• How easing of AI chip controls could reshape US-China trade talks
• China joins US in hunt for ripples in spacetime with new telescope in Tibet
• US, China ‘creeping’ towards deal; brain drain a ‘loss’ for America: SCMP daily highlights
• ‘Actionable results’, new ideas needed to boost China’s consumption, No 4 official says
• Chinese state newspaper strikes rare friendly tone towards internet giants
• China looks to Africa as testing ground for global roll-out of yuan
• US to build Philippines boat hub for South China Sea edge, ‘low-footprint’ deterrence
• China’s visa-free boom picks up steam as entries soar in first half of 2025
• China family holds funeral as Indian neighbours host wedding in joint act of communal harmony
• Free trade ‘essential’: China’s He Lifeng warns Western reshoring threatens supply chains
• Huawei returns to the top of China’s mobile phone charts for first time in 4 years: IDC
• Chinese Foreign Minister Wang Yi urges SCO to work for more ‘equal and orderly’ world
• China reveals superfast maglev, Viagra’s cancer-fighting potential: 7 science highlights
• Ex-top China student gets low exam score, kicked out by parents who change door code
• Chinese county admits plagiarism after web users flag data filed by another 400km away
• Airbus signs fresh deal with Chinese partner amid talk of massive China order
• China and Europe power 24% growth in global EV sales in June
• US and China are ‘creeping’ towards a trade deal, former ambassador Nicholas Burns says
• Former top Shell engineer Jing Xudong leaves Britain to chase ‘cleaner’ oil tech in China
• How Indonesia can maximise benefits from Chinese investments
• Chinese brain drain a great loss for US, Nvidia CEO Jensen Huang says
• China’s Xi Jinping makes case for free trade as supply chain expo opens
• China university expels girl for casual sex with Ukrainian man that ‘hurts national dignity’
• China’s local governments urged to use legislation ‘propeller’ to power economy
• Chinese toymaker Pop Mart says first-half revenue to rise by 200% from a year earlier
• The Taiwan papers: academics suggest how mainland China might rule the island
• The EU is doing itself no trade favours in pushing China on Russia
• US-China spy wars intensify under Trump 2.0 as tech competition heats up
• Trump claims trade deal struck with Indonesia; Bessent says China deal timeline ‘flexible’
• In Latin America poll, China grows in appeal though US remains preferred economic ally
• China lifts its sanctions on retired EU lawmaker Reinhard Buetikofer
• Double-edged sword: US probe into China’s drone dominance is a risk, analysts say
• Trump’s trade policies drive Hong Kong industry’s ‘China plus N’ shift
• Is US pushing its Asian allies to do more to counter China?
• Alibaba to roll out ‘Super Saturdays’ event as China’s on-demand delivery market heats up
• China’s strong GDP figures, delivery robots riding Shenzhen subway: SCMP daily highlights
• Chinese humanoid robot maker Unitree sees significant delivery growth in 2025
• Chinese scientists thank Nasa for sharing data critical to deep-sea mining in Indian Ocean
• China’s dated urban-development model must change, Beijing says at rare meeting
• Manus AI lays off China staff, scrubs social media, shelves mainland service
• What if Chinese, US firms make humanoid robots together? Tech CEO calls for collaboration
• Xi Jinping hails ‘turnaround’ in China-Australia relations as PM Albanese visits Beijing
• Chinese province quintuples marriage leave to give betrothals a boost
• China rolls out ‘voluntary’ cyber ID system amid concerns over privacy, censorship
• China Merchants Bank’s brokerage arm receives virtual asset licence in Hong Kong
• In China, delivery robots now ride the subway to restock 7-Eleven stores
• Driver in China criticised for turning car bonnet into ‘fish tank’
• China charts course to boost legal arsenal against foreign sanctions, interference
• Chinese firms’ Hong Kong stocks trade at smallest discount to onshore shares in 5 years
• Why millions in China are still quitting the national health insurance scheme
• China on track to issue record amount of exchange-traded funds in 2025 amid booming demand
• ‘China’s Ozempic’ pioneer inks deal with JD Health for online distribution
• China woman, left school at 15 to support her family, gets 7 million fans selling produce online
• EU chief for Asia-Pacific set to leave role after China summit, sources say
• China’s June new-home prices fall by the most in 8 months as weak sentiment grips market
• China’s Tianlong-3 rocket passes critical stress test a year after explosive mishap
• Viral knife attack on Chinese student shocks Malaysia
• Tech war: Nvidia says it will resume sales of H20 graphic processing chips to China
• Can a superalloy technique fix China’s aircraft engine woes, even for sixth-gen fighters?
• China’s drug prowess on show at global event, drawing industry ‘shoppers’: Jefferies
• The talent gambit: how the US’ brain drain is China’s brain gain

How easing of AI chip controls could reshape US-China trade talks

https://www.scmp.com/economy/china-economy/article/3318471/how-easing-ai-chip-controls-could-reshape-us-china-trade-talks?utm_source=rss_feed

The United States’ decision to ease export restrictions on certain advanced chips – part of a broader package of trade agreements with China – is seen by experts as an early sign that high-level negotiations have steered bilateral relations in the right direction.

Washington’s move to resume license application reviews for Nvidia’s H20 AI and Advanced Micro Devices’s MI308 AI chips comes ahead of talks between senior officials from both nations in the coming weeks, despite a protracted strategic stand-off over tech and export controls.

Zhuang Bo, global macro strategist at Loomis Sayles Investment Asia, said the development was a clear win for China – effectively resetting the clock to March, before rare earths became a geopolitical chokepoint.

“It signals that Beijing is inching closer to the G2-style negotiations it has long sought, framed in official rhetoric as a call for ‘mutual respect and equality.’”

While the reality on the ground has not changed much, the situation has not deteriorated, he added. “Whether there will be a Xi-Trump summit later this year will be crucial. If that happens, a partial agreement is still possible.”

On Tuesday, AMD said the US Department of Commerce was reviewing its licence applications to export MI308 chips to China, and that sales would resume once approved.

Nvidia also hopes to resume deliveries of its made-for-China H20 GPUs soon. “The US government has assured NVIDIA that licences will be granted,” the company said in a statement on Monday.

In an interview with Bloomberg on Tuesday, US Secretary of the Treasury Scott Bessent said the move was “part of a mosaic” of trade agreements that came out of the separate rounds of high-level talks in Geneva and London, where it served as a “negotiating chip”.

“They had things we wanted. We had things they wanted… We are in a very good place… and I tell market participants not to worry about August 12 [the tariff deadline with China],” Bessent said.

Exports of rare earths – a group of critical minerals widely used in electric vehicles, aerospace and advanced electronics – have become a flashpoint in the intensifying US-China trade rivalry in recent months.

Beijing tightened controls on shipments in April, a move widely seen as a countermeasure to US restrictions on advanced semiconductor exports and rising tariffs.

Bessent previously confirmed that China had resumed rare earth magnet exports to the US, although volumes have not yet returned to pre-April levels. He said Nvidia’s H20 could be exported so long as Chinese manufacturers were producing equivalent chips.

US Commerce Secretary Howard Lutnick told CNBC the resumption of chip sales is linked to the rare earth deal. Washington approved the exports because Nvidia’s H20 chips are “not our second-best stuff, not even our third-best” but only the fourth, he said.

“You want to sell the Chinese enough that their developers get addicted to the American technology stack,” Lutnick said. “That’s the thinking.”

Bessent said the focus must now shift to China “opening its markets” and increasing “domestic and consumer production there”.

“The one thing that we do not want is a digital belt and road springing up around the world because other countries or China are substituting for our American chip manufacturers,” he said, adding that he expects to meet China’s vice-premier in a third country in the coming weeks.

Easing H20 export controls is a positive step for both China and the US, and carries even greater strategic significance for Beijing, said Cui Fan, a professor of international trade at the University of International Business and Economics, on his public social media account.

“The US has long followed what I call a policy of marginal control: once China develops products or technologies with similar capabilities, Washington tends to relax restrictions to squeeze the market share of Chinese competitors,” he said.

While China’s domestic AI chips are advancing rapidly, he said, domestic production still struggles to meet demand, particularly in terms of capacity and general-purpose performance.

“The AI sector is evolving at breakneck speed, and the relaxation of H20 controls gives us far more room to coordinate both domestic and international resources and foster greater synergy across the supply chain,” Cui said.

“At the same time, easing restrictions also aligns with the development interests of the US chip industry.”

“Just as the Geneva talks on tariffs marked the beginning of a strategic stalemate in US-China tariffs negotiations, the London discussions may signal a similar phase on export controls,” he added.

Morgan Stanley said in a report published on Tuesday that the H20 decision, along with media reports suggesting US President Donald Trump is considering a visit to China, could be early signs that bilateral relations are moving in a more positive direction.

However, the investment bank cautioned that macroeconomic weaknesses in China persist, including deflationary pressures and a housing slump, while further clarity is needed from coming Politburo meetings and economic data releases.

Additional reporting by Ji Siqi

China joins US in hunt for ripples in spacetime with new telescope in Tibet

https://www.scmp.com/news/china/science/article/3318387/china-joins-us-hunt-ripples-spacetime-new-telescope-tibet?utm_source=rss_feed

High on the Tibetan Plateau, China has completed a cutting-edge telescope designed to detect ripples in spacetime from the dawn of the universe with the help of the United States – strengthening a global effort to probe how everything began.

The Ali Cosmic Microwave Background Polarisation Telescope (AliCPT), perched at 5,250 metres (17,220 ft) in Tibet’s remote Ali prefecture, was finished this month after eight years of construction involving 16 institutions worldwide, including Stanford University, according to state broadcaster CCTV.

Led by the Institute of High Energy Physics (IHEP) in Beijing, the project is one of the few surviving examples of China-US collaboration in basic science at a time when geopolitical tensions have sharply curtailed joint research.

Among the project’s international partners, Stanford University played a key role in building and testing the telescope’s detectors and readout systems, ensuring the “brains” of the instrument could operate reliably in freezing conditions before being shipped to Tibet, according to a 2020 paper in Proceedings of SPIE.

The US National Institute of Standards and Technology (NIST) could also contribute to the project.

“NIST is leading many aspects of camera development, including the design, fabrication and characterisation of superconducting detector arrays and electronics,” the US federal agency said on its website.

The US leads the other two major observatories in this field, located at the South Pole and in Chile’s Atacama Desert.

“With the completion of AliCPT, we now have three major observation sites around the world – and Ali is the only one in the Northern Hemisphere,” said lead scientist Zhang Xinmin of IHEP in an interview with CCTV on Sunday.

Zhang said the project was also expected to drive advances in domestic technologies such as superconducting detectors and cryogenic electronics, which are critical for detecting the universe’s faintest whispers.

Scientists believe that in the first instant after the Big Bang, the universe underwent a burst of rapid expansion called cosmic inflation. That process would have sent gravitational waves rippling through spacetime which are so faint and stretched over time that they have never been directly observed.

Unlike the gravitational waves first detected by the Laser Interferometer Gravitational-Wave Observatory in 2015, which are caused by events like black hole mergers, these primordial waves are thought to have left their imprint on the cosmic microwave background, a faint afterglow from the Big Bang.

As they passed through the early universe, the waves would have subtly twisted the orientation of this ancient light, leaving behind a swirling signature known as B-mode polarisation. Telescopes like AliCPT are designed to detect that polarisation pattern with extreme sensitivity.

But such signals are easily disrupted by water vapour in the atmosphere, so these experiments must be done in the clearest, driest places on Earth. That leaves just a handful of suitable locations – Antarctica, the Atacama Desert, Greenland and the Tibetan Plateau.

Construction of AliCPT began in December 2016 on a peak in the Gangdise Mountains of western Tibet, where the air is thin and dry, thanks in part to the Himalayas blocking moist air from the Indian Ocean.

The telescope uses a 70cm lens to collect microwaves from the sky at 95 and 150 gigahertz – frequencies where signals from the early universe are thought to be most detectable.

Inside, nearly 7,000 ultra-sensitive detectors are cooled to near absolute zero to catch minute temperature fluctuations from ancient radiation. Their signals are then read by superconducting electronics known as SQUIDs.

Once fully operational, AliCPT will scan the entire northern sky and part of the southern sky, complement southern-hemisphere observatories and help to complete the global sky map in the search for primordial gravitational waves.

So far, Zhang’s team has tested the telescope’s remote control and data transmission from Ali to Beijing. It also captured clear images of the moon and Jupiter at 150 gigahertz, marking a successful first demonstration of its observing power.

Zhang said the next step would be to begin scientific observations and upgrade the system by adding more detector modules. A second-phase telescope could also be built at an even higher site, around 6,000 metres above sea level.

“With the Ali project, China’s search for primordial gravitational waves is stepping onto the international stage,” he said.

US, China ‘creeping’ towards deal; brain drain a ‘loss’ for America: SCMP daily highlights

https://www.scmp.com/news/china/article/3318464/us-china-creeping-towards-deal-brain-drain-loss-america-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 .

Washington and Beijing are on a “creeping path towards some kind of a deal”, former US ambassador to China Nicholas Burns said on Tuesday, while offering some rare support for US President Donald Trump’s tariff strategy towards China.

Chinese Foreign Minister Wang Yi has urged the Shanghai Cooperation Organisation to push for an “equal and orderly multipolar world” and reform of the global governance system.

China’s expanded efforts to encourage visitors continued to pay off in the first half of 2025, with the number of visa-free foreign entries rising by more than half compared to the same period a year earlier.

Airbus has signed a new cooperation deal with its Chinese partner that will see the company localise more production of its A321 jet in China, with the announcement coming just a week ahead of a key China-Europe leaders’ summit.

It is a “great loss” for the United States that many Chinese academics and researchers have left the country and chosen to return to China amid worsening bilateral relations, said Jensen Huang, co-founder and CEO of chipmaker Nvidia.

A leading engineer, who spent 20 years working for the global oil giant Shell, has left Britain to take up a position at a Chinese university to lead a team working with the petroleum industry on low-carbon technology.

A survey of academic papers points to a noticeable increase since 2019 in consideration of a “one country, two systems” framework for the island.

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‘Actionable results’, new ideas needed to boost China’s consumption, No 4 official says

https://www.scmp.com/economy/china-economy/article/3318450/actionable-results-new-ideas-needed-boost-chinas-consumption-no-4-official-says?utm_source=rss_feed

The Communist Party’s chief theoretician has urged groups outside the party – including China’s eight minor political parties, industry and commerce representatives, and public figures without party affiliation – to contribute to the discussion on how to boost domestic demand, as Beijing steps up efforts to entice the public to spend more.

Improving domestic demand is a strategic priority and a necessary step towards ensuring the long-term and healthy development of China’s economy, said Wang Huning, head of the Chinese People’s Political Consultative Conference and China’s No 4 official, at a meeting of the political advisory body on Wednesday that was specifically dedicated to boosting demand.

“Efforts should focus on key issues related to expanding domestic demand, delivering more in-depth, detailed and practical research outcomes, and ensuring that these findings are effectively translated into actionable results,” he said.

Wang also called for improvements in the quality of field research and the overall standard of policy proposals and political consultation, according to a statement published by party mouthpiece Xinhua after the meeting.

The fresh comments make Wang the latest high-ranking Chinese official to join the chorus championing the need to expand domestic demand, led by President Xi Jinping.

Wang’s remarks came just a couple of weeks before a meeting of China’s cabinet, the 24-member Politburo, scheduled for the end of the month, and with analysts expecting further demand-side stimulus policies as China struggles to lift domestic consumption.

Retail sales, a gauge of consumption, rose in June by 4.8 per cent, year on year, according to data released by the National Bureau of Statistics on Tuesday. The pace marked a slowdown from 6.4 per cent in May and fell short of market expectations.

The effects of new austerity measures introduced in May for government officials were also reflected in the latest data. Growth in retail sales of catering services fell from 5.9 per cent in May, year on year, to 0.9 per cent in June, while tobacco and liquor sales growth crashed from 11.2 per cent in May to -0.7 per cent in June.

The 0.9 per cent growth for catering services was the lowest since the end of the zero-Covid policies at the end of 2022, according to a Nomura note on Tuesday.

“To effectively cope with the mounting challenges, we believe Beijing needs to take bolder actions to clean up the mess in the property sector, support consumption in a more sustainable way by reforming the pension system, fix the fiscal system to better protect business owners, and improve its relationships with other economies,” economists led by Lu Ting said in the note.

To boost domestic consumption over the long term, the Chinese government needs to introduce bolder reforms, rather than relying on stimulus measures, according to analysts such as Xu Tianchen, senior China economist at The Economist Intelligence Unit.

“Consumer subsidies can support domestic consumption in the short term,” Xu told the Post on Wednesday, “but in the long run, there need to be structural changes – including deregulation and fiscal reforms.”

Chinese state newspaper strikes rare friendly tone towards internet giants

https://www.scmp.com/tech/policy/article/3318466/chinese-state-newspaper-strikes-rare-friendly-tone-towards-internet-giants?utm_source=rss_feed

A leading Chinese state media outlet has expressed support for the nation’s internet platform operators, emphasising their importance alongside hard-tech companies like chip manufacturers, as it adopts a positive tone that reflects Beijing’s friendly stance towards e-commerce companies.

According to the editorial published by the Economic Daily on Wednesday, food delivery and “hard-tech” breakthroughs – such as advances in high-speed trains and aerospace technologies – represented two key aspects of Chinese innovation.

“China needs breakthroughs in ‘stranglehold technologies’ just as much as it needs innovations that improve daily life and boost employment,” the article said. “We need both.”

“Stranglehold technologies” refer to critical technologies or equipment that China needs to import, owing to its inability to produce them locally in sufficient quality or quantity. This category includes lithography machines for advanced chip production, computer operating systems, aircraft engine nacelles, and industrial design software.

The article was published amid intense competition among e-commerce behemoths Alibaba Group Holding, JD.com and Meituan in the food delivery sector, as companies offered massive subsidies to entice users.

Alibaba, owner of the South China Morning Post, reportedly plans to launch a “Super Saturdays” programme over the next 100 days to attract consumers with discounts, intensifying a price war against Meituan and JD.com.

While Chinese authorities typically maintain a cautious stance regarding price competition, the Economic Daily’s piece adopted a more lenient and supportive tone, challenging the prevailing notion among some critics that only stranglehold technologies matter.

