Mistral点评

• Beijing mulls US engagement options as China-sanctioned Rubio awaits top diplomat post
• China, Philippines trade blame over run-in near contested Spratlys reef in South China Sea
• China’s defence companies, eliminating ‘lying flat’ mentality: SCMP daily catch-up
• China’s plans for yuan unfazed by Trump’s pledge to protect ‘mighty US dollar’
• China has ‘no right’ to demand Philippines to remove US Typhon missile system
• China opens its first atmospheric monitoring station in Antarctica
• Man sentenced to death in China for pushing wife into sea, using insurance payout on prostitutes
• Biden takes a last aim at China’s hi-tech ambitions with new chip restrictions
• Indonesia yet to agree with Beijing on joint development areas in South China Sea: minister
• China condemns Lithuania’s expulsion of 3 diplomats; says countermeasures possible
• A gallery of China’s military might unveiled at Zhuhai air show, including its new J-35A fighter
• US dims Southeast Asia detour for China’s solar products with anti-dumping tariffs
• China’s generative AI users reach 230 million as start-ups, Big Tech roll out LLM services
• What ‘China problem’? Thai tourism post-Covid is in good health
• Malaysia warns Chinese firms from using it as a base to ‘rebadge’ to avoid US tariffs
• ‘Chinese support for Russia’ hitting ties, German Foreign Minister Baerbock tells Wang Yi
• Chinese economist calls for confidence, says GDP target should remain 5% in 2025
• New US chip sanctions to hit Chinese tool makers, but Japan, Netherlands exempt
• Chinese cities fight lying flat mentality with ‘snail awards’ for poor workers
• Dangerous weight loss camps on the rise in China as country grapples with obesity crisis
• China actress Huang Yi, from ‘lousy men collector’ to helping burn-injured kids
• China hot on the agenda at Apec, G20 gatherings as Trump’s spectre looms large
• China’s intelligence ministry warns of security risks from open-source information
• China’s Meituan to expand Keeta food delivery service to more Middle East cities, sources say
• Chinese MMA champion Shi Ming gains viral fame for contrasting persona as TCM doctor
• China’s factory activity hits 5-month high in November: Caixin PMI
• Philippines outnumbered as ‘largest China vessel swarm’ spotted near Thitu Island
• Chinese recycling firm Carbon Zero aims to replicate success overseas after Nasdaq IPO
• Why are Chinese defence firms missing out on global arms sale surge as US keeps crown?
• Taiwan’s president meets Hawaii’s governor and members of Congress in a visit condemned by China
• [Sport] ‘Italian’ purees likely to contain Chinese forced-labour tomatoes, BBC finds
• Nobel-winning economist James Robinson on China’s place in his theory of institutions

Beijing mulls US engagement options as China-sanctioned Rubio awaits top diplomat post

https://www.scmp.com/news/china/diplomacy/article/3289021/beijing-mulls-us-engagement-options-china-sanctioned-rubio-awaits-top-diplomat-post?utm_source=rss_feed

When Marco Rubio was nominated by US president-elect Donald Trump last month to be the next US secretary of state, one obvious question loomed: how would the Florida senator, who has been sanctioned by China twice, engage with Washington’s biggest rival?

Rubio – known for his hawkish stance towards China – could move to stifle high-level exchanges between Washington and Beijing and throw up road blocks to any meaningful negotiation, according to observers.

However, Beijing could consider several options to counter confrontational US moves, and sanctioned high-level diplomats from either side could still meet face-to-face in a neutral, third-party location analysts said.

As Yuan Zheng, deputy director of the Institute of American Studies at the Chinese Academy of Social Sciences (CASS), put it: “We could follow the American formula. The US has set an example for us, and this is reciprocity.”

This was the case with Li Shangfu, the former Chinese defence chief who was sanctioned by the US after being accused of helping to transfer combat aircraft and air defence missile systems from China to Russia.

Li, who was ousted a few months after being named defence minister, never held formal talks with his American counterpart Lloyd Austin, but they did have a brief exchange at a regional security conference in Singapore in 2023. They “shook hands but did not have a substantive exchange”, according to the Pentagon.

Rubio would be the first sitting secretary of state to be sanctioned by Beijing.

He was twice sanctioned in 2020 – first, in retaliation for US measures against senior Chinese officials over the treatment of the Uygur ethnic minority group, and later after mainland and Hong Kong officials were sanctioned following the Hong Kong protests in 2019.

While a sanctioned US secretary of state would pose challenges for exchanges with China at the ministerial level, Dominic Chiu, a senior analyst with Eurasia Group, said symbolic contacts, such as a handshake between Rubio and Chinese Foreign Minister Wang Yi, could still happen.

“Rubio and Wang can do the same but it will be difficult for them to sit down for more substantive discussions. A way to work around that challenge would be ideal,” Chiu said.

Yuan, from CASS, said having a Chinese-sanctioned US official handling relations would be a “problem” but added that Beijing would likely wait and see how best to approach the situation.

Noting that Washington did not lift sanctions on Li despite calls from Chinese officials, Yuan expected Beijing would likewise not rush to act on Rubio, adding that China “is also a major country [and] not your little brother”.

“We do not rule out contact, but we will not unilaterally lift sanctions on him for the sake of contact,” he said.

China’s decision to lift sanctions it earlier imposed on Rubio would also hinge on how the Florida congressman acted after he assumed the new role, including whether he continued to “bad-mouth” Beijing, Yuan said.

“It depends on his performance … If the overall atmosphere of China-US relations is better than we expected, and the other side also shows goodwill, it is feasible for us to consider lifting the sanctions on Rubio.”

Otherwise, lifting sanctions would be “simply impossible”, Yuan said, adding that China would be “looked down upon by others”.

“China will not be in a hurry to … take the initiative to offer something [to the US] immediately. I think it is unlikely because Rubio is just so anti-China,” Yuan added.

Among other things, Rubio has pushed for taking a harder line against China and has previously targeted social media platform TikTok, whose parent company is Chinese.

“What [the US] did to Li Shangfu, we can do the same,” added another expert at CASS, who did not wish to be named.

Resolving the dilemma where Rubio is responsible for handling US ties with China required political wisdom, said another Chinese analyst who asked that his name not be used, adding that the Chinese sanctions were unlikely to be waived. “It is not child’s play,” he said.

Separately, in a commentary published last week about the impact of Trump’s likely cabinet on China, Luo Zhiheng, a prominent Chinese macroeconomics scholar, said Rubio and other Trump picks were “extremely hawkish” on China, and that it would be “difficult for them to change their tough attitudes towards China in the short term”.

Aside from US-China communication channels being impacted by Chinese sanctions, he said that Rubio still acted as the anti-China “vanguard”, and that it would be unlikely that Beijing would take the initiative to lift sanctions in the short term.

According to Yuan, if the top US and Chinese diplomats were unable to hold talks in either country, it would be possible to meet in a third location, such as somewhere in Southeast Asia or the Middle East. He gave the example of meetings held between US national security adviser Jake Sullivan and Chinese Foreign Minister Wang Yi in other countries. They met in Vienna and Malta last year and in Bangkok earlier this year.

Chiu, from Eurasia Group, said that if sanctions prevented Rubio and Wang from meeting in person, other channels of communication would be available.

“It is important to remember that the secretary of state is not the only diplomatic channel that Trump and [Chinese President Xi Jinping] could deploy,” he said, adding that the national security adviser could play a key role.

The channel between Sullivan and Wang during the Biden administration has been “arguably the most effective one” between the two countries, due in large part to how Sullivan positioned himself as trusted interlocutor with the Chinese, Chiu said.

Exchanges could still happen at the deputy level, Chiu added, while suggesting that another method of establishing trusted contact is through backchannels, which would require both sides to find a go-between that could be trusted.

“The bigger challenge with regards to US-China communication under Trump 2.0 is not the technicality of sanctioned officials – important as they may be – but the broader hawkish posturing of the Trump cabinet nominees,” he added.

Trump has so far appeared to have recruited China hawks for his second foreign policy team. Florida congressman Mike Waltz, considered to be among the most hardline members of Congress, who even called for the US to boycott the 2022 Winter Olympics hosted by Beijing, is Trump’s pick for national security adviser.

“They all view China as a systemic rival at best and an existential threat to the US at worst. That makes progress from dialogue, as well as trust-building exercises, much more difficult to materialise, regardless of whether an individual is legally restrained from visits or talks,” Chiu said.

China, Philippines trade blame over run-in near contested Spratlys reef in South China Sea

https://www.scmp.com/news/china/diplomacy/article/3289046/china-philippines-trade-blame-over-run-near-contested-spratlys-reef-south-china-sea?utm_source=rss_feed

China and the Philippines traded accusations on Monday over recent activities near a disputed South China Sea reef, as bilateral tensions remain high over confrontations in the key waterway.

In a statement released on Monday, China Coast Guard (CCG) said that several Philippine vessels “under the guise of” fishing boats “gathered illegally in the waters near Houteng Reef in the Nansha Islands”.

Nansha is China’s name for the contested Spratly Islands, claimed by several neighbours including the Philippines.

The vessels ignored warnings from the Chinese coastguard, which then took “necessary management and control measures” in accordance with the law, spokesman Liu Dejun said in the statement.

China has indisputable sovereignty over the Nansha Islands, including Houteng Reef, and its adjacent waters, he added.

Houteng Reef is China’s name for Iroquois Reef, called Rozul Reef in the Philippines. It lies about 128 nautical miles (237km) from the Philippine island of Palawan, a distance that Manila says falls within its UN-mandated 200 nautical mile exclusive economic zone (EEZ).

The Chinese statement did not give the time of the encounter or further details.

It also accused the Philippine boats of bringing along “media reporters to pose for photos and hype”.

“We warn the Philippine side to immediately stop infringement and provocation … and stop inciting propaganda,” Liu was quoted as saying in the statement.

He said the Chinese coastguard would continue law enforcement activities in waters under China’s jurisdiction in accordance with the law, and resolutely safeguard national territorial sovereignty and maritime rights and interests.

According to Philippine Coast Guard (PCG) spokesman Jay Tarriela, two PCG vessels were sent to Rozul Reef to ensure the safety and security of Filipino fishermen operating there.

The deployment came after the coastguard on November 28 received footage from a Philippine fishing boat, Tarriela said on Monday on X, formerly Twitter. He said the video footage and images “captured the harassment of Filipino fishing vessels by a PLA Navy helicopter at Rozul Reef”.

In response to media queries on Monday about the purported incident, Chinese foreign ministry spokesman Lin Jian said “the Philippines’ claim is not factual”, adding that China’s law enforcement in relevant waters to uphold its sovereignty was “reasonable and lawful”.

Tensions between Beijing and Manila over disputed South China Sea features have escalated in the past year, with a string of maritime confrontations including collisions, vessel damage and injury to personnel.

Beijing claims almost all of the resource-rich, busy waterway. Those claims are contested by several other neighbours including Malaysia and Vietnam. An arbitration tribunal moved by the Philippines rejected Beijing’s expansive claims in 2016, but the Chinese side refused to take part in the proceedings and never accepted the ruling.

China’s defence companies, eliminating ‘lying flat’ mentality: SCMP daily catch-up

https://www.scmp.com/news/china/article/3289011/chinas-defence-companies-eliminating-lying-flat-mentality-scmp-daily-catch?utm_source=rss_feed

Catch up on some of SCMP’s biggest China and economy stories of the day. If you would like to see more of our reporting, please consider .

A University of Chicago professor, Robinson was one of the three winners of the Nobel Prize for economics this year. Here, he discusses his work on ‘inclusive’ vs ‘extractive’ institutions and how China fits in.

Chinese defence companies saw their lowest annual revenue growth in four years amid a domestic economic slowdown while global arms sales continued to grow, fuelled by demand from the wars in Ukraine and the Middle East, a Swedish think tank report said.

The growth outlook for foreign direct investment (FDI), one of China’s traditional main economic drivers, faces a challenging outlook as Donald Trump’s second term as US president clouds Beijing’s ongoing efforts to retain and attract overseas businesses, according to analysts.

Blocks are piling up for Chinese manufacturers seeking roundabout ways to access the United States, after Washington imposed a new round of tariffs on solar products imported from four Southeast Asian countries.

China should set next year’s target for economic growth at around 5 per cent – the same benchmark as this year – as a show of determination, a prominent central bank adviser has suggested, adding the country should lift the fiscal deficit ratio above 3.8 per cent to create space for more stimulus and guard against increased tariffs under US president-elect Donald Trump.

China’s top intelligence agency has warned that open-source information poses threats to national security by making sensitive data vulnerable to exploitation by foreign spies.

Several Chinese cities are awarding a “snail award” to sluggish cadres among their measures to eliminate a “lying flat” mentality among workers, after repeated calls for greater diligence by President Xi Jinping and Chinese disciplinary authorities.

China’s plans for yuan unfazed by Trump’s pledge to protect ‘mighty US dollar’

https://www.scmp.com/economy/global-economy/article/3289019/chinas-plans-yuan-unfazed-trumps-pledge-protect-mighty-us-dollar?utm_source=rss_feed

China may need to exercise caution when promoting the overseas use of the yuan over the next four years, analysts said, as US president-elect Donald Trump appears poised to make the preservation of the status of the US dollar a top priority in his second term.

But given the yuan’s current share of international payments, foreign exchange reserves and commodity pricing – none of which befit China’s status as producer of 17 per cent of global economic output, they argued – US policy will do little to deter Beijing’s long-term plans for the internationalisation of its currency.

In an unsparing social media post on Sunday, Trump vowed to impose 100 per cent tariffs on the Brics bloc of emerging economies – a group which counts China, Brazil, India, Russia and South Africa as its most prominent members – should they attempt to undercut the greenback through the creation of a new common banknote.

