatt data centres,” Dominguez said in the interview. “It could only be done at the location the power is produced.”

Across the US, energy companies are racing to meet a jump in electricity demand from power-hungry AI data centres, manufacturing facilities and electric vehicles. As recently as a few years ago, experts thought that solar and wind output would be sufficient to meet additional power needs. Now coal plants are being kept online longer, utilities are planning record amounts of new natural gas generation and nuclear reactors are popular again.

Constellation announced last week that it would restart a reactor at the Three Mile Island plant in Pennsylvania and deliver the power to Microsoft. And Amazon.com agreed in March to spend US$650 million to acquire a data centre campus connected to another nuclear plant in the state. Given the enormous power needs, nuclear plants that run around the clock are the best options for delivering energy to outsized US data centres, Dominguez said.

“AI is here to stay,” he said. “And the country has to be successful on AI from a geopolitical security perspective as well as an economic perspective.”

China tea shop in hot water after ‘funny’ video of staff wearing paper handcuffs backfires

https://www.scmp.com/news/people-culture/trending-china/article/3279444/china-tea-shop-hot-water-after-funny-video-staff-wearing-paper-handcuffs-backfires?utm_source=rss_feed

A leading Chinese tea shop chain got into hot water for creating a video it hoped would amuse internet users, but which instead attracted widespread criticism for being disrespectful to its employees.

The controversy arose from a clip released by the brand Good Me on social media earlier this month, featuring staff admitting to mistakes they had made at work, as reported by the Southern Metropolis News.

In the video, workers in uniforms had their heads lowered and were “handcuffed” with cardboard tea cup holders.

Hanging around the necks of some were cardboard signs stating things such as “the crime of forgetting to put a straw in the cup”, “the crime of overturning tea buckets”, and “the crime of not sticking on an expiration date label”.

One worker wore a larger cardboard sign around his neck that read: “I am guilty of not putting in a straw, not putting a lid on, and not adding nuts.”

Along with the footage, Good Me added the caption: “This is a warning. Next time…there will be no next time.”

The video went viral and was condemned by many online observers.

“Employees are humans too. Did you consider their dignity?” one commenter asked.

“I think the company is messing with these employees,” another remarked.

Amid the backlash, a worker from one of Good Me’s shops in Shenzhen, in southern Guangdong province, who participated in the filming, pointed out that the clip was intended to be entertaining.

“We were willing to take part in the filming. Our company took the initiative to make the video, and we cooperated. There is no such punishment [as depicted in the video] in our company,” they said.

The chain deleted the video from its social media account and issued an apology in a statement released on September 18.

“Sorry that we messed up in our video that we thought was funny,” it stated, adding that the content was inspired by other similar online videos that are popular.

“We thought it was a joke, but it was misunderstood and made some observers feel uncomfortable. We will take this into account and be more cautious with our marketing activities in the future.”

Good Me is one of the most successful tea shop chains on the mainland, with over 9,000 outlets across the country.

This is not the first time that tea shops in China have erred while attempting to promote themselves innovatively.

Last year, a shop in eastern China’s Zhejiang province faced criticism for printing Chinese characters on its tea cups that sounded like a swear word in the local dialect.

China’s car dealers struggle with US$20 billion of losses amid price war

https://www.scmp.com/business/china-evs/article/3279679/chinas-car-dealers-struggle-us20-billion-losses-amid-price-war?utm_source=rss_feed

A debilitating price war in China’s automotive industry, coupled with weak consumer demand, has severely hurt the mainland’s car dealers, resulting in losses of more than 138 billion yuan (US$19.6 billion), according to an industry body.

The widespread losses have caused dealerships cash flow problems as they have been saddled with large unsold inventories, leaving them in a situation where survival is becoming increasingly difficult, the China Automobile Dealers Association (CADA) said in a report on Monday.

The association said it has submitted the report to relevant authorities to draw attention to the difficulties facing the industry and to get financial assistance. It did not name the authorities.

“Lacklustre consumption and pressure from wholesalers have kept dealer inventories high, [but] to ease financial strain and reduce borrowing costs, dealers are being forced to sell vehicles at reduced prices,” CADA said. “The ongoing price war has worsened the issue of dealers selling at a loss, where the more cars they sell, the greater their losses.”

Dealerships are struggling to meet their financial obligations, and the time they have to maintain sufficient working capital has been compressed to its absolute limit, the report said.

China’s car industry has been embroiled in a cutthroat price war since January 2023, when Tesla introduced a second round of hefty discounts for its electric vehicles, prompting local carmakers to respond. Several major local companies, including Xpeng and Warren Buffett-backed BYD have slashed prices several times since then to stay competitive.

Such heated competition has reduced the dealers’ cost of goods profit margin to as much as negative 22.8 per cent from January to August, widening 10.7 percentage points from the same period last year. The overall discount for new cars was 17.4 per cent in August, according to the association.

The difficulties have already claimed a few casualties. China Grand Automotive Service, mainland China’s second-largest car dealer with more than 730 outlets across the country, was delisted from the Shanghai Stock Exchange in August after its shares traded below their par value for 20 consecutive days.

The dealer’s downfall followed the demise of Pang Da Automobile Trade, which became the first company in the industry to collapse in June 2023.

“These business failures largely stem from [industry-wide] liquidity issues, rather than being directly related to the dealers’ operations,” CADA said. “The collapse of the financial chain eventually resulted in the companies’ closure.”