This perspective reflected an emerging trend in China amid the escalating tech rivalry with the US and Beijing’s efforts to align its tech champions – including online services giants – with a national agenda that prioritises hard tech.

China relaxed its stringent control over internet platform operators after its strict Covid-19 control measures severely affected the economy. Beijing shifted from cracking down on these firms to enlisting their help in creating jobs and reviving the economy amid high youth unemployment.

The youth unemployment rate – covering those aged 16 to 24 in urban areas, excluding students – stood at 14.9 per cent in May, according to the National Bureau of Statistics.

With full-time jobs in short supply, flexible employment has become sought after. China’s Ministry of Human Resources and Social Security estimated that at the end of 2021, about 200 million individuals were engaged in gig jobs, including meal delivery riders, package couriers, and ride-sharing drivers.

In its article, the Economic Daily praised the food delivery business as uniquely beneficial for China, as it met the demand for on-demand services in densely populated cities while providing a reliable income source.

China looks to Africa as testing ground for global roll-out of yuan

https://www.scmp.com/news/china/diplomacy/article/3318388/china-looks-africa-testing-ground-global-roll-out-yuan?utm_source=rss_feed

China appears to be positioning Africa as a testing ground for internationalisation of the yuan as it seeks to expand the currency’s global use and break the dominance of the US dollar.

During a recent meeting in Cairo, the central banks of China and Egypt signed a series of agreements to promote the use of the yuan in trade and investment. These deals – lauded by People’s Bank of China governor Pan Gongsheng as a key step in advancing economic ties – were signed last week during Chinese Premier Li Qiang’s visit to Egypt.

They will explore a currency swap as well as panda bonds in yuan issued by overseas companies in mainland markets.

The deals also cover cooperation on electronic payments, including expanding China’s UnionPay services and facilitating cross-border business in yuan for banks in the China-Egypt TEDA Suez Economic and Trade Cooperation Zone near the city of Suez. That will be done via local currency settlements made through the Cross-border Interbank Payment System, or CIPS – China’s alternative to the SWIFT international payment network.

Egypt joins a growing list of African nations that have yuan-based deals with China, including South Africa, Nigeria and Angola which are all exploring or implementing the use of the Chinese currency for trade and financial transactions.

For example, Nigeria has a currency swap agreement with China that was renewed in December for 15 billion yuan (US$2 billion), allowing direct exchange between the naira and the yuan that bypasses the US dollar.

According to Lauren Johnston, a senior research fellow at the AustChina Institute and a China-Africa expert, Africa is a continent where trade with China is important, but it is also one where many countries struggle to access sufficient foreign currencies such as the euro or US dollar.

“For China, there may be a chance to test the internationalisation of the RMB via a few countries in Africa first, where volumes might be small on a global scale and China’s footprint in the region relatively large,” Johnston said.

Last week, China Development Bank and the Development Bank of Southern Africa signed a loan deal worth 2.1 billion yuan, their first yuan-denominated financing cooperation agreement. Beyond that, South Africa also has a currency swap agreement with Beijing that was initially signed in 2015 for 30 billion yuan and aims to facilitate bilateral trade and investment.

Johnston said China was in an unusual position as a major world trader and a large economy whose currency does not play a significant role in the global economy. She said there were historical and economic reasons for this, including China’s desire to control its capital account rather than be at the whim of speculators.

“Like any policy shift over recent decades of ‘reform and opening’, any change related to internationalising the RMB will be incremental,” Johnston said. She said such changes were especially complex in the case of the yuan because of “a host of policy variables, such as the exchange rate, the growth rate, the terms of trade and capital account balances”.

In June, South Africa’s Standard Bank became one of the first in Africa to offer CIPS to facilitate direct yuan interbank payments between Africa and China. Standard Bank is the continent’s largest bank and is partly owned by the Industrial and Commercial Bank of China, which holds a 20 per cent stake.

Multilateral financier African Export-Import Bank (Afreximbank), which is headquartered in Cairo, also joined CIPS last month for “faster, cheaper and more autonomous yuan transactions” in China-Africa trade.

According to the lender, China now accounts for 20 per cent of Africa’s global trade, up from just 5 per cent two decades ago.

“While trade in goods has advanced rapidly, the same cannot be said for financial flows, which remain hindered by cross-border frictions, high settlement costs, and complex processes that limit the full potential of this vital economic partnership,” Afreximbank said in early July.

It said CIPS was already being used by more than 4,900 banking institutions across 187 countries and regions.

The new CIPS partnerships represent key progress for China as it seeks to build an alternative to SWIFT outside the legal jurisdiction of the United States and the European Union.

Johnston said geoeconomic tensions around the use of SWIFT and the capacity to freeze savings in foreign currencies – such as Russia’s forex reserves being frozen after it invaded Ukraine – highlighted the interest of some Brics nations to reduce their reliance on such currencies.

“Egypt and South Africa are both members of Brics and important African economies, but not important economies internationally,” Johnston said. “This may make them good cases for testing the gradual international roll-out of the RMB.”

Sub-Saharan Africa geoeconomic analyst Aly-Khan Satchu said yuan-based deals in China-Africa agreements were becoming more popular though they represented “a fraction of the trade figure”.

“This potentially could go to 100 per cent of the trade number,” he said, noting that there was no reason for Africa to use the US dollar for its China trade.

“China is probably keen on proceeding on an incremental basis, but over time this trend is headed in only one direction,” he said, adding that challenging US dollar dominance was still “some ways away”.

US to build Philippines boat hub for South China Sea edge, ‘low-footprint’ deterrence

https://www.scmp.com/week-asia/politics/article/3318432/us-build-philippines-boat-hub-south-china-sea-edge-low-footprint-deterrence?utm_source=rss_feed

A discreet but strategically significant US-funded boat maintenance hub in the western Philippines is poised to strengthen Manila’s maritime presence in the contested South China Sea while avoiding raising the risk of political escalation.

The new facility in Quezon, a coastal town on Palawan Island less than 260km (162 miles) from the flashpoint Second Thomas Shoal, could enable the Philippine Navy to maintain a more persistent and responsive posture amid rising tensions with China, in what analysts say is part of Washington’s broader push for “low-footprint” deterrence in the region.

Designed to service and deploy small Philippine naval craft, the hub’s proximity to disputed waters is seen as an advantage. “That proximity matters operationally – it reduces transit time and enhances the credibility of Manila’s maritime presence,” said Sylwia Monika Gorska, a political analyst and doctoral candidate at the University of Central Lancashire.

The project, first reported by the United States Naval Institute on Monday, is part of a larger shift in US regional strategy that prioritises smaller, dual-use infrastructure over permanent military bases. It will support rigid-hulled inflatable boats and “assault boats” built by Oregon-based Reconcraft, which specialises in vessels used by military and law-enforcement agencies.

The US embassy in Manila confirmed that the initiative would enhance repair capabilities for Philippine vessels at the nearby Naval Detachment Oyster Bay – improving readiness without overtly expanding America’s military footprint.

From Washington’s perspective, the investment supported “partner-led deterrence” by enabling allies to operate more independently, without requiring forward-deployed US assets, Gorska said.

“It fits into a broader pattern: supporting allies through dual-use, low-visibility infrastructure,” she said.

“Compared to legacy bases like Subic, this model avoids the optics of re-basing but still reinforces Manila’s forward posture. Quezon functions as both a tactical enabler and a strategic signal – embedding deterrence within the alliance without placing the US directly on the front line.”

Dr Anita Abbott, chair of the Asia-Pacific Security Innovation Forum in New Zealand, echoed the view that the site would help Manila counter so-called grey-zone tactics by Beijing – such as using civilian or paramilitary vessels to disrupt Philippine patrols and resupply missions.

The hub would also enhance operational resilience, she added, allowing damaged vessels to be rapidly repaired or replaced by support ships stationed nearby.

“It is necessary to remember, however, countering Chinese grey-zone tactics does not mean stopping them. And any Taiwan contingencies will spill over into the South China Sea. Palawan will be a suitable hub for the US and allied forces,” Abbott said.

“When we talk about countering China’s grey zone, it is necessary to remember that a full military response would be risky, costly, and disproportionate. Which means low footprint maritime infrastructure projects would be ideal. The effect is obviously strategic – it is near a flashpoint but still in the territory of the Philippines.”

Tensions have flared at Second Thomas Shoal – known in the Philippines as Ayungin Shoal and in China as Renai Jiao – where Manila maintains an outpost aboard the BRP Sierra Madre, a beached warship routinely resupplied by the Philippine Navy. The Chinese coastguard has previously attempted to block or disrupt these missions, accusing Manila of bringing construction materials to reinforce the grounded vessel.

Although Beijing and Manila reached a provisional agreement in July 2024 to allow unimpeded Philippine resupply missions, confrontations continue at other contested sites such as the Scarborough and Sabina shoals.

The US Naval Facilities Engineering Systems Command formally solicited designs for the Quezon facility on July 7, emphasising that the project “is not a military base” and had been approved by the Philippine government in line with local and US regulations.

Still, analysts see the site as part of Washington’s evolving approach to its military presence in Southeast Asia.

“The approach looks pragmatic: enhancing the capabilities of regional partners while avoiding overstretch or unnecessary provocation,” Arnaud Leveau, assistant professor of geopolitics at Paris Dauphine University, told This Week in Asia.

“It aligns with a broader strategy of maintaining influence and responsiveness through flexible, locally integrated infrastructure.”

According to Leveau, the US recognises the political sensitivities surrounding foreign military bases in the region. By funding dual-use assets like boat ramps, logistics hubs and drone platforms, Washington was offering meaningful support while keeping a low profile, Leveau said.

“This helps avoid the backlash often triggered by more visible, permanent deployments and reinforces alliances in a quieter, but no less strategic, manner,” he said.

According to Gorska, the Quezon hub fits into a layered US posture in the Indo-Pacific, combining enduring bases in Guam and Japan with smaller, partner-operated sites designed for flexibility and rapid response.

The Quezon facility is just the latest in a series of US-supported projects. Last month, Washington proposed an ammunition storage and manufacturing hub in Subic Bay, once the site of a major US naval base. Earlier this year, the US Navy reportedly considered leasing a storage site near Subic to preposition Marine Corps equipment, and in 2023, awarded a US$32 million contract to upgrade the Philippine Air Force’s Basa Air Base under the Enhanced Defence Cooperation Agreement, which grants the US access to select Philippine bases.

The Philippines and the US are bound by the 1951 Mutual Defence Treaty, obliging both nations to come to each other’s aid in the event of external aggression.

Gorska said facilities like the one in Quezon offered strategic value without triggering a domestic political backlash due to their modest scale and civilian-military utility.

“Still, these facilities are not strategically neutral. While formally under Philippine control, they are often designed with US interoperability and contingency timelines in mind,” she said. “Their value lies not in their size, but in how they’re integrated into a broader deterrence architecture – one that can be mobilised quickly.”

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China’s visa-free boom picks up steam as entries soar in first half of 2025

https://www.scmp.com/news/china/article/3318452/chinas-visa-free-boom-picks-steam-entries-soar-first-half-2025?utm_source=rss_feed

China’s expanded efforts to encourage visitors continued to pay off in the first half of 2025, with the number of visa-free foreign entries rising by more than half compared to the same period a year earlier.

Foreign nationals made 38 million trips in and out of the country, a 30 per cent increase year on year, according to the administration.

“Visa facilitation measures have effectively attracted large numbers of foreign visitors for tourism and business, driving sustained growth in inbound consumption,” administration spokeswoman Lu Ning said.

A previous long-standing policy allowed travellers without a Chinese visa to transit through the country visa-free for up to 24 hours if they held valid travel documents with onwards confirmation to a third country, consistent with international practice.

In the 2010s, Chinese cities such as Xiamen and Kunming introduced 72-hour or 144-hour visa-free transit to attract foreign visitors, though travel was restricted within those individual cities.

In late 2023, after three years of tough pandemic restrictions under the zero-Covid policy, China began expanding its visa-free entry policy to lure foreigners in a bid to boost tourism, stimulate a sluggish domestic economy and encourage people-to-people exchanges.

The visa-free transit policy has since been expanded to cover more countries and regions, with travel permitted nationwide.

In December, the administration added 21 ports for visa-free entry and exit, and extended the permitted stays for foreigners from 72 or 144 hours to a uniform 240 hours, or 10 days. The policy now applies to 24 provinces.

During their stays, eligible travellers are allowed to take part in tours, business, exchange visits or family visits, but activities such as employment, study or journalism still require prior approval and appropriate visas.

Lu said China would introduce “more diverse and effective” entry-exit policies alongside residence regulations to make it easier for people visiting from other countries.

With Indonesia included in the scheme as of June, China’s 240-hour transit visa exemption now covers 55 countries, including most European nations along with the United States, Canada and Australia.

Nine more countries – including Brazil, Argentina, Saudi Arabia and Oman – have been granted unilateral visa-free entry to China, meaning the other countries do not necessarily offer Chinese nationals the same treatment.

To date, 47 countries benefit from unilateral visa exemptions, spanning parts of Europe, Oceania, Asia and South America. Eligible passport holders from these nations may enter China for business, tourism or sightseeing for up to 30 days.

In the first half of this year, a total of 333 million cross-border trips were recorded by the Chinese authorities, a 15.8 per cent increase over the same time in 2024.

The journeys included 159 million trips by mainland residents, an increase of 15.9 per cent from the previous year, and 136 million trips by Hong Kong, Macau and Taiwan residents – up 12.2 per cent from the same period last year, according to the immigration administration.

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China family holds funeral as Indian neighbours host wedding in joint act of communal harmony

https://www.scmp.com/news/people-culture/article/3317684/china-family-holds-funeral-indian-neighbours-host-wedding-joint-act-communal-harmony?utm_source=rss_feed

A Chinese funeral and an Indian wedding took place on the same street on the same day in Malaysia, but the two families managed to coexist and show mutual respect, winning applause online.

Both ceremonies took place on July 5 in Tampin, in the Malaysian state of Negeri Sembilan.

The funeral was that of the mother of a local Democratic Action Party politician of Chinese origin.

On the other side of the street, an Indian family rented a hall to host a wedding.

Funerals are usually considered ominous and a jinx on new couples.

Meanwhile, the happy vibes of a wedding are often believed not to be suitable for the solemnity of funerals.

However, the politician, surnamed Wong, was more worried about his neighbour’s big day, the Malaysian news outlet China Press reported.

He contacted the Indian family to comfort them with the fact that his mother died at the age of 94, a number which is considered to bring a “joyful funeral” in Chinese culture.

It is believed that death at an old age while surrounded by your family is a joyful occasion, especially when the elderly person does not suffer too much from illness or pain.

Wong sent a friend to tell the Indian family that his family did not plan to hold any religious ceremonies that evening and that their family could celebrate their wedding normally.

The Indian family did not say much back, but simply smiled.

Then, to the Chinese family’s surprise, the Indian family also turned down the wedding’s music and asked their guests to park their cars a decent distance from the funeral site.

The Chinese family and their friends expressed gratitude to their neighbour.

The two families’ mutual empathy and care moved many people online.

Local media outlet SAYS reported on their interactions, calling them “a display of Malaysian harmony”.

Malaysia is known for its cultural and ethnic diversity.

According to the country’s official data, as of 2024, the official overall population is around 34.1 million.

The country’s three largest ethnic groups, Malays, Chinese and Indians, account for 63 per cent, 20 per cent and six per cent of the population respectively.

“Mutual respect and help. This is what good neighbours are like,” said one online observer.

“This is the true Malaysian spirit,” said another.

“Both families have accepted their events as a part of life,” a third said.

Free trade ‘essential’: China’s He Lifeng warns Western reshoring threatens supply chains

https://www.scmp.com/economy/china-economy/article/3318438/free-trade-essential-chinas-he-lifeng-warns-western-reshoring-threatens-supply-chains?utm_source=rss_feed

China’s top trade negotiator has criticised Western efforts to de-risk and reshore manufacturing, presenting the world’s second-largest economy as a defender of global stability at a high-profile supply chain expo in Beijing.

Vice-Premier He Lifeng called for a global supply chain system that leverages the comparative advantages of all countries, taking into account their different resource endowments and levels of economic development.

“Some countries are currently intervening in the market in the name of de-risking, using measures such as additional tariffs and restrictions to promote so-called ‘manufacturing reshoring’,” He said at the opening ceremony of the third China International Supply Chain Expo on Wednesday.

“The redundant development of industrial and supply chains has reduced the overall efficiency of the global economy.”

“Free trade remains an essential requirement for world economic development... There are no winners in tariff wars or trade wars.”

Tensions persist between the world’s three largest economies – the US, China and the European Union – amid growing uncertainty over the future of global trade.

Despite a slight thaw in US-China relations in recent months – marked by Beijing loosening export controls on rare earths and Washington easing restrictions on semiconductor hardware and technology – Chinese exports to the US still face an effective tariff rate exceeding 40 per cent.

The Chinese vice-premier led the first two rounds of trade negotiations with Washington, in Geneva and London. His counterpart in the talks, US Treasury Secretary Scott Bessent, has described him as a skilled negotiator.

In an interview with Bloomberg on Tuesday, Bessent said he expected to meet He in the coming weeks.

Beijing and Brussels are also scheduled to hold a summit next week to address trade disputes.

“We must further build consensus on development, resolutely oppose the politicisation, ideologisation and over-securitisation of economic and trade issues, and work together to uphold an open and cooperative international environment,” He said.

“Together, we should forge a global industrial and supply chain system with broader crisis resilience and greater inclusiveness.”

China accounts for about 30 per cent of global manufacturing value-added output and leads production in over 220 industrial goods, cementing its role as an indispensable anchor in the global industrial division of labour, He said.

The country is also an ideal testing ground for emerging technologies and industrial transformation and would continue to enhance the quality, efficiency and dynamism of global industrial and supply chains, he added.

“China will leverage its enhanced supporting capacity and more stable production capabilities to drive continuous cost reduction and efficiency gains across global industrial and supply chains.”

He said Beijing is stepping up efforts to boost domestic consumption and position itself as a “supersized consumer market” on top of its role as a manufacturing powerhouse.

“This transformation will create vast new growth opportunities for businesses worldwide.”

He also urged entrepreneurs to defend global trade and resist protectionism.

“We hope our entrepreneur friends will proactively align with prevailing trends, seize opportunities with greater efficacy and steadfastly uphold the stability and smooth operation of global supply chains – as determined guardians, active builders and vital contributors to this crucial ecosystem.”