His fierce defence of the “mighty US dollar” was viewed as a preview for how his administration will attempt to maintain the currency’s status as the global reserve.

But Zhu Feng, dean of the Institute of International Relations at Nanjing University, said the use of local currencies among developing nations is unrelated to any broad de-dollarisation campaign.

“The use of yuan and local currencies to settle among Brics countries is for trade facilitation and has little impact on the [US] dollar’s unrivalled dominance,” he said. “Beijing should send a clear message to Washington.”

Although the choice of currencies for international settlements ultimately lies with the parties making transactions, it has become a subject of greater geopolitical scrutiny as financial sanctions have been deployed more frequently and expansively.

Beijing has long expressed worries over the weaponisation of the US dollar, especially after Russia’s invasion of Ukraine in February 2022. Among the many punitive measures taken by the West in the wake of that incursion, Moscow was kicked out of the Swift international financial messaging system and deprived of some of its overseas foreign exchange reserves.

At an expanded Brics summit hosted by Russia in October, the bloc agreed to promote a “diversified, multipolar” financial system and advance the use of local currencies. Although there was no mention of a Brics banknote in official documents, speculation was rife over the possibility.

Zhu said even though the yuan would benefit most from a local currency push thanks to the overall weight of the Chinese economy and Beijing’s status as a lifeline for Moscow, the internationalisation of the currency will take decades.

“It’s a trend not defined by what happens in the next four years … the yuan cannot acquire a meaningful global stature in such a short time frame,” he said.

“China should continue to focus on economic development and trade growth to underpin the yuan’s rise.”

Some actions have, however, helped to speed that process along.

The People’s Bank of China, China’s central bank, has agreed to 40 bilateral swap lines with other nations enabling them to exchange local currencies for the yuan.

The Shanghai-based New Development Bank has also resolved to increase the share of loans it disburses in local currencies to 30 per cent by 2026.

China’s own alternative to Swift, the Cross-border Interbank Payment System, is also being pitched for more frequent overseas use in conjunction with the mBridge cross-border digital currency initiative.

Wang Yiwei, director of the Institute of International Affairs at Renmin University, said plans for the yuan will not be derailed by Trump’s threats because there are no intentions to dethrone the US dollar.

“China benefits from the [US] dollar’s preponderance since a majority of its trade, foreign reserve and foreign debts are still held in US currency,” Wang said. This attitude, he added, could be seen in Beijing’s lukewarm response to Russia’s overtures towards de-dollarisation at October’s Brics summit.

Despite its relatively limited stature in global payments, Wang said some countries still have reason to use the yuan – and the US should consider why.

“Some turn to the yuan to hedge against risks when Washington abuses its dollar hegemony and imposes sanctions at will,” he said.

Wang added Beijing does not see the yuan’s limited internationalisation as a potential counter-attack should Trump intensify his trade containment efforts.

In October, the yuan was the fifth most active currency for global payments by value according to Swift data, with a share of 2.93 per cent compared with 3.61 per cent in September. It trailed the US dollar’s 47 per cent and the euro’s 22.9 per cent, and fell behind the pound sterling and Japanese yen.

The value of payments settled in yuan the same month decreased by 16.35 per cent compared to September, while the figure for all currencies increased by 3.16 per cent.

On Monday, the offshore yuan slipped 0.3 percentage points versus the US dollar, its lowest level since July.

China has ‘no right’ to demand Philippines to remove US Typhon missile system

https://www.scmp.com/week-asia/politics/article/3289036/china-has-no-right-demand-philippines-remove-us-typhon-missile-system?utm_source=rss_feed

China has “no right” to demand the removal of the US Typhon missile system stationed in the Philippines or tell Manila not to purchase it, according to a Philippine official and security analysts.

The Mid-Range Capability (MRC) missile launcher was transported from the US to the city of Laoag in the northern Philippines for the 39th Balikatan exercises involving troops from the US, Philippines, Australia and France from April 22 to May 10. It was supposed to leave the country by June but has been retained since then by the Philippine military for further assessment.

Army Brigadier General Michael Logico, spokesman of the joint drills, expressed anger at “the nerve” of Beijing over the Typhon issue, telling This Week in Asia: “China has no right to tell us what to do.”

On the Typhon remaining in the Philippines, the director of the Armed Forces of the Philippines Joint and Combined Training Centre, said: “I guess higher leadership decided to let the MRC stay longer than intended.”

China’s defence ministry spokesman Wu Qian was quoted by his ministry last Thursday as warning that “the Chinese side will take resolute countermeasures” if the Philippines failed to withdraw the missile system “immediately”.

Wu also remarked that “history and reality have repeatedly proven that wherever US weapons are deployed, the risk of war and conflicts will rise, and the local people will suffer undeserved suffering from war”.

At a press briefing on April 17, Logico said what the US army brought to the Philippines was a “prototype” to test the Typhon’s feasibility.

The Typhon can launch the Standard SM-6 missiles, which have a maximum range of 300 nautical miles, as well as Tomahawk missiles, which could reach up to 870 nautical miles.

A military source, who spoke on condition of anonymity, said the Typhon’s presence in the Philippines was notable because Taiwan was well within the range of the system given its location in Laoag.

Collin Koh, Senior Fellow at the Institute of Defence and Strategic Studies of the S. Rajaratnam School of International Studies at the Nanyang Technological University, said: “It’s the sovereign prerogative of any country to adopt appropriate measures for its peacetime self-defence, either by self-help or with external assistance.

“In this case, Beijing claims a threat [from Typhon] but since its posing as a direct threat to the Philippines has been the reason for the missile deployment in the first place, its objection rings hollow.”

Koh was not surprised by China’s vehement objection as the Typhon’s deployment would “undermine the edge” that it has over the Philippines and that its “contingency planning whether it’s the case of the South China Sea or even the Taiwan conflict scenario would be complicated by this deployment”.

Beijing views Taiwan as a renegade province that should be reintegrated into mainland control, by force if necessary. While many nations, including the US, do not officially acknowledge Taiwan as an independent state, they oppose any use of force to alter the status quo.

Roland Simbulan, vice chair of the Centre for People Empowerment in Governance (CenPEG) think tank, said a Malaysian official recently told him that the Typhon’s deployment in the Philippines was a cause for “alarm” as it could violate the Asean Declaration of the Zone of Peace, Freedom and Neutrality.

Koh pointed out, however, that the Association of Southeast Asian Nations did not require its member states to consult one another over such matters as it did not have a collective security framework.

“Even if Manila were to consult [other Asean members], would it just merely be an advance notice or to seek consensus? There’s a great deal of worms if one opens this can,” he said.

He noted that “a precedent” was set in 2013 when Manila was criticised for not consulting other Asean members before filing its South China Sea arbitral tribunal case against Beijing.

“Would consultations have mattered if Asean had stepped up [in the first place] to intervene on behalf of its member state subjected to bullying by an extra-regional party?” Koh said.

American security analyst Raymond Powell agreed with Koh, saying Beijing has consistently objected to every move by Manila to improve its security, especially if the US was involved.

The director of SeaLight, a project of Stanford University’s Gordian Knot Center for National Security Innovation focusing on China’s grey-zone maritime strategies, said it was “wise” of Manila to ignore Asean given its security needs.

“Over two decades of fruitless South China Sea Code of Conduct negotiations have clearly demonstrated that Asean is too conflicted and compromised to act as a security organisation,” Powell said.

Calling China “an imperial power” seeking to impose its will on its neighbours, Powell added: “By continuing the Typhon deployment, the Philippines not only satisfies its security requirements, it also gains some leverage in its relationship with Beijing. China respects hard power, which is why it doesn’t want Manila to have it.”

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China opens its first atmospheric monitoring station in Antarctica

https://www.scmp.com/news/china/science/article/3289000/china-opens-its-first-atmospheric-monitoring-station-antarctica?utm_source=rss_feed

China has opened its first atmospheric monitoring station in Antarctica as it continues to expand its presence in the southern continent.

Located in the Larsemann Hills in East Antarctica, the Zhongshan National Atmospheric Background Station began operating on Sunday, according to the China Meteorological Administration.

The station will conduct “continuous and long-term operational observations of concentration changes in Antarctic atmospheric components, and provide a faithful representation of the average state of atmospheric composition and related characteristics in the region”, the administration said in an article posted to its website on Monday.

It said the monitoring data would “support the global response to climate change”.

Ding Minghu, director of the Institute of Global Change and Polar Meteorology at the Chinese Academy of Meteorological Sciences, was quoted as saying that the polar regions were “amplifiers” of global climate change.

He said the new station’s observations would have “unique geographical advantages and scientific value” – including for studying the impact of human activities on the environment.

It is China’s ninth operational atmospheric monitoring station and its first overseas. In addition, 10 new atmospheric monitoring stations are currently being tested in China.

The new facility is based at Zhongshan, China’s second Antarctic research station that was established in 1989 and has been equipped with atmospheric monitoring instruments and systems since 2007.

The administration said Zhongshan Station now had a comprehensive observation system covering seven key meteorological elements including ozone, atmospheric chemistry and aerosols.

China established its first Antarctic research base – known as the Great Wall Station – in 1984, and this year marks 40 years of Chinese polar exploration.

Like its rival the United States, China has been expanding efforts to explore polar resources through its five scientific research stations in Antarctica and two in the Arctic.

Earlier this year, Chinese researchers said they were setting up a surveillance network to monitor Antarctic krill, a project that could help protect the continent’s marine ecology in the future.

China’s fourth polar research icebreaker, the Jidi, was delivered to the Ministry of Natural Resources in June and completed its maiden voyage in September.

Meanwhile, the US Coast Guard cutter Polar Star left Seattle on Friday to begin a month-long deployment to Antarctica in support of Operation Deep Freeze, an annual joint military mission to resupply research stations.

Man sentenced to death in China for pushing wife into sea, using insurance payout on prostitutes

https://www.scmp.com/news/people-culture/trending-china/article/3288483/man-sentenced-death-china-pushing-wife-sea-using-insurance-payout-prostitutes?utm_source=rss_feed

A man in China was sentenced to death after pushing his wife into the sea from a ferry and attempting to claim her life insurance compensation to pay off debts and finance the use of prostitutes.

The case of the husband, 47, surnamed Li, was reported by China’s state broadcaster CCTV on November 21. He received the capital punishment for intentional homicide from the Liaoning Higher People’s Court in December last year. However, it remains unclear whether the sentence has been carried out.

On May 5, 2021, while travelling on a ferry from Dalian in northeastern China’s Liaoning province to Yantai in eastern China’s Shandong province, his wife, also surnamed Li, fell over the railing into the sea.

The police discovered her body after a 45-minute search. Upon hearing of his wife’s death, the husband appeared paralysed, sitting on the ground in shock.

Although he claimed the incident was accidental, police grew suspicious because the location where the victim fell was in a blind spot of the ferry’s surveillance system, which consists of over 200 cameras.

Forensic experts also found bruises on her face.

Moreover, Li was eager to obtain his wife’s death certificate from the police, insisting that local customs required cremation within three days of death.

The police invited Li to Dalian, promising to provide him with the certificate, while secretly dispatching officers to Shanghai, where he lived, to investigate him.

It was revealed that Li operated a restaurant in Shanghai but frequently owed money to his staff and suppliers. He remained single until marrying Li, a 46-year-old two-time divorcee with two children, in October 2020, six months before her death. The woman had been working at his restaurant since 2016.

The police discovered that the restaurant staff was unaware of their marriage, and neighbours noted that the couple did not appear to be in a relationship.

During the investigation, officers tracked down a 19-year-old girlfriend of the husband.

Li solicited a prostitute just half a month after his wife’s death in the hotel room arranged by the police, an act that was caught by their surveillance.

The police later found that Li, who owed over one million yuan (US$140,000), had bought four life insurance policies for his wife two months after their marriage, naming himself as the sole beneficiary.

If his wife died in a transport-related incident, the combined compensation from all four policies could total up to 12 million yuan (US$1.6 million).

Li was arrested, but he continued to assert his innocence.

The police sought help from forensic experts to examine footage captured by surveillance cameras positioned farther from the site of the fall on the ferry.

The experts determined that the manner in which the victim’s body fell indicated that she was pushed rather than having fallen accidentally.

They also enhanced the footage and identified another person’s arm in black – Li had been wearing a black suit that day.

Li was sentenced to death for murder in the first trial in July 2022, and a higher court upheld the verdict following his appeal.

“It is always the husband,” one commenter noted.

“This is what people mean by ‘too clever by half’. Those who lay traps for others often find themselves ensnared by their own schemes,” another remarked.

Biden takes a last aim at China’s hi-tech ambitions with new chip restrictions

https://www.scmp.com/news/china/diplomacy/article/3288933/biden-takes-last-aim-chinas-hi-tech-ambitions-new-chip-restrictions?utm_source=rss_feed

Washington has unveiled sweeping new regulations aimed at curbing China’s ability to develop advanced semiconductors critical to military technologies, artificial intelligence, and hi-tech weaponry.

The measures, announced on Monday by the Commerce Department’s Bureau of Industry and Security, impose export restrictions on 24 types of chipmaking equipment and three categories of software essential for semiconductor development.

A significant focus is superfast high-bandwidth memory (HBM) – seen as vital for AI systems and other advanced computing tasks – with restrictions on the export of US-origin and foreign-made HBM to China in an attempt to prevent Beijing from expanding its AI capabilities in military applications.

The updates included revisions to the foreign direct product rule, which allows the US to inspect products manufactured outside its borders if they contain American technology.

One rule targets semiconductor manufacturing equipment destined for mainland China or Macau.

