• Has Apple been trapped by China? Not so fast, analysts say
• China urged to keep close eye on US-led Quad as trade tensions fail to dent solidarity
• Chinese sellers bracing as Amazon Prime Day sale could put weight of US tariffs on display
• China AI champion Baidu rolls out most sweeping changes to search platform in a decade
• Why President Xi Jinping sees China’s marine economy as a national priority
• Communication expert Julian Cheng leaves Canada career for China university
• EU-China summits begin, Trump bill may affect some tax credits: SCMP daily highlights
• China’s ban on ex-Philippine senator won’t halt Manila’s South China Sea stance: experts
• China could be about to attempt a landmark satellite refuelling test
• China’s real consumption ‘far from as low as it seems’ – think tank bucks market consensus
• Alibaba’s US$7 billion subsidy deepens China’s instant e-commerce war with JD.com, Meituan
• US munition hub plan for Philippines’ Subic Bay sparks China retaliation fears
• China’s top leadership takes aim at ‘disorderly low-price competition’
• Chinese jeweller Laopu Gold surges 15% as investors devour 69 million shares post lock-up
• China’s mosquito-sized drone, how exercise slows ageing: 7 science highlights
• Mainland Chinese drivers can apply for Hong Kong entry permits in November
• Labubu’s rise reflects hitmaker ability of China’s digital ecosystem
• China air travellers caught off guard after regulator grounds mobile power banks
• The world is going all-in on stablecoins. Is China’s digital yuan any different?
• Chinese fans bash ‘sore loser’ Zheng after Wimbledon exit, question her attitude
• China graduate honours dad at ceremony by dressing him in academic gown, touches hearts
• China’s war lessons after India-Pakistan conflict prioritise integrated systems
• China student’s Labubu at graduation sparks debate after vice-president pinches toy’s tassel
• How US under Trump 2.0 plans to combat China’s military strength
• The EU-China reset that never was: summits begin but divisions remain
• China mostly unscathed by turbulent 6 months, but 2025 still an uphill climb

Has Apple been trapped by China? Not so fast, analysts say

https://www.scmp.com/news/china/science/article/3316716/has-apple-been-trapped-china-not-so-fast-analysts-say?utm_source=rss_feed

A new book contending that Apple Inc went too far in consolidating its operations in China is prompting debate among analysts of the country – some of whom say the company may have had no realistic alternatives.

“If they were to have it to do over again, would they have done anything differently?” asked Meg Rithmire, a Harvard Business School professor, during an event Wednesday at the Centre for Strategic and International Studies, a Washington think tank.

Probably not, she said. There has been “this huge wave of innovation and production going on in China, and to miss out on that would be to not be the company that they are today”, Rithmire continued.

Apple in China: The Capture of the World’s Greatest Company, by business journalist Patrick McGee, explores Apple’s entry into China from the 1990s onwards.

It argues, in McGee’s words, that the iconic Silicon Valley company made the “rookie and calamitous mistake of consolidating all its eggs in one basket” and doubling down “when that basket turned out to be more of a ruthless, authoritarian surveillance state” than previously thought.

McGee, who covered Apple for the Financial Times, also argues that “China wouldn’t be China today without Apple” – a view that Rithmire partly challenged.

Speaking on Wednesday, Rithmire posited that China “probably” would have caught up to American companies even without US businesses like Apple and Tesla, and that the relationship today is not one in which only China extracts value.

US companies “want to stay engaged in China”, she said, and “not just for the revenues” and “not just for the labour”.

“It’s really for learning and understanding what their competitors are doing.”

In recent years, Washington has increasingly emphasised the risks of engagement with China and questioned whether business ties made in the 1990s and 2000s – in part due to the country’s low-cost labour – were worth it.

But while trade tensions – particularly through tariffs – are placing mounting pressure on US businesses in China, a May survey of 112 firms by the American Chamber of Commerce in China found that most were not planning to exit the market.

In particular, China’s role in consumer electronics has not gone unnoticed by Washington, with the Trump administration exempting smartphones, computers, semiconductors and other electronics from its “reciprocal tariffs” on imports from the country in April.

Some analysts are also beginning to fear that efforts to build US competitiveness and insulate national security through decoupling from China are failing.

In recent months, China’s capacity for innovation has caused alarm with the emergence of low-cost AI models by the Chinese firm DeepSeek, despite – some argue because of – US export controls on semiconductor chips.

Also speaking Wednesday, Jeffrey Ding, a scholar of emerging technologies and international relations at George Washington University, similarly questioned whether there was a counterfactual in which companies like Apple and Microsoft gained more by not investing in China.

Ding, citing a well-known academic study, also noted that China accounts for only a small share of the economic value generated in iPhone production, undercutting the idea that Apple had given China an outsize technological boost.

“If you gave truth serum to Apple, they would say Chinese companies have not necessarily moved up that value chain,” he said.

Meanwhile, Ding said, another often overlooked benefit to US engagement with China is its potential to promote peace.

“In my field of international relations, there is a huge literature that suggests greater economic interdependence between great powers limits the risk of war and conflict escalation,” he said.

Responding to some of the remarks on Wednesday, McGee acknowledged that perhaps during Apple’s early days it had no other option but to engage China, even knowing the changes that would come with Chinese President Xi Jinping.

But he continued to question the level of Apple’s ongoing involvement.

“There’s diminishing value, let’s say, of sending America’s best engineers to China,” he said.

China urged to keep close eye on US-led Quad as trade tensions fail to dent solidarity

https://www.scmp.com/news/china/diplomacy/article/3316702/china-urged-keep-close-eye-us-led-quad-trade-tensions-fail-dent-solidarity?utm_source=rss_feed

Beijing should remain alert to the continued solidarity between the US and its regional partners in countering China, despite their trade tensions with Washington, Chinese observers have warned.

They cited this week’s meeting of Indo-Pacific Quad partners as the latest example of such unified signalling.

The top diplomats of the United States, Japan, Australia and India, meeting in Washington on Tuesday, agreed to deepen cooperation on Indo-Pacific maritime security and introduce a critical minerals initiative to diversify supply chains.

“We remain seriously concerned about the situation in the East China Sea and South China Sea,” read a joint statement following the talks between US Secretary of State Marco Rubio and his three counterparts – Takeshi Iwaya of Japan, Penny Wong of Australia and India’s Subrahmanyam Jaishankar.

The apparent reference was to regional tensions and disputes with China involving territorial claims and freedom of navigation in these maritime areas.

“We are deeply concerned about the abrupt constriction and future reliability of key supply chains, specifically for critical minerals,” the statement added, again apparently referring to China leveraging its rare earths dominance, though it was not mentioned by name.

The latest Quad foreign ministers’ meeting built upon their previous gathering on January 21, held just one day after US President Donald Trump’s inauguration for his second term. That meeting was widely viewed as an early indication of the administration’s focus on China, despite the White House’s increasing attention towards the Middle East and the war in Ukraine in recent months.

Zhu Feng, dean of the school of international studies at Nanjing University, said Tuesday’s meeting offered little novelty.

“[The meeting] showed that the Trump administration, regardless of adjustments in its domestic and foreign policies, still firmly views China as its largest strategic rival and keeps the Indo-Pacific as a key point of the US global security strategy,” he said.

Although members of the US-led informal strategic forum share concerns about Beijing’s expanding influence in the Indo-Pacific, the latest talks took place as Quad ties are put to the test by Trump’s global tariffs and defence disagreements.

All three Quad partners face steep US import duties with Trump’s 90-day pause on what he calls reciprocal tariffs set to expire in a week’s time.

The same day as the Quad meeting, Trump said a trade deal with Japan was unlikely before the July 9 deadline, warning that tariffs on Japanese imports could increase to up to 35 per cent.

Washington is also reviewing its Aukus defence pact with Britain and Australia, initiated under Trump’s predecessor Joe Biden, which would allow Australia to acquire nuclear-powered submarines – citing concerns over pressures on its own fleet.

Zhu said that despite the trade tensions, cooperation between the US and its allies and partners with regard to geopolitical and geostrategic interests remained largely unaffected.

“The outcome of this Quad meeting also showed the basic reality that while trade disputes within the US alliance and partnership system are indeed on the rise, there has been no substantive change in their so-called common will in geopolitical and geostrategic domains and the basic strategic choice to counter China,” he said.

China still needed to remain “highly vigilant” about the increasing coordination and strategic alignment under US-led alliances on policies toward Beijing, Zhu noted, while warning against assuming that Trump’s actions in the economic and trade arena would create cracks in the US alliance system in the short term.

Other analysts also believe that tariff tensions and other disagreements are unlikely to undermine their collective commitment to building a “China-free” critical mineral supply chain.

Shen Dingli, a professor of international relations at Fudan University in Shanghai, said that China’s dominance of rare earth minerals – shown to be a powerful bargaining tool in negotiations with the US – had “delivered a jolt”, prompting other nations to strengthen critical mineral independence.

But given that achieving self-sufficiency in critical minerals may take three to five years, Quad nations would in the short term maintain “a delicate balance of competing without a complete rupture [with China],” Shen said.

“However, Beijing should wield its rare earth card ‘judiciously’, ensuring that they remain partially dependent on China while avoiding a full-scale decoupling,” he suggested.

“Ultimately, Beijing’s goal is to solidify its own strategic autonomy, not to inadvertently push its competitors to achieve complete independence in rare earths.”

Zhao Minghao, a professor at Fudan University’s Institute of International Studies, said while Beijing’s dominance in the sector was a shared strategic concern for the Quad, “it would be extremely difficult to establish an independent supply chain without China”.

A fact sheet released after Tuesday’s foreign ministers’ meeting announced the launch of the Quad Critical Minerals Initiative, which “will strengthen cooperation on priorities such as securing and diversifying reliable supply chains, and electronic waste (e-waste) critical minerals recovery and re-processing”.

Zhao said the initiative looked like a continuation of the US-led Minerals Security Partnership launched in 2022 that aimed to reduce Chinese influence in the critical minerals industry.

That effort had “seen little progress”, he noted, due to the time required to restructure the industrial chain and develop relevant technology, and also the lingering issue of how much cost each participating country could bear.

“During Trump’s second term, initiatives like this would likely encounter a heightened ‘collective action dilemma’, as countries remain wary of US policies and seek to maintain a balanced approach in their relations with Beijing,” Zhao added.

Wu Xinbo, director of the Centre for American Studies at Fudan, said that with the three US Quad partners likely to be more concerned about impending US tariffs, they might not be as enthusiastic about the grouping as they were during the Biden administration.

The latest Quad meeting looked somewhat like a “routine exercise”, Wu said, adding that the “Quad currently does not hold a significant place in Trump’s foreign strategy.”

Still, China should keep a close eye on developments in the group’s maritime law enforcement cooperation, Wu warned. “If it moves toward the South China Sea, we must be very cautious,” he said.

“Especially if, to some extent, the Philippines is brought in to conduct law enforcement and security activities in disputed areas of the South China Sea, that will require a strong response from us,” he added.

The Philippines is among several regional nations to contest Beijing’s expansive claims in the strategic waterway.

According to Tuesday’s joint statement, the Quad countries agreed to continue to deepen “maritime law enforcement cooperation through regional training initiatives, maritime legal dialogues, and Coast Guard cooperation”.

The group also pledged to increase collaboration on critical and emerging technologies – including artificial intelligence, semiconductors, technical standards, biotechnology and cybersecurity – while renewing their commitment to support humanitarian assistance and emergency response operations.