Organised by the China Council for the Promotion of International Trade, the five-day supply chain expo will host 651 companies and institutions from 75 countries, regions and international organisations, according to organisers.

Additional reporting by Luna Sun

Huawei returns to the top of China’s mobile phone charts for first time in 4 years: IDC

https://www.scmp.com/tech/big-tech/article/3318415/huawei-returns-top-chinas-mobile-phone-charts-first-time-4-years-idc?utm_source=rss_feed

Huawei Technologies topped mainland China’s smartphone market in the second quarter – the first time in four years – “underscoring its strong brand appeal and effective shipment management”, according to International Data Corporation (IDC).

However, China’s smartphone sales shrank 4 per cent to 69 million units in the April to June quarter due to weak consumption and reduced government subsidies for electronic devices, data from the consultancy released on Tuesday showed. It was the first quarterly contraction after six consecutive periods of growth, according to IDC.

Shenzhen-based Huawei, which divested the Honor smartphone brand in 2020, accounted for 18.1 per cent of the mainland’s market, although its shipments dropped 3.4 per cent from a year ago to 12.5 million units.

Vivo and Oppo came in second and third, respectively, while fourth-ranked Xiaomi was the only one in the top five to record a growth in shipments. Xiaomi, with a focus on the “value-conscious customer base”, posted a 3.4 per cent increase in shipments to 10.4 million units, IDC said.

Fifth-placed Apple saw a quarterly shipment decline of 1.3 per cent – the least among the top five, as it “leveraged strategic price adjustments that made specific iPhone 16 and 16 Pro variants eligible for government subsidies”, said Will Wong, senior research manager for client devices at IDC in Asia-Pacific.

Apple started to cut prices in May, initially through distributors, making some of its models, including the iPhone 16 Pro, cheap enough to qualify for government subsidies, which cover smartphones priced below 6,000 yuan (US$837).

During this year’s 618 promotional season – the most important online shopping festival in the first half in China – Apple claimed the top spot. The US firm’s shipments grew 8 per cent between May 26 and June 22, “thanks to aggressive price cuts on the iPhone 16 series”, said Counterpoint Research earlier this month.

However, the subsidy programme, carried out by provincial governments, hit some obstacles. In early June, the incentives were paused by some local governments, such as Jiangsu and Hubei provinces, casting a shadow on the consumption recovery. Late last month, the state-owned People’s Daily said that the central government would allocate 138 billion yuan for the consumer subsidy programme in the third and fourth quarters.

“Despite administrative hurdles and a recent slowdown in subsidy disbursement, the programme is expected to continue through the remainder of 2025, and may even extend into 2026,” Counterpoint said.

The research firm forecast China’s smartphone market would grow by less than 1 per cent this year as “economic headwinds persist” despite “a strong cushion” from the subsidy programme.

It also warned that the effectiveness of the incentives would diminish as the mainland’s phone market matures.

Chinese Foreign Minister Wang Yi urges SCO to work for more ‘equal and orderly’ world

https://www.scmp.com/news/china/diplomacy/article/3318428/chinese-foreign-minister-wang-yi-urges-sco-work-more-equal-and-orderly-world?utm_source=rss_feed

Chinese Foreign Minister Wang Yi has urged the Shanghai Cooperation Organisation to push for an “equal and orderly multipolar world” and reform of the global governance system.

Wang told a meeting of foreign ministers from the Eurasian security bloc’s 10 members in the northern Chinese city of Tianjin: “Hegemonism and power politics are going against the trend of the times, protectionism is surging, and regional conflicts are emerging one after another.”

Against that backdrop, he said the bloc needed to “stick to the right path” and defend fairness and justice.

“Certain countries place their own selfish interests above the common interests of the international community, harming the shared interests of the global society,” Wang said, according to the Chinese foreign ministry.

“The SCO should … advocate for an equal and orderly multipolar world, inclusive and beneficial economic globalisation, promote the common values of all humanity, safeguard the legitimate rights and interests of member states, and promote the construction of a more just and reasonable global governance system.”

The SCO was established in 2001 by China and Russia – along with Kazakhstan, Kyrgyzstan, Tajikistan and Uzbekistan – to ease border tensions and it has traditionally focused on battling the “three evils” of terrorism, separatism and extremism.

In recent years, it has added India, Pakistan, Iran and Belarus as members, while its scope has broadened to include issues such as economic cooperation.

Wang told the meeting the “three evils” continued to “cause chaos”, adding that Beijing was concerned by the situation in the Middle East and that fresh security threats and challenges have emerged.

The statements issued after the meeting, perhaps unsurprisingly, made no reference to the recent conflict between India and Pakistan.

On Wednesday Wang met Iranian Foreign Minister Abbas Araghchi, telling him that China respected Iran’s right to the peaceful use of nuclear energy and was willing to play a constructive role in promoting stability in the Middle East.

China has been trying to rally countries around the world to oppose unilateral sanctions and “bullying” – an indirect reference to US President Donald Trump’s sweeping tariffs – and painted China as a defender of multilateralism and free trade.

Wang urged the bloc to stabilise supply chains and create areas for trade and investment, as well as scientific and technological innovation.

The Chinese foreign ministry said all parties had agreed to deepen cooperation within the bloc, that “unilateralism should be opposed” and that “hotspot issues should be resolved through dialogue and negotiation”.

It added: “Together, these efforts will make new contributions to promoting world peace and development.”

A separate statement from the ministry said the bloc had agreed that “the current shadow of power politics and bullying persists... and the rights of countries to survival and development are under attack, and international fairness and justice need to be upheld”.

Russia’s Foreign Minister Sergey Lavrov said that his counterparts had affirmed the bloc’s approach of strengthening its role “as one of the central pillars of a more equitable multipolar world order”.

He added that the meeting unanimously condemned Israel’s attacks on civilian infrastructure in Iran, and described US strikes on Iranian nuclear sites as “blatant violations of the United Nations Charter”.

He also said that the foreign ministers had “demonstrated an understanding” of Russia's position on Ukraine and stressed the necessity of addressing the root causes of the conflict, according to the foreign ministry in Moscow.

His comments came as Trump threatened to impose 100 per cent “secondary” tariffs on any country doing business with Russia if a Ukraine ceasefire was not secured within 50 days.

“An unprecedented volume of sanctions has been levied against us. We are managing,” Lavrov said. “I have no doubt we will prevail – a conclusion supported by independent assessments and analyses, including those from many Western economists and policymakers.”

On Tuesday, Chinese President Xi Jinping also met the SCO foreign ministers, telling them the bloc must stay focused and play a more proactive role in injecting greater stability in today’s turbulent world.

The Chinese leader also called on member states to “firmly oppose hegemony, power politics and bullying in order to promote a more equal and balanced multipolar world”.

China will also host the bloc’s leaders in Tianjin on August 31 and September 1.

China reveals superfast maglev, Viagra’s cancer-fighting potential: 7 science highlights

https://www.scmp.com/news/china/science/article/3318383/china-reveals-superfast-maglev-viagras-cancer-fighting-potential-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 .

China has demolished 300 dams and shut down most of the small hydropower stations on a major tributary of the upper Yangtze River to safeguard fish populations as part of an effort to restore the ecology of Asia’s longest waterway.

A Chinese-built maglev train that will be the nation’s fastest-ever ground transport vehicle has made its public debut in Beijing – an ambitious project that is expected to drastically reduce travel times and cement China’s reputation as a world leader in high-speed rail networks.

China has completed a sand control belt spanning three deserts in Inner Mongolia, marking yet another milestone in the creation of a “green great wall” across the arid northern region.

The earliest tools used by humans were made of stone, followed by bronze, then iron, and finally steel. But was there a “Wood Age”? This question has been difficult to answer as wood decomposes easily, leaving behind little evidence of ancient wooden tools – especially in East Asia. However, a study published in the top journal Science on Friday suggests that wooden tools were widely used in southwest China 300,000 years ago.

A top Chinese oncologist and physician-scientist, Cheng Ying, has died suddenly aged 62, according to multiple sources. There has been no official statement about the doctor’s death, and the cause of death is not known.

Chinese scientists have developed a method to turn the alcohol methanol into white sugar, which they say could allow captured carbon dioxide to be converted into food.

Men around the world dealing with sexual impotence have been treated for years with the drug sildenafil, sold under brand names including the well-known Viagra. A new Chinese study now suggests that the drug may perhaps also help to save lives.

Ex-top China student gets low exam score, kicked out by parents who change door code

https://www.scmp.com/news/people-culture/trending-china/article/3317666/ex-top-china-student-gets-low-exam-score-kicked-out-parents-who-change-door-code?utm_source=rss_feed

A high school graduate in China who sat the country’s university entrance exam in June was kicked out of his home by his parents who thought his score was not high enough to get him into a prestigious school.

Teenager Xiaokai, who lives in Huaihua in central Hunan province, called the local Hunan TV for help after he found he could not go back home because his parents had changed the door passcode.

They also decided to cut off his financial aid.

The boy’s parents were angry because he achieved a score of 575 out of 750 in the university entrance exam, known as “gaokao” in China.

The mark left them worried that their son could not be admitted to a so-called 985 school.

The “985” designation refers to a group of the 39 most esteemed universities in China. The name comes from the date May 1998, when China’s central government vowed to build some world-class institutions.

Xiaokai’s parents said the boy, a top student since his childhood, had neglected his studies recently by playing too much on his mobile phone.

Two years ago, they bought a mobile phone for Xiaokai after he asked for one.

“I still remember that time. He wrote a letter promising that he would focus on his studies,” the boy’s father, surnamed Luo, was quoted as saying.

“But he soon indulged in playing with his mobile phone, spending longer and longer on it. He even played truant to spend time with the gadget.”

Xiaokai’s current score is close to the 985 school admission line for last year. His admission result will be released in mid-July.

“My parents told me if I cannot get into a 985 school, they will not fund me to study at a university,” the boy told Hunan TV.

After being locked out of his home, Xiaokai called his mother, asking why he could not open the door.

She told him she was on a business trip and did not know the new password.

“Do not ask us for help. When you were at high school, you did not do what you should do, study hard. You did not obey our rules. There is no place in the world without rules, right?” she said.

“I do not see you regretting your behaviour. So let’s live our lives separately. We will do our jobs and you do your own things,” the mother concluded.

His father gave Xiaokai two options: come back home and obey his parents or go out to find a job.

“I admire the parents of other kids, but my parents are stubborn. They use extreme ways to force me to follow their orders,” said Xiaokai.

His story triggered a stir on mainland social media.

“I understand his parents. The boy has been a top student for many years, but gave up his studies before the gaokao. How disappointed his parents are!” one internet user said.

But another person said: “His score still enables him to attend a not-bad university, although not one of the top ones. His parents are too strict with him and place too high expectations on him.”

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Chinese county admits plagiarism after web users flag data filed by another 400km away

https://www.scmp.com/news/china/politics/article/3318288/chinese-county-admits-plagiarism-after-web-users-flag-data-filed-another-400km-away?utm_source=rss_feed

A county government in southern China has confirmed plagiarism in an official document and pledged to “promptly correct” the offending sections in a rare admission of such misconduct.

This came after internet users flagged information almost identical to that filed by another county about 400km (250 miles) away in a neighbouring province.

In a news release on Tuesday, the government of Pingle county in Guangxi Zhuang autonomous region said it had detected plagiarism in “a limited number of paragraphs” in its 2023-2030 forest fire prevention plan.

Authorities checked the document after media reports of suspected plagiarism and found the claim was “essentially true”, the county government said on its official social media page.

“We’ll promptly correct and reissue the document, strengthening review of official documentation,” it said.

Web users reported the suspected plagiarism after finding that descriptions and data used in a Pingle hydrology report were nearly identical to those for Anhua county in Hunan province next door, according to official news platform Jiupai News.

The Pingle bureau collaborated with a third-party company in preparing the document, and the hydrological data involved was provided by the contractor, Jiupai News reported, citing an unidentified county official involved in producing the plan.

“[The data from Anhua] may have been used as a reference but not modified [when writing the Pingle document]. If there are errors, they must be corrected. The third party was careless,” the official was quoted as saying.

According to the report, the official said the county government would contact the company at the earliest to amend the issue.

The plan was not on the official websites of the Pingle government or its natural resources bureau when the South China Morning Post checked on Tuesday.

Not only was some of the data in the Pingle document identical to those for Anhua, some townships named in the plan are actually in Anhua, and there are no identically named towns in the Guangxi county, administrative information for the two shows.

Further proof lies in the different hydrological features of the two counties. Pingle’s rivers belong to the Xi River system in the Pearl River Basin, according to official records maintained by Guilin, a tourist resort city north of the county.

However, the plan claimed the county’s waterways were “distributed across the Zi, Xiang and Yuan river systems”. Those systems are part of the Yangtze River Basin and are mainly within Hunan – not Guangxi.

Moreover, the Pearl and Yangtze river basins are clearly separated by the Nanling Mountains, which run from east to west, eliminating any possibility of coincidental overlap in the data cited.

Plagiarism in official documents is rarely reported in China. Last year, Beijing introduced new regulations aimed at reducing the burden of excessive paperwork, meetings and inspections on grass-roots officials, citing these tasks as obstacles to their ability to perform effectively.

Airbus signs fresh deal with Chinese partner amid talk of massive China order

https://www.scmp.com/economy/china-economy/article/3318393/airbus-signs-fresh-deal-chinese-partner-amid-talk-massive-china-order?utm_source=rss_feed

Airbus has signed a new cooperation deal with its Chinese partner that will see the company localise more production of its A321 jet in China, with the announcement coming just a week ahead of a key China-Europe leaders’ summit.

The European aviation giant will work with its partner AVIC Xi’an Aircraft Industry Group to start fuselage equipping – installing components onto the front and rear parts of an aircraft – for the A321 at its factory in Tianjin under the agreement.

The programme is an extension of the companies’ similar cooperation on the A320 and sends a positive signal in the run-up to next week’s summit in Beijing, where some analysts predict Airbus may sign a “mega-deal” worth tens of billions of dollars.

“It has expanded the scope of cooperation between both parties in the manufacturing of Airbus single-aisle aircraft, and is also an important measure by Airbus to continuously implement its localisation strategy,” George Xu, CEO of Airbus China, told state media outlet Xinhua News on Tuesday.

“China’s supply chain is an indispensable part of the global aviation industry, showing strong resilience and competitiveness,” he said.

The front and rear of the first A321 to undergo fuselage equipping in Tianjin were shipped to the factory at the beginning of the month, and Airbus expects the installation of the components to be completed by October.

The whole process includes incoming inspection, insulation installation, bracket installation, as well as installation and testing of electrical, electronic, drainage, oxygen, flight control and hydraulic systems, according to an Airbus statement published on Tuesday.

The Tianjin factory also houses Airbus’ first commercial aircraft assembly line outside Europe. Inaugurated in 2008, it assembled and delivered its first A321 aircraft in 2023.

Airbus and AVIC Xi’an Aircraft Industry Group first agreed to work together on this new project during the Zhuhai Air Show in 2023, following their successful cooperation with the A320 model.

Since 2021, when that earlier programme started, AVIC Xi’an Aircraft Industry Group has delivered 104 A320 aircraft body parts to Airbus, according to the statement.

China’s three major state-owned airlines – Air China, China Eastern Airlines and China Southern Airlines – placed an order for 292 Airbus A320neo aircraft in 2022. The deal, worth about US$37.2 billion, was the biggest single aircraft order in the airlines’ history.

There has been market speculation that China might announce a deal of a similar magnitude with Airbus during the China-European Union summit in late July.

However, no official confirmation of a deal has been announced so far, and relations between Beijing and Brussels remain tense ahead of the summit, which has reportedly been cut from two days to just one.

China and Europe power 24% growth in global EV sales in June

https://www.scmp.com/business/china-evs/article/3318380/china-and-europe-power-24-growth-global-ev-sales-june?utm_source=rss_feed

Global sales of electric and plug-in hybrid vehicles surged 24 per cent in June from a year earlier, driven by strong demand in China and Europe, while the US fell behind, according to the market research firm Rho Motion.

A total of 1.8 million battery-powered electric vehicles (BEVs) and plug-in hybrids were sold last month, the London-based firm said on Tuesday. Sales in China jumped 28 per cent to 1.11 million units, or 60 per cent of the worldwide total, while Europe’s demand rose 23 per cent to 390,000 units, according to the report.

The US, the world’s second-largest vehicle market after China, was the laggard, with sales in North America falling 9 per cent to just over 140,000 units, the data showed. Demand in the rest of the world surged 43 per cent to more than 140,000 vehicles, boosting the significance of the emerging markets of Southeast Asia and Central America, Rho Motion said.

In the first half of this year, 9.1 million electric vehicles (EVs) were sold globally, a 28 per cent increase from a year earlier. China led with 5.5 million units, followed by Europe with 2 million and North America with 900,000.

“[The] EV sales figures for the first half of 2025 show that China and Europe are steaming ahead in terms of the electric transition,” said Charles Lester, data manager at Rho Motion.

Lester said he expected subsidies in China to continue in the second half despite “reports that some cities’ subsidies have run out, prompting expectations of a slowdown in the Chinese market”.

US EV sales, which fell 1 per cent in June from a year earlier, were likely to struggle to pick up this year after US President Donald Trump’s “big, beautiful bill” cut tax credits sooner than anticipated, Lester said.

Trump’s landmark spending bill, signed into law on July 4, would cut US government support for emission-light vehicles and clean energy, potentially impacting EVs and driving up costs for EVs and electricity.

At the same time, global carmakers face a 25 per cent import tariff in the US, the world’s second-largest car market, causing many of them to recalibrate their outlooks for 2025.

On Monday, Sweden-based Volvo Cars, which is controlled by China’s Geely Holding, said it was booking an impairment charge of 11.4 billion Swedish kronor (US$1.2 billion) in the second quarter related to its ES90 and coming EX90 due to tariffs and launch delays.

The company said that it was currently unable to profitably sell the China-made ES90 in the US due to import tariffs, while profit margins in Europe were also under pressure.

“Given market developments such as import tariffs in the US, development and launch delays for the EX90 and strategic investment [priorities], we have reassessed volume assumptions for these two cars,” said Fredrik Hansson, CFO at Volvo Cars. “This has resulted in a lower-than-planned lifecycle profitability.”