China’s car market has entered a new phase of competition and survival, it noted.

“As the car distribution industry is capital-intensive and largely comprises private enterprises, enhancing financial support for dealerships will be crucial in stimulating car consumption and advancing the industry’s overall development.”

China to cut rates, reserve ratio to support economy

https://www.scmp.com/economy/policy/article/3279681/china-cut-rates-reserve-ratio-support-economy?utm_source=rss_feed

China plans to lower its reserve requirement ratio to support the economy, while it will also lower mortgage rates for existing housing, officials said on Tuesday.

The reserve requirement ratio – the amount of cash that commercial banks must hold as reserves – and the mortgage rates for existing housing would be cut by half a percentage point, according to People’s Bank of China governor Pan Gongsheng.

It will also issue new monetary tools to support stock market.

More to follow …

For China, a Cambodian canal project shows how Belt and Road Initiative can go only so far

https://www.scmp.com/economy/global-economy/article/3279619/china-cambodian-canal-project-shows-how-belt-and-road-initiative-can-go-only-so-far?utm_source=rss_feed

This is the first story in a two-part series about China’s increasing interest in canals, both at home and abroad, and what their construction will mean for economic growth and transport routes.

Months earlier than originally scheduled, a polarising China-backed canal project broke ground in Cambodia on August 5 – the 72nd birthday of Hun Sen, former Cambodian prime minister and the longest-serving head of government in the country’s history.

“We must build this canal at all costs,” current Prime Minister Hun Manet proclaimed at the launch event.

It did not take long for the Funan Techo canal to go from the drawing board to construction after being announced in early 2023. In October, during his visit to China to attend the annual Belt and Road Forum, Hun Manet – the son of Hun Sen – witnessed the signing ceremony for a framework agreement with the state-owned China Bridge and Road Corporation (CRBC).

Cambodia sees China as a natural partner with whom it can build the highly anticipated canal. The world’s second-largest economy has backed many of Cambodia’s infrastructure projects in recent years, but the canal is the first of its kind.

For China, which has its own agenda to boost connectivity with Southeast Asian countries through investing in regional transport links – including a domestic canal under construction in China’s southern Guangxi Zhuang autonomous region as well as several cross-border railways – the 180km (110-mile) waterway in Cambodia undoubtedly presents an attractive opportunity.

But China’s involvement appears to have been downplayed in the waterway’s official narrative following the initial announcement, perhaps owing to both Phnom Penh and Beijing becoming more wary about turning the project into a geopolitical battleground – sentiment reinforced by Cambodian officials’ vows in May that the canal would not be turned into a “regional or international issue”.

After it was announced, the canal’s proposal quickly sparked concerns from neighbouring Vietnam, the United States and environmentalists. Some Vietnamese feared that the canal could be used by Chinese warships and reduce Cambodian dependence on Vietnamese ports, affecting local income streams. Washington saw the project as a sign of China’s growing influence in the region. And conservationists worried the canal could reduce water flow to the Mekong, among the world’s most biodiverse rivers.

“When the project came out of the gates, it looked and felt a lot like a typical Belt and Road Initiative project,” said Brian Eyler, director of the Stimson Centre’s Southeast Asia Programme in Washington, referring to Beijing’s decade-old initiative to link economies into a China-centred trading network.

“But since [the announcement], it has morphed into a project framed with local ownership for local benefits to the Cambodian government and related industries,” said Eyler, adding that the evidence was “inconclusive” as to where the canal concept was cooked up.

In May, Cambodian media quoted Hun Sen as saying: “This project has absolutely nothing to do with China’s Belt and Road Initiative. It is 100 per cent initiated by Cambodia.”

With an originally estimated cost of US$1.7 billion, the waterway will connect the Mekong River Basin to the Cambodian coast, reducing the nation’s economic dependence on Vietnam. Currently, about 33 per cent of cargo to and from Cambodia goes through Vietnamese ports via the Mekong River.

However, the price tag could rise in the coming years, as long-term maintenance and upkeep costs of the canal have certainly not been factored into that estimate, Eyler said.

The Cambodian government has called the project an opportunity for Cambodia to “breathe through our own noses”, as well as a “game-changer” for the kingdom’s international politics.

For Beijing, participating in the canal project is a “business practice”, said Gu Jiayun, director of the Centre for Cambodian Studies at Beijing Foreign Studies University.

“As for any other [political] considerations, I don’t think there are [for China] … the project is entirely Cambodia-centred,” said Gu, who is also a researcher at the Charhar Institute, a Beijing-based independent think tank.

“China did not even know Cambodia wanted to build the canal until they came to us,” he said.

Thus, as of now, the canal does not meet the principle of Belt and Road Initiative projects – “extensive consultation, joint contribution and shared benefits”, he added.

Rather than Beijing concocting the canal, the project was initiated by Hun Sen and advanced by Hun Manet, said Sokvy Rim, a research fellow at the Cambodian Centre for Regional Studies.

“I think the main significance of the Funan Techo canal is for Hun Manet to strengthen his own popularity and image as Cambodian new leader,” Rim said. “He has to accomplish something significant, as his father did.

“The Cambodian people perceive the project optimistically, as they believe that the project can help Cambodia reduce its dependency on Vietnam.”

Even though construction has begun and is expected to be finished in a few years, scarce details about the project have been disclosed. It was originally said to be constructed under the collaborative build-operate-transfer model that would see the CRBC developing the canal and covering its costs under an agreement with the government of Cambodia, and in exchange obtaining a multi-decade concession.