Chinese sellers bracing as Amazon Prime Day sale could put weight of US tariffs on display

https://www.scmp.com/economy/global-economy/article/3316673/chinese-sellers-bracing-amazon-prime-day-sale-could-put-weight-us-tariffs-display?utm_source=rss_feed

Ahead of Amazon’s annual Prime Day sales event, Chinese sellers are already walking a tightrope as they try to strike a balance between staying competitive and adjusting to Washington’s tariffs.

Gloria Gu, an Amazon seller based in Zhejiang province, said her outlook for this year’s summer event – extended this year to a record four days, July 8-11 – was “not optimistic”.

Her company mainly sells household consumables – low-margin products that are highly price-sensitive. “Depending on the item, prices have gone up by 10 to 20 per cent,” she said, while the minimum discount requirement for Prime Day deals on Amazon’s platform is 20 per cent, the same as in previous years.

“We pass part of that on to consumers, but we also eat up some ourselves and ask our suppliers to share the burden,” she explained. But raising prices too much is not an option in Amazon’s hyper-competitive environment, she added.

“The market is still extremely cutthroat; we really can’t hike prices too much,” she said, noting that the platform’s own fees were also climbing.

With a US tariff deadline approaching on July 9 – marking the end to President Donald Trump’s 90-day pause on his “reciprocal tariffs” for most countries, excluding China – and with Amazon kicking off one of its biggest sales events of the year just a day earlier, many price-sensitive American consumers are waiting to see if they will be the ones hit hardest, as inflation and overall cost-of-living concerns are front of mind.

Morgan Gard, a Midwestern Amazon shopper, said she was seeing clear signs of volatility and an “overall increase in prices”.

She expected sellers on Amazon to increase prices to compensate for tariffs, thereby fuelling price fluctuations in products, no matter where they come from.

But it also “depends, in the moment, on the product”, Gard said, noting that a fan she bought last week for US$26, made by a Chinese company, now costs US$37. But a US$9.99 shirt dropped in price to US$8.49.

She added that she was more concerned with overall inflation, and that most consumers probably did not know why prices are rising.

“They just know that their grocery bills are going up, and that’s not OK,” she said.

New York-based Annabelle Zhou has seen a noticeable increase in grocery prices on Amazon, but small changes on small items, “maybe just a dollar or two here and there, are not enough to change how I shop”.

For her go-to Chinese planner brand, Moterm, the price has crept up from US$45 to US$46.99. “Honestly, that’s still a small change compared with the overall price,” she said.

Americans continue to grapple with the broader weight of inflation, which remains stubbornly above the US Federal Reserve’s 2 per cent comfort zone, driven in part by food, housing costs and tariff effects, though inflation in the US cooled from around the 3 per cent mark in early 2025 to 2.4 per cent in May.

Tariffs are also complicating the Fed’s path forward just as price pressures have begun to ease.

With tariff deadlines for America’s trade partners fast approaching, raising uncertainty for cross-border e-commerce, Fed Chair Jerome Powell told the media on Tuesday that rate cuts had been postponed due to inflation from new tariffs.

Prices for made-in-China goods sold on Amazon have also been rising slightly faster than overall inflation, according to an exclusive Reuters report. The median price of a basket of more than 1,400 such products sold to US buyers was found to have gone up by 2.6 per cent between January and mid-June, outpacing the US inflation rate for core goods.

The analysis showed that price increases for those goods began accelerating in May, signalling that Trump’s tariffs were “starting to filter through to consumers”, Reuters reported.

The shift to online shopping may also be cushioning some of the tariff impact – particularly for platforms like Amazon, said Wang Dan, director of Eurasia Group’s China team.

“Many US bricks-and-mortar retailers, such as Walmart and Target, are being hit much harder by tariffs,” she said. “But Amazon’s online supply chains remain largely intact. A lot of products from China that you can’t find in physical stores are still available online.”

She added that this could push more seasonal shopping – such as Black Friday demand – towards digital channels, ultimately benefiting Amazon and its Prime ecosystem.

China AI champion Baidu rolls out most sweeping changes to search platform in a decade

https://www.scmp.com/tech/big-tech/article/3316689/china-ai-champion-baidu-rolls-out-most-sweeping-changes-search-platform-decade?utm_source=rss_feed

Baidu, one of China’s artificial intelligence (AI) champions, said it is using the technology to upgrade and make the most significant changes to the company’s core internet search service in a decade.

Beijing-based Baidu has now enlarged the mobile app’s search bar and turned it into a “smart box” that supports long text input and handles more tasks than simple text-based queries and information retrieval, according to the company’s statement on Wednesday.

This search box is capable of handling prompts that are thousands of words long, rather than just a few dozen words.

It could also be used for AI text and image generation, planning trips, identifying objects and writing research reports, thanks to Baidu’s multimodal Ernie AI models and the integration of more than 18,000 third-party AI agents.

AI agents are programs that are capable of autonomously performing tasks on behalf of a user or another system. Essentially, these agents create a plan of specific tasks and subtasks to complete a goal using available resources.

The upgrade reflects Baidu’s stated goal to “expand the boundaries of search”, from a tool that merely retrieves information into one that helps users complete tasks.

The company said other major changes to its search platform would be rolled out in phases over the coming weeks.

With greater AI integration, Baidu’s online search platform would enable users, for example, to use a snapshot of a tourist attraction to find its location via the app, which would also be able to offer an audio tour of the place.

The app would also be able to “read through” a user’s medical report and analyse the person’s health based on that information.

Those capabilities would mark a significant evolution of Baidu’s traditional search service amid the growing adoption of AI tools by both consumers and enterprises.

According to a report by search consultancy OneLittleWeb, traffic to the world’s top 10 chatbots increased 191.67 per cent between April 2023 and March 2025, while traffic to the world’s top 10 search engines only grew 2.38 per cent over the same period.

Baidu’s online search upgrade comes right on the heels of the company’s move to open-source variants of its Ernie 4.5 AI model family, even as it continues to develop proprietary AI systems.

Other major Chinese technology firms, from Alibaba Group Holding and Tencent Holdings to ByteDance, have also initiated programmes that leverage their AI expertise to help transform their businesses. Alibaba owns the South China Morning Post.

TikTok parent ByteDance, for example, has used its self-developed AI coding tool, Trae, to improve programmers’ coding efficiency.

Why President Xi Jinping sees China’s marine economy as a national priority

https://www.scmp.com/economy/china-economy/article/3316669/why-president-xi-jinping-sees-chinas-marine-economy-national-priority?utm_source=rss_feed

President Xi Jinping has stressed the need to advance the “high-quality development” of China’s marine economy, highlighting its growing strategic importance during a high-level economic meeting on Tuesday. He also called for stronger policy support to accelerate the sector’s growth.

In this explainer, the Post examines why the marine economy matters to the country's overall economic strategy, where government policy is heading, and which sectors stand to benefit.

China’s marine gross domestic product exceeded 10 trillion yuan for the first time in 2024, accounting for 7.8 per cent of national GDP – a milestone the government called “a truly remarkable achievement”.

The progress came after decades of investment in marine industries, which are now entering a pre-boom phase, said Hu Zhenyu, a senior research fellow at the China Development Institute, a think tank based in Shenzhen.

The marine economy plays an increasingly important role in job creation, food security and coastal development. But to fully unlock its potential, further support is needed.

The marine economy spans a wide range of industries – from fisheries, shipping and offshore drilling to marine biotechnology and coastal tourism. These sectors sometimes involve high capital investment, elevated risks and lengthy return cycles – but also hold the potential for strong returns.

Take deep-sea mining, for example. Over the past decade, state-owned enterprises such as China Merchants Heavy Industry and China Minmetals Corporation have heavily invested in the sector. While progress has been made, the large-scale commercialisation of deep-sea mining will take time and requires sustained support, Hu said.

China also listed deep-sea science and technology as one of its emerging industries in this year’s government work report.

In the 14th Five-Year Plan and the 2035 Vision, Beijing outlined three main goals: build a modern marine industrial system, create a sustainable marine ecosystem and deepen China’s participation in global ocean governance.

Though specific targets were not included, Beijing aims to achieve technological breakthroughs in marine engineering, launch pilot zones and develop specialised industrial clusters across major marine economic regions in northern, eastern and southern China.

During visits to coastal provinces such as Shandong in recent years, Xi has repeatedly urged local governments to prioritise the development of world-class ports.

Tuesday’s meeting highlighted several industries, including offshore wind power, deep-sea fishing, marine biopharmaceuticals, tourism and shipping.

Offshore wind power, in particular, was mentioned for the second time this year at a central government-level meeting. It also featured in the annual government work report, according to a note from China International Capital Corp on Wednesday.

Another emerging area is marine pharmacy, which involves studying and applying substances derived from marine resources, Hu said.

China has heavily invested in the area since 2003. With the rise of artificial intelligence – which could significantly shorten the drug development cycle – breakthroughs in marine biopharmaceuticals are expected, he said.

Communication expert Julian Cheng leaves Canada career for China university

https://www.scmp.com/news/china/science/article/3316594/communication-expert-julian-cheng-leaves-canada-career-china-university?utm_source=rss_feed

Julian Cheng Zhizhen, a global expert in optical and radio frequency wireless communication, has left his position in Canada to join the newly established Great Bay University (GBU) in southern China.

Cheng, previously an electrical engineering professor at the University of British Columbia (UBC), will be chair professor and dean of the school of information science and technology, GBU announced in a post on its official social media account on June 23.

The announcement came just four days after China’s education ministry approved the establishment of the university in Guangdong province.

Shanghai-born Cheng secured fellowships at both the Engineering Institute of Canada and the Canadian Academy of Engineering during his 30-year research career in the country.

He said he was inspired to return to China after visiting the GBU campus in the city of Dongguan last April. “After thinking about it for six months, I sold all my houses in Canada and bought a one-way ticket to return to China full-time,” he said in a video posted as part of the GBU announcement.

Many of Cheng’s research projects at UBC’s school of engineering related to ultraviolet communication (UV-C), notable for being able to use non-linear wavelengths in signal transmission, but his interests also span wireless robot communication and the integration of artificial intelligence into wireless networks.

His UBC team achieved the world’s first verification of non-line-of-sight UV-C signal localisation, and his UV communication platform has held the world record for kilometre-scale transmission distance since it was established in 2024.

Because of its potential for rapid signal attenuation and scattering, UV-C is significantly more difficult to intercept or interfere with than traditional radio frequency wireless communication.

Cheng’s research has both military and civilian applications, particularly in the field of sensing. For example, forest fires emit UV signals that can be detected by ultraviolet sensors. There are also potential applications in search and rescue operations.

In January 2023, Cheng was made a fellow of the Institute of Electrical and Electronics Engineers – one of fewer than 0.1 per cent of the IEEE’s members who are elevated annually.

Later that year, Cheng met Li Xiaoming, academic leader of GBU – which at that time was still in the planning stages.

GBU is a public university sponsored by the Guangdong provincial government, with primary funding from the Dongguan municipal government. Its president is Tian Gang, an academician of the Chinese Academy of Sciences and also director of Peking University’s mathematics department.

GBU offers full-time degree programmes up to the doctoral level, and will enrol its first 80 undergraduate students this autumn. The university expects to have 10,000 students on the rolls by 2034 and has so far recruited nearly 300 faculty members from more than 30 overseas locations.