The charge reflects adjustments in expected volumes and lifecycle profitability for the EX90 and ES90 platforms, as well as significant past launch delays and additional development costs.

Of the total, 4 billion kronor will impact the cost of sales, while the rest will affect research and development expenses.

Volvo Cars, which releases its second-quarter results on Thursday, anticipates a 9 billion kronor impact on net income for the period.

US and China are ‘creeping’ towards a trade deal, former ambassador Nicholas Burns says

https://www.scmp.com/news/china/diplomacy/article/3318386/us-and-china-are-creeping-towards-trade-deal-former-ambassador-nicholas-burns-says?utm_source=rss_feed

Washington and Beijing are on a “creeping path towards some kind of a deal”, former US ambassador to China Nicholas Burns said on Tuesday, while offering some rare support for US President Donald Trump’s tariff strategy towards China.

Burns, who served as envoy to Beijing under former president Joe Biden from 2022 until this year, told a crowd at the Aspen Security Forum in Colorado that both sides had strong economic incentives to reach a trade agreement. He also pushed back against the argument made by some critics of Trump’s trade policy that China had the upper hand in negotiations.

“It’s a symbiotic relationship,” Burns said, pointing to the presence of more than 10,000 American companies in China and the US’ role as China’s largest export market. “Logic and self-interest will lead both of them towards the deal.”

Burns’ remarks at the high-profile national security conference came as the two countries are in the middle of a 90-day trade truce, with an August deadline to reach a more durable deal. Earlier in the year, the Trump administration had hiked tariffs to as high as 145 per cent on Chinese goods, prompting Beijing to respond with its own steep levies on US imports.

Last week, US Secretary of State Marco Rubio and Chinese Foreign Minister Wang Yi met in Malaysia on the sidelines of an Association of Southeast Asian Nations (Asean) summit, with both sides later describing the meeting as “constructive”.

Burns praised US negotiators on Tuesday, calling Treasury Secretary Scott Bessent “impressive” in his discussions with Chinese Vice-Premier He Lifeng.

As for why Trump was, in Burns’ words, “right to be tough-minded” towards China, the former ambassador pointed to what he characterised as Chinese dumping practices.

“We’ve got to drive a hard bargain, because, as [former Treasury secretary Janet] Yellen said publicly, China is producing two to three times domestic demand in steel, robotics, EVs, lithium batteries, solar panels [and] dumping them in the rest of the world,” he said.

Burns also highlighted China’s growing ambitions.

“The will and ambition and increasing strength of China – technologically, economically, through their intelligence apparatus, and certainly through the [People’s Liberation Army] – it’s not just a wake-up call,” he said.

“We’ve got to be ready. We’ve got to up our own game.”

He further drew parallels between the approaches of Biden and Trump to trade, noting that while both had ruled out full economic decoupling, they agreed on protecting critical US supply chains and restricting China’s access to sensitive technologies One example, Burns said, was the Biden administration’s 100 per cent tariffs on Chinese electric vehicles – ones he did not expect to be rolled back in a future deal.

Still, while acknowledging he became more hawkish on China during his time as ambassador, Burns said he probably would not have advised hiking tariffs on China to 145 per cent as Trump did in April.

Burns, now a professor at Harvard University’s John F. Kennedy School of Government, also took issue with the Trump administration’s posture towards allies – highlighting the president’s rhetoric towards Denmark, Canada and Nato members.

Since his second term began in January, Trump has floated the idea of taking over Canada and Greenland, an autonomous territory of Denmark, and has sharply rebuked allies for not spending more on defence.

America’s network of alliances, Burns argued, was a strategic advantage that set it apart from China. The Chinese, he said, saw the Biden administration’s strengthening of ties with Australia, Europe, Japan, South Korea, India and Thailand as a threat – one he felt “in [his] bones” in conversations with counterparts in recent years.

Burns added that unlike the US-Europe relationship, which he called a “forever” alliance, China’s strategic alignment with Russia was not likely to last beyond 15 years.

Burns’ remarks opened the four-day forum, coming a day after the US Defence Department abruptly withdrew its participation, including that of Admiral Samuel Paparo, commander of US Indo-Pacific Command, who was scheduled to speak on Thursday.

The annual conference in Aspen is known for featuring senior officials from the sitting administration, including top civilian leaders at the Pentagon and military commanders.

In a statement on Monday, forum organisers said they would “miss the participation of the Pentagon” but that their “invitations remain open” – a sentiment that Burns, a co-chair of the Aspen Strategy Group, echoed on Tuesday.

The Pentagon said on Monday that the forum’s values did not align with its own, with spokeswoman Kingsley Wilson calling it an event that “promotes the evil of globalism, disdain for our great country and hatred for the president of the United States”.

This year’s forum still includes some Trump administration officials on its agenda, including Adam Boehler, the US special envoy for hostage response, and Tom Barrack, the US ambassador to Turkey and special envoy to Syria.

Former top Shell engineer Jing Xudong leaves Britain to chase ‘cleaner’ oil tech in China

https://www.scmp.com/news/china/science/article/3318278/former-top-shell-engineer-jing-xudong-leaves-britain-chase-cleaner-oil-tech-china?utm_source=rss_feed

A leading engineer, who spent 20 years working for the global oil giant Shell, has left Britain to take up a position at a Chinese university to lead a team working with the petroleum industry on low-carbon technology.

Jing Xudong, who was an adjunct professor at Imperial College London at the time of his departure, held a number of positions in academia and industry and collected a number of awards and honours along the way.

This included his election as a fellow of Britain’s Royal Academy of Engineering in 2024. He introduced himself to the election ceremony by saying: “I chose to study engineering at a young age in China during the 1970s – just after the decade of the Cultural Revolution when everything needed to be rebuilt. Engineering was so highly regarded in China. And it remains highly regarded today.”

Each year, the academy selects up to 60 British, 10 foreign and five honorary academicians for their outstanding contributions to the field of engineering and technology.

Jing joined Nanjing University earlier this month, where he will lead a team focusing on carbon capture, storage and monitoring.

The university said this would involve deeper collaboration with major oil firms on technologies such as carbon sequestration, enhanced oil recovery and intelligent monitoring systems to support China’s green, low-carbon technology development.

During his career with Shell, where he became head of technology and research and development, he worked around the world, including in the Netherlands, Oman, the United States, Shanghai, and Beijing.

A key contribution was advancing waterflooding technology – a process that involves injecting water into rocks to displace oil – by adding polymers that made the process more efficient.

Additionally, Jing worked on carbon capture and storage projects, including experimental work at Canadian oil wells that involved injecting carbon dioxide instead of water.

This not only produced more oil and helped to conserve water but also sequestered carbon dioxide underground, reducing greenhouse gases.

Despite his involvement in the industrial sector, which also included a spell as vice-president of the Abu Dhabi National Oil Company, Jing has published more than 100 academic papers and co-authored two monographs on petroleum engineering.

Born in Dongtai, Jiangsu province, Jing earned a bachelor’s degree in oil drilling engineering from China University of Petroleum (East China) in 1985 and a doctorate from Imperial College London in 1990, where he became a lecturer.

He told the royal academy that he had joined Shell a few years later after realising that gaining industry experience and tackling real-world engineering challenges were paramount for an engineer, particularly in applied fields such as petroleum engineering.

In 2024, as well as being elected to the academy, he became the first Chinese winner of the Darcy Award, the highest honour conferred by the International Association of Core Analysts, for distinguished technical achievements.

How Indonesia can maximise benefits from Chinese investments

https://www.scmp.com/week-asia/economics/article/3318306/how-indonesia-can-maximise-benefits-chinese-investments?utm_source=rss_feed

Indonesia must tighten oversight of Chinese-funded infrastructure projects to maximise their economic benefits while guarding against debt risk, environmental harm and lack of transparency, according to a new report by leading policy researchers.

The study by US-based AidData and Indonesian think tank Foreign Policy Talks draws on more than two decades of investment data and urges Jakarta to play a more assertive role in ensuring that such projects deliver long-term public benefit.

While the report, titled “Balancing Risk and Reward”, raises red flags about the scale and structure of Chinese financing, it also pushes back against alarmist narratives that cast Beijing as predatory or portray Indonesia as a passive victim.

Instead, it calls for greater domestic accountability and stronger governance to ensure foreign-backed development works in the national interest.

Between 2000 and 2023, Chinese state-linked financing in Indonesia reached US$69.6 billion, with a further US$94.1 billion invested by private Chinese companies between 2010 and 2024. According to the report, 90 per cent of China’s state-directed funding was issued as debt, while only 3 per cent took the form of grants or concessional loans.

That approach differs from countries such as Japan, where development assistance is more often provided on concessional terms. But the authors cautioned against interpreting China’s model as predatory.

Samantha Custer, AidData’s director of policy analysis and lead author of the report, said the “debt trap” narrative was “unhelpful and misleading”.

“China wants to get repaid and avoid countries defaulting on their payments, as this is bad for its commercial interests and geopolitical reputation,” she said.

However, she urged Indonesians “to scrutinise” debt-financed public infrastructure projects – from China or any other country – to ensure they were sustainable.

“[They have] to ensure that the government is not borrowing at unsustainable rates and has a credible pathway to repay these obligations without negatively impacting the economy,” Custer said.

“China’s infrastructure investments are a high-risk, high-reward proposition, and Indonesia should take proactive steps to ensure these projects are a net positive rather than a net negative for the country.”

Not all the investments came from China, as some of their funds were collected from “439 discrete entities from 35 countries”.

“Fifty-eight Chinese state-owned policy and commercial banks, government agencies, and diplomatic missions were the primary financiers. These players relied on a multinational pool of 208 co-financiers across Asia, Europe, and North America to raise capital and distribute risk,” the report said.

From 2000 to June 2025, China-funded projects were carried out by 213 entities, either Indonesian or Chinese. Of the latter, Chinese state-owned enterprises formed the bulk of project implementers, including 14 who were sanctioned for questionable business practices and/or flagged for environmental, social and governance (ESG) risks, either directly or through a parent company, by the World Bank or Asian Development Bank, the report said.

However, whether an entity has been sanctioned does not prevent it from engaging directly with the government or private companies in Indonesia, according to the authors.

In the past two decades, China-funded projects in Indonesia were on average completed 2½ years after the funds were committed, “slower” than Chinese projects in other Asean countries like the Philippines, the report noted.

Energy and transport projects are most vulnerable to delays, with delivery typically more than 1,000 days after the initial target. Such projects also face greater exposure to environmental and social risks, according to the report.

“Unfortunately, over 40 per cent of Beijing’s development finance portfolio, or US$30 billion, relied on risky implementers with higher levels of ESG exposure or prior sanctions for questionable business practices. Risky firms were often repeat implementers,” the report said.

The authors pointed to the Jakarta-Bandung High Speed Rail, known as Whoosh, as a prime example of these delays. The US$7.3 billion train started operation on October 2, 2023, three and a half years later than planned and with a US$1.2 billion cost overrun.

Pilar Sinergi BUMN Indonesia, a consortium of Indonesian state-owned enterprises that owns a majority of stakes in Whoosh operator KCIC, reported 4.19 trillion rupiah (US$257 million) in losses last year, bigger than the projected loss of 3.2 trillion rupiah for 2024, according to recent financial data from state railway firm Kereta Api Indonesia, part of the consortium.

Some Chinese investments had also created “significant environmental costs at local levels”, the report said, citing the example of nickel hotspot Morowali Industrial Park in Central Sulawesi. Mining activities in the park had reduced green cover and fish stocks in the area, polluted the air and caused health problems for local residents.

Muhammad Zulfikar Rahmat, a researcher of China-Indonesia relations at Jakarta-based think tank Centre of Economic and Law Studies, said ESG practices had not been properly implemented in Chinese investments in the nickel sector.

“We cannot blame China for this. It is our side who is responsible to ensure better that ESG [practices] are implemented,” said Muhammad, who is not involved in the study.

“The stances of local governments [in nickel hubs Morowali and Konawe] are that it is Jakarta who is to blame for allowing this to happen. China acts in accordance with what the host country permits.”

Despite the environmental risks, the report highlighted benefits of Chinese investments in Indonesia, including expanding access to essential services, lowering unemployment, boosting agricultural and industrial productivity, and enhancing connectivity via upgraded roads, ports and railways.

The big injection of money, however, did not translate into increased favourability of Beijing, as “Indonesians may be more inclined to attribute the benefits of infrastructure-led growth to domestic politicians than to Chinese investment”, the report said.

The report pointed to last year’s Gallup World Poll, which found that only 29.2 per cent of 1,073 Indonesian respondents approved of Chinese leadership, compared to 75.79 per cent of approval rate for Indonesian leadership.

Factors that could have contributed to the low approval rate included Indonesians’ disapproval of Beijing’s maritime claims in the Natuna Sea, China’s treatment of Uygur Muslims in Xinjiang, and lingering anti-Chinese sentiment from the past, the report said.

To mitigate risks from China’s and other countries‘ debt-financed projects, the Indonesian government could “mandate the public disclosure of the terms, conditions, cost-benefit analysis, and results of debt-financed development projects for greater accountability”, Custer said.

Chinese brain drain a great loss for US, Nvidia CEO Jensen Huang says

https://www.scmp.com/economy/china-economy/article/3318364/chinese-brain-drain-great-loss-us-says-nvidia-ceo-jensen-huang?utm_source=rss_feed

It is a “great loss” for the United States that many Chinese academics and researchers have left the country and chosen to return to China amid worsening bilateral relations, said Jensen Huang, co-founder and CEO of chipmaker Nvidia.

“I’m also happy they go home, because that’s where they’re from,” Huang said in response to a question from the Post during a group interview on Tuesday. “But it’s an enormous loss for America when the brightest minds decide to come to you for education and decide to go home.”

Huang is in Beijing this week – on his third visit to China this year – to attend the China International Supply Chain Expo, which is being held from Wednesday to Sunday.

“I hope that the United States continues to be a country where we can pursue our American dream,” he said at an event organised by the China Council for the Promotion of International Trade.

Huang, who was born in Taiwan, said he ended up in the US “because my parents wanted to pursue the American dream”.

“I’m an immigrant,” he said. “And because of the United States and all of my colleagues and the dream that we had, we created a very nice company and it has helped me become quite successful. All of that, I hope that other people can enjoy as well.”

Nvidia, the first company to surpass US$4 trillion in market capitalisation, makes the chips that power many artificial intelligence (AI) applications.

Nvidia announced on Tuesday that the US government had cleared the way for the company to export its H20 chip, a made-for-China product less powerful than its gold-standard acceleration chip.

Another reason so many US-educated Chinese researchers were returning to China was that “the Chinese market is so vibrant”, Huang said.

“Every time I come here, there’s so much energy and excitement and dynamism, and so much opportunity for young entrepreneurs, so many start-up companies everywhere,” he said.

The administration of US President Donald Trump has been sending mixed signals on visas for international students and has cut research funding, deterring more of China’s best and brightest from pursuing study and research in the US.

Prominent researchers who have returned to China in recent months include statistician She Yiyuan, mathematician Yitang Zhang, battery expert Zhou Jianbin and neuroscientist Dan Yang.

Half of the world’s AI researchers were in China, which had made the industry there a dynamic one, he added.

The Chinese semiconductor and AI industries were advancing very quickly, Huang said, something demonstrated by the rise of AI models including DeepSeek, Alibaba’s Qwen and Moonshot AI’s Kimi. Alibaba is the owner of the South China Morning Post.

“These models are very advanced, and the inference and processing requirement is very high, and Nvidia’s H20 Hopper architecture is really ideal for that,” Huang said. “The demand is so great across all of the services.

“We have a lot of competition, so we have to work hard.”

It was “extremely important” that China and the US collaborate on AI research, he said.

“Because this technology is so capable, so powerful, we have to make sure that we share with each other ideas and how to improve the technology, but also how to keep the technology safe,” Huang said.

“It is excellent that China advances AI technology in open source. This way, you can have the global scientific community scrutinise the technology because it’s completely transparent.

“That’s the best way to keep it safe. I think international cooperation, especially in important technologies, is more vital than ever.”

China’s Xi Jinping makes case for free trade as supply chain expo opens

https://www.scmp.com/economy/china-economy/article/3318312/chinas-xi-jinping-makes-case-free-trade-supply-chain-expo-opens?utm_source=rss_feed

President Xi Jinping has spoken out against unilateral sanctions and trade barriers – reiterating China’s support for globalisation as the international economic environment turns more protectionist – in an article published on the opening day of a high-profile supply chain expo.

Wednesday’s piece in Qiushi – the leading theoretical journal of the ruling Communist Party – compiles statements Xi has made on the topic since 2012.

The article, titled “Unswervingly Advancing High-Level Opening Up”, comes as China continues to make its case as a champion of free trade in contrast with the policies of US President Donald Trump.

“At present, unilateralism and protectionism are on the rise, posing serious challenges to multilateralism and free trade,” Xi wrote.

“China adheres to the correct direction of economic globalisation, promotes trade and investment liberalisation, opposes protectionism, building walls and barriers, and rejects unilateral sanctions and maximum pressure.”

The Chinese president also vowed to uphold “genuine multilateralism” and promote “an inclusive and universally beneficial economic globalisation”.

Published the same day the third China International Supply Chain Expo is set to begin, the timing appears deliberate.

The five-day trade fair will host a total of 651 companies and institutions from 75 countries, regions and international organisations, according to organisers. Some of the world’s most prominent entrepreneurs are expected to attend, including Nvidia CEO Jensen Huang.

Foreign participants have been estimated to represent 35 per cent of all attendees, with half of that number hailing from the US and Europe.

Relations among the world’s three biggest economies remain tense as the future of global trade grows more uncertain.

Though Washington and Beijing have had a minor rapprochement in recent months, goods shipments from China to the US still carry an effective tariff rate of more than 40 per cent.

Beijing and Brussels are also scheduled to hold a summit next week to address their trade disputes.

Denunciations of trade barriers – while rarely naming the country or countries viewed as responsible – are common among Chinese officials.

“What I would like to point out is that the Chinese side firmly and consistently opposes the politicisation, instrumentalisation and weaponisation of science, technology, and economic and trade issues,” said Lin Jian, spokesperson for China’s Ministry of Foreign Affairs, at a press conference on Tuesday.