“Is it 30 years, is it 40 years, is it 50 years – that will be discussed during our negotiation,” Cambodia’s deputy prime minister, Sun Chanthol, said in an interview with Reuters in May.

In June, Hun Manet said the canal was no longer a predominantly foreign-invested project and was primarily owned by Cambodian companies, holding a 51 per cent stake.

Funding for the project’s development now comes from Cambodian state-owned enterprises, local private businesses and the CRBC, according to a report from The Cambodia China Times, citing the latest memorandum on the project from the Cambodian government.

Zeus Lam, director of Cambodia Business Centre, said the canal would take three to five years to finish, and he expected the cost to surpass US$2 billion.

But as of yet, according to Eyler with the Stimson Centre, “no major contracts have been signed for the canal’s construction – by Chinese contractors or Cambodian or others – nor have any major loans been issued”.

“So, the ultimate ownership and financing structure for the project still remains undecided,” he noted.

Meanwhile, geopolitical tensions and sensitivities may have led to some of the investor hesitation, which likely also stems from uncertainties regarding potential income streams, Eyler added.

“After all, the largest ocean-bound ships will not be able to use the canal, and [there is] a parallel-running expressway to an already-built deepwater seaport at Sihanoukville,” Eyler said.

The parallel expressway, meanwhile, is also owned and operated by the CRBC. So, it is possible that the Chinese state-owned firm’s reluctance to move forward with the canal has to do with protecting its expressway investment, he said.

“Goods bound for the Pacific Ocean likely will still be transported down the Mekong instead of the canal to save time – the canal outlets into the Gulf of Thailand, not the South China Sea. These and other factors likely discourage investors,” he added.

Additionally, he noted, the canal passes through an active floodplain that is covered in water that moves from Cambodia to Vietnam for several months during the wet season.

“Those seasonal floods – which currently drive agricultural production and livelihoods in southern Cambodia – will crash into the canal’s high levees, occasionally toppling them or undercutting their foundations and will require limitless resources to defend over the life of the project,” Eyler said.

And the Charhar Institute’s Gu said that even after construction completes, the canal would not immediately boost connectivity between China and Cambodia in the short term. Gu noted that most China-related goods would continue to be transported via the Sihanoukville port, which is close to the Sihanoukville Special Economic Zone – a joint venture between Chinese and Cambodian companies under the belt and road plan.

“The canal needs to be dug first, then trade flow can be gradually formed, and throughput gradually increased,” he said, adding the planned water depth will make it impossible to accommodate some of the largest ships, let alone Chinese warships.

The economic benefits could improve slowly, and this may take decades, Gu added.

In general, China-backed infrastructure investments and operations in Cambodia – from airports to highways – are far from lucrative, he said.

“We are not losing money, but the profit is not too much,” Gu added.

Still, Chinese involvement in Cambodia’s infrastructure and economic development can be seen as a role model for the rest of Southeast Asia, as some countries might still be wary of closer engagement with China, he said.

In terms of China’s involvement in infrastructure projects in Southeast Asia, economics is never the only consideration. Even though the two governments no longer acknowledge an association between the canal and the Belt and Road Initiative, there is no doubt that Beijing’s role can be further enhanced in a country that it has already heavily influenced.

“The whole issue is political – it is never a pure economic project,” said James Wang Jixian, research director of the Bay Area Hong Kong Centre. “China helped Cambodia on this matter, but in fact, it has also strengthened its own influence.”

For Cambodia, the canal’s significance lies in the greater autonomy it can have in the region, said Wang, who is also the former head of the Department of Geography at the University of Hong Kong.

“What is the best way to support a man? Teach him to fish and you feed him for a lifetime,” he said. “China helps Cambodia build an outlet to the sea – that’s teaching it to fish – so it won’t need to go through Vietnam all the time.”

Naubahar Sharif, head of the public policy division at the Hong Kong University of Science and Technology, said Beijing has endeavoured for a decade to connect itself with Cambodia, along with Laos and Thailand, mainly to facilitate China-bound trade.

“The canal and expressway make China a logical destination for inbound trade, including goods shipped from Cambodia to China from factories invested by third countries such as Japan,” Sharif said. “Barges could use the canal.”

Despite initial objections from Vietnam that were mostly voiced in academia rather than through official channels, Hanoi conveyed its support for the project after last month’s groundbreaking and expressed respect for Cambodia’s development efforts.

The transit income that Vietnam is set to lose from the new canal is too insignificant to impact the traditionally good relations between Cambodia and Vietnam, Gu said.

Vietnam could even take an investment stake in the canal if it plays its cards right, Eyler said, adding that, “any canal with transboundary implications changes the geostrategic chessboard”.

The canal looks to create water access into and out of Cambodia in ways and means that could not be accessed before – without Vietnam’s consent – and this obviously changes the trade and supply-chain calculus for Vietnam and Cambodia while also affecting their respective defence strategies, he explained.

“Whether China plays into the geostrategic shift depends on the will of the Cambodian government and the ability of Cambodia and Vietnam and others to come to a consensus on the uses and functionality of the canal,” Eyler said.

Additional reporting by Ralph Jennings

Trump listens but is mostly quiet at event about China’s influence on US economy

https://www.scmp.com/news/world/united-states-canada/article/3279676/trump-listens-mostly-quiet-event-about-chinas-influence-us-economy?utm_source=rss_feed

Donald Trump sat in a large barn in rural Pennsylvania on Monday, asking questions of farmers and offering jokes, but in a rarity for his campaign events, mostly listening.