Cheng earned a bachelor’s degree in electrical engineering from the University of Victoria in Canada in 1995 and a master’s degree in mathematics and engineering from Queen’s University in 1997.

He received his doctorate from the University of Alberta in 2003, and then worked as a postdoctoral researcher at a Canadian telecoms firm before becoming a lecturer at Lakehead University in 2005. The following year, he joined UBC as an assistant professor.

“Initially, I focused on traditional performance analysis. After joining UBC, I began researching wireless optical communication, which I pursued for about 20 years,” Cheng said on the UBC website.

He was promoted to associate professor in 2011 and became a tenured full professor at UBC in 2016.

Cheng’s homepage and profile have been removed from the UBC website, with only some award announcements continuing to mention him.

EU-China summits begin, Trump bill may affect some tax credits: SCMP daily highlights

https://www.scmp.com/economy/article/3316688/eu-china-summits-begin-trump-bill-may-affect-some-tax-credits-scmp-daily-highlights?utm_source=rss_feed

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

After much talk of patching things up, a grand rapprochement has failed to materialise, with Beijing seen to be playing a “waiting game”.

The US Congress is poised to bar companies with ties to China from gaining clean energy tax credits – a move that critics warn could jeopardise dozens of planned projects.

For the first time, Taiwan’s largest annual military exercise will combine conventional war games and urban survival drills under “unprecedented” live-fire conditions.

Officials have favoured a vaguer term – “involutionary competition” – but the president cut to the chase at top-level economic meeting.

Analysts said Beijing has a number of challenges to reckon with this year, but largely agreed the country can still meet its economic growth target.

Washington is said to be missing out on “big” opportunities while Beijing reaches agreements with “dozens and dozens of countries”.

Beijing said the succession of the Dalai Lama should be in accordance with tradition and Chinese law, in a swift rejection of a plan announced by the exiled Tibetan spiritual leader.

China’s ban on ex-Philippine senator won’t halt Manila’s South China Sea stance: experts

https://www.scmp.com/week-asia/politics/article/3316679/chinas-ban-ex-philippine-senator-unlikely-sway-manilas-stance-south-china-sea?utm_source=rss_feed

China’s decision to bar former Philippine senator Francis Tolentino from entering its territories is unlikely to deter lawmakers in Manila from pursuing legislation that Beijing might oppose, according to analysts and current legislators.

The indefinite travel ban on Tolentino, a former Senate majority leader who lost his re-election bid in May, was announced by China’s foreign ministry on Tuesday, a day after his term formally ended. The ministry accused Tolentino of “egregious conduct on China-related issues”.

“For quite some time, driven by selfish interests, a handful of anti-China politicians in the Philippines have made malicious remarks and moves on issues related to China that are detrimental to China’s interests and China-Philippines relations,” ministry spokeswoman Mao Ning said in a brief statement.

In response, Tolentino released a statement calling the sanction “a badge of honour” and “a testament to my unwavering commitment to protect our national interest and our people’s dignity.”

“No foreign power can silence me or weaken my resolve to uphold our sovereignty,” he added.

The Chinese embassy in Manila had earlier accused Tolentino of playing “the so-called China card to serve their political self-interests and boost their election prospects before the midterm elections. Such attempts are despicable and doomed to failure”.

Observers noted that Beijing waited until Tolentino was out of office before taking action.

“It appears that China is intentionally avoiding the imposition of sanctions on sitting Philippine officials to avoid diplomatic backlash,” Lucio Blanco Pitlo, president of the Philippine Association for Chinese Studies, told This Week in Asia.

He called China’s action “more symbolic, confined to travel curbs to the Mainland, Hong Kong, and Macau”, adding that those affected can opt for alternative transit points, causing minimal disruption to their international travel plans.

But, he pointed out, Beijing waited for the midterm election results before acting, as the former Senate Majority Leader lost his re-election bid.

He said Tolentino could have elicited Beijing’s displeasure because “he sponsored landmark maritime bills that passed into law – the Philippine Maritime Zones Act and the Archipelagic Sea Lanes Act.”

The acts defined the country’s four maritime zones for the first time, including the West Philippine Sea, Manila’s name for a portion of the South China Sea, which encompasses a 200 nautical mile exclusive economic zone (EEZ) and the Kalayaan Island Group in the Spratly Islands.

The sea lanes act restricts foreign vessels and planes to follow specified routes while transiting within the country’s internal waters.

“However,” Pitlo stressed, “it is his bold accusations of Chinese espionage and interference in the polls, claims China refuted, that likely drew Beijing’s ire.” Tolentino claimed that Chinese spies were “embedded” inside the Philippine government.

Tolentino also accused the Chinese embassy of hiring local public relations firm Infinitus Marketing Solutions to create fake social media accounts that trolled him, criticised the Typhon missile system installed by the US, attacked the maritime zones’ law, and smeared President Ferdinand Marcos Jnr.

Infinitus denied his accusations, and the embassy called his attempts “despicable and doomed to failure.”

Tolentino responded by issuing a statement saying, “I look forward to seeing the day when we will be expelling some Chinese diplomats because of this incident.”

Pitlo said it was not the first time that Beijing had imposed travel restrictions against high-ranking Filipino leaders.

In May 2019, Conchita Carpio-Morales, a retired Supreme Court justice and top anti-corruption prosecutor, was barred from entering Hong Kong for a family holiday and held for about four hours, Pitlo said.

“Hong Kong airport and immigration officials later told her there was a mistake and that she could proceed with her trip to Hong Kong, but she and her family had already decided to return home,” he recalled.

The following month, former Department of Foreign Affairs (DFA) secretary Albert del Rosario flew to Hong Kong to attend a business meeting and was also barred entry.

Pitlo indicated that the ban likely resulted from a complaint by Carpio-Morales and Del Rosario to the International Criminal Court in March that year against Chinese President Xi Jinping and other Chinese officials, citing damage to coral reefs and artificial islands affecting Filipino fishermen in the South China Sea.

“It was also under the watch of Secretary del Rosario that Manila took Beijing to international arbitration in 2013, following months of a tense stand-off over the Scarborough Shoal in 2012,” he said.

The stressful experience in Hong Kong affected Antonio Carpio, a retired Philippine Supreme Court justice advocating for Manila’s maritime rights. “I have not been to Hong Kong since the time Secretary Albert del Rosario and Justice Morales were barred from entering Hong Kong. I expect they will do the same to me,” he told This Week in Asia.

“China always intimidates those who resist its hegemonic actions. China thinks it will scare others from resisting,” Carpio said.

Carpio also recommended that the Senate affirm that the Philippines, as a sovereign state, can legislate to protect its exclusive economic zone and extended continental shelf under the United Nations Convention on the Law of the Sea (UNCLOS).

“In solidarity with a former colleague, the Senate can express its dismay over this Chinese move,” Pitlo said.

Beijing’s actions were unlikely to stop the upper chamber from investigating Chinese activities that threaten Philippine interests, as the maritime dispute is crucial for the country and lawmakers want to be seen as defending the national stance in the contentious area, he added.

Newly re-elected Senator Francis Pangilinan told This Week in Asia he would “support a Senate resolution condemning the said sanctions. The Philippines does not recognise the false and illegal claims of China over our ocean waters and our UNCLOS recognised EEZ.”

He expressed doubt that current senate members would be discouraged by Beijing’s actions against a former Senate official, but said that it will only strengthen the Philippines’ resolve to defend its national interests against Chinese claims in the disputed waters.

“The DFA should file a diplomatic protest on such a ban and make it known to the Chinese government,” Pangilinan said.

Acting Senate President Jinggoy Estrada also urged the DFA to summon the Chinese envoy to explain why its government considers sponsoring two landmark pieces of legislation that assert Manila’s maritime rights as “egregious acts” by Tolentino.

“Will they now impose the same sanctions on our President for signing” the two laws?,” Estrada asked.

The Senate resumes on July 28. Among the measures expected to be refiled is a law to amend the country’s espionage act to include spying during peacetime as a criminal offence. The current law specifies that spying can only be considered a crime when the country is at war with a foreign power.

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China could be about to attempt a landmark satellite refuelling test

https://www.scmp.com/news/china/science/article/3316605/china-could-be-about-attempt-landmark-satellite-refuelling-test?utm_source=rss_feed

China’s first satellite-to-satellite refuelling test appears to be imminent after a second round of close-proximity operations between two probes in high orbit on Monday.

The landmark Chinese mission will be one of the most ambitious attempts at autonomous satellite servicing in geostationary orbit, which rival the United States has yet to achieve.

On Monday, the Shijian-21 and Shijian-25 spacecraft – both orbiting at an altitude of 35,786km (22,236 miles) above the equator – came within extremely close range after days of closing in on each other, according to Swiss space surveillance firm s2a Systems.

The optical tracking image shows the two satellites nearly indistinguishable from each other, suggesting they may be about to attempt docking and potentially even conduct the refuelling and servicing test that is the primary mission of the Shijian-25.

The two satellites had a similar encounter on June 13, when they reportedly came within 1km of each other before separating 90 minutes later. That manoeuvre could have been a rehearsal for docking, or an aborted attempt at docking, according to US-based space situational awareness software company COMSPOC.

The Shijian-25 was designed to test “on-orbit refuelling and satellite life-extension technologies”, Chinese state media reported when the probe was launched in January. It said the mission aimed to verify capabilities for maintaining and prolonging the operational lifespan of satellites already in orbit as a way to reduce costs, improve sustainability and to help address growing concerns over space debris.

The satellite has been drifting towards the Shijian-21 and is expected to use its robotic arms to latch onto the latter and replenish its fuel.

US surveillance satellites USA 270 and USA 271 have manoeuvred into position to monitor the event, flanking the Chinese probes since early June, according to COMSPOC.

The Shijian-21 was launched in 2021 and used up much of its own propellant in 2022 to pull a defunct BeiDou navigation satellite from geostationary orbit and into a higher “graveyard” orbit.

Both satellites were developed by the Shanghai Academy of Spaceflight Technology, a subsidiary of state-owned China Aerospace Science and Technology Corporation. They have nearly synchronised orbits and are primed for rendezvous and docking, according to public tracking data from the US military’s Space-Track.org website.

Satellite-to-satellite refuelling in high orbit presents extraordinary technical challenges such as precise autonomous docking between free-flying spacecraft and difficult fluid transfer in microgravity conditions.

Nasa’s similar OSAM-1 – On-orbit Servicing, Assembly and Manufacturing 1 – mission was cancelled in 2023 after years of delays and technical challenges. DARPA, or the Defence Advanced Research Projects Agency, carried out a flight demonstration in low-Earth orbit in 2007 known as Orbital Express, which was successful but less complex.

Should the refuelling and servicing be successful, the Shijian-21 – designed as an “experimental validation of space debris mitigation technology” – could continue serving as a space tug, a role that has sparked concern in the US since it could have anti-satellite potential for military purposes.

China’s real consumption ‘far from as low as it seems’ – think tank bucks market consensus

https://www.scmp.com/economy/china-economy/article/3316650/chinas-real-consumption-far-low-it-seems-think-tank-bucks-market-consensus?utm_source=rss_feed

China’s actual consumption power may have already surpassed that of Mexico and reached 40 to 50 per cent of the levels seen in developed nations such as Japan and Germany, a Beijing-based think tank contends.

That conclusion, put forth by China Finance 40 Forum, which comprises senior Chinese regulators and financial executives, runs contrary to the market consensus that China’s consumption is underdeveloped, while providing a new perspective from which to assess the consumer potential of the world’s second-largest economy.