Another restricts the foreign-made goods that can be sent to companies on the Commerce Department’s entity list, which includes organisations linked to China’s military or to alleged human rights violations.

The Chinese foreign ministry accused the US of abusing export controls to “maliciously blockade and suppress” China.

“The move violates the principles of market economy and fair competition, disrupts international trade order, and destabilises the global supply chain, ultimately harming the interests of all countries,” spokesman Lin Jian said on Monday.

Lin added that China would take measures to safeguard the legitimate rights of Chinese enterprises.

The restrictions follow a long series of such moves stretching back to the first administration of president-elect Donald Trump, who returns to the White House in less than two months.

In 2019, Trump signed an executive order banning US companies from using communications technology from anyone deemed a national security threat. Then Huawei was added to the entity list, effectively barring the Chinese telecoms giant from the US market.

While Trump initiated the trade war with China in 2018 during his first term, the tech rivalry between the two powers has grown more intense during President Joe Biden’s time in the White House.

The Biden administration has imposed more restrictions on trade, citing concerns that cutting-edge American technology flowing to Chinese companies could eventually be used militarily against the US.

Under Biden, the US has imposed tariffs and export controls on semiconductors – a key tech component that Washington fears could accelerate China’s military development and threaten American national security.

Dozens of Chinese firms have been blacklisted because of suspected ties to the PLA, while chipmakers – including China’s largest memory chipmaker, Yangtze Memory Technology Corp – have been barred from access to US technologies.

The latest restrictions are “the strongest controls ever enacted by the US to degrade the PRC’s ability to make the most advanced chips they are using in their military modernisation”, according to Commerce Secretary Gina Raimondo.

“We can’t allow US technology, our most sophisticated, cutting-edge technology, to be used to fuel the military modernisation of our adversaries, particularly the PRC,” she said in a press briefing on Sunday.

National security adviser Jake Sullivan said the measures were a strategic move to “protect America and our allies” as well as “ensuring that American kit and know-how aren’t used against us or our friends to undermine our national security”.

“[China] has a stated goal to produce key sensitive technologies that directly support the PRC’s military modernisation and related activities. The steps today are designed to achieve that and will continue to limit our technologies from being used and abused by our adversaries.”

Sullivan underscored that the rules were “strategic and targeted”, in line with the Biden administration’s broader aim of engaging with China only when it aligns with US interests, while minimising disruptions to commercial exchanges.

However, administration officials conceded that the controls would extend beyond military applications.

“We’re not denying that those frontier models have other applications, but given the strategic context, we think it’s entirely appropriate for us to be targeting frontier AI,” a senior official said.

A Commerce Department official also noted that while a broader impact on non-military fields will be unavoidable, efforts were made to limit the restrictions to “a small portion of China’s economy”.

In addition to tech controls, the measures blacklist 140 Chinese organisations, including semiconductor factories, equipment manufacturers, and investment firms linked to China’s military ambitions. The names of the affected entities have not been disclosed.

Reuters reported in July that the US planned to add 120 Chinese entities into its restricted trade list of semiconductor-related goods.

Washington has also urged its allies to restrict semiconductor equipment to China. Japan and the Netherlands – each home to global giants in chip manufacturing tools – have followed suit.

Last month, the Biden administration said that US investments in Chinese advanced tech industries – including semiconductors, quantum technologies and artificial intelligence – would be banned from January 2.

Many analysts expect Trump to continue Biden’s tech restrictions against China, despite his criticism of the Chips and Science Act – legislated in 2022 to enhance American semiconductor competitiveness – as a “bad” deal.

During the election campaign, Trump suggested raising tariffs on foreign chip manufacturers to encourage them to build plants in the US. He also threatened to impose new 60 per cent tariffs on all Chinese imports, as well as across-the-board 10 per cent tariffs on imports from all other nations.

The US Chamber of Commerce notified its members last week that another set of regulations targeting shipments of high-bandwidth memory chips is expected to come out next month, according to Reuters.

Beijing has often condemned Washington’s tech restrictions, which have challenged China’s technology sector. The Chinese government has responded by doubling down on efforts to develop hi-tech manufacturing.

Progress was already under way through a programme started in 2015 called “Made in China 2025”.

China has achieved many of the programme’s goals – in integrated circuits, communication equipment, operating systems, industrial software and smart manufacturing.

Chinese companies can now produce high-value products including servers, desktop CPUs, solid-state drives, high-speed fibre optics, industrial operating systems and big data systems.

Beijing has also retaliated with export controls on rare earth minerals – including gallium, germanium and graphite, which are essential chipmaking inputs. China produces more than 60 per cent of the world’s rare earth minerals.

Additional reporting by Amber Wang

Indonesia yet to agree with Beijing on joint development areas in South China Sea: minister

https://www.scmp.com/news/asia/southeast-asia/article/3289017/indonesia-yet-agree-beijing-joint-development-areas-south-china-sea-minister?utm_source=rss_feed

Indonesia has yet to decide on any joint development areas with China in the South China Sea, its foreign minister said on Monday, seeking to allay concerns that a recent agreement with Beijing could compromise its sovereignty.

Indonesia caused a stir last month when it issued a joint statement with China pledging to develop projects “in the overlapping waters claimed by the two countries”, in what was widely interpreted as rare recognition of China’s sweeping territorial claim in the South China Sea.

China stakes its claim to sovereignty over about 90 per cent of the waterway via a U-shaped nine-dash line on its maps that includes parts of the exclusive economic zones (EEZ) of its neighbours, which have refused to recognise the claim.

An international tribunal in 2016 concluded the claim had no legal basis. China refuses to recognise that.

Indonesia Foreign Minister Sugiono, who goes by one name, on Monday reiterated to lawmakers that Jakarta still does not recognise the Chinese claim and would make decisions in its national interests.

Sugiono said no areas had yet been specified to work with China on jointly developing fishing or extracting other resources.

“It’s better to do beneficial partnerships without forgetting the main principles that exist, in that we still safeguard our sovereignty,” he said.

Many littoral states in the South China Sea have been reluctant to enter into joint agreements with China, particularly on energy, fearing those could be interpreted as legitimising Beijing’s claims, which stretch as far as 1,700km (1,056 miles) from its mainland.

Sugiono said Indonesia had expressed the joint development plans to leaders of its neighbouring countries “in a bid to reduce tension”.

Analysts have said Indonesia’s agreement with China could mark a reversal of its long-held stance as a non-claimant state in the South China Sea.

Yohanes Sulaiman, an international relations professor, said the deal was a “blunder” that could anger other Southeast Asian countries that had so far held the line against China on its claims.

China condemns Lithuania’s expulsion of 3 diplomats; says countermeasures possible

https://www.scmp.com/news/china/diplomacy/article/3289023/china-condemns-lithuanias-expulsion-3-diplomats-says-countermeasures-possible?utm_source=rss_feed

Beijing said it could take countermeasures against Lithuania as it strongly condemned and protested over the decision by Vilnius to expel three Chinese diplomats.

The Chinese foreign ministry hit out at Lithuania on Monday, days after the Baltic country declared three staff members of the Chinese representative office to the country as personae non gratae, and required them to leave the country within a week.

In the Chinese statement, the ministry said Lithuania’s decision was “without any reason”, and that China “reserves the right to take countermeasures against Lithuania”.

It also accused Lithuania of violating the one-China principle on Taiwan-related issues and deteriorating bilateral relations.

“China calls on Lithuania to immediately stop undermining China’s sovereignty and territorial integrity, and stop creating difficulty for bilateral relations,” the ministry said in the statement.

Beijing sees Taiwan as a breakaway province that is to be reunited, by force if necessary. Most nations, including Taiwan’s major backer the United States, do not recognise the self-ruled island as an independent country but Washington is opposed to any attempt to take the self-governed island by force and is committed to supplying it with weapons.

Relations between Beijing and Vilnius have worsened since 2021 when Lithuania allowed Taiwan to open a de facto embassy under the name “The Taiwanese Representative Office”. Its other representative offices in Europe and the US have used “Taipei” to avoid reference to the island as a whole.

China, in response, downgraded its presence in Lithuania from ambassador level to charge d’affaires. Before that, both countries recalled their envoys from each other’s country.

The foreign ministry of Lithuania said on Friday the three diplomats were expelled for violating the Vienna Convention and Lithuanian laws, without providing further details. The convention, enacted in 1964, sets out international diplomatic rules.

The decision followed the damage of two telecoms cables in the Baltic Sea – one of which connected Sweden and Lithuania – and an investigation into the role of a China-registered bulk carrier vessel Yi Peng 3. The Chinese foreign ministry said it had been consistently communicating with counterparts in the affected countries.

“China stands ready to work with relevant countries to find out what happened,” ministry spokeswoman Mao Ning said on Friday.

Relations between Lithuania and China may improve as Lithuania looks to a new term of government led by Gintautas Paluckas, who seeks to normalise ties with the world’s second largest economy.

He described the decision to allow the Taiwan Representative Office to be installed as a “grave diplomatic mistake”, in an interview with Lithuania state broadcaster LRT.

“We hope the upcoming new government of Lithuania will follow the prevailing international consensus, abide by the one-China principle and foster conditions for the normalisation of China-Lithuania relations,” China’s foreign ministry said in the statement on Monday.

A gallery of China’s military might unveiled at Zhuhai air show, including its new J-35A fighter

https://www.scmp.com/news/article/3288911/gallery-chinas-military-might-unveiled-zhuhai-air-show-including-its-new-j-35a-fighter?utm_source=rss_feed

Discover some of the cutting-edge military aviation technology unveiled at 15th China International Aviation and Aerospace Exhibition in Zhuhai, where the J-35A fifth-generation fighter made its debut with jaw-dropping aerial acrobatics.

Highlights included aerial displays, advanced drone technology and models of advanced combat missiles, at the show which opened a day after the People’s Liberation Army Air Force marked its 75th anniversary.

Check out more images in our online gallery here.

Part of this article was produced with the assistance of generative AI.

US dims Southeast Asia detour for China’s solar products with anti-dumping tariffs

https://www.scmp.com/economy/global-economy/article/3288977/us-dims-southeast-asia-detour-chinas-solar-products-anti-dumping-tariffs?utm_source=rss_feed

Blocks are piling up for Chinese manufacturers seeking roundabout ways to access the United States, after Washington imposed a new round of tariffs on solar products imported from four Southeast Asian countries.

The region has become a major destination for Chinese solar firms transferring production capacity overseas in the past years, seen as an attempt to bypass US tariffs on direct imports from China.

But on Friday, the US Department of Commerce imposed preliminary anti-dumping duties of up to 271.2 per cent on solar cells and modules from Cambodia, Malaysia, Thailand and Vietnam.

China’s Jinko Solar received duties of 21.31 per cent for products made in Malaysia and 56.51 per cent for its goods produced in Vietnam.

The Jiangsu-based Trina Solar, meanwhile, saw a dumping tariff of 77.85 per cent imposed on its products made in Thailand and one of 54.46 per cent on the goods it produces in Vietnam.

South Korea’s Hanwha Qcells, though, saw its new dumping margin set at zero for its production in Malaysia.

Hanwha Qcells, along with other companies including the Arizona-based First Solar, filed a petition in April for the Biden administration to impose tariffs on panels and cells from the four Asian countries, accusing Chinese companies of flooding the US market with cheaply priced products.

Friday’s announcement was the second of two preliminary decisions following an investigation by the US government, after a series of anti‑subsidy duties were imposed in October.

The “circuitous tactic” of Chinese solar manufacturers detouring via Southeast Asia to gain access to the US market may face bigger hurdles once US-president elect Donald Trump takes office, said Ron Cai, a partner at the Shanghai-based Zhong Lun Law Firm.

“As business in Southeast Asia is getting harder, people start to think about going to Mexico or the Middle East … it is possible that the new US administration will further tighten up the restrictions, so that they can drive you to invest in the US, and transfer the capacity and technology to the US,” Cai said.

“It is entirely possible that they treat your production in Mexico the same as ‘Made in China’.”

Last week, Trump said that he would levy tariffs of 25 per cent on all Canadian and Mexican imports, as well as additional duties of 10 per cent on Chinese goods, on his first day in office to address drug and immigration issues.

Kevin Wang, chief operating officer of Chinese electronics giant TCL Technology, said Chinese companies with investments overseas “should not worry too much” facing continuous abrupt threats from Trump, as they keep changing.

“So whatever you do to prepare for this today may be right or wrong,” Wang said on Thursday at an event organised by the Beijing-based Centre for China and Globalisation think tank.

“We have been studying these for a long time, no matter what kind of move he makes, we don’t think it will cause very serious damage.”

The US is the biggest export market for TCL, whose major products include televisions, and washing machines, as well as solar panels. The company has production bases in Mexico and Vietnam.

As for setting up factories in the US, the level of feasibility depends on the industries, he added.

“I think in industries like consumer electronics, it may not be cost-effective to build an assembly plant in the United States,” he said.

“Of course, the situation is always changing. Maybe some industries feel that the current changes in the situation make [investment in the US] necessary, this may have to do with their products. We are paying close attention to the changes in various relevant policies.”

China’s generative AI users reach 230 million as start-ups, Big Tech roll out LLM services

https://www.scmp.com/tech/big-tech/article/3288989/chinas-generative-ai-users-reach-230-million-start-ups-big-tech-roll-out-llm-services?utm_source=rss_feed

The number of generative artificial intelligence (GenAI) users in China reached 230 million at the end of June, as a crop of start-ups and Big Tech firms rushed to offer their large language model (LLM) services, according to government data.

That means around one in every six users in the world’s biggest internet market are using a GenAI product, according to a report released on Saturday by the China Internet Network Information Centre (CNNIC), a state-run agency.