The bombastic former US president was unusually restrained at an event about China’s influence on the US economy, a round table at which farmers and manufacturers expressed concerns about losing their way of life.

Behind Trump were large green tractors and a sign declaring “Protect our food from China”.

The event in Smithton, Pennsylvania, gave Trump a chance to drive his economic message against Vice-President Kamala Harris, arguing that imposing tariffs and boosting energy production will lower costs.

He highlighted Harris’ reversal of a previous vow to ban fracking, a method of producing natural gas key to Pennsylvania’s economy. And he noted the tractors behind him were manufactured by John Deere, which announced in June it was moving skid steer and track loader manufacturing to Mexico and working to acquire land there for a new factory.

Trump threatened the firm with a 200 per cent tariff should he win back the presidency and it opted to export manufacturing to Mexico.

“If they want to build in the United States, there’s no tariff,” he added.

In response to an participant’s concerns about energy production, Trump said he did not know that farmers were so energy-dependent. Another farmer talked about Chinese-subsidised businesses, prompting Trump to respond: “That’s why we need tariffs.”

When the same farmer finished her comments by praising him profusely, he said: “Amen. I agree.”

Trump has embraced tariffs as he tries to appeal to working-class voters who oppose free-trade deals and the outsourcing of factories and jobs, and the event was not all about showing a more personable side.

Later the former president took questions from reporters and got more customarily combative when asked whether he was concerned that tariffs on manufacturers such as John Deere would increase costs for farmers.

He said of Harris: “She is not going to be good for Pennsylvania.”

Trump was holding a rally later in the day in Indiana, Pennsylvania, where he is hoping conservative, white working-class voters help him pull ahead of Harris, who herself is visiting Pennsylvania on Wednesday.

“Despite all his lies and pandering, Donald Trump used the White House to give handouts to wealthy corporations and foreign companies at the expense of family farmers, drive farm bankruptcies to record levels, and sacrifice small American farmers as pawns in his failed trade war with China,” Harris campaign spokesman Joseph Costello said in a statement.

Monday’s farming event was hosted by the Protecting America Initiative, led by Richard Grenell, Trump’s former acting director of national intelligence, and former New York congressman Lee Zeldin.

Grenell said: “China is getting into our farmlands, and we have to be able to see China very clearly.”

At the end of 2022, China held nearly 250,000 acres of US land, which is slightly less than 1 per cent of foreign-held acres, according to the US Department of Agriculture. By comparison, Canada was the largest foreign owner of US land, accounting for 32 per cent, or 14.2 million acres.

Still, the National Agricultural Law Centre estimates that 24 states ban or limit foreigners without residency and foreign businesses or governments from owning private farmland.

The issue emerged after a Chinese billionaire bought more than 130,000 acres near a US Air Force base in Texas and another Chinese company sought to build a corn plant near an Air Force base in North Dakota.

Rex Murphy, from a nearby rural community who raises cattle and grows corn and hay, said farmers support Trump in this area, and said he wanted fewer taxes and “more freedom”.

“I want him to do everything for the economy,” said Murphy, 48. “If he just becomes president, and he does what he does, he will do more.”

US-China research has given Beijing’s military technology a boost, House GOP says

https://apnews.com/article/china-higher-education-research-tech-republicans-f6c00d6ccac7ebef5c9eadabf499b06bChina's President Xi Jinping, speaks at the opening ceremony of the Forum on China-Africa Cooperation (FOCAC) at the Great Hall of the People in Beijing, Thursday, Sept. 5, 2024. (Greg Baker/Pool Photo via AP)

2024-09-23T21:58:54Z

WASHINGTON (AP) — Partnerships between the U.S. and China at universities over the past decade have allowed hundreds of millions of dollars in federal funding to aid Beijing in developing critical technology that could be used for military purposes, congressional Republicans asserted in a new report.

The report said U.S. tax dollars have contributed to China’s technological advancement and military modernization when American researchers worked with their Chinese peers in areas such as hypersonic weapons, artificial intelligence, nuclear technology and semiconductor technology.

The report, released Monday by Republicans on the House Select Committee on the Chinese Communist Party and the House Education and Workforce Committee, raised concerns over the national security risks of collaborations between researchers from the two countries that were once celebrated. It urged stronger safeguards and more robust enforcement.

The committees conducted a yearlong investigation as lawmakers and their policy advisers focus on higher education’s role in the economic rivalry with China, especially when it comes to technology. While American universities don’t engage in secret research projects, their work — often among the best in the world — has the potential to be turned into military capabilities.

The U.S. House of Representatives this month approved about two dozen China-related bills, with a clear goal to compete with Beijing in the tech field. The bills, which still need to be approved by the Senate, seek to ban Chinese-made drones, restrict China-linked biotech companies in the U.S. market, and cut off remote Chinese access to advanced U.S. computer chips.

Other measures include those to curb Beijing’s influence on U.S. college campuses and to revive a Trump-era program meant to root out China’s spying and theft of intellectual property at American universities and research institutes. That’s despite such efforts raising concerns about racial profiling and the ability to keep up exchange programs that boost tolerance between the two countries.

Collaboration among U.S.-based scholars and China also declined as a result of the Trump administration’s anti-spying program, which ended in 2022, studies say.