Beijing has reported stronger-than-expected gross domestic product growth of 5.3 per cent for the first half of this year, but analysts expect more headwinds for the Chinese economy in the second half, with trade playing no small part.

“On a positive note, industrial production exceeded expectations due to stronger than expected exports and the US tariff pause,” HSBC said in a note on Tuesday.

“However, there remain some clouds on the horizon, as trade uncertainty will likely persist and calls for more structural adjustments to balance supply and demand may mean a near-term hit for growth.”

Additional reporting by Carol Yang

China university expels girl for casual sex with Ukrainian man that ‘hurts national dignity’

https://www.scmp.com/news/people-culture/trending-china/article/3318266/china-university-expels-girl-casual-sex-ukrainian-man-hurts-national-dignity?utm_source=rss_feed

A Chinese student is facing expulsion from university for having casual sex with a Ukrainian gamer.

The student, surnamed Li, has been accused of “hurting national dignity”, sparking online accusations of excessive punishment and rights infringement.

An official from Dalian Polytechnic University, in northeastern China’s Liaoning province, on July 8, said the institution planned to expel Li for an act of “misconduct” on December 16, 2024.

The 21-year-old was reported to have had a one-night stand with 37-year-old former Counter-Strike player Danylo Teslenko, who is “Zeus”, while he was attending an event in Shanghai last December.

Teslenko posted intimate videos and photos of himself and Li in his fan group, and reportedly called her an “easy girl”.

The footage was leaked by his Chinese fans, and Li’s information, including her real name, family background, and social media accounts, was doxxed.

Some men reportedly harassed the university to punish Li.

But many people said it was the reaction of the university that they found shocking.

Not only did the university divulge Li’s full name, it also cited disciplinary regulations stating that Li’s behaviour saw her “socialise with foreigners improperly and undermine national dignity and the school’s reputation”.

Many protested against the school over its excessive punishment and the infringement of Li’s privacy.

“Her private life is none of the school’s business,” one online observer said.

It was widely reported that Teslenko was married with a child and that Li had a boyfriend at the time of the fling.

However, Teslenko said he was neither married nor in a relationship when he was intimate with Li.

He also expressed regret for posting the videos and denied the accusations that he had ever called Chinese girls “easy”.

A UK gaming news website reported that what Teslenko had said in Russian while hugging Li in the video may have been misconstrued as meaning he thought Chinese girls were “easy”.

The school’s statement said that Li could appeal the decision by September 7. Li has yet to respond to the school’s decision.

Jin Lin, a lawyer from Beijing’s Xidong Law Firm, told the mainland media outlet Fengmian News that the school’s decision does not have legal grounds.

According to the Provisions on the Administration of Students in Regular Institutions of Higher Education, students can only be expelled in eight circumstances, none of which match Li’s situation.

More than one lawyer advised Li to seek legal help and sue the school.

The case also triggered accusations of bias against female students.

In similar and even more serious cases involving male students, full names were rarely revealed, and some perpetrators received minor punishments.

One online observer said: “We still do not know Uncle Red’s full name, but the school cannot wait to publish a female student’s name for living her own life.”

Uncle Red is a 38-year-old cross-dresser from eastern China’s Jiangsu province who went viral worldwide for tricking hundreds of men into having sex with him and filming them.

“She is the biggest victim in this case. The Ukrainian man posted her face without her consent. The men witch-hunted her. Her school further hurt her by expelling her and publishing her name. They all owe her an apology,” said another.

The university had not responded to the public comments by the time of writing.

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China’s local governments urged to use legislation ‘propeller’ to power economy

https://www.scmp.com/news/china/politics/article/3318294/chinas-local-governments-urged-use-legislation-propeller-power-economy?utm_source=rss_feed

China’s local governments should use their legislative power to support private companies, recruit talent and encourage technological innovation to develop their economies, Communist Party mouthpiece People’s Daily said in a commentary on Tuesday.

“The reason local legislation can serve as a propeller in economic and social development is that it establishes a stable and open system, where all types of market entities can operate within the framework of the rule of law,” the article said.

The commentary praised the Hangzhou government in Zhejiang province for legislation on the Hangzhou West Science and Technology Innovation Corridor, which it said focused on serving talent and helping industries grow.

As a result, the corridor, which stretches 39km (24 miles), has seen the birth of more than 140,000 companies, including the headquarters of industry giants such as Alibaba, which owns the South China Morning Post, and CETHIK Group, a leading enterprise in the field of the Internet of Things.

Chinese cities were given more power after the legislation on drafting laws was modified in 2015, expanding its coverage from 49 large cities to 293 cities and 30 autonomous prefectures. A government memo at the time said the change was to ensure these cities could draft local laws on “issues concerning urban and rural development, environmental protection and heritage preservation”.

People’s Daily said that over a decade, creative legislation tailored to the realities of local cities had played a crucial role in reaching the public, and cities had shifted from relying on direct orders from above to using the law when dealing with economic issues.

“Whether local legislation can secure long-term benefits depends on whether it adapts to the needs of economic and social developments,” it said.

For example, the eastern city of Changzhou implemented a law on the development of new-energy industries last year, after rapid developments in its photovoltaic industry and new energy vehicles.

In Quanzhou, Fujian province, a law to protect its cultural heritage on the Maritime Silk Road was implemented in 2017. In 2021, Unesco listed 22 sites in the city on its World Heritage List, the commentary said.

The article was published as the Central Urban Work Conference took place in Beijing this week. President Xi Jinping addressed the conference on Tuesday, pointing out the requirements, key principles and priority tasks for urban work.

In another article on Monday, People’s Daily praised the efforts of the central leadership to develop cities, where 940 million of the country’s 1.4 billion people live. It called for urban governments to develop and rule in ways suited to their own characteristics, and to contribute to China’s modernisation.

In one example, it said the megacity of Xiongan – about 100km south of Beijing and a signature project of Xi – had been “growing rapidly”. State media reported in October that more than 760 billion yuan (US$106 billion) had been invested in Xiongan’s construction and infrastructure, including a high-speed railway station connecting it with Beijing and Tianjin.

The ambitious plan has raised concerns among some observers who said the landlocked area was not near any regional commercial hubs and there were few incentives for people to move there.

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Chinese toymaker Pop Mart says first-half revenue to rise by 200% from a year earlier

https://www.scmp.com/business/china-business/article/3318340/chinese-toymaker-pop-mart-says-first-half-revenue-rise-200-year-earlier?utm_source=rss_feed

Chinese toymaker Pop Mart is gearing up for another period of blockbuster growth, following the runaway success of its Labubu toy in international markets since last year, saying it expects first-half revenue and profit to surge from a year earlier.

In a filing to the Hong Kong stock exchange on Tuesday, the Beijing-based company said it expected revenue for the first half of 2025 to increase by more than 200 per cent from a year earlier, while profit would rise by at least 350 per cent.

In April, the company said its first-quarter revenue rose by 170 per cent from a year earlier, driven by a nearly 480 per cent surge in overseas business and close to 100 per cent growth at home.

The company attributed its first-half growth to “the increased global recognition of the Pop Mart brand and its [intellectual properties], and diversified product categories”, noting that revenue from all regional markets rose “rapidly and continuously”.

It added that its growing presence in overseas markets, where the brand has a more premium positioning, helped improve its revenue structure and overall gross profit. The company said it also benefited from a substantial increase in profit from economies of scale, cost optimisations and tighter expense controls.

The toymaker’s breakneck success in international markets came in 2024, when its “Labubu” toy – a toothy, elfin character created by Hong Kong-born artist Kasing Lung – won over millions of fans in Asia, including K-pop star Lisa of Blackpink and members of the Thai royal family. The company’s launch of the third iteration of the toy in Western markets in April also experienced success, attracting high-profile fans like Rihanna and the family of David Beckham.

The company’s Hong Kong-listed shares have gained nearly 189 per cent this year after surging 370 per cent in 2024, despite a major restock that pushed down resale prices and an official warning on the mainland about the potential addictiveness of “blind boxes”, which are a core part of the company’s business model.

The Taiwan papers: academics suggest how mainland China might rule the island

https://www.scmp.com/news/china/politics/article/3318338/taiwan-papers-academics-suggest-how-mainland-china-might-rule-island?utm_source=rss_feed

As tensions between Beijing and Taipei rise, academia and the education sector reveal how each side is changing to adapt to – or shape – the new environment. In the first of a two-part series, we survey the vast research by mainland academics studying potential paths and models for governing the island.

For decades, Beijing has talked about peaceful reunification with Taiwan and possibly governing it under the arrangement of “one country, two systems”, a term that means the island could have a different political system than the mainland.

The idea was first proposed by late paramount leader Deng Xiaoping and written into the constitution as a legal foundation for future governance of Taiwan in 1982.

Generations of Chinese leaders have shared their broad vision of how post-reunification governance would look for the island, including its military and political parties.

Yet it was only under President Xi Jinping – or more specifically since Xi made a key speech on the matter of Taiwan in January 2019 – that detailed discussion of the issue picked up in public, including from policy advisers and academics.

The growth in the discussion took place as the Democratic Progressive Party (DPP) government in Taiwan continued to push the island towards pro-independence, and Washington kept up its support for Taiwan amid competition with Beijing.

Many recommendations published in state-affiliated academic journals specifically on the subject of Taiwan have drawn lessons from Hong Kong – which saw massive anti-government protests in 2019 – and emphasised Beijing’s direct authority, national security education and vetting of senior government officials.

While most of the proposals have been based on the presumption of reunification via peaceful means, there is a growing amount of work by mainland Chinese scholars on what it might look like to govern the island if the unification cannot be achieved through peaceful negotiation, as Beijing steps up its contingency preparations against growing risks of separatist movements on the island.

There is no evidence that the discussions reflect a shift in Beijing’s previously stated principles on the issue, nor the fact that Beijing has not set a timetable for it.

But some experts say discussions about governing Taiwan published by state-affiliated scholars in state-endorsed publications mark a change from Beijing’s previous defensive position of deterring independence to a more proactive promotion of reunification with the island.

And those discussions, they say, may provide policy options for Beijing, which has a level of deniability regarding the messaging and says it retains the ultimate power to choose what to do with Taiwan.

The South China Morning Post reviewed academic papers from four major journals specifically on the subject of Taiwan studies and published on the mainland since 2013, when Xi became president. The survey reveals a noticeable increase since 2019 in consideration of a “one country, two systems” framework specifically for Taiwan.

In January that year, Xi had for the first time called for “exploring a ‘two systems’ solution to the Taiwan question” and to “enrich efforts towards peaceful reunification”.

Although Beijing has remained tight-lipped over its preferred timeline for reunification and ideas about the governance structure of the island, mainland China’s academic world is studying different options.

A review of titles and abstracts of papers in the four journals finds that at least 42 published since 2019 specifically address the topic – a sharp increase on the six papers on the topic published between 2013 and 2018. It is not clear what the exact reason is behind the increase.

The papers, accessible on mainland China’s largest academic research database CNKI, are from four key journals run by leading government-backed think tanks, which may hint at Beijing’s focus and possible pathways on the Taiwan issue.

They include Taiwan Studies, a bimonthly journal put out by the mainland’s most important Taiwan-related think tank, the Beijing-based Institute of Taiwan Studies under the Chinese Academy of Social Sciences.

The other three are: Cross-Taiwan Strait Studies under the Shanghai Institute for Taiwan Studies; the Taiwan Research Journal under the Taiwan Research Centre of Xiamen University in Fujian province; and Studies on Fujian-Taiwan Relations under the Fujian Institute of Governance.

Beyond the select journals, the overall number of papers featuring the search phrase “two-system solution to Taiwan”, a term that is also mentioned by top leaders, saw a moderate peak in 2020, followed by a notable surge between 2022 and 2023, according to a summary of data available on CNKI.

It is believed that mainland scholars also make policy recommendations through channels and publications not accessible to the public, including on the Taiwan issue. But it is not possible to assess those internal discussions.

One common suggestion seen in the papers reviewed is that the governance framework for Taiwan should draw, to some extent, on lessons from the Hong Kong model. Another key argument is that the level of autonomy granted should still provide the central government with sufficient flexibility to intervene when necessary.

In academic writing on the mainland, there has been discussion of a greater number of Taiwanese delegates joining the National People’s Congress, the country’s top legislature, to articulate local interests.

Several scholars advocated for local governance to be led by patriots, echoing the approach implemented in Hong Kong. One study suggested “Taiwan-style socialism” could be adopted as the island needed to “quickly align with the mainland system” to avoid problems caused by their differences.

Similar discussions on governance have been raised on some other platforms on the mainland, and also in Taiwan.

In August last year, the mainland Chinese research institute the Cross-Strait Institute of Urban Planning at Xiamen University proposed that Beijing establish a “shadow government”, saying it was “imperative to prepare a plan for the comprehensive takeover of Taiwan after reunification”.

In March, Peking University scholar Li Yuhu, who is also a deputy to the national legislature, warned that Taiwan might lose the high degree of autonomy previously on offer if it had to be reunited with the mainland by force.

“If Taiwan moves towards separation or resists reunification, and the mainland government still needs to complete reunification, the arrangement may be downgraded, even to the level of Taiwan province,” he said.

Scholars from Taiwan are joining that discussion.

At a forum in Shanghai in May, Zhong Qin, a senior research fellow at the Asia Pacific Research Foundation in Taiwan, suggested that the concept of “practical reunification” – through actual implementation of governance – could be an alternative approach, avoiding a prolonged wait or abrupt changes in the event of non-peaceful scenarios.

In December, former Taiwanese legislative speaker Wang Jin-pyng proposed the concept of “separate governance without division” so Taiwan and mainland China could coexist while maintaining separate governance yet “share undivided sovereignty”.

It is not clear if any of these proposals are supported by the public, especially in Taiwan.

According to the latest survey published by Taiwan’s Mainland Affairs Council in April, 84.4 per cent of respondents remain opposed to the “one country, two systems” concept, consistent with previous quarterly survey results.

More than 85 per cent of those surveyed said they preferred maintaining the status quo, including 36 per cent favouring its permanent preservation.

In Beijing’s latest official white paper on Taiwan in 2022, it credited the implementation of the one country, two system concept in Hong Kong as a “resounding success”. But in policy discussions, mainland intellectuals said the city offered a number of lessons for the potential governance of Taiwan.

A paper by Wu Libin, associate professor at Sun Yat-sen University in Guangzhou, published in 2022, argues that Taiwan should be granted authorised autonomy – similar to Hong Kong’s model – to give Beijing “greater flexibility and legal grounds” to intervene when necessary or otherwise risk “overly rigid constraints on central authority”.

A paper published last year, written by Zhang Jian, a senior research fellow at the Shanghai Institutes for International Studies, suggested the framework should implement the idea of “patriots governing Taiwan”, a view also seen in several other studies.

Beijing responded to Hong Kong’s months-long anti-government protests in 2019 by imposing a national security law on the city, followed by an overhaul of the electoral system to ensure social stability and safeguard national security, with the principle of only patriots ruling the city.

Zhang argues that the governance plan for Taiwan “should include sound legislation on central authorities’ powers in areas such as national defence, the judiciary, education and national security”.

“The experience and lessons from the Hong Kong case show that relevant laws must be designed and established before reunification to ensure that after reunification the central government’s powers are protected through strong legal frameworks,” Zhang argued.

Another study published this year by scholars from Xiamen University cited the national security law in Hong Kong, suggesting that efforts should focus on introducing a new criminal law in Taiwan to target separatist activities.

While most of the papers in the journals focus on peaceful reunification, there is a rising number of studies mentioning the possibility of non-peaceful scenarios. Many discussed the Anti-Secession Law that provides a legal framework for Beijing to use non-peaceful means.

In general, a search on CNKI identifies 76 papers published since 2019 mentioning non-peaceful options compared to 21 papers published between 2013 and 2018. There is no clearly stated reason, but it could be a reflection of the perceived threat by Beijing of the growing risks of separatist movements in Taiwan and the attempt by the US and its allies to use the issue to destabilise China.

A closer review finds at least six studies published since 2022 that feature more detailed discussion. Two specifically focus on the premise of non-peaceful scenarios and suggest detailed proposals – including deploying People’s Liberation Army (PLA) forces to the island.

Since Taiwanese leader William Lai Ching-te took office in May last year, he has repeatedly asserted that the two sides of the Taiwan Strait “are not subordinate to each other”, drawing fierce condemnation from Beijing – especially after he described mainland China in March as a “foreign hostile force”, an unprecedented escalation in cross-strait rhetoric.

Amid heightened tensions, a paper by a mainland researcher published this year on non-peaceful means attracted attention.

Wang Heting, a professor at Soochow University’s Marxism school, wrote that Beijing could choose a moment to revive “civil war operations” against Taiwan and impose “direct governance” over the island during that time.

Mainland China and Taiwan split in 1949 at the end of a civil war when the Kuomintang was defeated by Communist Party forces and fled to Taipei.

Beijing regards Taiwan as part of its territory, to be reunited by force if necessary. Most countries, including the United States, do not recognise the island as an independent state, but Washington is opposed to any unilateral change to the status quo and is also committed to providing weapons to Taipei for the island’s defence.

Wang suggested that Beijing could blockade Taiwan’s ports, airspace, cyberspace and surrounding seas to prevent the conflict from escalating externally and to cut off foreign help. A trade embargo could block military supplies, and any Taiwanese or foreign vessels and aircraft violating the embargo could be confiscated.

In another paper published in 2023, the author Zhu Lei, a professor at Minnan Normal University, argued that the governance framework for Taiwan must be significantly more strict under non-peaceful scenarios. Regarding security, Taiwan’s military would be restructured and the PLA would be stationed in Taiwan and take primary responsibility for the island’s defence, while the restructured local force would mainly manage social order.

Zhu suggested introducing a decades-long transitional period in which Taiwan would retain its capitalist system under which the state would not play the chief role in the economy and public life – unlike the system on the mainland.

He said Taiwan would be granted greater autonomy than that of ethnic minority autonomous regions, which include Tibet and Xinjiang, but slightly less than Hong Kong and Macau, arguing that “the treatment granted through non-peaceful reunification must never exceed that of peaceful reunification, otherwise it would amount to encouraging resistance”.

He also suggested local governance should be carried out by “the virtuous”, which he defined as those supporting reunification.

Tong Zhao, a senior fellow at the Carnegie Endowment for International Peace in the US, observed that these publications appeared to aim at helping manage perceptions of post-conflict stability.