Chinese tech giant Baidu’s Ernie Bot, known as Wenxiaoyan in Chinese, is the most frequently used GenAI product by domestic users, with an 11.5 per cent share, according to the CNNIC report. It was followed by OpenAI’s ChatGPT and Google’s Gemini, with 7 per cent and 3.8 per cent share respectively, although the two US services are not officially available in mainland China.

GenAI refers to algorithms that can be used to create new content, including audio, code, images, text, simulations and videos. LLMs are the technology behind GenAI services like ChatGPT.

Nearly two-thirds of GenAI users on the mainland employ LLM services to answer questions, while one-third rely on them as working assistants to generate meeting transcripts and slides, the report showed.

As of November, more than 309 GenAI products had registered their LLMs with the Chinese internet regulator, with Beijing accounting for 96 and Shanghai 84, according to the report.

Among the registered services, over 190 received approval and made their services commercially available to the public as of July this year, according to data from internet watchdog Cyberspace Administration of China, as cited by the CNNIC report.

The GenAI user numbers in China highlight the expanding adoption of LLMs in the world’s second-largest economy, as domestic companies race to close the gap with the US after OpenAI set off a global frenzy with the release of ChatGPT in 2022.

All major Big Tech firms in China have launched their own LLMs for consumers as well as enterprise uses, while the rise of start-ups, including the four so-called AI ‘tigers’ Baichuan, Zhipu AI, Moonshot AI and MiniMax, is drawing increasing attention from users and investors.

The nearly 200 commercially available LLMs in China have attracted over 600 million registered users, according to statistics cited by an official of the Ministry of Industry and Information Technology in October.

Chinese AI companies face common hardware restrictions as Washington has applied curbs on US suppliers such as Nvidia selling advanced graphics processing units to China.

What ‘China problem’? Thai tourism post-Covid is in good health

https://www.scmp.com/opinion/asia-opinion/article/3288934/what-china-problem-thai-tourism-post-covid-good-health?utm_source=rss_feed

For an industry that went from hero to zero when the Covid-19 pandemic erupted, look no further than Thailand’s tourism sector. In 2019, the “land of smiles” welcomed 39.9 million foreign tourists, a record high. In 2020, the number of arrivals plunged to 6.7 million. The following year, it fell to just 400,000.

The pandemic delivered a hammer blow to Thailand’s economy. With tourism accounting for about a fifth of output and 20 per cent of employment before the pandemic, Thailand’s tourism flows suffered what the International Monetary Fund called a “sudden stop”.

That didn’t abate for some time. Only at the beginning of last year did monthly arrivals exceed 2 million, still down from close to 3.5 million in early 2019. The pandemic’s impact on tourism was felt most acutely in visitor numbers from mainland China, which was also the biggest source of concern about the recovery.

In 2019, Chinese travellers accounted for about 28 per cent of international arrivals and tourist revenue, the largest source market. By 2022, their share had fallen to a mere 2.4 per cent. Even as recently as the end of last year, Chinese tourists constituted just 13 per cent of arrivals.

Beijing’s draconian zero-Covid policy fanned fears about a weak and prolonged recovery in Thailand’s tourism sector. These worries intensified when China’s economy reopened and it became clear that outbound travel would take much longer to return to 2019 levels because of a combination of cheaper and more appealing domestic destinations, reduced airline capacity and geopolitical concerns.

“The fact that Chinese travellers were not desperate to get a on plane to go abroad caught a lot of people off guard, not just in Thailand,” said Ananth Ramchandran, head of advisory and strategic transactions, hotels and hospitality, Asia, at CBRE.

In fact, two years after China’s economy reopened, Chinese tourist numbers in Thailand remain significantly below 2019 levels. Since the start of this year, the country has welcomed 6 million Chinese tourists, just less than 20 per cent of international arrivals.

Even so, the “China problem” has proved less damaging than many feared. Thailand is on course to meet its full-year target of 36.7 million tourists. Next year, overseas arrivals could surpass the 2019 peak, according to online travel platform Agoda Holdings.

In a sign of Thailand’s resilience, the hotel sector is performing better than it did in 2019 by some measures. In Bangkok and Phuket, average daily rates this January – the peak of the high season – were 17-22 per cent higher in local currency terms than in January 2019.

In Phuket, revenue per available room was about 20 per cent higher, while occupancy levels were only a few percentage points lower. In some other popular destinations, notably Koh Samui, occupancy rates exceed 2019 levels, according to data from CoStar.

This is mainly because other big source markets for tourism have picked up the slack, so much so that total arrivals excluding China reached 2019 levels at the start of this year. More tellingly, average monthly tourist revenue per head in the first three quarters of this year was almost as high as it was for the whole of 2019.

One of the drivers of the recovery has been the spectacular growth in Indian tourists. According to global travel data provider OAG, airline capacity on some India-Thailand routes has surpassed 2019 levels.

Thailand’s strong performance partly reflects the return of mass tourism, fuelled by pent-up demand, increased flight capacity and a wider range of destinations and activities. Asian hotels are a big beneficiary of these trends.

“The hotel sector is the first to suffer [in a crisis] but also the first to recover. The ability to reset rates daily is a big advantage,” said Nihat Ercan, Asia-Pacific chief executive of hotels and hospitality at JLL. Hotel investment in Thailand this year is 80 per cent higher than the annual average in 2011-20.

However, there is another factor at work. While other source markets have compensated for the slow recovery in Chinese tourists, this is partly because the government has gone to great lengths to make Thailand more attractive.

The most consequential measure was a relaxation in visa requirements for travellers from some of Thailand’s main feeder markets, including China. The scheme, which allows visa-free entry for visitors from 93 countries and territories to stay for up to 60 days, was instrumental in boosting tourist numbers this year.

The visa-exemption programme was introduced “out of a sense of nervousness” about tourist volumes, Ramchandran said, especially Chinese arrivals. The anxiety paid off. China reclaimed its position as the single largest source market this year, but the number of Chinese tourists is still nowhere near the 11 million in 2019.

However, it is questionable whether 2019 should be the benchmark. Since the pandemic erupted, Chinese tourists have become more discerning and sophisticated. During the “golden week” holiday in October, which admittedly was just before Thailand’s high season kicked in, Thailand did not even figure in the top 10 outbound flight destinations ranked by the daily number of routes as a proportion of 2019 levels, according to HSBC data.

Thailand’s goal of welcoming 9 million Chinese tourists next year attests to the continued importance of China as a source market. Yet the fact that the government expects foreign arrivals to exceed the pre-pandemic record shows that the China problem is not such an issue after all.

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Malaysia warns Chinese firms from using it as a base to ‘rebadge’ to avoid US tariffs

https://www.scmp.com/news/asia/southeast-asia/article/3288972/malaysia-warns-chinese-firms-using-it-base-rebadge-avoid-us-tariffs?utm_source=rss_feed

Malaysia has urged Chinese companies to refrain from using it as a base to “rebadge” products to avoid US tariffs, its deputy trade minister said on Monday, amid increasing export restrictions and concerns of a US-China trade war.

Washington is expected to further curb exports to Chinese semiconductor toolmakers and sales of certain chipmaking equipment, including products manufactured in Malaysia, Singapore and Taiwan, sources have said.

Malaysia is a major player in the semiconductor industry, accounting for 13 per cent of global testing and packaging, and is seen as well-placed to grab further business in the sector as Chinese chip firms diversify overseas for assembling needs.

“Over the past year or so … I have been advising many businesses from China not to invest in Malaysia if they were merely thinking of rebadging their products via Malaysia to avoid US tariffs,” Malaysia’s deputy trade minister Liew Chin Tong told a forum on Monday.

He did not specify the types of businesses.

Liew said regardless of whether the US had a Democratic or Republican administration, the world’s largest economy would impose tariffs, as seen in the solar panel sector.

Washington imposed tariffs on solar exports from Vietnam, Thailand, Malaysia and Cambodia – home to factories owned by Chinese firms – last year and expanded them in October following complaints from manufacturers in the United States.

US president-elect Donald Trump has threatened to slap an additional 10 per cent tariff on all Chinese imports when he takes office on January 20.

‘Chinese support for Russia’ hitting ties, German Foreign Minister Baerbock tells Wang Yi

https://www.scmp.com/news/china/diplomacy/article/3288992/chinese-support-russia-hitting-ties-german-foreign-minister-baerbock-tells-wang-yi?utm_source=rss_feed

German Foreign Minister Annalena Baerbock has accused China of supporting Russia’s war in Ukraine, warning Chinese counterpart Wang Yi during talks on Monday that this was affecting Beijing’s relations with both Berlin and Brussels.

“Foreign Minister Baerbock emphasised that the increasing Chinese support for Russia’s war against Ukraine has an impact on our relations, as core German and European security interests are affected,” her ministry said in a statement.

The warning came as German President Olaf Scholz paid a surprise visit to Ukrainian capital Kyiv on Monday morning to meet his counterpart Volodymyr Zelensky.

Baerbock, who arrived in Beijing on Monday for a two-day visit including strategic dialogue at the foreign ministers’ level, had also criticised China for supporting Russia ahead of her trip.

“Instead of shouldering responsibility for peace and security in the world as a permanent member of the UN Security Council, China is going against our core European interests by providing economic and military aid to Russia,” she said on Sunday.

“The fact that we cannot simply ignore this in our relations with China is something I will also be discussing in Beijing.”

The German foreign ministry described Monday’s dialogue with Wang as “exhaustive and open”, both on topics where cooperation was possible, as well as on issues where there were clear differences of opinion, especially regarding security and economic policy issues.

“The German foreign minister made clear that there is close European coordination on security and economic issues,” the statement added.

Her visit comes as the European Union readies fresh sanctions against Russia over its invasion of Ukraine, including on Chinese companies believed to be involved in the development of drones for the Russian military.

European leaders have expressed growing concerns over Beijing standing by Moscow against the backdrop of deepening ties between the neighbours. China has not condemned Russia’s actions in Ukraine

Baerbock’s visit also comes amid an intensifying trade row between the EU and China, after the bloc imposed additional tariffs on Chinese-made electric vehicles in October.

In response to Beijing’s criticism of the extra tariffs of 7.8 per cent to 35.3 per cent, depending on brands, Baerbock underlined the clear mandate of the EU Commission, her office said.

“A level playing field, fair competition and reciprocal market conditions are essential. She called on her Chinese counterpart to engage constructively with the EU Commission in order to find a negotiated solution,” the statement said.

Germany, the EU’s top economy and car producer, had voted against the hike.

While negotiations have continued, Beijing has said it will take measures to safeguard the interests of Chinese companies and has filed a complaint with the World Trade Organization.

This is Baerbock’s second visit to China as foreign minister. After her first trip, in April last year, she said Beijing was becoming more of a systemic rival than a trade partner and competitor.

Chinese economist calls for confidence, says GDP target should remain 5% in 2025

https://www.scmp.com/economy/china-economy/article/3288956/chinese-economist-calls-confidence-says-gdp-target-should-remain-5-2025?utm_source=rss_feed

China should set next year’s target for economic growth at around 5 per cent – the same benchmark as this year – as a show of determination, a prominent central bank adviser has suggested, adding the country should lift the fiscal deficit ratio above 3.8 per cent to create space for more stimulus and guard against increased tariffs under US president-elect Donald Trump.

The recommendations were made by Wang Yiming, former deputy director of the Development Research Centre of the State Council, at the China Macroeconomy Forum in Beijing on Saturday. The forum was held ahead of the coming central economic work conference, an annual meeting that sets the tone for policy in the following year.

“Setting the gross domestic product growth rate at around 5 per cent is essential, as it guides market expectations and expresses our confidence,” Wang said.

Despite the momentum seen in recent economic data releases, comparatively slow periods of GDP growth in 2024 have presented challenges to the world’s second-largest economy in achieving its annual goal of “around 5 per cent”.

As heightened trade tensions seem inevitable, Wang said, a likely contraction in exports, sluggish domestic demand and an ongoing slump in the property market all indicate more supportive fiscal and monetary policy will be needed to reach a similar target next year.

Wang cited research from China Finance 40 Forum – a Chinese think tank which covers economic and financial policy – indicating broad fiscal expenditures should increase by 2.6 trillion yuan (US$359 billion), 2 per cent of nominal GDP. This, however, would necessitate a raising of the government’s deficit ratio.

China has maintained an official fiscal deficit ceiling of around 3 per cent most years. Exceptions include 2020 – when the pandemic prompted an increase to 3.6 per cent – and last October, when the rate was increased to 3.8 per cent after issuing 1 trillion yuan in special government bonds for disaster relief and reconstruction.

“To indicate more proactive support from the policy side, we should think about the possibility of raising the budget deficit ratio above 3.8 per cent,” Wang said. “We need clear policy statements to restore and boost confidence.”

Wang’s projection was echoed by analysts at Bank of China. According to an outlook published in late November, the bank said implementation of existing stimulus policies as well as further measures would be crucial to economic recovery. The analysts added China’s economy could expand by around 5 per cent in 2025, even with trade tensions depressing exports.

At Saturday’s forum, Wang also said the issuance of special government bonds could be further expanded in 2025 to support commercial banks. When the time is right, he added, interest rates and the reserve requirement ratio could be cut further to reduce debt costs.

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New US chip sanctions to hit Chinese tool makers, but Japan, Netherlands exempt

https://www.scmp.com/tech/tech-war/article/3288963/new-us-chip-sanctions-hit-chinese-tool-makers-japan-netherlands-exempt?utm_source=rss_feed

The US will launch its third crackdown in three years on China’s semiconductor industry on Monday, restricting exports to 140 companies including chip equipment maker Naura Technology Group, among other moves, according to two people familiar with the matter.