Deputy Secretary of State Kurt Campbell said at a forum by the Council on Foreign Relations earlier this year that he would welcome more Chinese students studying humanities and social sciences but “not particle physics” in American schools.

Monday’s report identified about 8,800 publications that involved U.S. researchers who received funding from the Department of Defense or the U.S. intelligence community working with Chinese researchers — many of whom were affiliated with China’s defense research and industrial base. Such research is “providing back-door access to the very foreign adversary nation whose aggression these capabilities are necessary to protect against,” the report said.

The House investigation also flagged what it described as problematic joint institutes between U.S. and Chinese universities, which the report said “conceal a sophisticated system for transferring critical U.S. technologies and expertise” to China.

Through those institutes, American researchers and scientists, including those who conduct federally funded research, have traveled to China to work with and advise Chinese scholars and train Chinese students, the report said.

“This creates a direct pipeline for the transfer of the benefit of their research expertise” to China, the report said.

The Georgia Institute of Technology, which is named in the report for its joint Georgia Tech Shenzhen Institute, defended its work in China, saying it was focused on educating students, not research, and that the report’s claims are “unsubstantiated.”

“There was no research conducted at GTSI, no facilitation of technology transfer, and no federal funding provided to China,” the university said in a statement.

However, Georgia Tech announced Sept. 6 that it would discontinue its participation in the joint institute with Tianjin University and the government of Shenzhen, a city in southern China. Georgia Tech said the partnership was “no longer tenable” after the U.S. Commerce Department accused Tianjin University in 2020 of theft of trade secrets.

The congressional report also identified Tsinghua-Berkeley Shenzhen Institute, which the University of California, Berkeley, and China’s Tsinghua University opened in 2015 in the city of Shenzhen to focus on “strategic emerging industries,” according to the institute’s website.

Berkeley’s researchers “engage only in research whose results are always openly disseminated around the world” and the school was “not aware of any research by Berkeley faculty at TBSI conducted for any other purpose,” Katherine Yelick, the university’s vice chancellor for research, said in a statement.

Berkeley also is unwinding its partnership, saying it has no oversight of research activities conducted only by non-Berkeley employees at the joint institute.

The U.S. university has decided “to start the process of relinquishing all ownership” in the Shenzhen school “after careful consideration, which began several months ago,” Yelick said.

She said Berkeley “takes concerns about research security very seriously — including those concerns voiced by Congress.”

The University of Pittsburgh, which is named in the report for its cooperation with Sichuan University, said it could not comment because the Pennsylvania university “was not consulted and did not work with the House Select Committee throughout the investigation.”

Canadian who was detained by China on spying charges says he experienced psychological torture

https://www.scmp.com/news/world/united-states-canada/article/3279669/canadian-who-was-detained-china-spying-charges-says-he-experienced-psychological-torture?utm_source=rss_feed

A Canadian man detained by China for more than 1,000 days said he was put into solitary confinement for months and interrogated for up to nine hours every day, treatment he said amounted to psychological torture.

Michael Kovrig, speaking to the Canadian Broadcasting Corporation in an interview released on Monday, also said he had missed the birth of his daughter and only met her for the first time when she was two-and-a half years old.

Kovrig and fellow Canadian Michael Spavor were taken into custody in December 2018 soon after Canadian police detained Meng Wanzhou, the chief financial officer of Chinese telecoms equipment giant Huawei Technologies, on a US warrant. Both men were accused of spying.

“I still carry a lot of pain around with me and that can be heavy at times,” Kovrig said in his first substantial comments since he and Spavor were released in September 2021.

Kovrig noted that United Nations guidelines say prisoners should not be put into solitary confinement for more than 15 days in a row.

“More than that is considered psychological torture. I was there for nearly six months,” said Kovrig, a former diplomat who had been working as an adviser with a think-tank when arrested.

Kovrig said there was no daylight in the solitary cell, where the fluorescent lights were kept on 24 hours a day. At one point, his food ration was cut to three bowls of rice a day.

“It was psychologically absolutely, the most gruelling, painful thing I’ve ever been through,” he said.

“It’s a combination of solitary confinement, total isolation, and relentless interrogation for six to nine hours every day,” he said. “They are trying to bully and torment and terrorise and coerce you … into accepting their false version of reality.”

Kovrig and Spavor were released on the same day the US Justice Department dropped its extradition request for Meng and she returned to China.

Bilateral ties are chilly. China this month opened a one-year anti-dumping investigation into imports of rapeseed from Canada, just weeks after Ottawa announced 100 per cent tariffs on Chinese-made electric vehicles.

Kovrig’s partner was six months pregnant at the time of his arrest. She played their daughter recordings of his voice and showed pictures of her father so she would recognise him when they finally met.

“I’ll never forget that sense of wonder, of everything being new and wonderful again and pushing my daughter on a swing that had her saying to her mother ‘Mummy, I’m so happy’,” he said.

The Chinese embassy in Ottawa was not immediately available for comment.

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Brazilian officials work with China on details of joining belt and road

https://www.scmp.com/news/china/article/3279671/brazilian-officials-work-china-details-joining-belt-and-road?utm_source=rss_feed

The Brazilian government has established an inter-ministerial working group to analyse Brazil’s entry into the Belt and Road Initiative in the coming days, while also examining the potential impact of membership on relations with Washington in the event of a Donald Trump victory in the US presidential election.

The local news site ICL Notícias first reported the news, which The Post confirmed on Monday.