The research report came as Beijing has been rallying efforts to rev up China’s domestic market as an economic growth engine amid a trade war with Washington. But market analysts have raised concerns that consumption could run out of steam, pointing to the waning impact of a trade-in programme, and to the weakened purchasing power of residents troubled by job insecurity.

“Mainstream metrics have systematically underestimated China’s consumption level,” two of the think tank’s research fellows, Guo Kai and Yu Fei, wrote in the report, posted online on Friday.

Despite being the world’s second-largest consumer market, after the US, China’s per capita spending before adjustment is only 8.8 per cent of what Americans spend, about half of what Mexicans spend, about a quarter of what Japanese spend, and 18 per cent of what Germans spend, the report said, citing World Bank data.

It looks a bit better when adjusted for purchasing power parity – an international metric that compares the relative economic strength of countries by equalising the purchasing power of their currencies. By this measurement, China’s level is 17.1 per cent of US consumption, 35.3 per cent of Japan’s, 59.6 per cent of Mexico’s, and 28.5 per cent of Germany’s.

However, in defending their more optimistic assessment, the authors wrote: “If we look at real consumption volumes, the gap between China and developed countries across various sectors is far narrower than it appears.”

The think tank reached the conclusion by looking into per capita consumption volumes across categories such as food, clothing, computers, home appliances, housing and travel.

China’s consumption power in food is on par with that of the US, and in certain categories – such as freezers and air conditioners – even surpasses the US, according to the authors.

They attributed underestimations mainly to China’s price levels and the yuan’s exchange rate.

But given what some analysts see as China’s slower-than-expected progress in boosting consumption, there is ongoing debate over whether the country should refocus on a more traditional driver of economic growth: investment.

The think tank report also noted China’s ability to offer goods and services at prices far below global market levels, due to its complete industrial chain and economies of scale.

It added that China’s relatively high consumption volume reflected the yuan’s stronger underlying purchasing power, which the authors said had not been fully realised by its current exchange rate.

“While China’s overall consumption level is no longer low, there remains room for further growth – not just in quantity, but also in quality,” they noted, singling out categories such as clothing, electronics and household appliances, where per capita consumption could still rise.

They cautioned that, while current consumption subsidies are aimed at unlocking this potential, “attention must be paid to the sustainability of such policies to avoid a pullback in consumption once the subsidies are withdrawn”.

The massive subsidy scheme is playing a key role in China’s efforts to bolster its domestic consumption this year. Beijing pledged last month to distribute the remaining 300 billion yuan (US$42 billion) worth of subsidies by year’s end – with the next two rounds scheduled for this month and October – after some regions halted their programmes due to depleted funds.

China’s recent consumption data pointed to an improved picture under these efforts, with retail sales increasing in May by 6.4 per cent, year on year, up from a 5.1 per cent rise in April.

Last week, Premier Li Qiang pledged that China would become a “consumption powerhouse” capable of fuelling domestic and global growth, while speaking at the World Economic Forum’s annual meeting in Tianjin.

The think tank report noted that reassessing China’s consumption level would not alter the size of its trade surplus.

“Proactively boosting consumption to achieve a more balanced trade structure is not only beneficial for domestic economic development and improving household welfare, but also for fostering a more favourable external environment,” the authors added.

Alibaba’s US$7 billion subsidy deepens China’s instant e-commerce war with JD.com, Meituan

https://www.scmp.com/tech/big-tech/article/3316646/alibabas-us7-billion-subsidy-deepens-chinas-instant-e-commerce-war-jdcom-meituan?utm_source=rss_feed

Alibaba Group Holding’s instant commerce service announced on Wednesday a substantial subsidy programme totalling 50 billion yuan (US$7 billion) over the next 12 months for both consumers and merchants, intensifying the fierce competition in China’s on-demand delivery sector, where JD.com and Meituan are also major players.

Consumers using Taobao’s in-app Shangou service, the instant commerce business of Alibaba, will enjoy significant incentives, including cash vouchers, free purchase coupons, and subsidised prices on select items, according to the company.

Merchants will benefit as well, receiving support through store launch subsidies, product discounts, delivery subsidies, and reduced or waived commissions. Alibaba owns the South China Morning Post.

“Taobao Shangou leverages technological and business model innovations to build a highly efficient, integrated consumer platform … channeling substantial online traffic to offline businesses,” the company said, while emphasising its strategy as “anti-involution, pro-consumption”.

“Involution” refers to increasingly intense internal competition that leads to diminishing returns, a phenomenon seen across various parts of Chinese society in recent years that has drawn concerns.

Launched late in April, Taobao Shangou – which means “flash shopping” in Chinese – expanded nationwide in early May, offering rapid delivery for a variety of products, including food, electronics, clothing and flowers. Deliveries are fulfilled by Alibaba’s food delivery subsidiary, Ele.me.

Alibaba announced last month the merger of Ele.me and online travel agency Fliggy into its core e-commerce operations, Taobao and Tmall, describing the move as a “strategic upgrade from an e-commerce platform to a comprehensive consumer platform”.

The renewed push follows JD.com’s aggressive entry into China’s food delivery market in February, promoting “quality food”, lower merchant commissions, and enhanced benefits for delivery riders.

Meituan, currently the leader in China’s food delivery sector, launched its own instant commerce service – also named “Shangou” – in mid-April. During Meituan’s first-quarter earnings call in May, founder and CEO Wang Xing pledged to win the competition “at any cost”, while questioning the sustainability of heavy subsidies.

On Tuesday, Meituan introduced an infrastructure project called “Raccoon Canteen”, aimed at establishing centralised kitchens for takeaway meals to ensure consistent food safety standards. The company said it planned to invest in building 1,200 such kitchens nationwide over the next three years.

Meituan’s daily orders reportedly reached about 90 million recently, while JD.com achieved 25 million daily orders earlier this month. As of June 23, Alibaba said Taobao Shangou recorded 60 million daily orders.

“This reflects significant pressure in China’s consumer market in recent years,” said Kenny Ng, a strategist at Everbright Securities International. “The growth of the traditional e-commerce model is stagnating, forcing companies to expand their reach, resulting in intensified cross-sector competition.”

China’s Consumer Price Index, a key measure of inflation, fell 0.1 per cent year on year in May, marking the fourth consecutive month of decline. This indicates ongoing deflationary pressures driven by weak domestic demand and trade uncertainties.

The impact of corporate promotions on overall consumption is limited, according to Ng.

“Companies are primarily aiming to boost their own sales,” he said. A true revival in consumption heavily depends on macroeconomic policies that can reshape consumer optimism about the future.”

US munition hub plan for Philippines’ Subic Bay sparks China retaliation fears

https://www.scmp.com/week-asia/politics/article/3316609/us-munition-hub-plan-philippines-subic-bay-sparks-china-retaliation-fears?utm_source=rss_feed

A proposal to build a US ammunition manufacturing and storage hub in Subic Bay – the site of a former American naval base in the northern Philippines – is raising fears of strategic entrapment, local economic disruption and Chinese retaliation, despite tentative backing from Manila’s defence chief.

Experts said while the move could help plug logistics gaps in the Indo-Pacific and deepen alliance coordination, it might also undermine the Philippines’ policy of strategic ambiguity and reignite long-held fears about military dependence.

The plan emerged in a report released on June 24 by the US House Committee on Appropriations’ defence subcommittee, which noted the lack of a munitions hub in the region and suggested setting up one at the former Subic Bay base.

“The committee is concerned with the lack of a forward-staged ammunition manufacturing facility in the Indo-Pacific,” the report said. “Therefore, the committee directs the Department of Defence to assess … the feasibility of establishing a joint ammunition manufacturing and storage facility at United States Naval Base Subic Bay.”

Although no formal proposal has been made, Philippine Defence Secretary Gilberto Teodoro Jnr welcomed the idea, citing potential economic and strategic benefits. “Any production entity which would be of benefit to the Philippines, not only in terms of our resilience, but improving, giving employment and other technological transfers, that might be encouraged,” he said on Monday.

He said the proposal was plausible, given that the Philippines and the United States were treaty allies with shared strategic interests. Under their 1951 Mutual Defence Treaty, both countries are committed to support each other in the event of external aggression.

Analysts caution that a US ammunition hub on Philippine soil would have wide-ranging consequences, however.

Chris Gardiner, CEO of the Institute for Regional Security, an Australian non-profit organisation, said that the war in Ukraine served as a reminder that modern conflict depended on continuous, localised and flexible supply chains for material and logistics.

“We pray that war is prevented by deterrence, but that deterrence, and properly resourced defence if it fails, needs local stockpiles and manufacturing,” he said.

“Defence of the Philippines, of course, involves risk for the US. And defence of Philippine freedom involves risks for its citizens. On balance, the risks of enhanced forward basing and manufacturing of ammunition … must be accepted.”

A major concern was how China would perceive such a move, said Arnaud Leveau, an assistant professor of geopolitics at the Paris Dauphine University. “Allowing that facility could make the Philippines more exposed to retaliatory threats from China, ” he said.

“There’s also a risk of alienating segments of the population who could view this as a regression to Cold War-era dynamics, undermining the legitimacy of current defence policies,” he said, adding that stakeholders – from local government and civil society to fishing communities whose livelihoods may be directly affected – should be consulted.

“More broadly, it could constrain the Philippines’ ability to maintain the kind of flexible, multi-vector diplomacy that many Asean members favour – engaging both the US and China without being forced to choose sides,” Leveau added.

On Monday, Pamalakaya, a fishermen’s group, warned the government against allowing a US arms facility, citing risks to national sovereignty and local industries.

“We have already removed US military bases from our soil. We are concerned that their renewed presence is aimed at using the Philippines as a strategic location for provocative actions against China,” said Pamalakaya head Fernando Hicap.

“We don’t want to be caught in the middle of a war between the US and its rivals, especially since we know that it will also cause great harm to the country’s fisheries.”

Jonas Reyes, a resident of Subic who works with the local government, said he supported the plan as it would generate employment. “But the wealthy here, including American retirees, are not supporting the move because it will make the country a target,” he told This Week in Asia.

Subic Bay – a 670 sq km (260 square mile) area once home to the largest US naval base overseas – remains a politically sensitive site. Though American forces left in 1992, it has retained its relevance as a hub for logistics and joint drills under the Balikatan exercises.

Earlier this year, the US Navy reportedly considered leasing a storage facility within 100km (62 miles) of Subic to preposition equipment for the Marine Corps.

“Reintroducing a US defence presence there, even in a different form, could carry strong symbolic and strategic implications – both domestically and regionally,” said Sylwia Monika Gorska, a political analyst with a doctorate in international relations from the University of Central Lancashire.

“Concerns raised by groups such as Pamalakaya reflect long-standing apprehensions about sovereignty, environmental risk and the Philippines’ role in regional power dynamics.”

A US munitions hub could improve interoperability with the US under the Enhanced Defence Cooperation Agreement (EDCA), boost local economies and strengthen alliance signalling. “At the regional level, the proposal may be interpreted as a step toward a more formalised and permanent US military-industrial presence in Southeast Asia,” Gorska said.

In 2023, the Philippines granted the US access to four additional sites under the EDCA, bringing the total to nine. The deal allows American troops to rotate and preposition material, equipment and supplies at designated locations across the country.