“These academic papers authored by government-affiliated experts and approved for publication in leading journals signal a shift in [Beijing’s] Taiwan policy from preventing independence to promoting reunification,” Zhao said.

“They shape domestic and international narratives to legitimise non-peaceful reunification while mitigating concerns about prolonged chaos and massive destruction.”

He added that the discussions could convey a coercive message to Taiwan’s ruling party and its supporters, and influence public opinion in Taiwan.

“Publishing these discussions in academic journals, rather than through official government statements, allows [Beijing] to advance these objectives while maintaining plausible deniability regarding official policy endorsement.”

Yun Sun, director of the China programme at the Washington-based Stimson Centre, said the discussions reflected “the reality that since 2019, US-China relations have deteriorated at an accelerated rate, and the notion of a Taiwan contingency has become increasingly real”.

“Since most of the military planning cannot be discussed in the open, discussion about the future political arrangement over Taiwan becomes both needed and desired,” Sun said. “This does not mean that China is close to [attacking] Taiwan militarily.

“Preventing independence and promoting reunification are the two sides of the same coin as long as [the Democratic Progressive Party] is in power. At the current state, Taiwanese people will not embrace reunification willingly, so the only viable option is by force if China believes that it can deter US military intervention.”

Some analysts say these discussions among mainland scholars will remain reference points for Beijing but have limited influence.

Zhu Songling, a professor at the Institute of Taiwan Studies at Beijing Union University, noted that since 2019 there had been increasing attention paid to the governance framework for Taiwan, with two major projects set up under the National Social Science Fund – a major source of funding for social science research in mainland China.

However, he said, there was more work to be done. “Since one country, two systems is a relatively new concept [that has only been tested in Hong Kong and Macau], it holds vast theoretical and practical potential, with much space still to be explored.”

Zhu also said “there remains a possibility that the plan for Taiwan will differ significantly from the model in Hong Kong and Macau” because of differences between the regions.

“Due to historical reasons, the Hong Kong and Macau arrangements were formed through negotiations and implemented along with practices. Exactly how the plan for Taiwan should be studied and implemented still requires exploratory advancement through practice.”

Li Fei, a Taiwan studies specialist at Xiamen University, also noted that academic discussions “provide a reference for decision-making” but planning had “to be constantly adjusted according to changes in the situation”.

However, according to one analyst, the prospect of Beijing’s possible governance plan for Taiwan is losing appeal, creating major problems.

Chong Ja Ian, an associate professor of political science at the National University of Singapore, suggested that any proposal from Beijing lacking credible self-restraint was unlikely to appeal to Taiwan.

He said that meanwhile, military pressure and coercive tactics, such as the drills, espionage cases and disinformation campaigns, had only deepened distrust and resistance in Taiwan.

Beijing, however, has blamed the Taiwanese authorities for provoking the hostility and said its action was in response to such action. The central government has vowed to unwaveringly uphold the rights to defend national sovereignty and territorial integrity if “Taiwan independence elements do not stop their provocations”.

Zhu Fenglian, a spokesman for the Taiwan Affairs Office of the State Council, earlier said that the mainland’s military drills around Taiwan served as a resolute warning to “instigators of war” and were not aimed at Taiwanese people.

The EU is doing itself no trade favours in pushing China on Russia

https://www.scmp.com/opinion/world-opinion/article/3317581/eu-doing-itself-no-trade-favours-pushing-china-russia?utm_source=rss_feed

Ahead of the China-European Union summit, set to take place in Beijing on July 24, the 27-nation bloc seems determined to adopt a firm stance in its relationship with the world’s second-largest economy. While accusing China of aiding Russia’s war efforts in Ukraine, the EU also seeks what it sees as fairer economic relations. But can the growing pressure influence Beijing’s position on Moscow and the Ukraine conflict?

In a recent speech, European Commission President Ursula von der Leyen said Brussels “cannot accept” that China is “de facto enabling Russia’s war economy”. She also said the EU’s process of “de-risking, not decoupling” from the world’s second-largest economy must “speed up”.

This comes just days after Chinese Foreign Minister Wang Yi reportedly told top EU diplomat Kaja Kallas that Beijing did not want to see a Russian loss in Ukraine because it feared the United States would then shift its whole focus to Beijing. Von der Leyen’s rhetoric suggests the EU has adopted an “if you’re not with us, you’re against us” dichotomy in its approach towards China.

But even if Beijing does not wish for Russia to lose the war, it does not necessarily mean it is interested in Moscow accomplishing all of its goals in Ukraine. Similarly, American support for Kyiv does not automatically imply that Washington wants Ukraine to secure a complete victory over Russia. If the US really benefits from the war and China is, as widely seen, the conflict’s “big winner”, then what does either power have to gain from ending the stalemate?

More importantly, from Beijing’s perspective, it would be highly problematic if a Russian victory resulted from US President Donald Trump’s betrayal of Kyiv, however unlikely that seems. There is no free lunch in politics and policymakers in Beijing are fully aware the US would expect the Kremlin to make concessions in exchange for any US abandonment of Ukraine. What if those concessions mean Russia’s decoupling from China?

There has been growing concern among Russian analysts that Trump aims to sow discord between Moscow and Beijing, eventually using Russia as an instrument against China. But given that Trump, increasingly annoyed with Russian President Vladimir Putin, now says Washington must continue to send weapons to Ukraine and is threatening to to impose tariffs on any country doing business with Russia, the chances of Moscow and Washington normalising relations any time soon are rather low. Thus, the scenario of Russia being used by the Americans against China is not on the horizon.

But neither is the alleged Russian-Chinese military alliance against the West. Nato Secretary General Mark Rutte recently suggested that if China were to “attack” Taiwan, it would ask Moscow to open a second front against Nato territory. Even if Beijing were to launch a military attack on the island, it is highly unlikely that Russia – unable to achieve any of its major war goals in Ukraine, and struggling to seize strategically insignificant villages in Ukraine’s southeast – would have the capacity to fight a war against the transatlantic security alliance.

In spite of this, the West repeatedly accuse China of siding with Russia against Ukraine, most recently claiming Beijing has been supplying drones to Moscow. But until May, China had reportedly also been selling drones to Ukraine and other European countries. Is the Western criticism of China aimed at forcing Beijing to continue providing drones to Ukraine and the West?

The EU in particular is unhappy about another Chinese decision: the suspension of exports of a wide range of critical raw materials. Beijing’s move has disrupted European industries and could impede the EU’s green energy transition. As a result, Brussels and several member states are working to boost their presence in strategically important Central Asia to secure access to key resources. But even there, they face strong competition from China.

As long as Brussels remains heavily dependent on China for raw and industrial materials, it is unlikely to be able to afford to wage economic war against Beijing. A leading German industrialist has gone so far as to say that, given this reliance, the EU may as well “apply to be a province of China”. On the other hand, France’s Marie-Pierre Vedrenne, a member of the European Parliament, insists that if the economic situation persists or worsens, the EU “will have to respond to this economic coercion with the instruments at our disposal”.

In reality, the EU and China maintain a complex and interdependent relationship. China is the EU’s second largest trading partner for goods after the US, with bilateral trade reaching €739 billion (US$866.74 billion) in 2023. The EU, for its part, is China’s largest source of imports for consumer goods and the top market for China’s mechanical and electrical products.

What worries Brussels is that the EU-China goods trade balance has been persistently in favour of Beijing. Last year, the EU exported goods worth €213.3 billion to China and imported €517.8 billion, resulting in a trade deficit of €304.5 billion. But is it China’s fault that so many European countries have been pursuing a policy of deindustrialisation that puts them in danger of “economic suicide”?

One thing is for certain: under the circumstances – where the US has launched a global trade war – tensions between Europe and China serve the interests of neither side. That Chinese President Xi Jinping is now not expected to attend the China-EU summit, with Prime Minister Li Qiang likely to be sent instead, signals that the dispute between Beijing and Brussels is far from over.

US-China spy wars intensify under Trump 2.0 as tech competition heats up

https://www.scmp.com/news/china/article/3318356/us-china-spy-wars-intensify-under-trump-20-tech-competition-heats?utm_source=rss_feed

When the Federal Bureau of Investigation last week arrested a suspected Chinese hacker for allegedly stealing sensitive American research on Covid-19 vaccines in 2020, the head of America’s top law enforcement agency hailed the episode as “manhunting” the Chinese Communist Party.

“The CCP’s relentless attacks on our institutions will not go unanswered,” FBI Director Kash Patel wrote on social media.

“The FBI will hunt down those who threaten our national security – wherever they hide,” he wrote, adding, “huge ... manhunting the CCP.”

Then, soon after the FBI announced taking 33-year-old Chinese national Xu Zewei into custody at Milan’s Malpensa Airport, China’s Ministry of State Security made a similarly dramatic announcement, saying it had disrupted three foreign espionage plots. It also warned government workers to remain alert.

In one of the cases publicised by the MSS, a provincial official identified as “Li” was allegedly seduced by a foreign intelligence agent while abroad, then blackmailed, using intimate photos, and coerced into stealing “confidential” documents when back in China.

“Foreign spies have become increasingly aggressive in infiltrating China and stealing secrets,” the MSS said in a statement that did not name any particular country but blamed “a weakened sense of discipline” among officials for recent lapses.

The announcements come amid a shifting geopolitical tech rivalry between the two superpowers, which experts say has intensified into a broader intelligence contest, as both sides escalate espionage and counter-espionage efforts, and increasingly publicise spy arrests and covert operations.

The US government has toughened measures against technology theft, cyber espionage, and academic infiltration, including revoking visas for Chinese students and researchers deemed security risks. As part of that toughening, Patel has quickly reshaped FBI priorities, calling the Chinese Communist Party the “adversary of our time”.

On the other hand, President Donald Trump has also eased some export controls he imposed earlier this year. On Tuesday, American tech giants Nvidia and AMD said they can resume selling of their artificial intelligence chips in the Chinese market. Earlier this month, the Trump administration lifted some curbs on exports design software to China in exchange for increased flow of critical minerals.

However, there is no expectation the spying competition will slow down.

Both countries have increased espionage against each other “as the relationship has developed into one of intense competition on many fronts from trade to military supremacy to global influence”, Dennis Wilder, the CIA’s deputy assistant director for East Asia and the Pacific from 2015 to 2016, said by email.

Wilder, who now teaches at Georgetown University’s School of Foreign Service, added that US intelligence agencies have “stepped up ... efforts to recruit Chinese spies using such innovations as direct online appeals to disaffected Chinese officials.”

“Similarly, MSS operations against US citizens and business persons have also intensified,” he said.

He said he doubted that the Nvidia announcement would have any significant impact on the overall espionage efforts of either side.

“China’s intelligence services might shift priorities a bit away from trying to steal secrets related to advanced chips but the overall effort is unlikely to be affected,” Wilder wrote.

Sheena Chestnut Greitens, an associate professor at the University of Texas, Austin, who is writing a book on Chinese internal security, agreed that as strategic competition between the US and China has heated up, “intelligence competition between the two great powers has also intensified.”

“These cases likely reflect the growing global profile of China’s intelligence apparatus — as well as increased global awareness of and efforts to counter Chinese espionage operations abroad,” she said.

A July 8 report by Kieran Green of Margin Research, an American cybersecurity firm, referred to a Chinese “cyber militia system” composed of “civilian volunteers operating under the dual leadership of local governments” and the Chinese military.

Greitens added that while external observers often look at announcements by agencies such as MSS through the lens of foreign policy, “it is important to remember that these communications have a domestic audience also”.

“One reason for agencies like MSS to publicise espionage cases is to remind citizens that intelligence and security services can see what they are doing and make arrests to protect regime security, to try to deter citizens from acting in ways the regime does not like,” she said.

Sergey Radchenko of the Johns Hopkins School of Advanced International Studies, who has written extensively on Russian and Chinese foreign and security policies, described Chinese espionage in the West as “pervasive”.

“It’s so pervasive, it’s becoming absurd,” he said, adding that he has been a target a “couple of times.”

Denis Simon, a fellow at the Quincy Institute, said that loosening some controls could reduce the urgency or desperation that drives some forms of tech theft” and that fully cutting off access to high technology could increase the pressure to circumvent restrictions.

However, he also said US-China relations are framed increasingly in “zero-sum terms” – especially in sensitive sectors such as AI, semiconductors, quantum computing, and aerospace, a competition that “fuels an ongoing ‘intelligence arms race’.”

Noting that Patel continues to “frame China as a top espionage threat, which shapes both elite and public perceptions”, he said that even if some sales resume, “surveillance and public warnings will persist – reinforcing mutual suspicion.”

The FBI under Patel, with other agencies, has made a series of public spying disclosures in recent months while Beijing has announced spy arrests of its own.

US federal prosecutors last week charged two Chinese nationals with attempting to recruit US Navy personnel to leak classified information to the MSS. The suspects were on June 27 in Oregon and Texas by the FBI after allegedly making a $10,000 “dead drop” payment for military secrets.

Also in June, three Chinese researchers were arrested in Michigan for allegedly attempting to smuggle biological materials into the US using false statements. The arrests followed the March arrest of two active-duty and one former US Army soldier of Chinese origin, accused of conspiring to sell “sensitive” and “top secret” national defence information to China.

On the Chinese side, in June, China arrested a Chinese couple said to have worked at “core” confidential departments in a Chinese state agency on charges of spying for British intelligence.

Chinese students and researchers at American universities have now come under intense scrutiny as counter-intelligence efforts have ramped up.

That scrutiny includes a congressional investigation of ties between major US universities and the China Scholarship Council, which lawmakers say operates as a channel for Chinese intelligence, and an administration inquiry into the University of California, Berkeley’s failure to report US$220 million in Chinese government funding linked to its partnership with Tsinghua University.

In addition, in May, Secretary of State Marco Rubio announced visa revocations for Chinese students with ties with Chinese Communist Party or involvement in sensitive scientific research.

“We may be entering a new phase in which mutual paranoia is the default posture, particularly in frontier technologies,” Simon said, adding that both the US and China increasingly treat every connection – whether a tech firm, scholar, or dating app – as a potential espionage risk.

Trump claims trade deal struck with Indonesia; Bessent says China deal timeline ‘flexible’

https://www.scmp.com/news/asia/southeast-asia/article/3318346/trump-says-us-struck-trade-deal-indonesia-without-providing-details?utm_source=rss_feed

US President Donald Trump said on Tuesday that his administration had reached a trade deal with Indonesia, without offering any details about the terms, scope, or timeline, while his Treasury Department chief cut Beijing some slack on the deadline for a final deal with China.

“Great deal, for everybody, just made with Indonesia. I dealt directly with their highly respected President. DETAILS TO FOLLOW!!!” Trump said in a social media post.

A deal between the US and Southeast Asia’s most populous country would suggest significant progress in the span of a few days. Last week, Trump sent a letter to Indonesian President Prabowo Subianto, threatening to hit imports from the country with a 32 per cent tariff rate, effective on August 1.

Such a development would also have implications for growing competition between Beijing and Washington for influence in the region, particularly since China is Indonesia’s largest trading partner.

Speaking about his trade talks with China in a Bloomberg interview later on Tuesday, Treasury Secretary Scott Bessent said investors should not worry about an approaching deadline on that front.

“I tell market participants not to worry about August 12,” Bessent said, in reference to the end of a 90-day tariff ceasefire between the two economic superpowers that was announced on May 12, following his talks with Chinese Vice-Premier He Lifeng.

Talks are in a “very good place” ahead of a new meeting that is expected in the coming weeks, Bessent said in an interview with Bloomberg.

Bilateral trade between the US and Indonesia stood at US$38.2 billion in 2024, with the US recording a deficit of US$17.9 billion that year, according to US Census Bureau data. That gap was US$9.71 billion in the first five months of 2025.

Trump’s deal with Jakarta would be the fourth such agreement for the US leader since he announced so-called “reciprocal” tariffs against most major trading partners in April, following those that he struck with Britain and Vietnam, as well as a framework deal with China.

Bessent said in his interview with Bloomberg that he hopes to meet He again soon, possibly in a third country, either before or after the Chinese leadership gathers for an annual, informal policy meeting early next month.

“We’re still working on” a meeting with He, the official said. “The Chinese leadership has a big conclave at the beginning of August. We’re trying to work out whether that could be in a third country either before or after that conclave.”

Senior Trump administration officials have also expressed optimism that other Asean countries will have time to negotiate with the US. Secretary of State Marco Rubio assured Malaysian Prime Minister Anwar Ibrahim last week that Kuala Lumpur would have “about a month” to negotiate a better tariff deal with the US.

Earlier, Trump had also threatened members of the developing nations’ Brics group with an extra 10 per cent tariff should they seek to align their “anti-American” policies, as Brics leaders met in Rio de Janeiro, Brazil. The Brics includes Indonesia as well as China and India.

Senior Indonesian officials had engaged the US in efforts to avert the tariffs. After attending the Brics summit in Brazil, Indonesian Coordinating Minister for Economic Affairs Airlangga Hartarto met with American officials in Washington.

Other than Indonesia’s proposals to increase imports from the US, discussions also spanned non-tariff issues, including collaboration in critical minerals such as nickel, and cobalt, according to Indonesian government readouts and media reports in the country.

Indonesia’s embassy in Washington did not immediately respond to a request for comment.

To address perceived trade imbalances, Trump has thus far sent a series of letters to about 20 trading partners, including traditional allies Canada and Japan, unilaterally declaring tariff rates of between 20 and 50 per cent, while also giving them time to negotiate these levels down before they come into effect next month.

In Latin America poll, China grows in appeal though US remains preferred economic ally

https://www.scmp.com/news/china/diplomacy/article/3318348/latin-america-poll-china-grows-appeal-though-us-remains-preferred-economic-ally?utm_source=rss_feed

Public attitudes toward China in parts of Latin America have become more positive compared to recent years, even though many in the region continue to view the United States as a more important economic partner, according to a new survey by the Pew Research Centre.

The survey, conducted from January 8 to April 26, involved face-to-face interviews with 3,833 adults aged 18 and older in Mexico (1,243 respondents), Brazil (1,298) and Argentina (1,292). It is part of a broader study that covers 25 countries and examines views on China’s influence, leadership and global role, as well as attitudes toward the US.

Thus, the field research in all three countries was begun before US President Donald Trump returned to power on January 20, but ran past his announcement of far-reaching global “reciprocal” tariffs on April 2.