Sources familiar with the matter say the Chinese embassy in Brazil has informed the Brazilian presidency that it expects to formalise membership during Chinese leader Xi Jinping’s visit to the country in November. The initiative is Xi’s plan to link global economies into a China-centred trading network.

However, diplomats from Brazil’s foreign ministry have reportedly advised President Luiz Inácio Lula da Silva to postpone the announcement until the outcome of the US presidential election on November 5 is known.

Brasilia has not officially commented on the US race, but Lula has spoken out in favour of Vice-President Kamala Harris, the Democratic contender. According to CNN Brasil, he discussed the matter with leaders of Brazil’s House of Representatives in early September and said: “God willing, Kamala will win this election.”

Diplomats favouring a delay in announcing Brazil’s joining of the Belt and Road Initiative fear that Lula’s preference for Harris, combined with Brazil’s entry into the Chinese initiative, could complicate relations with a potential Trump administration in 2025. The aim is to avoid the impression that Brazil is joining China in an anti-US alliance.

ICL Notícias also reported that Lula began considering joining the belt and road in June, when Dilma Rousseff, the former Brazilian president who now heads the New Development Bank (also known as the “Brics Bank”), visited Brasilia to present the benefits of membership.

The media outlet reported that Lula liked the proposal and set up a working group comprising his chief of staff, Rui Costa; planning minister Simone Tebet; institutional relations minister Alexandre Padilha; and Vice-President Geraldo Alckmin to analyse the matter. They are expected to meet after the UN General Assembly in New York to discuss the issue.

Lula first made public comments about the belt and road in July, saying at an event that Brasilia that he was considering what the country “had to gain” from the Chinese project. In August, the Chinese ambassador to Brazil described membership as a “fundamental measure” that would be a “demonstration of stability” in the countries’ “long-term cooperative relationship.”

“We believe that the initiative is highly consistent with the Lula government’s development strategy, such as [its] re-industrialisation plans, South American integration routes and growth-acceleration project,” he added.

The Chinese embassy in Brasilia and the Brazilian Ministry of Foreign Affairs did not immediately respond to a request for comment on the latest reports.

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Miner backed by Canadian province vows to compete with China in rare earths

https://www.scmp.com/news/world/united-states-canada/article/3279673/miner-backed-canadian-province-vows-compete-china-rare-earths?utm_source=rss_feed

The Canadian province of Saskatchewan has vowed to compete with China in processing and production of rare earths and become the first North American commercial alternative source for the metals, used to make magnets for electric vehicles and wind turbines.

The Saskatchewan Research Council Rare Earth Processing facility is betting on demand for these magnets to jump in the next couple of years, driven by demand from original equipment manufacturers such as carmakers.

The Canadian province, home to copper, potash and uranium mines, is known for its mining prowess.

China controls 95 per cent of the global production and supply of rare earth metals. The near-monopoly allows the country to dictate prices and create uncertainty for end users through export controls.

In the past year, China has placed export controls on some critical metals such as germanium, gallium and antimony, forcing western governments to look for alternatives.

The SRC Rare Earth processing facility has begun production on a commercial scale and expects to hit a production target of 40 tonnes of rare earth metals per month by the end of this year, enough to power half a million electric vehicles. The facility has already tied up with potential clients in South Korea, Japan and the United States.

“Our focus is to remain competitive within the Asian Metals Price Index,” said Muhammad Imran, vice-president of the SRC Rare Earth Element. “We are constantly looking to optimise our facility using artificial intelligence applications that would keep our process efficient,” Imran said.

The price of rare earth metals such as neodymium praseodymium, known as NDPR, fluctuates between US$65,000 and US$75,000 per tonne, a price determined by the Chinese government.

However, some miners have been asking for a premium price for metals produced outside China, arguing that Chinese metals are produced with low environmental, social and governance (ESG) standards.

Regardless, Imran said, the market will remain competitive and manufacturers have to be prepared to meet the reference point of the Asian Metals Index.

“This is what the market is telling you the price for rare earth is, if someone can strike a better deal that’s great, but premium or no premium the market is going to be competitive,” he said.

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How China can turn its demographic challenge into economic edge

https://www.scmp.com/opinion/china-opinion/article/3279493/how-china-can-turn-its-demographic-challenge-economic-edge?utm_source=rss_feed

China stands on the verge of a profound demographic shift. With an ageing population and mounting economic uncertainty, the government’s recent decision to raise the retirement age by up to five years is a bold move designed to avert what many fear could be an impending crisis. Yet while this policy addresses immediate concerns, it also points to a deeper issue – one that extends beyond shrinking workforces and pension deficits.

The true test for China lies in boosting labour productivity. Raising the retirement age is merely a stopgap for its strained pension system, which is projected to run dry by 2035. Several regions, particularly in China’s industrial northeast, rely heavily on subsidies from wealthier coastal provinces to maintain pension payouts.

While raising the retirement age is expected to reduce the pension shortfall by 20 per cent in the next decade, these transfers will become increasingly unsustainable as wealthier provinces face ageing populations of their own. As such, the real challenge is not just expanding the workforce but improving how efficiently labour is used.

Labour productivity – the amount of output per worker – is shaped by several factors, all of which are now crucial to China’s economic future. The term “new productive forces”, increasingly emphasised by Chinese leaders, reflects this vision and aims to lay the groundwork for “high-quality development”.