However, Gorska said the Subic plan could be “viewed by China as a deepening of the US-Philippines alliance posture, which could prompt reciprocal measures – diplomatic, economic or paramilitary in nature”.

It might also reduce Manila’s room to hedge between competing powers and signal bloc alignment in a region historically defined by strategic flexibility, she added.

Chester Cabalza, president of the Manila-based International Development and Security Cooperation think tank, said the site’s revival reflected Manila’s pragmatic push to strengthen its “self-reliant defence posture” – a strategy aimed at reducing dependence on foreign military support by developing domestic defence capabilities and infrastructure.

Subic offered both commercial and strategic advantages that should be maximised during peacetime for both combat and non-combat scenarios, he said.

“This is a bold decision for Manila to revive Subic for its many assets in military readiness and defence industry,” Cabalza told This Week in Asia.

Leveau noted that the Subic plan fitted into a wider trend of “logistical militarisation” across the Indo-Pacific – not just through basing agreements, but also via industrial capacity, supply chains and maintenance facilities.

While these efforts may enhance deterrence, they also risk fuelling an arms race and undermining Asean’s preferred model of informal, consensus-driven security cooperation.

“The main risk is strategic entrapment: countries like the Philippines could find themselves on the front lines of a US-China confrontation, without sufficient control over the strategic trajectory,” he said.

“The region does not need more confrontation. It needs confidence-building measures, crisis hotlines and sustained multilateral engagement. If this facility goes ahead, it must be accompanied by credible diplomatic efforts to reduce tensions and reinforce regional norms.”

China’s top leadership takes aim at ‘disorderly low-price competition’

https://www.scmp.com/economy/china-economy/article/3316616/chinas-top-leadership-takes-aim-disorderly-low-price-competition?utm_source=rss_feed

In addressing the price wars plaguing many industries in China, the country’s top leadership has resorted to a phrase rarely seen at a high-level meeting, saying that enterprises’ “disorderly low-price competition” needs to be regulated.

Speaking at a top-level economic meeting on Tuesday, President Xi Jinping used that phrase to explicitly characterise the much-debated phenomenon, in stark contrast to officials who have, since late last year, favoured the vaguer term “involutionary competition” when discussing the problem.

China needs to “lawfully regulate enterprises’ disorderly low-price competition, guide companies to improve product quality, and promote the orderly exit of outdated production capacity”, Xi urged at a meeting of the Central Financial and Economic Affairs Commission, the Communist Party body that supervises economic matters.

Beijing sees tackling such competition as crucial for the health of the world’s second-largest economy as it harms innovation, lowers efficiency and hinders industrial upgrading and product quality improvement.

Compared with “involutionary competition”, which was broader and potentially involved technology, talent and other areas, “disorderly low-price competition” was more focused on price wars and market behaviour – and especially on enterprises suppressing prices to capture market share – said Hou Xuchao, founding partner of China Insights Consultancy.

Xi’s description is reminiscent of the crackdown on China’s internet industry in 2020 and 2021, when it was criticised for having seen a “disorderly” expansion of capital as authorities targeted major tech firms’ unchecked growth and monopolistic practices.

The vicious competition within China in recent years is threatening the domestic industrial ecosystem and complicating China’s economic outlook amid a trade war with the United States and an uncertain international environment, researchers and industry insiders said.

“The low-price battle has become pretty brutal,” said Cao Lei, the 44-year-old owner of Hebei Zhongjing, a company that makes rebar couplers.

“In the steel industry, some low-end products are facing weak demand and huge inventory pressure, so some manufacturers are selling at cost or even taking a loss. Online platforms are bleeding money with subsidies just to keep traffic and hold onto customers.”

Cao said the phenomenon stemmed from a lack of technological innovation and the poor research and development (R&D) capacities of industry players, which meant they could only compete on price.

“The government could step in, but ultimately it’s the market’s call,” he said, adding that when the competition gets too intense, only high-quality players or those with solid R&D and tech strengths will survive.

The price war in the auto industry, driven by oversupply from too many companies and excessive investment, is likely to persist for years due to ongoing funding that will delay market consolidation, Gavekal Dragonomics economist Cui Ernan said in a note issued on Tuesday.

“While the leading automakers are profitable, there is a long tail of struggling firms that should probably exit the market, yet continue to produce thanks to ample government and private-sector financing,” she said.

“This funding support means the market is likely to consolidate only gradually, and the auto price war will probably continue for at least another couple of years.”

Goldman Sachs said in a research note issued on Monday that its onshore clients in Beijing and Shanghai, ranging from mutual funds and private equity funds to asset managers in banks and insurance companies, were concerned about the impact of the auto industry’s price war.

They were also concerned about increased competition between e-commerce giants Meituan and JD, as the latter, known for its low-price strategy, marches into the food delivery business, it said.

The same phenomenon is happening in China’s education and training market. Hua Ruyi, manager of Jiangsu Mingsi Education, said its operations were feeling the squeeze of fierce competition, “something we haven’t seen in the past decade or more”.

“Many customers are avoiding spending altogether, and those who spend are hunting for the cheapest options, comparing multiple providers,” Hua said. “This is making the industry more cutthroat, but everyone in the sector needs to make a living – low prices are the only way to draw in customers.”

Chinese jeweller Laopu Gold surges 15% as investors devour 69 million shares post lock-up

https://www.scmp.com/business/china-business/article/3316620/chinese-jeweller-laopu-gold-surges-15-investors-devour-69-million-shares-post-lock?utm_source=rss_feed

A surge in the supply of Laopu Gold shares after the end of a lock-up period turned out to be a buying opportunity for investors who missed out on the luxury jeweller’s 14-fold surge since its 2024 debut.

The Beijing-based company’s shares jumped 15 per cent to a record of HK$1,008 on Monday, bucking concerns of a pullback after 69 million shares – a 40 per cent stake – became free-floating, allowing pre-listing investors including founder Xu Gaoming to sell without restrictions a year after the stock’s debut. The stock was little changed at HK$1,006 on Wednesday as trading resumed after a public holiday.

Laopu’s resilience underscores investors’ persistent shift to a group of so-called new consumer names that are underpinned by the rise of Generation Z – those born between roughly 1997 and 2012. The firm’s faster pace of store openings at home and abroad this year has reinforced belief in sustainable earnings growth based on robust demand for its products.

“Laopu’s branding and strong pricing power will drive fast growth in sales and help to cut costs such as rentals,” said Fan Junhao, an analyst at Huatai Securities in Hong Kong. “Its foray into the overseas market will also give more growth room for its already strong sales.”

Laopu has surged more than 1,300 per cent since its debut on June 28, 2024, and is capitalised at HK$173.7 billion (US$22.1 billion). That translates to 38.5 times projected earnings for this year, compared with 17.2 times for Chow Tai Fook Jewellery Group, according to Bloomberg data. Laopu is expected to report 175 per cent profit growth this year.

Same-store growth at Laopu’s four flagship shops jumped by 170 per cent year on year in the first five months, and online sales at Alibaba’s Tmall and JD.com’s platform surged 333 per cent in the period, according to the brokerage, citing industry data.

Laopu opened six new stores this year: five in first-tier Chinese cities and one in Singapore, its first overseas outlet, according to Huatai Securities. The 110-square-metre (1,184 sq ft) store in Singapore’s Marina Bay Sands drew long queues for its launch last month. The brand had 36 shops in 15 Chinese cities at the end of last year.

Founded in 2009, Laopu aspires to be China’s Hermes and fill a void in the luxury market, which is dominated by foreign brands. It blends traditional Chinese craftsmanship with modern designs, aligning with a shift towards domestic luxury goods among younger consumers.

Unlike its rivals, Laopu does not tie its prices to the cost of gold, which gives it better control over its profit margins and attracts buyers when bullion prices rise.

Analysts tracked by Bloomberg set a 12-month price target of HK$1,031.17 for Laopu, implying a gain of about 2 per cent from the current level. JPMorgan Chase is the most bullish, with a share-price estimate of HK$1,249.

Traditional Chinese consumer companies such as distiller Kweichow Moutai have lost clout recently amid a slowdown in business activity and a worsening labour market. But “emotional consumption” by Gen Z would sustain the trade on new consumer stocks, analysts said.

“Laopu’s fast same-store growth is expected to continue because of branding and high gold prices,” said Li Xinxin, an analyst at China Post Securities. “It’s expected to go outside China and become one of the global luxury jewellery brands.”

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China’s mosquito-sized drone, how exercise slows ageing: 7 science highlights

https://www.scmp.com/news/china/science/article/3316617/chinas-mosquito-sized-drone-how-exercise-slows-ageing-7-science-highlights?utm_source=rss_feed

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

A robotics laboratory at the National University of Defence Technology (NUDT) in central China’s Hunan province has developed a mosquito-sized drone for covert military operations.

Chinese researchers have developed the first highly parallel optical computing integrated chip, named “Meteor-1”, setting a milestone for using light to perform an enormous number of operations at the same time, the scientists say.

After 12 years of technical hurdles and scepticism, China has successfully tested artillery-launched drones capable of surviving the crushing load in a 155mm (6 inches) cannon shell.

China has secured a major academic coup with the recruitment of mathematics luminary Joshua Zahl, recently celebrated for solving the more than 100-year-old three-dimensional Kakeya conjecture.

A Chinese university has successfully flown its Feitian 2 hypersonic vehicle at a site in northwestern China, according to an announcement on the Northwestern Polytechnical University (NPU) website.

Yajiang-1, a cutting-edge computing centre perched in the cradle of Tibetan civilisation, is up and running as part of China’s plan to transform the so-called roof of the world into a strategic frontier for sustainable supercomputing.

A team of Chinese scientists has found that betaine – a compound naturally occurring in the kidneys during long-term exercise – can slow down the ageing process.

Mainland Chinese drivers can apply for Hong Kong entry permits in November

https://www.scmp.com/news/hong-kong/transport/article/3316636/mainland-drivers-can-apply-hong-kong-entry-permits-november-under-southbound-scheme?utm_source=rss_feed

Drivers from Guangdong province will be able to apply to drive to Hong Kong in November under a highly anticipated cross-border scheme, transport minister Mable Chan has said.

The Southbound Travel for Guangdong Vehicles scheme is expected to be implemented a month earlier than originally planned.

Vehicles would be allowed to enter the city through the Hong Kong-Zhuhai-Macau bridge, with a daily quota of 100 applications, she said on Wednesday.

Under the scheme, mainland Chinese drivers in Guangdong can get into the city after having their licence and procedures processed, such as insurance purchase, car inspections and applications for a permit for a single entry.

Those drivers can park their cars at the Hong Kong International Airport, which is building 1,800 automated parking spaces for visitors on the artificial island by early next year, she said.

For single-entry permits, applicants will be eligible to stay in the city for a number of days, provided that the driver and the vehicle licensee are the same person at the time of application. The duration of stay is pending finalisation.

The cross-border driving scheme for Guangdong vehicles has been the subject of discussion for years and was originally expected to start at the end of 2024 or early this year.

Authorities would require vehicles arriving in Hong Kong to comply with safety regulations, like other local drivers, and be covered by third-party insurance.

To facilitate the participation of more mainland drivers in the scheme, the Transport Department will consider appointing some accredited centres to conduct car inspections in Guangdong.