The effort to hobble Beijing’s chipmaking ambitions will also hit Chinese chip toolmakers Piotech and SiCarrier Technology with new export restrictions as part of the package, which also takes aim at shipments of advanced memory chips and more chipmaking tools to China.

The move marks one of the Biden Administration’s last large scale effort to stymie China’s ability to access and produce chips that can help advance artificial intelligence for military applications or otherwise threaten US national security.

It comes just weeks before the swearing in of Republican former president Donald Trump, who is expected to keep in place many of Biden’s tough-on-China measures.

The package includes curbs on China-bound shipments of high bandwidth memory (HBM) chips, which are critical for high-end applications like AI training; new curbs on 24 additional chipmaking tools and three software tools; and new export restrictions on chipmaking equipment manufactured in countries including Singapore and Malaysia.

The tool controls will likely hurt Lam Research, KLA and Applied Materials, as well as non-US companies like Dutch equipment maker ASM International.

Among Chinese companies facing new restrictions are nearly two dozen semiconductor companies, two investment companies and over 100 chipmaking tool makers, the sources said.

US lawmakers say some of the companies, including Swaysure Technology, Qingdao SiEn, and Shenzhen Pensun Technology, work with China’s Huawei Technologies, the telecommunications equipment leader once hobbled by US sanctions and now at the centre of China’s advanced chip production and development.

They will be added to the entity list, which bars US suppliers from shipping to them without first receiving a special licence.

China has stepped up its drive to become self-sufficient in the semiconductor sector in recent years, as the US and other countries have restricted exports of the advanced chips and the tools to make them. However, it remains years behind chip industry leaders like Nvidia in AI chips and chip equipment maker ASML in the Netherlands.

The US also is poised to place additional restrictions on Semiconductor Manufacturing International Corporation, China’s largest contract chip manufacturer, which was placed on the Entity List in 2020 but with a policy that allowed billions of dollars worth of licences to ship goods to it to be granted.

For the first time, the US will add two companies that make investments in chips to the entity list. Chinese private equity firm Wise Road Capital and tech firm Wingtech Technology will be added.

Companies seeking licences to ship to firms on the Entity List generally get denied.

An aspect of the new package that addresses the foreign direct product rule could hurt some US allies by limiting what their companies can ship to China. The new rule will expand US powers to curb exports of chipmaking equipment by US, Japanese, and Dutch manufacturers made in other parts of the world to certain chip plants in China.

Equipment made in Malaysia, Singapore, Israel, Taiwan and South Korea is subject to the rule while the Netherlands and Japan will be exempt.

The expanded foreign direct product rule will apply to 16 companies on the entity list that are seen as the most important to China’s most advanced chipmaking ambitions. The rule will also lower to zero the amount of US content that determines when certain foreign items are subject to US control. That will allow the US to regulate any item shipped to China from overseas if it contains any US chips. The new rules are being released after lengthy discussions with Japan and the Netherlands, which, along with the US, dominate the production of advanced chipmaking equipment.

The US plans to exempt countries that put in place similar controls, the people said.

Another rule in the package restricts memory used in AI chips that correspond with what is known as “HBM 2” and higher, technology made by South Korea’s Samsung and SK Hynix and US-based Micron. Industry sources only expect Samsung Electronics to be impacted.

The latest rules are the third major package of chip-related export restrictions on China implemented under the Biden administration. In October 2022, the US published a sweeping set of controls to curb the sale and manufacture of certain high-end chips which were considered to be the biggest shift in US tech policy toward China since the 1990s.

Chinese cities fight lying flat mentality with ‘snail awards’ for poor workers

https://www.scmp.com/news/china/politics/article/3288970/chinese-cities-fight-lying-flat-mentality-snail-awards-poor-workers?utm_source=rss_feed

Several Chinese cities are awarding a “snail award” to sluggish cadres among their measures to eliminate a “lying flat” mentality among workers, after repeated calls for greater diligence by President Xi Jinping and Chinese disciplinary authorities.

In the eastern city of Taizhou in Jiangsu province, a snail award has been given to workers who do not address concerns from the public in a timely manner – including fixing a government website, changing a road lamp and demolishing an unapproved building structure – the official People’s Daily reported on Sunday.

Some cities have researched and compiled a list of traits considered lying flat, meaning doing the bare minimum to get by. In Kunming, in southern China’s Yunnan province, the list includes being “complacent with the status quo, fear of taking responsibility, procrastination and low work standards”.

Most choose to punish cadres showing these traits. In September, Zhanjiang’s Mazhang district government in Guangdong province demoted eight cadres. In Jiangsu’s Taizhou and Guizhou’s Zunyi, those who received the “snail award” received poor annual evaluations and a lower bonus.

Some cities have set up positive examples to encourage workers. In Taizhou, authorities set up a “horse award” for those deemed efficient, and in Hanshou county in the central Hunan province, there is a public cadre image contest that celebrates the “diligent worker”.

The “lying flat cadre” phenomenon has been repeatedly raised by Xi and disciplinary authorities as a sign that officials love to seek comfort and enjoyment.

In January last year, Xi delivered a speech at the second plenum of the 20th Central Commission for Discipline Inspection (CCDI), China’s top corruption watchdog, stressing the need to maintain a trailblazing spirit among officials and saying that many cadres, untested by hardship, had become weak.

“After decades of peaceful rule, many party members and cadres have not experienced the test of life and death, lacking the tempering of brutal struggles and harsh environments,” Xi said.

Afterwards, the CCDI launched a campaign against the lying flat mentality, with local governments naming and shaming grass-roots officials deemed lacking. A commentary on the CCDI’s website said the cadres’ actions “have delayed the development of the party and the country, and harmed the well-being of the people”.

Alfred Wu, an associate professor at the Lee Kuan Yew School of Public Policy at the National University of Singapore, said Chinese authorities were running out of ways to deal with the problem, other than criticising and urging every few months.

“The core issue is that their incentive structure is problematic,” he said. “In a regular bureaucrat management system, you let the good ones go higher up and the weak ones down. But in China, if you do something wrong, the consequences are rather high, so the officials would rather stay inactive.”

In the post-pandemic era, many Chinese bureaucrats – the arms and legs that execute the leadership’s policy decisions – also face pay cuts, heavy workloads, seemingly never-ending inspections and numerous political studies while having to maintain social stability.

There have been calls from higher-ups to lessen the burden on grass-roots officials. In August, a document from the State Council, China’s cabinet, aimed to “tackle formalism”, emphasising the need to streamline meetings, documents and initiatives while curtailing community-level inspections and evaluations.

It offered guidelines on how local policy documents are created, aiming to keep tasks to a minimum, as well as advising against using unnecessarily complex evaluation systems or burdening officials with detailed criteria, allowing them to focus on taking policy action instead.

Dangerous weight loss camps on the rise in China as country grapples with obesity crisis

https://www.scmp.com/news/china/article/3288523/dangerous-weight-loss-camps-rise-china-country-grapples-obesity-crisis?utm_source=rss_feed

Weight-loss camps promising rapid transformations are booming in China as the country grapples with a growing obesity crisis.

The slimming boot camps enforce strict diet plans and rigorous workout regimens to help participants achieve quick weight loss.

However, the death of an online influencer in May 2024 has sparked debate about the lengths some camps will go to push their trainees.

Health experts are warning that the industry needs more regulation, as Beijing launches a campaign addressing unhealthy eating in schools and promoting more active lifestyles for its people.

The experts say economic development, changes in work behaviours and shifts in consumption have all contributed to the obesity epidemic in China.

China actress Huang Yi, from ‘lousy men collector’ to helping burn-injured kids

https://www.scmp.com/news/people-culture/china-personalities/article/3288622/china-actress-huang-yi-lousy-men-collector-helping-burn-injured-kids?utm_source=rss_feed

In China’s entertainment industry, Huang Yi was once regarded as one of the most promising actresses. However, her career declined due to two tumultuous marriages, during which she suffered domestic abuse, earning her the unfortunate nickname “lousy men collector”.

Now, at 47, she has reshaped her public image by dedicating herself to philanthropy, helping nearly 2,000 children with burn injuries over the past decade.

In 2001, she gained national fame at just 24 years of age for her portrayal of Li Yuhu in Wrong Carriage, Right Groom. Her character, a bright and lively young woman with a chivalrous heart, captivated audiences with her youthful energy and natural performance.

Building on her success, Huang took on the role of Xiaoyanzi in the third sequel of My Fair Princess (or Huan Zhu Ge Ge in Chinese) in 2004.

Huan Zhu Ge Ge, an iconic TV series now celebrated for over two decades, remains a household name in China. Its timeless comedic style and memorable characters have established it as a legendary milestone in Chinese television history.

Huang’s life took a dramatic turn due to two troubled marriages, which hindered her career and earned her the moniker “lousy men collector”.

Her first marriage was to Jiang Kai, a wealthy businessman she met at a charity auction in 2009. The pair tied the knot just three months later, but their marriage ended in divorce.

After their separation, Jiang publicly insulted her, further damaging her reputation.

Later, she married Huang Yiqing, a wealthy “second-generation” individual, who turned out to be abusive and subjected her to domestic violence, including one incident where he struck her with electronic devices.

This ordeal concluded when Huang Yiqing was sentenced to 16 years in prison for bootlegging, marking a significant turning point in her life.

As she rebuilt her life and career, her daughter from her second marriage became her inspiration and driving force, motivating her to overcome challenges.

She once wrote to her daughter, who was studying abroad: “You will face many challenges being alone overseas, but don’t be afraid. I will always have your back. My shoulders may not be broad, but I will make sure you stand tall on them to see the world. Fly high, my dear.”

Beyond her acting career, Huang recently made headlines for her dedication to philanthropy, being named one of the “Top 10 Philanthropists of the Year” at a charity gala hosted by IFeng.com on November 26.

In a post on Weibo, she reflected on her decade-long commitment to helping children with burn injuries, writing: “My journey into philanthropy began with a mother’s love. Alongside five other mothers, I co-founded Angel Baby. Over the past 10 years, we’ve collaborated with 201 hospitals across 30 provinces, providing aid to 1,892 children affected by burns and scalds.”

Her transformation has deeply resonated with many online.

One supporter commented: “She is truly beautiful inside and out, helping so many children.”

Another echoed: “Even as someone with a low tolerance for emotional stories, I can’t help but feel moved by her actions.”

China hot on the agenda at Apec, G20 gatherings as Trump’s spectre looms large

https://www.scmp.com/economy/global-economy/article/3288906/china-hot-agenda-apec-g20-gatherings-trumps-spectre-looms-large?utm_source=rss_feed

Global Impact is a weekly curated newsletter featuring a news topic originating in China with a significant macro impact for our newsreaders around the world. Sign up

We were only beginning to absorb the implications of US president-elect Trump’s stunning victory in this month’s election when the focus of world attention shifted a few thousand kilometres south.

Leaders representing the Apec descended on Lima, Peru, within a week of the election, before moving on to Rio de Janeiro for the G20’s annual meeting.

But two figures dominated the high-profile events: Xi, who headlined events in four locations and signed dozens of agreements, and Trump, who was nowhere near South America yet loomed over most of the discussions.

Xi arrived in Peru accompanied by some 400 businesspeople and entrepreneurs to attend the summit, but in some ways, China’s arrival had preceded him in the form of excitement – and concern among some American officials – around a multibillion-dollar Chinese-funded megaport on the country’s coast.

Funded through China’s Belt and Road Initiative, which Washington has been trying to counter, the Chancay Port will open a conduit for critical minerals and other strategic South American commodities to China and the rest of Asia.

Just a few months earlier, it appeared that an outstanding legal question over management rights might impede Xi’s ability to inaugurate the port during Apec.

Diplomacy prevailed, however, as Beijing managed to resolve the dispute. And underscoring China’s deft diplomatic skills, Peruvian President Dina Boluarte had earlier agreed with Xi during a visit to Beijing to deepen cooperation on trade, the digital economy and scientific and technological innovation.

While the port became more of a question mark in terms of its ambition to connect China with Brazil, Xi still managed to pull off a diplomatic tour de force with President Luiz Inacio Lula da Silva by signing 37 agreements.

Hong Kong also benefited from Apec by signing a pact that will initially remove 91.3 per cent of tariff lines for goods originating in the city. Peru will gradually eliminate another 7 per cent of its tariff lines for such products.

The deal also granted Hong Kong businesses benefits spanning more than 150 sectors in Peru, including the professional services, financial, transport, and research and development industries.

Chief Executive John Lee Ka-chiu said he intended to build on the foundation of his engagements while in Peru to explore possible free-trade agreements with more countries in Latin America.

Apec and G20 participants are expecting very different outcomes going forward with Washington, given the likelihood that “tariff man” Trump will follow through with his threats, and with consensus- and alliance-building Biden exiting the world stage.

On Monday, Trump escalated his campaign pledges by saying that he would impose new tariffs on goods from China by using an executive order on the first day of his administration, which starts on January 20.

Biden’s fading spotlight at both conferences stood in stark contrast to the Biden-Xi summit a year ago at Apec in northern California.

He did stand out as the first sitting US president to visit the Amazon rainforest, flagging the dangers of global warming often dismissed by Trump, who has vowed to scrap measures to fight climate change.

Xi, meanwhile, spent much time working to improve frayed relationships, including with Australian Prime Minister Anthony Albanese, whose country had been subject to Chinese restrictions on billions of dollars of exports in more than a dozen key Australian industries – including barley, beef, coal, copper, timber and wine. That was sparked by Canberra’s push for an independent international inquiry into the origins of the Covid-19 pandemic.

Progress on that front was already under way, as China lifted anti-dumping and anti-subsidy tariffs on Australian wine in March.