This concept refers to the integration of human labour with advanced technology and infrastructure – key elements that, as President Xi Jinping has said, will “guide the building of a modernised industrial model”. To sustain growth despite demographic challenges, China must boost total factor productivity, which measures the efficiency of both labour and capital.

Technological innovation is a critical driver of productivity. Automation and artificial intelligence (AI) are transforming industries, particularly in manufacturing and logistics, where robots are already taking over repetitive tasks. This enables older workers to stay productive longer by focusing on higher-order skills.

In knowledge-based sectors, AI assists in areas such as data analysis and healthcare, enabling experienced professionals to maintain or even enhance their output. By integrating AI and automation into its economic fabric, China can extend the productive years of its workforce and increase the overall efficiency of labour.

However, technology alone is not enough. Capital investment in better tools, machinery and infrastructure is equally crucial. In industries where physical strength once dictated productivity, modern machinery and tools can enable older workers to remain competitive. This shift is already visible in sectors such as construction and agriculture, where advancements reduce the need for young, physically capable workers and allow experienced older workers to take on supervisory or knowledge-intensive roles.

The third crucial component is human capital development. Productivity gains hinge on how well workers are educated and trained to adapt to technological advances. As China transitions towards more knowledge-based industries, investing in education and upskilling will be essential, especially as older workers remain in the workforce for longer. Retirement age reform must be coupled with initiatives in vocational training and lifelong learning to ensure workers stay employed longer and contribute more effectively.

China can draw lessons from other economies as it addresses these challenges. For instance, Japan faced similar demographic pressures in the 1990s but maintained productivity by embracing automation and extending the retirement age. Similarly, Germany transitioned from labour-intensive sectors to high-skill industries by investing in vocational training and workforce development.

While China’s scale and structure are unique, these examples can offer a blueprint for how adopting new technologies and human capital development can sustain productivity in the face of demographic shifts.

Efficiency improvements and specialisation are also crucial drivers of productivity growth. By refining workflows and eliminating inefficiencies in sectors such as healthcare and services, China can achieve substantial productivity gains. Simultaneously, deeper specialisation – focusing on areas where China has a competitive advantage – combined with strategic outsourcing can further optimise labour use.

Despite these potential gains, China faces significant headwinds. Youth unemployment surged to 17.1 per cent in July, underscoring the growing challenge of creating sufficient opportunities for the younger generation.

The labour market faces the dual burden of managing an ageing population while finding productive roles for young workers. State-owned enterprises could see reduced vacancies as older employees remain in the workforce longer.

Adding to the challenge, China’s overall labour productivity has slowed. Productivity growth fell to 4.2 per cent in 2023, down from 7.7 per cent in 2013, and dropped by 4.3 per cent year on year in December 2023. This decline underscores the difficulty of maintaining productivity amid structural economic shifts. While technological advancements and capital investment offer hope, these tools must be wielded effectively to reverse the trend.

Beyond retirement age reform, China is also trying to balance the needs of both its younger and older workers. Only half of China’s provinces reported pension surpluses last year, reflecting the strain on the pension system and the urgent need for additional reforms, including better pension management and increased government investment.

China’s ability to navigate its demographic shift will define its economic future. Raising the retirement age is only the beginning. True success will come from harnessing the full potential of its workforce by integrating advanced technology, refining labour practices and investing in human capital.

As China confronts the challenges of an ageing population, the path forward lies in boosting productivity across all sectors and age groups. If executed effectively, this shift will transform what many see as a looming crisis into a powerful opportunity for sustained growth and global competitiveness.

US targets China’s rare earths dominance with minerals-security finance network

https://www.scmp.com/news/china/article/3279674/us-targets-chinas-rare-earths-dominance-minerals-security-finance-network?utm_source=rss_feed

The United States announced the establishment of a minerals-security finance network with its allies on Monday, the latest step in its bid to halt China’s global dominance of critical minerals.

The joint finance network will be used to “strengthen cooperation and promote information exchange and co-financing” among participating institutions from Indo-Pacific and European nations, according to the US State Department. It will also “advance diverse, secure and sustainable supply chains for critical minerals”.

The network was the latest initiative out of the Minerals Security Partnership (MSP), a framework the US set up with 13 countries and the European Commission in 2022. It aims to diversify the countries’ supply chains for critical minerals amid an intensifying US-China tech rivalry. The US also rolled out a chip ban against China in 2022.

Its unveiling came as leaders of the Quadrilateral Security Dialogue, or Quad, pledged during a weekend summit in Delaware to “focus near-term efforts” on boosting mineral production across their countries.

China produces nearly two-thirds of the world’s rare earth metals and has imposed export controls on minerals such as graphite and gallium that are critical for making semiconductors and electric vehicles.

Beijing’s actions came in response to Washington’s ramped-up chip restrictions as the two economic giants increasingly face off over technology.

Those taking part in the MSP include banking and mining institutions from Australia, another top producer of critical minerals, as well as from Japan and South Korea, which together have undertaken talks with the US to curb their chip exports to China.

“Partners emphasised that the scope and scale of meeting the rapidly increasing global demand for critical minerals to achieve the clean-energy transition is beyond the purview of any single institution,” the US State Department said in a statement.

“Creation of the MSP finance network reflects a desire to strengthen information sharing, coordination and collaboration among the network participants,” it added.

Addressing the MSP finance meeting in New York on Monday, Jose Fernandez, the State Department’s undersecretary for economic growth, energy and the environment, described the energy transition as “at risk”.

“Many of the supply chains for critical minerals are concentrated in one or two countries and also lack resilience,” said Fernandez.