Favourable views of China have increased slightly in the region since 2024. In Mexico, the share of respondents with a positive opinion of China rose to 67 per cent, from 61 per cent last year. In Brazil, it rose to 66 per cent, from 63 per cent. In Argentina, the change was more pronounced, rising to 56 per cent, from 49 per cent.

That regional rise in favourability sets Latin America apart from many wealthier nations, where views of China remain overwhelmingly negative.

Across the 25-country survey, the global median share expressing a positive view of China is just 36 per cent. In high-income democracies, sentiment is particularly low – only 13 per cent of adults in Japan, 30 per cent in France and 32 per cent in Britain view China favourably.

By comparison, middle-income countries such as Kenya (71 per cent), Nigeria (64 per cent) and Indonesia (63 per cent) give China higher approval ratings, placing Latin America in line with other parts of the Global South.

The United States remained the ally most frequently cited by respondents in all three Latin American countries. But in a separate, open-ended question, the US was also the most frequently cited threat, possibly reflecting a familiar ambivalence in regional views of Washington, particularly in the context of Trump’s return to power.

Laura Silver, associate director at Pew Research Centre and one of the study’s authors, said the uptick in China’s favourability might be linked not only to perceptions of its expanding economic influence but also to growing unease about the US under Trump.

“It’s entirely possible to have positive opinions of both superpowers,” she said. “However, when one superpower behaves in a way that’s maybe less reliable … the natural result could be to see the other one in a different light.”

Views on global economic power are also shifting. In Brazil and Argentina, more respondents now identify China rather than the US as the world’s leading economic power. In Mexico, views are evenly divided.

And while the US still remains first in terms of economic preference, its lead is narrowing. In Mexico, 45 per cent of respondents said they believed that strong economic relations with China were more important than with the US (47 per cent). A decade ago, only 15 per cent of Mexicans prioritised ties with China.

Silver noted that Mexico showed some of the “most stark changes in opinion” among the countries surveyed, which may be partly related to economic friction, including Trump’s recent tariff threats.

Perceptions of Chinese investment vary across the region. In Mexico, 63 per cent said it benefited their country by creating jobs; in Brazil, 58 per cent.

Opinion in Argentina was more mixed, with just 40 per cent expressing a positive view and nearly half saying such investment gives Beijing too much influence.

Concern about Beijing’s role in debt and politics was particularly pronounced in Brazil. Sixty per cent of respondents considered their country’s debt to China a very serious problem, and 44 per cent cited political interference. Albeit less stark, similar concerns were expressed in Argentina and Mexico.

Trust in Chinese President Xi Jinping remained limited, although it has risen slightly since last year. Thirty-one per cent of Mexican respondents said they had at least some confidence in him, up from 24 per cent in 2024. In Brazil, the figure rose to 30 per cent, from 23 per cent. In Argentina, confidence in Xi remained unchanged at 24 per cent.

Ideological divides are also shaping public opinion in Brazil and Argentina, where views on global powers often align with political identity. In both countries, those on the right are more likely to favour close ties with the United States and to express confidence in Trump’s economic leadership.

Mexico, by contrast, showed no significant partisan split on the issue.

China lifts its sanctions on retired EU lawmaker Reinhard Buetikofer

https://www.scmp.com/news/china/diplomacy/article/3318351/bid-normalise-ties-eu-china-drops-sanctions-it-imposed-retired-mep?utm_source=rss_feed

Beijing has removed “restrictions” on Reinhard Buetikofer, the former EU lawmaker it sanctioned in 2021, as it looks to normalise ties with the European Parliament.

The move is expected to galvanise a new round of engagement, with an official meeting of the National People’s Congress (NPC) and the China delegation of the European Parliament pencilled in for Brussels in October, according to several people familiar with the plan. This would be the first official meeting between the sides since 2018.

In April, China lifted sanctions on sitting lawmakers, but in a letter to European Parliament President Roberta Metsola dated July 4 - reviewed by the South China Morning Post - it made clear that the move also applied to former MEPs who had been sanctioned, of which there is only one, Buetikofer, an outspoken critic of the Chinese government.

In the letter, the Chinese mission to the EU also stated that there was a “preliminary consensus” to resume political meetings between the European Parliament and the NPC, seen as Beijing’s parliamentary equivalent.

The development came during an NPC visit to Brussels in late June, led by Fu Ziying, vice-chairman of its foreign affairs committee. They met with the parliament vice-president Younous Omarjee of the Left Group; vice-president Javi Lopez of the Socialists and Democrats; head of the trade committee Bernd Lange; and head of the China delegation, Engin Eroglu.

It is thought that the European Parliament’s China delegation and other groups demanded that Beijing remove sanctions on Buetikofer, a former Green Party lawmaker who had dominated the parliament’s China files until he retired last year, before considering normalising ties.

Eroglu, who confirmed the meeting with Fu, said that “the complete lifting of false and unfounded restrictions against current and former MEPs is a step toward resuming regular EP-NPC meetings, during which we can now continue these discussions in an official framework”.

“I am pleased that the Chinese side was able to correct mistakes and look forward to an open, honest, and results-oriented exchange with our Chinese counterparts in the future,” he added.

China also reiterated an invitation for Metsola to visit China, this time from NPC Standing Committee Chair Zhao Leiji. It is understood that the Maltese politician currently has no plans to travel to Beijing.

Chinese sanctions remain on researchers from the Mercator Institute for China Studies, a German think tank; German scholar Adrian Zenz; Swedish researcher Björn Jerdén; and the Alliance of Democracies Foundation in Denmark.

They also remain in place on national parliamentarians from Belgium, Lithuania and the Netherlands, as well as the EU’s political security committee composed of member state diplomats.

The 2021 EU sanctions that sparked Beijing’s retaliation also remain in place and will not be lifted as a result of China’s outreach.

Those were placed on several Chinese officials and one organisation for their alleged roles in human rights violations in Xinjiang.

“The EU has not observed changes in the human rights situation in China/Xinjiang. Therefore, the council maintains the China/Xinjiang-related designations,” Anitta Hipper, spokeswoman for foreign affairs and security policy, said in April.

China denies that any such violations have taken place in Xinjiang.

Beijing’s decision to drop its sanctions of Buetikofer – long a thorn in its side – comes just ahead of an important leaders summit in Beijing in July 24, when EU leaders will sit down for a morning of talks with Chinese President Xi Jinping, followed by an afternoon meeting with Premier Li Qiang.

On the European side, expectations are low about major breakthroughs on perennial points of difference on trade and geopolitics. The EU accuses China of aiding Russia through its invasion of Ukraine, while Beijing proclaims to be neutral.

On trade, Brussels is adamant that China must adapt its economic policies and has threatened to gradually close its market to Chinese goods otherwise. It complains that China is exporting industrial overcapacity – generated partly through subsidies – at a cut-price rate that imperils EU manufacturers.

Beijing, on the other hand, contends that the trend of soaring exports to Europe and falling imports from Europe are caused by market dynamics.

Double-edged sword: US probe into China’s drone dominance is a risk, analysts say

https://www.scmp.com/economy/global-economy/article/3318317/double-edged-sword-us-probe-chinas-drone-dominance-risk-analysts-say?utm_source=rss_feed

The United States has launched investigations into imports of drones and polysilicon – two sectors where China holds a global lead – in a move that could pave the way for tariffs and give Washington leverage in trade negotiations between the world’s two largest economies, analysts said.

The US Bureau of Industry and Security released a document on Monday, seeking public comments as it moves forward with the investigation, which began on July 1 under “Section 232” of the Trade Expansion Act.

“Interested parties are invited to submit written comments, data, analyses or other information pertinent to the investigation,” the notice’s authors said.

While the investigation does not explicitly name China, it will examine American reliance on imported unmanned aircraft systems – including drones used for commercial, industrial and military purposes – as well as polysilicon, a critical material used in solar panels and semiconductors. Beijing holds a dominant position in both sectors.

Section 232 grants the US president the power to impose duties if a Department of Commerce investigation finds that certain imports threaten national security. Trump has used the law to levy tariffs on steel, aluminium and cars, and the 50 per cent copper tariff he threatened last week also came from a Section 232 probe.

Alfredo Montufar-Helu, a senior China-based adviser to C-suites, said he “wouldn’t be surprised” if Washington’s investigation was used to gain leverage for future trade negotiations with China.

But he also cautioned that the move was a double-edged sword.

“Even if this investigation results in the imposition of tariffs, the impact won’t be material for Chinese industry. The main issue is that this could empower the more hawkish voices within the Chinese government, leading to a hardened stance in future trade talks.”

He noted that both sides are interested in long-term solutions to address trade tensions, as the 90-day truce between China and the US is set to expire on August 12. “Not only because of economic considerations, but also because both China and the US have a strategic interest in buying time to reduce external dependencies,” he said.

The investigation will also examine the possibility of unfair trade practices or state-backed overproduction, and whether foreign exporters could weaponise their control over supply chains to threaten US national security.

For drones in particular, the investigation aims to address concerns that foreign governments or companies could misuse the technology or gain control over key parts of the supply chain.

Chinese drone giant DJI has a 90 per cent share in the US commercial market, according to the Centre for Strategic and International Studies, a Washington-based think tank. Demand for drones in the US is expected to increase in the US, especially in the farming, construction, maritime and industrial sectors.

Apart from DJI’s dominance, Chinese firms also lead in the production of drone components, with many foreign manufacturers relying on suppliers in China for parts they cannot source elsewhere, according to market research firm Drone Industry Insights.

In 2024, China exported 3.72 million drones, valued at US$2.1 billion, according to Chinese customs data.

China also produces over 90 per cent of the world’s polysilicon, according to Xinhua News Agency – a sector the US dominated just over a decade ago.

Chinese exports of the critical material surged over 370 per cent to over 40,000 tonnes in 2024, reaching a total value of nearly US$350 million – up 97 per cent from the previous year.

Trump’s trade policies drive Hong Kong industry’s ‘China plus N’ shift

https://www.scmp.com/news/hong-kong/hong-kong-economy/article/3318347/trumps-trade-policies-drive-hong-kong-industrys-china-plus-n-shift?utm_source=rss_feed

Hong Kong’s industrial sector is increasingly adopting a “China plus N” strategy as a primary defence against unpredictable United States trade policies, with about 70 per cent of its members already operating in, or moving to, Southeast Asia, according to a report.

Steve Chuang Tzu-hsiung, chairman of the Federation of Hong Kong Industries, said that this strategy was a calculated hedge against geopolitical volatility that has been years in the making.

“You don’t know which madness [US President Donald] Trump will have tomorrow,” said Chuang. “It could be 20 per cent in Vietnam or it could change tomorrow, so we have already done our homework.”

Chuang clarified that the 70 per cent diversification figure was derived from a survey conducted among the federation’s members late last year.

The “China plus N” strategy involves diversifying production and supply chains to multiple locations beyond mainland China, aiming to mitigate geopolitical and economic risks concentrated in a single country.

The proactive diversification into the Association of Southeast Asian Nations (Asean) bloc is a direct response to years of tariff uncertainty.

“Basically among our members, 45 per cent are already in Asean, having already set up factories, operations and so on, and 25 per cent are in the process. If you add 45 per cent and 25 per cent, in fact, for the Federation of Hong Kong Industries’ members, almost 70 per cent are already doing China plus N.”

The findings were revealed as part of the federation’s comprehensive report, “Made by Hong Kong: Strategies for New Industrialisation.”

Commissioned by the federation and conducted by the Hong Kong Institute of Economics and Business Strategy at the University of Hong Kong, the report was based on a survey in the fourth quarter of 2024, gathering 243 valid responses from local manufacturing firms.

The survey was supplemented by four focus group interviews conducted between March and April this year, involving 42 enterprise representatives. These representatives identified significant challenges stemming from US-China trade relations and broader geopolitical risks.

Reinforcing this trend of proactive diversification, the report’s survey found that 81.2 per cent of manufacturers expected investment in Southeast Asia to grow over the next three years, with 12.3 per cent anticipating high-speed growth.

According to Chuang, this strategic pivot involves a fundamental re-evaluation of Hong Kong’s role in the industrial process. He emphasised that the physical location of factories was becoming less critical than the city’s ability to command the high-value segments of the industrial process.

“The most important value is for Hong Kong to control more of the upstream research and development and downstream professional services … for a manufacturer headquartered in Hong Kong, I think that is where the value lies,” Chuang said.

This widespread “Going Out” strategy is being pursued in tandem with a push for technological upgrading.

The report highlights a strong commitment to innovation, with 46.4 per cent of firms anticipating their research and development spending would account for at least 5 per cent of their revenue in 2024. This is seen as a key tactic to create higher-value products more resilient to tariff-related price pressures.

To support these diversifying businesses, the report urged the government to help build “Brand-Hong Kong” to support market expansion and leverage the city’s industrial strengths in R&D and quality control.

The federation proposed that the Hong Kong Trade Development Council could establish “Brand-Hong Kong” themed exhibitions and pop-up stores in key growth areas like Southeast Asia and the Middle East to promote local products.

Ricky Chan Wai-chung, the federation’s executive deputy chairman, said he was optimistic about the industry’s ability to adapt despite the challenges.

“I believe we will walk out of this haze bit by bit,” Chan said.

Is US pushing its Asian allies to do more to counter China?

https://www.scmp.com/news/china/military/article/3318119/us-pushing-its-asian-allies-do-more-counter-china?utm_source=rss_feed

Reports that a senior Pentagon official has been telling America’s European allies to stay away from the Indo-Pacific may be a sign that Washington will ask its Asian allies to shoulder more responsibility for countering China, according to some analysts.

On Tuesday, Politico reported that defence undersecretary for policy Elbridge Colby had tried and failed to stop Britain from sending an aircraft carrier to the Indo-Pacific.

The report cited sources who interpreted the Pentagon’s No 3 as “basically saying ‘You have no business being in the Indo-Pacific’”. They added that he thought the United States does not “need the Europeans to be doing anything” in the region.

Liselotte Odgaard, a senior fellow at the Hudson Institute in Washington, said this might increase the pressure on US allies in the region to do more to help contain China.

“Asking Europe to leave doesn’t mean they [the European countries] should not be tough on China. The US asks them to be much tougher in Europe on China with regards to export controls, their cooperation with Russia in the Arctic et cetera,” Odgaard said.

“But when it comes to [China]... the US doesn’t want Europe to mess up its defence cooperation with its Indo-Pacific allies and its plans for military deterrence of China. There is a risk that Europe and Indo-Pacific allies join forces in resisting some US defence policies.”

The White House has been pushing its allies to spend 5 per cent of gross domestic product on defence.

According to Politico, Colby, who said in March that Japan should spend 3 per cent of GDP on defence, had angered Japanese Prime Minister Shigeru Ishiba with his stance.

“The Japanese were very frustrated,” one source told the media outlet. “They thought that they were agreeing to at least negotiate on the basis of 3 or 3.5 per cent. Then Colby, all of a sudden, got [the Pentagon] to say five, and the Japanese got angry, because that’s not what they just agreed to.”

Over the weekend, the Financial Times reported that Colby had also been putting pressure on Japan and Australia to clarify what role they would play if Washington and Beijing went to war over Taiwan.

Beijing regards the island as part of its territory and has never renounced the use of force to bring it under its control. The US, Japan and Australia, in common with most countries, do not recognise Taiwan as independent but would oppose any attempt to seize it by force.

Colby reacted to the report with a social media post that said the Pentagon was focused on the “America first, common sense agenda of restoring deterrence and achieving peace through strength”, which includes urging the allies to “step up their defence spending and other efforts”.

“Of course, some among our allies might not welcome frank conversations. But many, now led by Nato after the historic Hague Summit, are seeing the urgent need to step up and are doing so” Colby wrote, alluding to the recent commitment to the 5 per cent target by members of the alliance.

Ramon Pacheco Pardo, a professor of international relations at King’s College London, said the effort to dissuade the British from sending the carrier was part of Washington’s efforts to tell European countries to “focus on the deterrence of Russia and stay away from Asia and the Indo-Pacific”.

He said: “In their view, European assets bring little to the Indo-Pacific table, and the US doesn’t want to focus on Russia and prefers to have Europe focus on it.”

Pacheco Pardo added the “clear” message that US allies should increase defence spending was “primarily so that the US can concentrate on dealing with China, including in case of war, and also so that these allies can support the US if there is a conflict with China”.

John Bradford, executive director of the Yokosuka Council on Asia-Pacific Studies, said Washington thought “allied resources are best preserved with allies acting locally, building on their strengths, and avoiding long-range deployment costs”.

He added: “The argument would be that the security situation in Europe and the Middle East is sufficiently tough to warrant UK focus on that side of the globe.”

According to Bradford, US policymakers increasingly think that the Chinese threat has “grown to the extent that deterrence will require a massive build-up of allied power,” which would increase pressure on all allies to do more.

Colby has signalled that the US might reassess the role of its troops in the Indo-Pacific, most notably in South Korea. He has said Seoul should concentrate on countering its northern neighbour and free up the more than 28,000 US troops in the country to focus on containing Beijing.

“The US-Japan and US-ROK [Republic of Korea] alliances are different in that the forces in Japan are treaty-designated as being there to provide regional security whereas US forces in Korea are dedicated to the defence of South Korea,” Bradford said.

“Today, it is generally believed that South Korea has sufficient strength to pretty much handle North Korean conventional forces on its own.

“Therefore, American policymakers increasingly want to make the forces currently in South Korea available for a conflict with China by either redefining the arrangements in place with the South Korean government or moving them to new basing locations.”

Bradford added that US regional partners should recognise that such views were gaining currency in Washington and could not be attributed to one “rogue official”.

“New elites are bringing new thinking while the strategic realities of the Indo-Pacific area are also rapidly changing,” he said.

President Donald Trump told a recent cabinet meeting that South Korea paid “very little” for America’s military support and should significantly increase its defence budget, although he also falsely claimed there were 45,000 US troops in the country.

He also insisted Seoul should pay up to US$10 billion to Washington – an increase from US$1.11 billion agreed between the two countries to be paid from next year.

A report published last week by the think tank Defence Priorities made a similar argument, saying US troop numbers in South Korea should be cut to 10,000.

It cited Colby’s arguments that South Korea’s military could respond to the North but argued the US could not deal with Pyongyang and China at the same time.