Labubu’s rise reflects hitmaker ability of China’s digital ecosystem

https://www.scmp.com/opinion/china-opinion/article/3316496/labubus-rise-reflects-hitmaker-ability-chinas-digital-ecosystem?utm_source=rss_feed

The global frenzy around China’s Labubu, the candy-coloured monster character with the mischievous smile adorning bags, desks, streets and social feeds worldwide, is often hailed as a triumph of Chinese soft power.

But Labubu’s success reveals something deeper: the unmatched sophistication of China’s integrated platform economy. Pop Mart, Labubu’s retailer, started with a small shop in Beijing in 2010 but has leveraged China’s unique digital ecosystem in recent years to build a global intellectual property (IP) phenomenon, showcasing a new model for technology-powered commercial and cultural influence.

This model echoes history. Since the 15th century, when European royalty craved Chinese porcelain, the reach of China’s cultural exports relied on the technologies that supported trade, such as shipbuilding. Today, the success of toys like Labubu is propelled by the infrastructure of digital technologies.

China’s booming e-commerce and social media platforms such as RedNote, TikTok and WeChat are digitising the Silk Road. But instead of promoting IPs particularly linked to Chinese history and culture, companies like Pop Mart achieve success with cosmopolitan offerings like Molly, Pucky and Labubu that appeal to a broader audience.

Pop Mart exemplifies a broader shift in China’s economic engagement. Unlike earlier internet giants such as Tencent Holdings, JD.com and Baidu, whose dominance stemmed primarily from the vast domestic market, a new generation of Chinese companies across diverse sectors is prioritising global growth.

Pop Mart’s international footprint – it has stores across Europe, the United States, Australia, New Zealand and Southeast Asia – reflects the overseas expansion of many Chinese companies, including electric vehicle leaders such as BYD and Nio, tech companies like Unitree Robotics and Longi Green Energy Technology, artificial intelligence start-ups including DeepSeek and Manus AI, and entertainment powerhouses like Game Science and miHoYo.

As the Chinese government announces policies to help small and medium businesses develop overseas markets, those in the entertainment and toy industries in particular benefit from platforms like RedNote, TikTok, Bilibili and WeChat. These mobile-friendly platforms blend social networking, entertainment, e-commerce and finance, with their algorithms tracking and predicting consumer desires.

This infrastructure helped power Pop Mart’s rapid physical expansion and online dominance – it has even launched a film studio and announced plans for an animated series.

Pop Mart harnesses the power of digital platforms through three platform-native strategies. First, Pop Mart’s blind-box sales model is supercharged by clicks, likes and shares: Labubu videos on the company’s Bilibili channel can receive millions of views in just a few weeks; its US TikTok account has more than 6 million likes and over 900,000 followers.

These platforms spread unboxing videos of Pop Mart toys within hours, generating clout for aspiring influencers and celebrities alike. Platform algorithms rapidly circulate promotions, unboxings and memes, turning Labubu into an inescapable digital sensation. The constant stream of unboxing pleasure fuels endless user-generated content.

Secondly, it transforms a single IP into a universe, where one character comes with countless expressions, colours, sizes and textures. Consumers can buy Labubu keychains, bags, sculptures, plush toys and even jewellery, meeting a range of demand.

This diversity in design and “new but familiar” variations of the same character can catalyse popularity on digital platforms. The many Labubu outfits, paired with its signature jagged-toothed grin, make it seem trendy.

Thirdly, the thrill and anxiety of the unknown in blind boxes, coupled with rare editions, tap into the fear of missing out. As social interaction thrives online, owning and showcasing a rare Labubu, or sharing information about a store location where a Labubu can still be bought, becomes a kind of social capital.

Seeing friends unboxing sought-after toys on Instagram or Facebook creates psychological pressure to keep up to stay digitally present and relevant. The platforms provide the stage, an audience and constant comparisons, making collection a social imperative amplified by trend-focused algorithms.

In addition to social media, China’s wide adoption of digital payments also helped accelerate Labubu’s popularity. Daily transactions, from paying for groceries to transport, run on QR codes via WeChat Pay or Alipay, a habit that enables impulse purchases of blind boxes and blind cards.

This integrated digital ecosystem offers China a unique edge in creating global fervour for products while increasing transactional efficiency. For instance, unlike the fragmented structure in the United States of Instagram/Facebook for social engagement, WhatsApp for chat, individual e-commerce apps for shopping and card-based payment systems, Chinese apps like WeChat, TikTok and RedNote can combine them all.

This empowers users as micro-entrepreneurs, directly monetising content, a capability nurtured by initiatives like the TikTok Academy. This ecosystem is the true engine behind China’s IP boom and global commercial expansion: not just creativity or industrial capacity, but a digital environment that breeds viral hits, facilitates commerce and turns users into marketers.

Labubu’s monster aesthetic resonates with many in a tense global climate, offering a playful outlet for defiance. While the gambling-like mechanics of blind boxes have incurred criticism, the global embrace of Pop Mart’s IP redefines business models to take advantage of the viral nature of social media posts on consumer experience.

While the concept of the blind box originated elsewhere, China’s platform economy has uniquely amplified its allure, transforming user curiosity into a highly shareable, “sticky” experience suited for societies craving instant gratification.

In a world increasingly shaped by digital technologies, a holistic infrastructure for connection, commerce and cultural influence is necessary for economies. For any nation or company seeking global engagement, building or leveraging such a participatory digital ecosystem is paramount.

China air travellers caught off guard after regulator grounds mobile power banks

https://www.scmp.com/news/china/politics/article/3316648/china-air-travellers-caught-guard-after-regulator-grounds-mobile-power-banks?utm_source=rss_feed

An emergency ban on some power banks imposed by China’s aviation regulator over the weekend caught travellers off guard, many of whom arrived at airports only to be told that such portable devices could not be taken onto their flights.

The Civil Aviation Administration of China (CAAC) began enforcing the strict ban on lithium-based power banks over safety risks on Saturday, two days after issuing the notice. The ban applies to devices without proper safety and quality certifications or those that have been associated with product recalls.

The products are not allowed in either carry-on or checked luggage for domestic flights. International flights are not affected for the time being.

A CAAC spokesperson told People’s Daily on Wednesday that the decisions followed reports of several incidents globally this year involving lithium battery products overheating on planes. Lithium batteries without China Compulsory Certification (3C) safety certifications would be barred from domestic flights, the spokesperson said. The certification applies to products that could impact health, safety and environmental protection.

According to the notice, several leading portable battery manufacturers recently recalled batches of products due to safety risks such as overheating and fire hazards. China’s market regulators have also revoked or suspended 3C certification for several battery manufacturers.

“These developments indicate potential safety hazards associated with passengers carrying portable batteries, posing a growing risk to civil aviation safety,” it said.

A passenger who flew from Shenzhen, in southern Guangdong province, on Saturday said he noticed stepped security checks. There were many signs indicating that security staff would be checking devices for 3C labels, and that products without them, or those that had been recalled, would be barred from flights, he added.

Other passengers complained on social media that their power banks were taken away, with some posting pictures showing piles of banned devices at checkpoints.

So far, the ban has not affected trains, a spokesperson for China Railway told state news agency Xinhua on Tuesday. Currently, batteries that have rated capacities under 100 watt-hours (Wh) are allowed on trains in China, regardless of whether they have the 3C label, Xinhua said.

In June, two major Chinese battery companies – Romoss and Anker – announced several recalls, with news portal The Paper reporting that the battery makers recalled 490,000 and 710,000 devices respectively.

In a June 18 statement on Weibo, Romoss said that raw material for some battery cells could be at “risk in extreme situations”, and that its recall was voluntary. Anker told Chinese financial media outlet Cailian Press that it discovered a supplier had been secretly switching its battery materials, adding that the firm had since been dropped as a supplier.

China began handing out 3C certifications to lithium and portable batteries in August 2023. One year later, the certification for such products became mandatory.

Hong Kong’s aviation regulator began banning passengers from using power banks on April 7, after a spate of safety incidents. In March, a plane from the eastern city of Hangzhou to Hong Kong was forced to divert and land in Fuzhou after a fire broke out on board. The blaze was suspected to have been caused by an overheated power bank.

The world is going all-in on stablecoins. Is China’s digital yuan any different?

https://www.scmp.com/economy/china-economy/article/3316651/world-going-all-stablecoins-chinas-digital-yuan-any-different?utm_source=rss_feed

When South Korea reportedly halted its digital currency pilot programme this week in favour of stablecoins – cryptocurrencies pegged to a reference asset, typically a fiat currency – it sent shock waves through central banks across the world.

It also left China – a pioneer in central bank-backed digital currencies with its digital yuan, or e-CNY – with an important question to answer, namely whether it should continue to explore such digital assets or revisit the possibility of adopting the popular stablecoin format for its own purposes.

At first glance, stablecoins appear to have similar qualities to the digital yuan or other digital currencies, but there are significant differences in their design, purpose and management.

Issued by China’s central bank, the e-CNY is the digital form of China’s sovereign currency. It can be used for everyday transactions such as retail payments, government disbursements, salaries and public transport fares, and does not require a bank account.

First piloted in 2020, it had been used in 26 cities for transactions worth a total of 7 trillion yuan (US$977 billion) by June last year.

The digital yuan is largely intended for small domestic retail payments, and it cannot be exchanged for foreign currencies. Its cross-border use is being developed through the mBridge project, coordinated by the multinational Bank for International Settlements.

Unlike the digital yuan, which is entirely under the umbrella of a central bank, stablecoins are blockchain-based and privately issued cryptocurrency tokens pegged to fiat currencies like the United States or Hong Kong dollars. Issuers hold reserve assets, such as US Treasury bills, to back the total value of the tokens at a ratio of one to one.

Stablecoins are primarily used for cross-border payments, remittances and to ensure faster, cheaper transactions within digital ecosystems.

More reliable than free-floating cryptocurrencies like bitcoin, stablecoins are experiencing rapid growth in emerging markets with high inflation rates and volatile currencies, with countries in Latin America and Africa being quick to adopt them.

Although stablecoins can be pegged to any fiat currency, more than 99 per cent are currently backed by the US dollar or US dollar-denominated assets – far exceeding the US dollar’s roughly 50 per cent share in global payments and its 58 per cent share of global foreign exchange reserves.

In effect, that means they function as a digital version of the US dollar, Bank of China’s research institute said in a report released on Tuesday.

China adopts a centralised approach for its digital yuan.

The People’s Bank of China (PBOC), the country’s central bank, oversees the currency’s issuance, circulation and technical infrastructure, while commercial banks, payment platforms and e-commerce platforms help integrate it into daily use through pilot programmes.

In this vein, the government has taken the lead in promoting the digital yuan. Local authorities have issued consumption vouchers in the currency to residents and used them for public procurement. Some state-owned enterprises are using digital yuan for the payment of salaries and benefits.

On the other hand, Beijing has taken a hard line on cryptocurrencies, banning their trade and mining in mainland China, citing security issues. Stablecoins, despite being studied by market institutions and mentioned by former PBOC governor Zhou Xiaochuan last month, have been largely relegated to a topic of academic discussion.

Hong Kong – an international financial centre – has taken a more permissive stance than the mainland. In late May, the city passed a law establishing a regulatory framework for stablecoins that is set to take effect on August 1.

The legislation paves the way for issuers to obtain licences and offer the digital assets to the public, making the city the first in the world to introduce comprehensive legislation specifically regulating the assets.

The digital yuan is part of China’s broader push to internationalise its currency.

To enhance the global presence of the yuan, China will establish an “international operations centre” for the digital yuan, PBOC governor Pan Gongsheng announced at the Lujiazui Forum in Shanghai last month.