“Addressing this challenge requires close coordination between partners and allies, countries with public finance, tools, minerals producing countries and the private sector.”

The MSP partnership was announced on the sidelines of the ongoing United Nations General Assembly in New York, where US President Joe Biden and Chinese Foreign Minister Wang Yi are due to speak this week.

Sino-American competition over critical minerals has increasingly extended to other resource-rich regions in the world, including Africa, a traditional mineral supplier for China that has received large amounts of Chinese funding over the years.

In August, the US International Development Finance Corporation voiced interest in funding the Kabanga Nickel Project in Tanzania, a move widely perceived as trying to stem China’s and Indonesia’s dominance of nickel.

American efforts have entailed further investment in Canada. Toronto-based mining company Electra Battery Materials received US$20 million from the US Defence Department in August to support the construction and commissioning of North America’s first cobalt sulphate refinery. Cobalt is a key component for EV batteries.

And as China and the European Union stay locked in a dispute over EV tariffs, the bloc has sought to bolster the resilience of its local supply chains.

The European Bank for Reconstruction and Development (EBRD), described by the US as a “like-minded” MSP partner, has funded a lithium-tin deposit in the Czech town of Cinovec. It is the largest hard-rock lithium deposit in Europe and one of the world’s largest undeveloped tin resources.

The EBRD also provided a US$50 million loan to finance decarbonisation and electrification of mining operations in Turkey, which discovered the world’s second-largest rare earth element reserve, according to the US State Department.

Turkey is reportedly looking for Chinese investments to build infrastructure around the reserve in its northwestern city of Eskisehir.

Ankara is expected in October to dispatch Alparslan Bayraktar, the country’s energy and natural resources minister, to Beijing to discuss a deal, according to news website Middle East Eye, citing sources familiar with the situation.

A US State Department spokesperson last week told the Middle East Eye that Turkey had joined the MSP and a formal announcement would come in the following weeks.

Turkey, which in July secured an EV manufacturing plant by Chinese EV manufacturing giant BYD, filed an application earlier this month to join Brics, an emerging economies bloc comprising Brazil, Russia, India, China and South Africa.

The bloc is increasingly regarded as a rival to the Group of Seven major advanced economies consisting of Britain, Canada, France, Germany, Italy, Japan and the US. The EU is also represented within the G7.

Japan, China Reach Deal on Radioactive Water that Led to Seafood Ban

https://learningenglish.voanews.com/a/japan-china-reach-deal-on-radioactive-water-that-led-to-seafood-ban/7795041.html

China and Japan have reached an agreement over the release of wastewater from Japan’s destroyed Fukushima nuclear power center. The deal prepares the way for China to restart Japanese seafood shipments it banned because of concerns over the wastewater.

Representatives from both countries announced on September 20 a deal had been reached. Japanese Prime Minister Fumio Kishida said the agreement had established a level of “mutual understanding” on the issue.

China’s government began banning sales of seafood coming from Japan more than a year ago. Officials said they were concerned the wastewater – which was treated to remove radioactive material – might poison seafood products sold in China.

Japan has repeatedly said its testing and monitoring efforts have shown the treated wastewater presents no risk of radioactive poisoning to humans.

Operators of the Fukushima center announced in June 2023 that they had begun testing the process of releasing treated wastewater into the sea. The water first passes through equipment designed to remove harmful materials. Japan’s government says the processed water is considered “treated,” not “radioactive.”

But experts say it is impossible to remove all radioactive material from the wastewater. Government officials have said tritium – a radioactive form of hydrogen – is the only substance that cannot be removed from the water. However, they say the material is not considered harmful in small amounts.

The water release program began in August 2023. Officials said it was a necessary part of cleanup efforts at the Fukushima center. Three reactors there suffered meltdowns after a 2011 earthquake and huge ocean waves destroyed the plant’s cooling systems. The disaster forced 160,000 people to flee surrounding areas that were affected by radioactive material.

The agreement itself does not immediately remove China’s ban on Japanese seafood imports. Kishida told reporters Chinese negotiators said the deal begins the process for China to “revisit its import restrictions” on the seafood products.

The agreement calls for Japan to establish a long-term program in which international experts will carry out independent testing and monitoring. Kishida told reporters the government agreed to additional monitoring methods on the treated wastewater.

A Chinese foreign ministry official said his country still has concerns about the safety of Japanese seafood products. Chinese and Japanese experts are expected to come together in the coming months to work on China’s safety concerns. The official noted the ban will likely be lifted on products over time.

Before the ban, China was Japan’s biggest market for seafood exports. In the first half of 2024, Japanese exports of agriculture, forest and fish products fell for the first time since 2020. The decrease is blamed partly on China’s seafood ban.

The International Atomic Energy Agency (IAEA) has worked with Japan on its monitoring efforts involving the released wastewater. The head of the organization, Director General Rafael Grossi, welcomed the latest agreement between China and Japan.

Grossi praised Japan’s government "for its continued engagement with the IAEA.” He also thanked the Chinese side for taking part in “constructive” negotiations with IAEA officials leading up to completion of the deal.

I’m Bryan Lynn.

The Associated Press and Reuters reported on this story. Bryan Lynn adapted the reports for VOA Learning English.

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Words in This Story

mutual – adj. held in common by two or more parties

monitor – v. to watch something carefully

engage – v. to interest someone in something and keep them thinking about it

constructive – adj. helpful or useful