At the G20, Albanese noted progress in repairing ties, saying that “trade is flowing more freely to the benefit of both countries and to people and businesses on both sides”, adding that the two nations would explore opportunities for cooperation on energy transition and climate change.

Later, German Chancellor Olaf Scholz told Xi in their bilateral talks that having strong ties without “surprises” was good for both of their nations.

Xi said he also hoped Germany could play an important role in China-EU talks about the bloc’s punitive tariffs on Chinese electric vehicles. Last month, Germany voted against the European Union’s plan to impose punitive tariffs on Chinese electric vehicles, with Germany’s position fuelling criticism in Brussels.

As if to underscore the declining influence of Biden compared with Xi, the outgoing US leader missed the G20 “family photo” shoot, leaving his Chinese counterpart front and centre among the rows of leaders posed at the annual gathering’s traditional set piece.

China’s record has not been perfect in South America, as the scandal-plagued US$2 billion Coca Codo Sinclair dam in Ecuador has shown.

This has led to a shift away from large projects and towards smaller, more strategic ones in line with Beijing’s economic growth objectives.

But on many other counts during his nine-day swing through South America, Xi and his delegation managed to shine, setting up an even greater challenge for US officials concerned about their influence in the region.

60-Second Catch-up

G20 ends with call for urgent action on climate, global health, women’s rights.

China’s Xi Jinping meets with leaders of Germany, France, Argentina.

Opinion: Trump’s re-election could mark end of era dominated by US-led globalisation.

Xi Jinping meets with Brazilian president Lula, signing 37 trade and development deals.

At G20, Xi Jinping and Anthony Albanese discuss improved China-Australia trade relations.

Series: China’s Chancay, Peru port project.

Hong Kong to explore striking free-trade deal with more Latin American countries: John Lee.

Hong Kong says new free-trade pact with Peru will spur business opportunities.

Opinion: World in crisis needs more leaders to embrace China’s ‘big family’ vision.

Deep Dives

As Chinese President Xi Jinping inaugurated the US$3.5 billion Chancay port in Peru this month that promises to jump-start exports in the region and create a gateway to China, US Secretary of State Antony Blinken oversaw a ceremony just a few miles away to give US$6 million in 1980s diesel locomotives to the Andean nation.

The split screen said it all. One was about the future, the other about the past.

Read more.

Zhang Jun assiduously followed the news as Chancay port in Peru was developed into the biggest deep water project of its kind on the long Pacific coast of South America.

His Nanjing-based company, Jiangsu Haosanyou Information Technology, helps shippers of marine cargo find business along China’s supply chains via the internet. For Zhang, the US$3.5 billion megaport, which was inaugurated on November 14, foreshadows a boom in Chinese e-commerce in Latin America, where conventional Chinese trade is already growing.

Read more.

President Xi Jinping is expected to inaugurate Chancay port when he visits Peru next week. The Chinese-funded megaport may reshape Pacific trade and has also made the United States uneasy. In the first of a two-part series, Igor Patrick looks at the history of the project, its impact on global trade and the social costs incurred.

Drive about 70 kilometres (43 miles) along the Pan-American Highway north of Lima, Peru, and you’ll notice a sudden change in the landscape.

Read more.

President Xi Jinping is expected to inaugurate Chancay port when he visits Peru next week. The Chinese-funded megaport may reshape Pacific trade and has also made the United States uneasy. In the second of a two-part series, Igor Patrick looks at the implications for the whole of the South American continent.

Erik Bethel, a former US representative at the World Bank during Donald Trump’s presidency, was speaking at a conference in Miami in May when he surprised the audience by interrupting his analysis of security in the Western Hemisphere to issue a warning.

Read more.

Cui Hongjian is a leading Chinese researcher on European studies. A former diplomat, he is the head of European Union studies at Beijing Foreign Studies University. Talking to the South China Morning Post, Cui delves into the changing dynamics of China-EU relations and the impact of a strong comeback by Donald Trump, the US president-elect. For other interviews in the Open Questions series, click .

Read more.

Global Impact is a weekly curated newsletter featuring a news topic originating in China with a significant macro impact for our newsreaders around the world.

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China’s intelligence ministry warns of security risks from open-source information

https://www.scmp.com/news/china/politics/article/3288946/chinas-spy-ministry-warns-national-security-risks-open-source-information?utm_source=rss_feed

China’s top intelligence agency has warned that open-source information poses threats to national security by making sensitive data vulnerable to exploitation by foreign spies.

Sensitive data that is not properly declassified or assessed for risks can be publicly spread online and “become an important source of open-source intelligence” for overseas spy agencies, the Ministry of State Security (MSS) said in an article posted on its official WeChat account on Sunday.

Open-source information is publicly available and legally accessible through platforms that provide social media posts, online forums, blog articles, news reports and satellite images, the ministry said, adding that it “often contains large amounts of valuable data and intelligence that can become a key source of cyber espionage”.

“Overseas espionage agencies can aggregate fragmented and vague data, and through big data analysis, can conduct precise, continuous and stable tracking of targets, extracting valuable intelligence,” the ministry warned.

“This presents greater challenges to information security efforts, requiring stricter and more effective measures to prevent information leaks.”

The MSS highlighted three areas of concern and urged caution during procurement bidding, where sensitive information could be disclosed during the process. It cited construction project cases that involved confidential information and digitisation of confidential archives, which required security measures during procurement to protect national secrets.

Inadequate management and lack of awareness could lead to leaked procurement details, purposes or sensitive technical data, the ministry said.

The MSS added that government agencies should be alert when releasing information to the public, citing cases when some agencies did not follow confidentiality procedures for publishing information, resulting in sensitive documents being published online.

The ministry also said that people could be posting images on social media that contain confidential information useful to foreign spies.

“Some outdoor enthusiasts share images taken with sensitive, restricted areas as background to gain attention. Such behaviour not only seriously disrupts the management of sensitive areas, but can also be exploited by overseas espionage agencies, endangering national security,” the MSS said.

Since launching a WeChat account in August last year, the MSS has frequently posted alerts about what it says are threats to national security, as part of a public education campaign.

In June, the agency cited a case of a military technology enthusiast who used a drone with a remote high-definition camera to “illegally photograph” a new type of warship, which was then posted to online military forums.

After the user was tracked down by authorities, the person was sentenced to a suspended prison term of one year for “illegally obtaining state secrets”.

In Sunday’s article, the ministry said online platforms are responsible for improving management of information flows and content review procedures to ensure compliance in content creation, publishing and reposting.

The ministry also said internet users should be more aware and cautious to avoid exploitation by espionage agencies.

China’s Meituan to expand Keeta food delivery service to more Middle East cities, sources say

https://www.scmp.com/tech/big-tech/article/3288936/chinas-meituan-expand-keeta-food-delivery-service-more-middle-east-cities-sources-say?utm_source=rss_feed

Chinese food delivery giant Meituan, which operates the Keeta brand in Hong Kong and Saudi Arabia, is set to expand to more Middle Eastern and North African countries, according to two sources familiar with the matter.

Keeta, which launched in the Saudi Arabian city of Al-Kharj in September and has since entered the capital Riyadh, will be available in Dammam and Jeddah, two other major cities in the Gulf nation, by year end, the two people said.

The platform will then go to Mecca and Medina, Islam’s holiest cities, by January 2025. Keeta’s plan is to cover 80 per cent of Saudi Arabia by July 2025, one of the sources said.

It also has ambitious plans for the rest of the Middle East, including expanding to the United Arab Emirates and Bahrain likely next year, the two people said. As most of the customer service team is in Jordan, that country is also in its pipeline, one of the people said.

Keeta had considered expanding to Iraq, but recently dropped the plan due to “political and safety issues”, they said.

Besides the Middle East, the company is also studying the possibility of expanding to Egypt, as the first step into North Africa, one of the sources said.

Meituan did not immediately respond for comment on Monday.

Wang Xing, founder and CEO of Meituan, said in an earnings call last week that the company has seen some “encouraging results” in Saudi Arabia. When asked about plans in other countries, Wang said that Meituan will focus on Saudi Arabia for the time being, but “in the longer term … we want to become a global company.”

Launched in Hong Kong in May 2023, Keeta is the food delivery brand that Beijing-based Meituan hopes to use to conquer the overseas market. It recently received the distinction of “Best Everyday Essential” app on Google’s Play Store in Hong Kong.

In the first quarter of this year, Keeta surpassed Foodpanda for the first time to lead Hong Kong’s food-delivery market by number of orders with a 43 per cent share, according to local analytics firm Measurable AI.

But Keeta, which has only been in the Saudi market for less than three months, may face fierce competition from global rivals such as Uber Eats and Zomato, as well as HungerStation and Jahez.

During the earnings call, Wang said that Keeta’s advantage is that it is “faster”.

“Because of our operational cloud and our technology platform developed in China over the past 10 years, we know how to organise the network, we know how to deliver food faster. I think that’s what consumers want,” he said.

Chinese MMA champion Shi Ming gains viral fame for contrasting persona as TCM doctor

https://www.scmp.com/news/people-culture/china-personalities/article/3288277/chinese-mma-champion-shi-ming-gains-viral-fame-contrasting-persona-tcm-doctor?utm_source=rss_feed

A Chinese mixed martial arts (MMA) female fighter has become an online sensation not only for her recent victory in a UFC (Ultimate Fighting Championship) tournament but also for her role as a full-time practitioner of traditional Chinese medicine (TCM).

On November 23, at the Road to UFC tournament in Macau, Shi Ming delivered a stunning knockout to her opponent Feng Xiaocan with a powerful head kick in the third round of the women’s strawweight finale.

Feng, 22, stood 15cm taller than Shi, 30, and was expected to have the upper hand in the match.

Shi’s remarkable knockout left Feng unconscious for several minutes before she was carried out of the Octagon on a stretcher and rushed to the hospital. Feng later assured her followers on social media that she was fine.

Zhang Weili, the first Asian UFC champion, watched the match and was caught on camera expressing her excitement over Shi’s knockout, stating it made her “hair stand on end”.

Following her impressive win, Shi secured a contract with the UFC and earned an additional US$50,000 Performance of the Night award.

Since 2020, Shi has reportedly claimed 12 MMA championships across China, South Korea, and Myanmar.

In the post-fight interview, Shi appeared both shy and confident. She mentioned that she would gradually shift her focus to her fighting career while considering a return to her TCM practice as she ages.

She also expressed concern for Feng’s condition, a gesture many social media users praised as a reflection of her TCM doctor persona.

Shi works as a full-time acupuncturist at the Kunming Municipal Hospital of Traditional Chinese Medicine in southwestern China’s Yunnan province by day, and as an MMA athlete by night. Her fans have affectionately dubbed her “the most formidable martial arts TCM doctor.”

In the evenings, Shi trains at the Kunming Ong Bak Muay Thai Boxing and MMA Gym, learning from US catch wrestling coach Bagher Amanolahi.

She noted that her expertise in acupuncture and massage has helped both her and her teammates receive proper treatment after injuries sustained during fights.

Shi has drawn comparisons to Wong Fei-hung, one of the most celebrated martial arts figures in Chinese history, who was also known for his skills in acupuncture.

Born in northeastern China’s Heilongjiang province in 1994, Shi was inspired to pursue a career in TCM by her grandfather, who was also a TCM doctor and attended Yunnan University of Chinese Medicine.

In an interview with the UFC, Shi, who speaks sweetly and softly, revealed that most of her colleagues were unaware of her MMA career.

Her colleagues later disclosed that they were aware but chose to respect Shi’s desire to keep her fighting life low profile.

Shi began her martial arts training at the age of 13 but did not tell her parents about her involvement in MMA fights.

“Now your parents may find it hard to be unaware of your impressive fights,” one commenter noted on Douyin.

Another joked: “Shi’s hospital should play her fighting videos in its lobby to deter violence against medical workers.”

“She saves lives during the day and fights at night. What a character!” remarked a third.

China’s factory activity hits 5-month high in November: Caixin PMI

https://www.scmp.com/economy/economic-indicators/article/3288907/chinas-factory-activity-hits-5-month-high-november-caixin-pmi?utm_source=rss_feed

China’s factory activity expanded at the fastest pace in five months in November as new orders, including from abroad, led to a solid rise in production, pushing manufacturers’ optimism degree to an eight-month high, a private-sector survey showed on Monday.

The reading largely echoed an official survey on Saturday, which showed manufacturing activity expanded modestly, suggesting a blitz of stimulus is finally trickling through the world’s second-largest economy just as Donald Trump ramps up his trade threats.

The Caixin/S&P Global manufacturing PMI rose to 51.5 in November from 50.3 the previous month, reaching the highest level since June and beating analysts’ forecasts in a Reuters poll of 50.5.

New orders placed with Chinese manufacturers increased at the fastest rate since February 2023.

New export orders, in particular, rose for the first time in four months and marked the highest in seven months. The orders mainly rose in the investment and intermediate goods segments and fell fractionally for consumer goods makers.

Anecdotal evidence revealed that better underlying demand, new product launches and stockpiling following the US election were among the reasons for the rise in new work.

President-elect Trump last week pledged an additional 10 per cent tariff on imports from China.

He had previously threatened to end China’s most-favoured-nation trading status and impose tariffs on Chinese imports in excess of 60 per cent – much higher than those imposed during his first term.

China’s commerce ministry said Beijing’s position against unilateral tariff increases is consistent, and “imposing arbitrary tariffs on trading partners will not solve America’s own problems”.

As Chinese firms signalled hopes that better economic conditions and government policies can support sales in the year ahead, the level of their confidence hit the highest since March, the Caixin survey showed.

Despite a second successive month of accumulation of backlogged work, firms remained cautious about hiring, though the rate of job shedding eased from October.

“While the economic downturn appears to be bottoming out, it needs further consolidation,” said Wang Zhe, economist at Caixin Insight Group.