Last year, Hong Kong began allowing the use of digital yuan in retail settings, marking a step towards its cross-border application.

Along with domestic pilot programmes, the PBOC is collaborating with the central banks of Hong Kong, Thailand, the United Arab Emirates and Saudi Arabia on Project mBridge – a cross-border payment and foreign exchange platform using central bank digital currencies and distributed ledgers. The initiative is expected to expand the use of the digital yuan in international trade and transactions.

With most stablecoins pegged to the US dollar, analysts see Hong Kong’s embrace of stablecoins as paving the way for potential yuan-pegged trials, supporting the currency’s adoption as the US dollar’s prestige wanes.

“The implementation of Hong Kong’s stablecoin legislation is expected to accelerate the development of Hong Kong dollar, offshore yuan and even yuan-pegged stablecoins, with a Hong Kong dollar stablecoin likely to be launched first,” Huatai Securities said in a research note issued late last month.

Supporting Chinese firms’ overseas expansion, cross-border business and digital business – along with expanding the range of activities in which stablecoins can be used – would be essential to Hong Kong’s success in the stablecoin market and could broaden the yuan’s international appeal, it said.

Chinese fans bash ‘sore loser’ Zheng after Wimbledon exit, question her attitude

https://www.scmp.com/sport/china/article/3316659/chinese-fans-bash-sore-loser-zheng-after-wimbledon-exit-question-her-attitude?utm_source=rss_feed

Chinese tennis fans made clear their disappointment after Zheng Qinwen crashed out of Wimbledon in the first round for the third straight year.

The tournament’s fifth seed was beaten 7-5, 4-6, 6-1 by world No 81 Katerina Siniakova late on Tuesday – the second time in three years the Czech had knocked Zheng out in the opening round of the grass grand slam.

Afterwards, many on Chinese social media rounded on the 22-year-old, questioning whether she truly belonged among the world’s best.

“I feel like she thinks she really is a queen,” one user said. “Her opponent didn’t win because she played well; it was because [Zheng] didn’t play well. She doesn’t have the power of a queen, so she needs to stop acting like one.”

“Going out in the first round at Wimbledon three times in a row – not many people can say that,” one popular comment on Weibo said.

Another person joked: “That sore loser expression again”, alongside a screenshot of Zheng walking away after her handshake with Siniakova – a reference to previous stories about the Chinese player’s cold demeanour.

Zheng failed to learn her lesson from the quarter-final defeat to Aryna Sabalenka last month, with a poor first serve among the key reasons for Tuesday’s loss.

In the opening set, Zheng’s first serve landed just 47 per cent of the time. In the second, it improved to 69 per cent, compared to Siniakova’s 59. But in the final set, it dropped again to 50 per cent.

Siniakova is the world’s top-ranked women’s doubles player and has won 10 grand slam titles – including three at Wimbledon.

Some people noted that although Zheng has a strong serve, her conversion rate remains low.

“She’s just got one element, a great serve, but the conversion rate is just too low,” one person said.

Despite a number of popular comments expressing dismay with Zheng’s performance, there were some who jumped to her defence.

“So this Olympic champion is not worthy of praise? Not worthy of fan support?” one comment said.

“She’s still been a top-10 player for the last two years,” another said.

After the match, Zheng took responsibility for the defeat – echoing her sentiments after falling to Sabalenka at Roland Garros.

“I believe that my personal performance was the primary factor at play,” Zheng said. “I had previously lost to her in Berlin [in June 2024]. I distinctly recall that match, and I didn’t really have much desire to win at that time.

“Today I was determined to win the match … but my performance was not at its best, and I failed to seize the opportunities that I should have.”

China graduate honours dad at ceremony by dressing him in academic gown, touches hearts

https://www.scmp.com/news/people-culture/trending-china/article/3315900/china-graduate-honours-dad-ceremony-dressing-him-academic-gown-touches-hearts?utm_source=rss_feed

A man in China has honoured his education-starved farmer father at his university graduation ceremony, moving the hearts of millions of mainland internet users.

Yang Guozhong, 25, graduated from Guizhou Minzu University in Guiyang of Guizhou province, southwestern China, with a bachelor’s degree in June, Jiupai News reported.

His father had hardly travelled before due to the cost and because he needed to attend to his crops and livestock.

To convince his father to attend, Yang told him that his signature was needed to ensure he received the graduation certificate.

On June 17, Yang rented a car and drove back to his home in a village in the southwestern part of Guizhou province, about 300 km from Guiyang, to pick up his 70-year-old father.

The considerate son drove slowly because his father suffers from car sickness.

Wearing an academic gown and cap arranged by his son, Yang was the only parent at the commencement ceremony the next day.

His son, who initially stayed with his classmates at the behest of his teacher, sat beside his father after getting the teacher’s permission.

After receiving the graduation certificate from one of the university’s top academics, Yang gave it to his dad, saying: “Father, this honour belongs to you.”

A video posted on social media also shows Yang Junior giving his father an eye-opening tour around the city of Guiyang.

“My father was amazed at the tall buildings,” Yang junior was quoted as saying. He added that it was the first time his father had stayed in a hotel.

The son paid for everything on the trip after he managed to earn 5,000 yuan (US$700) by delivering food in his spare time over the past few months.

He wanted to take his father to Beijing after the graduation, but he had to drop the plan due to a shortage of money.

In September, Yang junior will go to southeastern Jiangxi province to work.

He said he was surprised that his video had been watched by so many people online.

“Many young people dislike and avoid communicating with old people. I think our society needs more positive energy. We should care about the elderly members of our family and should feel grateful,” he said.

During their trip, his mother looked after their livestock back home.

Yang, who has five elder sisters, said his father is always good-tempered and never scolds or beats him.

“My eldest sister financially supports my education and my father gives me a warm home,” said Yang.

China’s war lessons after India-Pakistan conflict prioritise integrated systems

https://www.scmp.com/news/china/military/article/3316623/chinas-war-lessons-after-india-pakistan-conflict-prioritise-integrated-systems?utm_source=rss_feed

Systemic warfare and surprise attacks will be key to winning future wars, according to a Study Times commentary published this week that appeared to be based on lessons drawn from the India-Pakistan conflict of early May.

“Recent real-world combat experience from regional conflicts has profoundly revealed the core logic of modern warfare: the contest of individual weapon performance has been replaced by systemic operations,” it said.

While the article – which appeared on Monday in the Central Party School-affiliated newspaper – did not explicitly refer to the conflict, it contained descriptions that closely mirrored what is reported to have occurred on the battlefield.

According to the commentary, a seemingly weaker force leveraged an imported combat system – “combining data links, early warning aircraft, air defence systems, and coordinated fighter jets” – to overwhelm its opponent’s mishmash of weapons from different countries.

During the four-day skirmish, which began on May 7, Pakistan deployed a combination of Chinese-made weapons against Indian forces equipped with arms from Russia and several Western countries.

One of the conflict’s most notable developments was the combat debut of China’s 4.5-generation J-10C fighter jets, which Pakistan claimed were used to shoot down five Indian fighters, including three French-made Rafales.

Islamabad also reported that JF-17 fighter jets – co-developed with Chinese defence contractors – and China’s PL-15E air-to-air missile, which has a range of 145km (90 miles), played a role in its skirmish with India.

Other Chinese systems in Pakistan’s armoury include the ZDK-03 Karakoram Eagle airborne early warning and control aircraft and the HQ-9 air defence system, although there has been no official confirmation by Pakistan that these were deployed in combat.

India has acknowledged that it suffered an unspecified number of fighter jet losses and said that it destroyed one of Pakistan’s HQ-9P systems. Both New Delhi and Islamabad separately claimed victory.

The Study Times article offered a rare glimpse into Beijing’s perspective on the fighting, as China has refrained from commenting publicly on the reported debut of its weapons in the combat between its nuclear-armed neighbours.

The confrontation was a significant opportunity to assess the capabilities of Chinese weapon systems, especially since China has not fought a war since the late 1970s. There are also long-term implications for Beijing’s ambitions in the Western-dominated global arms market.

The article’s appearance suggests that China is not only closely observing its weapons’ performance but also the evolving combat tactics emerging from regional conflicts to inform its own warfare preparations.

The commentary stressed the importance of maximising key strengths – a concept it described as the “long board effect” – by enhancing core capabilities to make one’s strongest advantages even stronger.

These strengths “can often produce decisive or even game-changing effects during certain phases or types of operations,” it said.

The article also noted the critical role played by “surprise strikes” in achieving unexpected victories through “silent and unpredictable” actions. These could not rely on a single weapon or unit, but rather on the tight integration of systems, it said.

“From the moment an enemy aircraft takes off, our early warning aircraft must immediately detect it, guiding air-to-air and surface-to-air missiles to strike before the pilot even realises the danger.”

The commentary argued that traditional physical surprise attacks were becoming less effective. In their place were multi-domain coordinated operations spanning the physical, informational, cognitive and social domains.

These involve a combination of electronic deception, cyberattacks, cognitive interference, and cross-domain strikes – all aimed at creating confusion and misjudgment for the enemy, it said.

The article emphasised the strategic value of striking key nodes in an adversary’s operational system – including command centres, early warning systems, communication hubs and network infrastructure.

China student’s Labubu at graduation sparks debate after vice-president pinches toy’s tassel

https://www.scmp.com/news/people-culture/trending-china/article/3315771/china-students-labubu-graduation-sparks-debate-after-vice-president-pinches-toys-tassel?utm_source=rss_feed

A student at China’s prestigious Tsinghua University took her Labubu toy to her graduation ceremony, placing the school’s vice-president in an awkward position.

However, the game-for-a-laugh university head joined in the fun and pinched the tassel of the toy, allowing it to earn the nickname “the Labubu with the highest education degree”.

A video of the episode at the university’s commencement ceremony in June has become an online sensation, thanks to the huge popularity of this plush doll in China and around the world, Chao News reported.

The woman who graduated in engineering released the clip on two leading social media platforms on June 22.

She said she bought a baccalaureate gown for her Labubu and took it on stage, asking the vice-president if he could pull the doll’s tassel.

“The vice-president seemed at a loss of what to do for a second. But he still pinched the tassel for my Labubu,” said the graduate who has been identified with the alias @xiaojinguailiyang.

“When we took the picture together, he asked me if it was the recently-popular Labubu?” she said.

“I saw someone take Chiikawa to a graduation ceremony. I thought it was so adorable. So I arranged for my Labubu to go with me,” said the graduate.

Chiikawa is a popular cartoon character.

Many internet users jokingly asked whether the Labubu had studied before receiving the diploma.

“I studied hard on her behalf. I believe it is not too much for her to receive a degree after accompanying me to study for such a long time,” the student replied.

Another Tsinghua student also took her Labubu, which is bigger than the first graduate’s, to undergo the tassel-turning ritual on the stage, according to another viral video clip. This student graduated with a master’s degree.

Internet users were divided over the presence of the toy at Tsinghua’s commencement ceremony.

“What a lovely scene! It is good that current kids are not so boring,” one person said.

“The vice-president might be saying to the Labubu ‘show me your graduation thesis first’, ha,” said another.

But another person said: “When Labubu enters Tsinghua, does Tsinghua still have the academic authority? This small toy is polluting the halls of academia.”

The toy, which has pointed ears, a mischievous smile and nine sharp teeth, is produced by the Chinese company Pop Mart.