Citing the continued contraction of employment, Wang said it indicated the effect of economic stimulus is yet to be felt in the labour market, and businesses’ confidence in expanding their workforce needs to be strengthened.

Cost concerns also rose as average input prices increased at the fastest pace in five months with rising raw material costs.

In turn, firms passed additional cost burdens to clients, leading to the quickest growth in selling prices since October 2023.

As a deep property downturn and tepid domestic demand weigh on economic growth momentum, government advisers are recommending Beijing maintain an economic growth target of around 5 per cent for 2025, Reuters reported previously.

Markets expect stronger fiscal stimulus to mitigate the impact of expected US tariff increases on Chinese exports.

Philippines outnumbered as ‘largest China vessel swarm’ spotted near Thitu Island

https://www.scmp.com/week-asia/politics/article/3288805/philippines-outnumbered-largest-china-vessel-swarm-spotted-near-thitu-island?utm_source=rss_feed

A US-based surveillance group has detected the “largest China vessel swarm” near Thitu Island, known as Pagasa Island in the Philippines, with observers noting that Manila lacks the fleet size to match Beijing’s latest deployment of at least 83 militia and fishing ships in the disputed waters.

Ray Powell, a former US air force official and director of Stanford University’s maritime transparency project, Sealight, confirmed the presence of the vessels last week using satellite imagery.

He reported that up to 75 Chinese ships were spotted just 2.5 nautical miles (4.6km) off Thitu Island – “well within [the Philippines’] 12-nautical-mile territorial sea”. Powell described this as “by far the largest China vessel swarm I’ve ever seen” in the area.

Thitu Island, the largest land mass in the Manila-claimed Kalayaan island group, hosts a Philippine civilian outpost with nearly 500 residents. It is one of the many features the falls under Beijing’s controversial nine-dash line claim in the South China Sea. A 2016 ruling by an arbitral court in The Hague determined that Beijing’s claims lack a basis in international law.

In response to escalating tensions, the Philippines has intensified plans for infrastructure development on the island, which is seen as central to its maritime claims. These plans include health facilities for residents as well as an airport and runway.

During a visit by lawmakers in May, then-Senate president Juan Miguel Zubiri said “our investment in infrastructure projects in Pagasa Island and Kalayaan is our investment in our security in the West Philippine Sea”, referring to the waters of the South China Sea that Manila considers part of its exclusive economic zone.

“It will show China and the rest of the world that we have a thriving community in Kalayaan and that we have a functioning military unit ready to complement our patrols in our territory and exclusive economic zone,” Zubiri added.

Matteo Piasentini, an analyst for Geopolitica.info and international-relations lecturer at the University of the Philippines, described the vessel swarm as a “notorious grey-zone tactic to assert China’s control over the sea”.

Since 2017, Chinese vessels have surrounded Pagasa Island in an attempt to occupy nearby features and deter Philippine construction, said Edcel Ibarra, an assistant professor of political science also at the University of the Philippines.

He pointed out that China has maintained de facto control over nearby Subi Reef since 1988, building military facilities there, and could be planning to occupy other areas.

“China used swarming tactics in 2019 too, possibly to stop Manila’s plan then to build a harbour on Pagasa Island and fix the runway there,” he added.

Don McLain Gill, an international relations lecturer at De La Salle University, said the large presence of Chinese vessels represents”[Beijing’s] way of incorporating its salami-slicing strategy in different parts of the West Philippine Sea”.

Thitu Island is vital to Philippine sovereignty, in large part because of its small civilian population, but has been “increasingly targeted by China”, he said.

Gill suggested that Beijing might be exploiting the Philippines’ domestic issues to further its agenda – “adding its own fuel to the fire at the external front” as President Ferdinand Marcos Jnr and Vice-President Sara Duterte-Carpio lock horns amid a fallout between the country’s most powerful political clans.

Maintaining a maritime presence in the area is vital to counter Beijing’s swarming tactics, observers say, but Manila currently lacks sufficient naval resources.

“The answer is simple – the Philippines does not have enough ships,” Piasentini said.

Gill noted that Manila might consider strengthening partnerships with allies like France and Japan to bolster its fleet. “I think that we’re doing a good job by working with France and Japan, increasing the number of patrol vessels, for instance, that we may possess,” he said.

However, Ibarra suggested that the presence of Chinese vessels might simply be due to the island’s proximity to Subi Reef.

“It’s possible that they’re just getting resupplies from Subi before they scatter again elsewhere in the West Philippine Sea and the South China Sea,” he said.

This perspective aligns with comments made by Philippine Navy spokesman Rear Admiral Roy Trinidad.

Speaking to a local radio programme last week, Trinidad said Manila was aware of the ships’ “illegal presence”, but reassured that there was no need for alarm as Subi Reef had been developed into an “enclosed marina and harbour” for Chinese militia boats and coastguard vessels, further emphasising the importance of maintaining the Philippines’ posture in the region.

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Chinese recycling firm Carbon Zero aims to replicate success overseas after Nasdaq IPO

https://www.scmp.com/tech/tech-trends/article/3288866/chinese-recycling-firm-carbon-zero-aims-replicate-success-overseas-after-nasdaq-ipo?utm_source=rss_feed

Shenzhen-based recycling firm Carbon Zero Technologies International, which is eyeing a US listing, is aiming to replicate its success in mainland China globally despite geopolitical uncertainties, according to its founder.

Carbon Zero, founded in 2016, operates an online platform that dispatches recycling orders from individuals, retail outlets and consumer brands to its recycling personnel. With thousands of physical sorting centres across China, the company then sells recycled items to dismantling and disposal firms.

“The recycling industry in China is relatively fragmented … with a large number of individual practitioners,” founder and CEO Baitong Tang said in an interview last week. “There is a need for a platform-based company or a formal recycling system to effectively integrate these scattered and disorderly operations. Our model happens to address this issue.”

Last year, Carbon Zero generated revenues of nearly 4 billion yuan (US$564.6 million), an increase of 35 per cent from a year earlier, it said in its initial public offering (IPO) prospectus.

In May, the China Securities Regulatory Commission approved the firm to go public abroad. The following month, it filed for an IPO on the Nasdaq stock exchange, with the timing of the IPO yet to be determined.

While the net profit margin remains low at 0.4 per cent in 2022 and 0.1 per cent in 2023, Carbon Zero is already gearing up to launch its services in Singapore by February 2025, followed by Hong Kong, Europe or the US, according to Tang.

“From a long-term strategy perspective, what we need is to capture more markets,” Tang said.

While many Chinese businesses going overseas in recent years have faced increased geopolitical headwinds amid escalating trade tensions between the US and China, Carbon Zero is optimistic about making it in Western markets, according to Tang.

“It would be false to say that we absolutely don’t have any concerns, but I think these concerns are minor because of the nature of our industry,” Tang said, adding that the company does not fall under high-end technology categories such as semiconductors or biotech.

“I think that because we’ll be helping to solve their [environmental] problems, they wouldn’t reject it,” he said.

In 2023, the top 10 types of recycled resources in China included scrap steel, electrical and electronic products and waste batteries, according to a report published by Qianzhan Industrial Research Institute in October. The volume reached 376 million tons, up 1.5 per cent from 2022, but value declined 1.2 per cent because of a global economic slowdown, the report said.

More companies have joined the resale market amid the Chinese government’s call for society to recycle and reuse materials to conserve water and energy, and reduce greenhouse gas emissions.

ATRenew, which focuses on recycling consumer electronics, went public on the New York Stock Exchange in June 2021.

Carbon Zero, which aims to raise at least US$32 million from its IPO, plans to use the proceeds to expand its product categories to lithium batteries, plastics, paper and clothing.

It will also use the funds to invest in or acquire downstream dismantling and disposal firms, Tang said. The company will aim to maintain an annual revenue growth of above 30 per cent, he added.

Why are Chinese defence firms missing out on global arms sale surge as US keeps crown?

https://www.scmp.com/news/china/military/article/3288877/why-are-chinese-defence-firms-missing-out-global-arms-sale-surge-us-keeps-crown?utm_source=rss_feed

Chinese defence companies saw their lowest annual revenue growth in four years amid a domestic economic slowdown while global arms sales continued to grow, fuelled by demand from the wars in Ukraine and the Middle East, a Swedish think tank report said.

According to the Stockholm International Peace Research Institute’s (SIPRI) annual report on the revenues of top 100 global defence companies published on Monday, total sales of arms and military services reached US$632 billion in 2023, an increase of 4.2 per cent from 2022.

Increases in arms revenues were seen in all regions and almost three-quarters of companies boosted their earnings, with particularly sharp rises among companies based in Russia and the Middle East as well as in the Asia-Pacific, amid growing tensions in East Asia.

Forty-one of the top 100 firms on the list were from the United States, which maintained its No 1 ranking for global arms revenue at US$317 billion, growing by 2.5 per cent over 2022 and accounting for half of the total arms revenues on the list.

Since 2018, the top five companies on the SIPRI list have all been based in the US, and 30 of the 41 US companies on the latest list have increased their arms revenues.

China ranked second with nine companies on the top 100 list, three of which made the top 10. The combined arms revenue for the nine firms was US$103 billion, equal to 16 per cent of the total for the top 100.

However, China’s year-on-year revenue increase was just 0.7 per cent, the lowest annual level of growth since 2019. Five of the nine companies recorded declines in their arms revenues, with the report citing China’s “deepening economic slowdown” as the reason.

“A lot of these companies are heavily involved in the civilian sector, which were really affected during Covid-19 and are now having a harder time to recover,” said Xiao Liang, a researcher with the SIPRI’s military expenditure and arms production programme. “So that really affects their profitability as a whole, and then specifically for their military sectors.”

“They might not be the area that received the highest priority from the Chinese government. So that’s why they are reporting some late payments and late deliveries of their military systems, whereas some other companies were almost unaffected.”

Aviation Industry Corporation of China (AVIC) ranked eighth on the list with a 5.6 per cent increase in revenue to US$20.9 billion, becoming China’s largest arms producer, highlighting the continued growth in domestic military aircraft production.

Aircraft engine maker Aero Engine Corporation of China (AECC), which ranked 23rd on the list, had the largest annual growth among the Chinese companies at 17 per cent, reflecting Beijing’s increased emphasis on boosting the capabilities of the PLA Air Force.

In contrast, Norinco, a land-based systems producer that had the most revenue among Chinese firms in 2022, recorded a 2.7 per cent drop in 2023, ranking it ninth after AVIC.

China Aerospace Science and Industry Corporation (CASIC) recorded the largest annual drop in revenue – 21 per cent among Chinese companies – due to delivery delays for a batch of missiles and electronics systems for the Chinese military, according to the report.

In contrast to the lacklustre performance from Chinese firms, 23 other defence contractors based in Asia and the Oceania region saw arms revenues rise by 5.7 per cent to US$136 billion, driven mainly by substantial growth among South Korean and Japanese firms.

Four South Korean companies on the top 100 list saw one of the largest combined jumps in revenue, with a 39 per cent increase to US$11 billion in 2023.

Three of them posted revenue growth of more than 40 per cent, most notably Hanwha Group. Hanwha vaulted from 42nd spot in 2022 to 24th in 2023 with a 53 per cent jump in revenue after it acquired one of the top three South Korean shipbuilders, DSME, last year, as well as after export contracts for land-based systems with Australia, Poland and Britain.

Five Japanese companies made the top 100 with a 35 per cent rise in revenue to US$10 billion, driven by domestic demand for arms procurement as Tokyo launched its largest military build-up since the end of World War II.

“South Korea was more affected by the geopolitical and international environment and dynamics in the global arms market, capitalised on increased demand from countries like Poland or other European countries related to the war in Ukraine, and also benefited from a much stronger domestic demand,” Liang said.

“Same for Japan – they have a more agile and market-responsive approach to their arms industry, whereas China’s arms industry relies mostly on the domestic demand for the PLA [People’s Liberation Army], so it will be more stable and fluctuate less due to changes in the global arms market.”

However, supply chain challenges continued in 2023. American giants Lockheed Martin and RTX, the world’s largest arms producers, recorded revenue drops of 1.6 and 1.3 per cent, respectively.

“Larger companies like Lockheed Martin and RTX manufacturing a wide range of arms products often depend on complex, multi-tiered supply chains, which made them vulnerable to lingering supply chain challenges in 2023,” said Nan Tian, director of SIPRI’s military expenditure and arms production programme.

“This was particularly the case in the aeronautics and missile sectors.”

Among countries with ongoing wars, only two Russian companies were listed on the top 100 list, because of a lack of data. Their combined revenues rose by 40 per cent to reach an estimated US$25.5 billion. Three companies based in Israel that made the top 100 also had a combined revenue increase of 15 per cent, reaching US$13.6 billion, amid the war in Gaza.

The SIPRI report said that the sharp overall rise in the arms revenues of Russian companies in 2023 could be attributed to increased output in response to the Russian military’s changing demands since it invaded Ukraine in February 2022. There has been a shift towards a strategy of attrition, which has led to intensified arms production to sustain the prolonged conflict.

Taiwan’s president meets Hawaii’s governor and members of Congress in a visit condemned by China

https://apnews.com/article/taiwan-us-china-lai-ching-te-hawaii-guam-7abcd0e5803fdb7f20615fd394aca91bTaiwan President Lai Ching-te, center, arrives at the Bishop Museum on Saturday, Nov. 30, 2024 in Honolulu. (AP Photo/Marco Garcia)

2024-12-01T20:51:13Z

HONOLULU (AP) — On a two-day visit to Hawaii, Taiwan’s president Lai Ching-te met with the state’s governor and congressional representatives as part of a Pacific island tour that has already triggered criticism from Beijing.

On Sunday, China’s Foreign Ministry said it “strongly condemned” U.S. support for Lai’s visit and had lodged a complaint with the U.S. It also denounced a newly announced U.S. weapons sale to Taiwan, a self-governing island that China claims as its own territory.

“China will closely monitor the situation’s development, and take resolute and forceful measures to safeguard the country’s sovereignty and territorial integrity,” said the statement.

Hawaii was Lai’s first stop on a weeklong voyage that will later take him to the Marshall Islands, Tuvalu and Palau. They account for three of the 12 countries Taipei has formal diplomatic relations with.

Hawaii’s Gov. Josh Green on Saturday hosted Lai at the state’s emergency management agency where they discussed disaster preparedness. Green, who was a longtime emergency room physician before becoming governor, posted on social media that he and Lai discussed how their experiences in health care informed their governance. Lai is also a physician by training and obtained a Master of Public Health degree from Harvard University.

“Together, we extended a warm aloha to Lai and his delegation, highlighting Hawai’i’s shared values of resilience and collaboration with Taiwan,” Green said in an Instagram post.

Lai also visited Bishop Museum, Hawaii’s leading museum of natural history and Native Hawaiian culture.

In the evening, Lai posed for photos with Hawaii congressional representatives and state lawmakers at a dinner banquet with the Taiwanese American community.

U.S. Rep. Ed Case, a Democrat who represents Honolulu in Congress, said on social media that he told the audience that “our ties endured on shared values and interests to advance mutual goals and meet shared challenges.”

It is unclear whether Lai with meet with any senior officials from the Biden administration or anyone from the incoming Trump administration during his Hawaii stay.

President-elect Donald Trump said in an interview with Bloomberg in July that Taiwan should pay for its defense. The island has purchased billions of dollars of defense weaponry from the U.S.

Trump evaded answering whether he would defend the island from Chinese military action.

The new arms announced by the U.S. State Department Friday include $385 million in spare parts and equipment for a fleet of F-16s, as well as support for tactical communication system to Taiwan.

The U.S. is obligated to help the island defend itself under the Taiwan Relations Act but maintains a position of strategic ambiguity over whether it would ever get involved if Taiwan were to be invaded by China.

Former Taiwanese President Tsai Ing-wen drew vocal opposition from China when she stopped in New York last year on her way to Latin America. Tsai met with former House Speaker Kevin McCarthy at the time.

The Chinese military also launched drills around Taiwan last year as a “stern warning” over what it called collusion between “separatists and foreign forces” days after Lai, then Taiwan’s vice president, stopped over in the U.S.

China also strongly objects to leading American politicians visiting the island as it views any official contact with foreign governments and Taiwan as an infringement on its claims of sovereignty over Taiwan. Washington switched its formal recognition from Taipei to Beijing in 1979.

[Sport] ‘Italian’ purees likely to contain Chinese forced-labour tomatoes, BBC finds

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Nobel-winning economist James Robinson on China’s place in his theory of institutions

https://www.scmp.com/economy/china-economy/article/3288713/nobel-winning-economist-james-robinson-chinas-place-his-theory-institutions?utm_source=rss_feed

James Robinson, a University of Chicago professor, was one of the three winners of the this year. He shared the prize for his work with two professors at the Massachusetts Institute of Technology – Daron Acemoglu and Simon Johnson – researching global inequality. He has co-authored three books with Acemoglu, including the bestseller Why Nations Fail: The Origins of Power, Prosperity and Poverty, first published in 2012.

Robinson, Acemoglu and Johnson have written extensively on the relationships between political and economic institutions and wealth. They argue that states with “inclusive institutions” that uphold the rule of law and property rights – as opposed to “extractive” ones – lead to economic success.

This interview first appeared in . For other interviews in the Open Questions series, click .

In the late 1970s, since the period of reform initiated under Deng Xiaoping, China started growing economically, exactly because economic institutions were moved in this more inclusive direction.

Collective agriculture was dismantled. The household responsibility system gave people incentives. It allowed them to make decisions. It made them residual claimants to their efforts. That sort of spread into the industrial manufacturing sector in the 1980s. So it was the sort of collapse of this socialist control of the economy that allowed all of this economic growth to happen.

So I think that is clearly within the scope of our theory. It’s a transition from what we call much more extractive economic institutions to much more inclusive economic institutions.

What is not kind of consistent with our theory, is that political institutions have remained extractive in the sense that control is still monopolised by the Communist Party.

What we say is: if you want to have an inclusive economy, then that is really a political construction. You can’t have that at the whim of a dictatorship. So that needs power to be spread in society, so that the people who benefit from economic inclusion actually get to control things.

So I think the prediction of our theory for China is very straightforward, which is that mainland China doesn’t have a political system which is consistent with creating a modern, innovative, prosperous society.

In Why Nations Fail, we give many examples historically of societies that experienced periods of what we call extractive growth like this. The most obvious example is the Soviet Union. When I was a student, the Soviet Union was an example of terrific economic success. Fifty years after the first central plan, the Soviet Union grew very rapidly. It fooled everybody. It fooled generations of economists. It fooled the CIA. It fooled its own leadership into thinking the Soviet Union had a model of economic growth that worked.

There are many differences between Chinese economic growth and that in the Soviet Union. But I think what’s interesting about that example is how we can be fooled into thinking we just extrapolate from the last couple of decades, and we think it’s going to go on forever. So I think if you look at the history of China, and you look at the history of what that kind of concentrated political power can lead to, you can see that this is not a model that will be sustainable.

I think the whole economic expansion of China in this period of intensified globalisation has been good for the Global South, or developing nations, in the sense that it’s driven up commodity prices, and it’s increased the demand for many commodity exports. I don’t think that’s done much, honestly, for institutions in the Global South. I’ve actually done a lot of research on this – there is very little evidence that economic growth, per se, changes institutions. So I don’t see it; it’s just as likely to keep autocratic regimes in power as it is to [democratise them]. In Venezuela, for example, if the oil price goes up, that’s good for the dictatorship rather than being any kind of democratising force.

So, I don’t see that this boom in commodity prices, which is generated by Chinese economic growth, has many implications one way or the other for the Global South.

And I don’t think you have to be a genius to predict what’s going to happen during the next [Donald] Trump administration, which is an intensification of these trade wars and a kind of contraction in globalisation. Although you can never tell with Trump – he has no principles, and he has absolutely no kind of understanding of economics as far as I can tell – he could completely change policy tomorrow. So, bearing that in mind, I think you’d have to guess that we’ll have an intensification of what we saw last time. [US] President [Joe] Biden didn’t touch the tariffs on China, and it seems to have somehow been communicated to the average American that China is somehow taking advantage of the US, which it has, in the sense that it’s violated enormous numbers of intellectual property rights and expropriated property rights on technologies and things like that.

I think it seems likely we’re now locked into trade wars. Trump has sold his political coalition on the idea that China is “stealing your jobs”. I think that’s powerful rhetoric that won’t be easy to move away from.

I think the most interesting thing is how China sees its role in the world. I don’t think we in the West really understand this very well. If you look at the history of Western countries, they’ve had this very expansionist idea – think about European colonialism.

Europeans have this view that ties into Abrahamic religions. Christianity, for example, is a very expansionary religion, and so is the broader Abrahamic tradition. They want to convert the heathens and see the world in terms of believers and non-believers. That’s kind of the way we think about international relations. We tend to assume that China thinks in exactly the same way we do, but it’s never been obvious to me that that’s true. Chinese religion, for example, is very different from the Abrahamic religions.

If you look at the history of the Chinese state, for example, during the imperial period, China actually had a very different attitude towards other powers, like Korea. Korea is always used as an example: the imperial Chinese state could have annexed Korea, but it didn’t. It seemed happy with a tributary relationship. China maintained a sphere of influence, but it didn’t have an empire in the way Europeans did; it didn’t seem to have expansionary designs.

So, rather than the trade question, I think the bigger question here is how China sees the world and its place within it. Obviously, China would like to be recognised on an equal footing with the US and other great powers, and it would prefer an international system – which at present is highly biased towards Western powers – that is more level. I don’t think that’s such a bad idea, honestly. But how that plays out, I don’t know.

For me, places like Latin America and Africa are stuck in these particular extractive institutions, but for very different reasons. Latin America is different from sub-Saharan Africa, and both are different from South Asia or other parts of the world. I’m not sure that the expansion of trade and world economic growth over the past 30 years has really done much to change that.

I think if you look at all of these Washington Consensus reforms that were implemented in Latin America in the last 30 years, they’ve basically been a dismal failure, despite economic growth.

But this argument is interesting, which is to say that maybe if you’re just getting this influx of income generated by trade, taxes or whatever, then that undermines your incentive to create inclusive institutions.

But I don’t think there’s much incentive to build inclusive institutions anywhere in Latin America anyway, for example, with a few obvious exceptions like Chile, maybe Costa Rica, and Uruguay.

I don’t think so. If you look at South Korea … I have actually been doing a lot of research on South Korea in the past five years on what exactly happened during the 1970s when president Park [Chung-hee] was kind of in charge of all of this export promotion.

His legacy was the economy. It was like building roads. It was exporting.

If you get someone like that who’s sort of genuinely interested in developing his country, that’s great. But how do you sustain that? That period in South Korea is very important, but in the end, it is when the military leaves power, and then you get this democratisation, and that is when growth and diversification really happens in Korea. If I look at Korea, it’s a triumph of inclusion. It is not just about Samsung or cars or mobile phones. It’s about K-pop and “Gangnam Style” and movies. There’s just this explosion of creativity in South Korea. For me, you could never have sustained what went on in the 1970s without that democratisation.

I think it is an interesting discussion, which we’ve been thinking about a lot. Could China be an exception in some sense? And if it is an exception, what could that look like?

For me, I think that would be a kind of cultural type of explanation, in the sense that Chinese culture, or Chinese political culture, is very distinct from Western political culture.

If you think about the notion of good governance in Confucian thought, that’s extremely different from the notion of good governance in Western thought.

So could it be that there is just a different way of thinking about political legitimacy and the allocation of political power in China than there is in the Western world?

Here is another reason why that might make sense: if you look at these autocratic regimes that have been successful economically in the world, they’re all in East Asia. Taiwan under the Kuomintang, South Korea under president Park [Chung-hee]. Cambodia in the last 40 years. Singapore under Lee Kuan Yew. Can that be a coincidence that all of these countries are in eastern Asia? And if it isn’t a coincidence, then surely that’s got something to do with something specifically cultural.

I don’t think it’s kind of a political thing. It’s not like everywhere has the Communist Party. No, they have completely different political regimes. So I think that is an interesting kind of academic discussion. I think the evidence on that is sort of confusing.

So if you ask me what does my theory imply – it implies what I told you, but that doesn’t mean that as an academic, we’re not investigating other ideas, right?

I have worked a lot in Latin America and particularly in sub-Saharan Africa over the past 25 years.

I know from my work in sub-Saharan Africa, in particular, that political culture there is extremely different from that in Western countries. And I think much – actually, more than much – social theory is essentially generalisations about the world based on Western culture, Western history and Western experience. So I’m painfully aware that we don’t really have a very good comparative social theory. In fact, one of the things I’m most interested in is exactly this topic, and China obviously plays a very interesting role in it.

I think that’s a fantastic discussion, but I don’t know what to conclude, and maybe that’s just because I’ve never really done research in China. So I don’t feel that I have a thorough understanding of the society or the culture. I have Chinese colleagues here, and we talk about it all the time. Yes, I’m an academic. This is not physics, this is social science, and there are many things we don’t understand about society.

I don’t think they’ll change the basic relationship between institutions and prosperity. I think professor Acemoglu and professor Johnson have written much more on this than I have, if you read their book, Power and Progress.

My view is very similar to theirs, although I’ve written much less about it. I think what’s created all the prosperity in the modern world over the last 250 years is all this technological change and innovation, but the institutions are critical, not just for stimulating innovation in the first place, but for utilising those technologies. How do those technologies get used? Are they used for the benefit of everybody in society? Or are they used for the benefit of a few people?

One of the biggest concerns we’ve had over the past decades is that modern information technology, computer technology, robotics, and now AI are being controlled by tech entrepreneurs and very narrow corporate interests.

The problem is that innovation is so fast, and the government is so far behind in understanding what’s happening and thinking through the implications of these things. Just think about the kind of automation of work that’s going to lead to. There’s already a lot of evidence it’s leading to falling wages and displacement of labour. But that’s only because of how the technology is being used. There’s nothing inherent about AI or robotics that dictates that outcome – that’s about the regulation of the technology and the way the technology is used.

That’s the crucial issue at the moment – these technologies are potentially fantastic. They can raise productivity and create prosperity, but they can also create this incredibly unequal, hierarchical society and exacerbate things. Where are all these political problems in the US coming from? Part of it is maybe to do with the “China shock”. But part of it is also to do with technological change, displacing unskilled workers and creating this massive concentration of wealth and inequality.

I don’t think so at the moment. My experience working with AI is that it is currently wildly overhyped. It’s being wildly overhyped by businesspeople who are trying to raise money and persuade people to invest in their corporations. I don’t know if you’ve interacted with AI – ChatGPT is a very underwhelming experience for me. ChatGPT makes things up and doesn’t get basic things right. The whole thing is also somewhat circular in the sense that ChatGPT and all this AI are learning from content they themselves generate.

So, my feeling is that the whole thing is really overhyped at the moment. Computers are not about to take over the world, and this is not as earth-shattering as people think. In the future, will it be? I don’t know – I’m not enough of an expert. But at the moment, I don’t see the threat you’re talking about. What I do see is the threat of massively displacing workers and creating more social dislocation, and that worries me.

Additional reporting by Sylvia Ma