It shot to fame last year after Lisa, from the South Korean band Blackpink, shared her collection of the dolls online.

A Labubu sells for 99 yuan (US$14) on the company’s website, but it can fetch thousands of yuan on the second-hand market.

In early June, a minty Labubu, which was among the first batch of the toys to be produced, was auctioned for 1.08 million yuan (US$150,000).

Besides Blackpink’s Lisa, Chinese and foreign celebrities, like Liu Yifei, Lu Han, Rihanna and Sir David Beckham, have also boasted about owning Labubus.

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How US under Trump 2.0 plans to combat China’s military strength

https://www.scmp.com/news/china/military/series/3316576/how-us-under-trump-20-plans-combat-chinas-military-strength?utm_source=rss_feed

The EU-China reset that never was: summits begin but divisions remain

https://www.scmp.com/news/china/diplomacy/article/3316596/eu-china-reset-never-was-summits-begin-divisions-remain?utm_source=rss_feed

For six months, Europe has debated how Washington’s shake-up of the Western order might reshape its relations with China. As a weeks-long flurry of summits gets under way, Brussels finally has its answer: not at all.

Flirtations between the two sides about patching things up in the early days of US President Donald Trump’s return have gone nowhere. European Union officials, laying the ground for the month ahead, say a much-vaunted Chinese charm offensive was threadbare.

Instead of a grand rapprochement, the EU finds itself back where it was at the end of last year: fighting with Beijing over trade and pleading for it to do more to rein in Russia’s aggression against Ukraine. For weary Europe, it’s as if the first half of 2025 was a fever dream from which it is finally coming around.

“I don’t think that the relationship has fundamentally moved. I think the Chinese have a tendency to want to portray this as a very problem-free relationship,” said a senior EU official, speaking on condition of anonymity.

“That’s because if they don’t change on the economic imbalances, and they don’t change on their embrace of Russia, it might be to their advantage, but it’s not to ours, and our job is to try to get some balance in this relationship.”

For much of the year, July has hung over the EU like Damocles’ sword. Sandwiched between big-ticket engagements with China, Brussels must reach a deal with the United States before July 9 or face a 50 per cent import tariff. Now that it’s here, policymakers and negotiators are girding themselves for some difficult conversations.

On Wednesday, before heading to meet counterparts in Paris and Berlin, Chinese Foreign Minister Wang Yi will meet European Council President Antonio Costa. That will be followed by a four-hour “strategic dialogue” with EU foreign policy chief Kaja Kallas, where they will discuss everything from Ukraine and Iran to Myanmar and Taiwan over dinner in the Belgian capital.

The aim is to lay the groundwork for a leaders’ summit on July 24 and 25, when Costa, Kallas and European Commission President Ursula von der Leyen will travel to Beijing and Hefei, in the central province of Anhui, for talks with Chinese President Xi Jinping and Premier Li Qiang.

The main summit is likely to be dominated by trade – namely China’s restrictions on rare earth exports, which have threatened to bring some quarters of European industry to a standstill.

Before that, Kallas is faced with the unenviable task of making progress on geopolitical issues, on which there appears little ground to gain. Her top priority will be achieving something every senior EU figure dealing with China has tried and failed to do for more than three years: get Beijing to distance itself from Russia.

“We know what will be the first, second, third, fourth, fifth, sixth, things on her agenda,” said Nathalie Tocci, an Italian political scientist who advised two of Kallas’ predecessors, referring to the Estonian’s reputation as a Russia hawk.

“Wang is a smooth operator though, he is very difficult to grapple with. So I’m not sure that a strategy aimed at one single line of attack is going to get very far.”

Kallas’ second meeting with Wang will be more substantive than the first – a short chat on the margins of the Munich Security Conference in February. But she could be forgiven for thinking the first meeting was longer than six months ago, given all that has happened since.

They met on the day the transatlantic relationship came apart at the seams, and Europe has been on a rollercoaster ride with both superpowers ever since.

“The threat I worry the most about vis-a-vis Europe is not Russia. It’s not China, it’s not any other external actor. And what I worry about is the threat from within,” said US Vice-President J.D. Vance, in a Munich speech that sent shock waves through the West.

US officials in the Bavarian city dismissed the idea that European nations would be present in peace talks to end the war in Ukraine, further dismaying the bloc, which has footed a sizeable portion of Kyiv’s defence budget.

Over several weeks, meanwhile, EU leaders made clear that they were open to offers from China on ways to improve their ailing ties. The veteran Wang was on the ground to capitalise.

In a whirlwind of in-person diplomacy in Munich he met a series of European leaders and envoys. On each occasion, he pitched China as a partner to Europe and a friend of the existing order.

He also insisted that Europe and Ukraine must have a seat at the negotiating table. It was a low-cost gambit, given that China ultimately has little say in the matter, but one which resonated given American hostility that weekend.

The roadshow continued after Munich, with two of Wang’s deputies visiting Brussels, Berlin and Paris to suss out Europe’s receptiveness to a detente with Beijing, prompting many to speculate that Trump would thrust the sides together, much as he did in 2017.

The Europeans kept waiting for the big offer to come – something on trade, perhaps – but it never did. China lifted some sanctions on EU lawmakers, but put European industry in jeopardy with export restrictions on rare earth elements, an issue that has superseded all other trade complaints and added a new wrinkle to the relationship

Brussels’ soft words for China have faded – along with major hopes of things improving this month.

“It’s not the case that just because we have this tariff discussion with the US, things are easier for us with the Chinese,” the EU official said, pointing to gaping trade imbalances that widened further in the meantime.

“It actually puts us in a more difficult spot with China to be under this pressure. So the urgency of China addressing some of these concerns is greater now than it was before.”

Nor have things improved on the Russia front.

“China likes to portray itself as the guardian of multilateralism and international law. It’s on them to explain how come they have not condemned such a blatant violation as a UN Security Council permanent member,” the official added.

In recent weeks, discussion in Brussels has shifted from whether China will flesh out its European charm offensive to why its offering to Europe has been so meagre.

Officials believe Beijing is playing a “waiting game”, observing how China’s and the EU’s talks with the US progress before making any offers.

“My guess is that the Chinese would hold their cards close to that chest until the last minute, in part because of the chronology – Donald Trump gets to shoot first next week,” said François Godement, a special adviser on China at the Institut Montaigne, a French think tank.

Janka Oertel, head of the Asia programme at the European Council on Foreign Relations, thinks Beijing perceives Europe as weak and “believes that it will never be united enough to come up with a tough response”.

“If you are weak, you will be taken advantage of – that is the historic lesson the Communist Party has learned and internalised,” she said, adding that Europe “theoretically” had leverage, given its huge trade with China.

“Theoretically, because if you aren’t willing to use it, it ain’t leverage.”

Tocci, now director of the Rome-based Istituto Affari Internazionali, agreed that Europe’s unwillingness to punch back at either the US or China had made it look weak in the eyes of both.

“If you are China and you look at Europe, you only offer something if you actually think it’s not going to fall in your lap anyway,” Tocci said.

“I guess how they would look at us is, look at these Europeans, they’re being screwed by the US. They’re facing war from Russia. They’re divided. They have these far right forces from within, war going on next door in the Middle East. They’re going to need us. So why do we have to go out of our way and offer something when sooner or later they’ll fall in our lap?”

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China mostly unscathed by turbulent 6 months, but 2025 still an uphill climb

https://www.scmp.com/economy/china-economy/article/3316531/china-mostly-unscathed-turbulent-six-months-2025-still-uphill-climb?utm_source=rss_feed

While China’s economy has shown considerable resilience through a turbulent first half of 2025 – navigating the dramatic twists and turns of US trade policy while maintaining steady growth - experts warn Beijing’s challenges are far from over.

Although many believe the country can still hit its annual goal of “around 5 per cent” for gross domestic product growth, more pressure points are expected to emerge in the latter half of the year.

After the bilateral trade war saw a temporary de-escalation following separate rounds of talks in Geneva and London, ratings agency Fitch raised its full-year forecast for China’s economy from 3.9 per cent to 4.2 per cent, even without the details of the framework to which the two countries had agreed. Other institutions remain more cautious, with Barclays holding to its below-consensus projection of 4 per cent.

While forecasts vary, financial institutions broadly agree on the challenges ahead - a downturn in exports, persistent sluggishness in the property sector, weak domestic demand and inefficiencies in the labour market.

Although the decline in China’s shipments to the US has been partially offset by heightened trade with a more diversified set of partners, Barclays forecast that export growth will slow to zero in the second half of the year, owing to a payback effect from a front-loading of orders in the first half and a projected slowdown in US consumer spending.

China Galaxy Securities was less optimistic, predicting that exports in the next six months will contract, with an ultimate annual growth rate of around 1.5 per cent.

The world’s second-largest economy saw its exports rise by 6 per cent year-on-year in the first five months of 2025, outpacing last year’s 2.7 per cent growth. However, according to customs data, exports to the US fell by 9.4 per cent, despite a wave of orders following the 90-day tariff truce agreed to in Geneva.

In the same period, China’s shipments to the European Union and Southeast Asia jumped by 6.8 per cent and 12.1 per cent respectively.

Even if China and the US were to eventually reach a more permanent agreement, a resolution is unlikely to come soon due to the sheer number of issues at stake, said Goldman Sachs in a research note. The investment bank predicted the current US effective tariff rate on China – around 39 per cent – will remain in place for the rest of the year.

The ailing property sector, which may have yet to reach its bottom, remains a significant concern for the second half of the year. Recent trends, including two straight years of decline in new home prices, suggest the sector could continue its slide.

In May, new and second-hand house prices across 70 cities contracted at their fastest monthly rate in seven and eight months, respectively. Meanwhile, real estate investment plunged 10.7 per cent in the first five months of 2025.

“Stabilising housing prices remains a very important goal. Property represents 60-70 per cent of China’s household balance sheets. As long as this does not turn around, it’s difficult to expect a substantive and sustainable recovery in sentiment,” said Lynn Song, chief Greater China economist at ING, in a note.

China’s consumption has surpassed expectations this year, thanks in part to a governmental trade-in programme which has spurred retail growth over the past three quarters.

However, without additional funding for the programme, retail sales growth may level off in the second half of the year as subsidies run out, according to a note from Gavekal Dragonomics.

Consumption is also being weighed down by a lacklustre labour market, which the CGS report described as a “core concern” for the remainder of the year.

In addition to the negative effects of the trade war, the job market must also contend with a record number of new graduates – more than 12.2 million – entering the workforce.

Despite these difficulties, stimulus measures are not expected to materialise until the third quarter, which Goldman Sachs has described as an “eventful window” for China.

During this period, several critical developments are set to unfold – including the end of the 90-day window for the China-US tariff truce and the July meeting of the Communist Party’s Politburo, a major decision-making body.

Analyst outlooks suggest new policy measures may be rolled out late in the third quarter - even sooner, they said, if the uneasy peace in trade breaks down or if the export or property sectors take an unexpected nosedive.

President Xi Jinping reiterated the need for China to develop a “unified national market” at the sixth meeting of the Central Financial and Economic Affairs Commission on Tuesday, explicitly recommending a crackdown on the cutthroat competition between firms that has lowered prices, a phasing out of obsolete industrial capacity and an improvement of the business environment.

“Building a unified national market is a requirement for high-quality development, and the country should strengthen coordination and cooperation to form a concerted effort,” Xi was quoted as saying by state news agency Xinhua.