The report, co-written by Dan Caldwell, a former senior adviser to Defence Secretary Pete Hegseth, also said US forces in Okinawa should be cut from 26,000 down to 14,000, saying they were vulnerable and relocating them to Guam could increase “US resilience and the ability to respond in a crisis.”

Pacheco Pardo said South Korea was one of the US allies that was going to be “pressed” to boost its defence spending.

He said Washington’s decision to maintain, reduce or increase its troop presence in South Korea and other countries would depend on the “role that these allies can play in case of a conflict with China”.

Odgaard said “repurposing” troops was not the same as scaling back”.

She added: “The US and Indo-Pacific [allies’] agreement on China as a threat will ensure that alliance relations will remain strong with Japan and South Korea. Friction should not be exaggerated and does not indicate a breakdown in relations. The US defence forces are needed by their Indo-Pacific allies.”

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Alibaba to roll out ‘Super Saturdays’ event as China’s on-demand delivery market heats up

https://www.scmp.com/tech/big-tech/article/3318322/alibaba-roll-out-super-saturdays-event-chinas-demand-delivery-market-heats?utm_source=rss_feed

Alibaba Group Holding will roll out a programme called “Super Saturdays” over the next 100 days to lure more consumers to its platform, while escalating a price war against Meituan and JD.com in the mainland’s on-demand delivery services market.

Under Alibaba’s instant commerce brand Taobao Shangou, “Super Saturdays” would offer consumers up to 188 yuan (US$26) in subsidies for the purchase and delivery of low-cost goods such as milk tea and breakfast meals, according to a report by state-owned financial newspaper Securities Times. Alibaba owns the Post.

Alibaba declined to comment on the new programme. Details of the initiative were still subject to change, according to sources with knowledge of the matter.

Meituan earlier rolled out coupons offering milk tea for free. JD.com on Friday said it would offer 100,000 servings of crayfish every night at a fixed price of 16.18 yuan from 6pm until 2am.

Alibaba’s latest programme reflected the intensifying price war in China’s quick delivery services market, where aggressive discounts and freebies are the norm.

While concerns have been raised about the price war’s impact on the revenue of the rival firms, China’s instant commerce market was forecast to surpass 2 trillion yuan (US$279 billion) in sales by 2030, according to data from the Chinese Academy of International Trade and Economic Cooperation.

According to a JPMorganChase report, the share prices of Alibaba, Meituan and JD.com would remain under pressure in the next three to six months.

Alibaba’s financial strength, however, still put it in a favourable position against its on-demand delivery competitors, the report added.

Still, Meituan was expected to maintain an edge over its rivals this year.

“Even if the price war continues until the end of the year, Meituan still has the opportunity to see the possibility of flat operating profits,” a Bank of China International report on July 7 said. “Meituan still has a leading advantage and has a high probability of maintaining market share. The short-term profit reduction does not affect the long-term view.”

On Saturday, Taobao Shangou’s daily delivery orders reached 80 million, but Meituan’s instant retail order volume shot up to a new high of 150 million on the same day.

On July 2, Taobao’s flash sale unit unveiled a 50 billion yuan subsidy programme for both consumers and merchants over the next 12 months.

Meituan responded by announcing its own programme on July 5. JD.com, meanwhile, said on July 8 that it would invest over 10 billion yuan to support more brands to achieve sales of more than one million yuan.

China’s strong GDP figures, delivery robots riding Shenzhen subway: SCMP daily highlights

https://www.scmp.com/news/china/article/3318325/chinas-strong-gdp-figures-delivery-robots-riding-shenzhen-subway-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 .

China’s economy beat market forecasts to grow 5.2 per cent in the second quarter, but analysts said headwinds would intensify in late 2025.

Taiwanese leader William Lai Ching-te is planning a US “stopover” trip in August that could take him to New York and Texas en route to South America, sources said, a move that is bound to anger Beijing.

Subway trains across the southern Chinese megacity of Shenzhen welcomed an unusual new set of passengers on Monday, as the city deployed a fleet of delivery robots to restock convenience stores scattered around its subway system.

China’s relations with Australia have “turned around” after overcoming “setbacks”, President Xi Jinping told visiting Australian Prime Minister Anthony Albanese in Beijing on Tuesday.

A year after its rocket accidentally lifted off and then crashed during a test, Beijing-based start-up Space Pioneer has redesigned the vehicle and shown that it can withstand the intense forces of launch.

The European Union’s top official for Asia is to leave his role after a summit with China next week to take up a post in Sweden, the Post has learned.

More Chinese people dropped out of the voluntary health insurance scheme for urban and rural residents last year, the latest available data shows – piling pressure on the system amid economic challenges and declining public trust.

Chinese humanoid robot maker Unitree sees significant delivery growth in 2025

https://www.scmp.com/tech/policy/article/3318333/chinese-humanoid-robot-maker-unitree-sees-significant-delivery-growth-2025?utm_source=rss_feed

Unitree Robotics’ founder and CEO Wang Xingxing on Tuesday said that China’s humanoid robots have seized the attention of “people from around the world” who are now willing to buy them.

The 35-year-old Wang shared his assessment of the industry at a government-hosted press conference in Beijing, where he forecast China’s robotics sector would expand at a rapid pace this year.

He added that Unitree – one of the six “Little Dragons” from tech hub Hangzhou, capital of eastern Zhejiang province – had significantly increased deliveries in the first half of the year.

China’s output of industrial robots surged 35.6 per cent from a year earlier to 369,316 units in the first six months of 2025, while production of service robots rose 25.5 per cent to 8.8 million units, according to data released on Monday by the National Bureau of Statistics.

At last month’s World Economic Forum in Tianjin, Wang said Unitree’s annual revenue had already surpassed 1 billion yuan (US$139.5 million).

In the same month, the company achieved unicorn status – referring to when a start-up’s valuation exceeds US$1 billion – after it completed a new funding round, with backers that included Alibaba Group Holding and fintech affiliate Ant Group, Tencent Holdings, carmaker Geely and ByteDance-linked Jinqiu Capital. Alibaba owns the Post.

The Unitree CEO’s positive assessment of China’s robotics sector reflects how the government has helped supercharge demand for humanoid robots in state-owned enterprises, while a number of manufacturers enter mass production this year.

China’s fast-developing humanoid robot market segment is seeing demand from enterprises gather speed, as AgiBot and Unitree landed orders totalling 124 million yuan from state-owned China Mobile.

In June, Unitree increased its registered capital from 2.6 million yuan to 2.9 million yuan, a move that could signal preparations for a new fundraising round.

During Hong Kong Chief Executive John Lee Ka-chiu’s visit to Hangzhou in April, Wang reportedly told him that a listing in Hong Kong was a possibility. Lee also tapped Wang to serve on his Council of Advisers.

Wang made headlines in February when he was seated in the front row at President Xi Jinping’s high-profile business symposium in Beijing. After the meeting, he gained attention for becoming the poster child for China’s dynamic robotics field.

In January, Unitree’s general-purpose H1 humanoid robots showed off their dancing skills at this year’s Spring Festival Gala, China’s most-watched television show.

Chinese scientists thank Nasa for sharing data critical to deep-sea mining in Indian Ocean

https://www.scmp.com/news/china/science/article/3318282/chinese-scientists-thank-nasa-sharing-data-critical-deep-sea-mining-indian-ocean?utm_source=rss_feed

When the United States’ twin GRACE satellites spotted an anomaly southeast of India while mapping the oceans, Chinese researchers spotted an opportunity.

Over a relatively flat seabed thousands of metres deep, Nasa detected a spike in gravity readings and then put that data online, free for all to use.

Chinese oceanographers who saw the data decided to find out more. In 2022, they loaded the Shiyan 6 vessel, one of the world’s most advanced research ships, with cutting-edge equipment and sailed more than 12,000 nautical miles.

The ship’s US-made DGS advanced marine gravimeter measured gravity’s pull every second, with precision as high as 0.01 milligal, a measure of gravitational acceleration.

The trip confirmed what they had suspected: thickened crust beneath the Indian Ocean’s Ninety East Ridge.

Dense rock in some seemingly flat areas along the ridge – which spans 5,600km and is the longest on Earth – is 5km (3.1 miles) thicker than normal.

That thickness matters. Where the crust swells, minerals – copper, nickel, cobalt, manganese, rare earths – rise as magma pushes them up from the deep.

The Chinese researchers marked the spots, potentially saving them years of searching and millions of dollars.

They did not say when they gained access to or analysed the data collected by Nasa, but on June 12 the team published a paper in the Chinese Journal of Tropical Oceanography on how the satellite data boosted their research.

“Thank you, Nasa … for providing the gravitational field data,” wrote the team led by Mao Huabin, of the South China Sea Institute of Oceanology, Chinese Academy of Science.

“The marine gravity field, as a critical component of Earth’s gravitational field, maintains close links with factors like crustal thickness, mantle convection, plate tectonics and seabed topography.

“It constitutes indispensable foundational data for determining marine geological structures, distribution of mineral resources, and heterogeneity characteristics within Earth’s internal density structure.”

US law forbids Nasa from cooperating with China in any form.

However, GRACE is a multinational project with data handled in Potsdam, Germany. The gravity readings are shared through academic channels with no military users involved, allowing its science to slip through the cracks.

The Chinese team also thanked the German Aerospace Centre.

The deep-sea mining race is heating up.

US President Donald Trump signed an executive order in April, allowing American companies to mine the deep at will, bypassing the authorisation of the United Nations. This would boost America’s access to minerals needed by the aerospace industry and other critical sectors, according to the White House.

China holds United Nations permits to explore the Indian Ocean and other seas. It has far more submersibles capable of diving to the deepest trenches than any other country. And Chinese shipyards are building vessels 200 times faster than America’s.

Some researchers believe thermal vents on the seabed gush out high-value minerals worth trillions of dollars.

But deep sea mining, if unregulated, could destroy deep marine habitats and disrupt the planet’s life cycle, scientists warn.

China’s dated urban-development model must change, Beijing says at rare meeting

https://www.scmp.com/economy/china-economy/article/3318305/chinas-dated-urban-development-model-must-change-beijing-says-rare-meeting?utm_source=rss_feed

At a surprising meeting of China’s political elite, it was declared that a sea change is needed in the nation’s urban development – shifting from a phase of large-scale, incremental expansion to one focused on optimising and enhancing existing resources.

The message, coming amid a persistent real estate slump and slowing urbanisation, was delivered at the two-day Central Urban Work Conference that ended on Tuesday. In 2015, Beijing held its first such conference in decades, and it kicked off a campaign to boost homebuying and shore up investment.

This time around, Beijing has been pursuing a new growth framework for the beleaguered property sector. Leadership has also vowed that migrant workers will receive more urban citizenship benefits.

With 67 per cent of its 1.4 billion people now living in urban areas, China needs to “proactively adapt to changing circumstances” and transform its approach to city planning, officials said at the conference.

After decades of rapid urbanisation, China’s city growth has now entered “a phase of stable development” where more focus should be put on human well-being, efficiency and governance, according to an official readout of the meeting. It was attended by President Xi Jinping and the other six members of the Politburo Standing Committee – the central leadership’s highest decision-making body.

Officials vowed to intensify efforts to create a “new model” for China’s property development, and renovations of urban villages and repairs to dilapidated housing are among the focal points.

Meanwhile, in contrast to an obsession with large-scale structures and skyscrapers that prevailed in urban planning over the past decades, officials called for “strictly limiting super-tall buildings”.

Additionally, leadership proposed that urbanisation should prioritise the development of integrated, networked modern city clusters and metropolitan areas, promote county-level urbanisation, and continue helping rural migrants obtain urban citizenship.

Ding Shuang, chief Greater China economist at Standard Chartered, speculated that the prolonged slump in the real estate market, with particularly weak trends in the past couple of months, may be one reason Beijing convened such an extraordinary meeting in the middle of the year.

The shift to a phase focused on quality and efficiency signals a departure from the previous rapid, large-scale development model, he said, adding that the potential of urbanisation remains, despite a slowing pace.

“In the context of real estate, with a substantial existing housing stock, the priority is now ‘destocking’,” he said. “This involves projects such as urban village renovations, emphasising the improvement of existing homes – those less suited to modern lifestyles or lacking eco-friendly features – to make them more liveable and sustainable.”

The Xiongan New Area, a green, smart and innovative “city of the future” being built at Xi’s request, was on a list of cities visited by Zheng Shanjie, head of the country’s top economic planner, during a two-day tour to investigate economic conditions right before this week’s conference.

China’s property investment fell 11.2 per cent in the first half of the year, widening from a 10.7 per cent decline in the first five months, according to data released on Tuesday by the National Bureau of Statistics.

A price gauge of newly completed homes in 70 major cities dropped 0.3 per cent in June from the previous month, a sharper fall than May’s 0.2 per cent decline and the steepest monthly drop in eight months.

Infrastructure investment, particularly projects related to shantytown renovations and improvements of municipal engineering, remains important to the Chinese economy, said Su Yue, principal China economist at the Economist Intelligence Unit, in a note on Tuesday.

This is because “the construction industry still accounts for a substantial share of employment, and boosting activity in this sector could provide meaningful support to both growth and the labour market”, she said.

Noting that the conference was not indicative of fresh stimulus measures for the housing sector, Zhang Zhiwei, president and chief economist at Pinpoint Asset Management, said: “As the GDP growth in the first half-year is above the official target of 5 per cent, I think the government will keep the current policy stance instead of running more stimulus at this stage.”

China’s economy grew by 5.3 per cent in the first six months of the year, according to official data released on Tuesday.

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Manus AI lays off China staff, scrubs social media, shelves mainland service

https://www.scmp.com/tech/tech-trends/article/3318310/manus-ai-lays-china-staff-scrubs-social-media-shelves-mainland-service?utm_source=rss_feed

The company behind the general-purpose artificial intelligence (AI) agent Manus laid off most of its staff in Beijing last week, according to local media reports, amid a reorganisation in line with relocating its headquarters to Singapore.

Manus AI has also scrubbed all of its content on Chinese social media platforms Weibo and RedNote.

Logging in returns this message: “Manus is not available in your region.” That marked a change from the earlier message that said its “Chinese version is under development”.

“To improve operational efficiency, we’ve decided to restructure some business teams,” a statement from the start-up said in response to the lay-offs. “The company will continue focusing on its core product and enhancing overall performance.”

Manus did not explain its rationale for pulling out of China. In an earlier statement to the Post, Manus said the move to Singapore was not about gaining access to Nvidia’s advanced chips because it was not developing AI models.

Manus did not respond to a request for comment on Tuesday.

Relocating to Singapore appeared to reflect Manus’ efforts to access more overseas clients and funding amid US-China tensions.

The firm’s global ambitions were clear from the start, as Manus’ eponymous AI agent debuted in English. It required a login via Gmail and Apple ID, which shut out many potential users on the mainland.

The service also relied on large language models (LLMs) like Anthropic’s Claude, which is not available in China, alongside fine-tuned versions of Alibaba Group Holding’s Qwen family of open-source AI models. Alibaba owns the Post.

AI agents are software 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.

In Singapore, Manus was looking to fill more than 20 jobs that cover engineering, design and legal roles, according to the listings on its website and LinkedIn.

Manus remains active on overseas social media platforms, where senior executives post the roll-out of new features, as well as their participation in various industry conferences and developer community events. The company’s co-founders who have accounts on X include CEO Xiao Hong, who uses the moniker “Red”; chief product officer Zhang Tao, with the handle “Hidecloud”; and chief scientist Peak Ji Yichao.

The firm’s AI agent was developed in China under start-up Butterfly Effect, which continues to operate on the mainland, according to people with knowledge of the matter. Its team in Wuhan, capital of central Hubei province, primarily works on the operation of Monica – a Chrome extension that integrates multiple LLMs and was initially designed for overseas users.

Founded by a team of serial entrepreneurs and experienced product managers, Manus is backed by Chinese venture capital firms ZhenFund, HongShan and Tencent Holdings. In April, Manus raised US$75 million from Silicon Valley heavyweight Benchmark, which brought its valuation to US$500 million.

The Benchmark investment drew scrutiny from the US Treasury based on a rule that took effect in January, which restricts American investment in certain hi-tech sectors in China, including AI, semiconductors and quantum computing, according to a Bloomberg report. As a Singapore entity, Manus is controlled by a Cayman Islands-registered parent firm.

“Building a truly global product comes with pains that have little to do with the product or user value itself,” CEO Xiao wrote on the Chinese platform Jike on July 9. He wrote that the goal was to prove that “Chinese-born founders can thrive in new global environments”.

Heightened US-China tensions have prompted other mainland firms to relocate to Singapore, including ByteDance-owned TikTok and fast-fashion vendor Shein.

What if Chinese, US firms make humanoid robots together? Tech CEO calls for collaboration

https://www.scmp.com/economy/china-economy/article/3318316/what-if-chinese-us-firms-make-humanoid-robots-together-tech-ceo-calls-collaboration?utm_source=rss_feed

The founder of a prominent Chinese robotics start-up sees great value in working with American peers to advance the global development of humanoid robots – and his call for stronger collaboration between the fractious trade partners comes as China’s private sector is playing an increasingly larger role in innovation.

“China has a deep foundation in manufacturing and hardware, while the United States possesses a rich AI software ecosystem,” said Wang Xingxing, founder and CEO of Hangzhou-based humanoid robot maker Unitree Robotics.

“Each has its advantages, making global collaboration and joint promotion of the field worthwhile,” he added, noting that the world shared a common goal for the industry.

Wang was speaking on Tuesday at a press conference organised by the government to promote confidence in the private sector, and executives from other leading private companies were also present.

The burgeoning field of humanoid robotics has become a new frontier in the broader technological competition between the US and China, with a race to commercialisation under way among companies in the two countries.

An emerging-industries representative, Wang attended February’s entrepreneur symposium that President Xi Jinping chaired to shore up confidence in China’s private sector. It was the first such meeting since late 2018.

Beijing also enacted a law, effective May 20, to unleash innovation in the private sector while protecting its legal rights.

At a local level, Unitree, one of six tech start-ups known as “Little Dragons”, sits high on the support list of private economy-thriving Zhejiang province. On Tuesday, the eastern province launched a three-year action plan to empower 1,000 internet platform companies, with most of which being privately run.

China’s humanoid robots entered mass production this year, with six out of 11 domestic manufacturers, including Unitree, planning to produce more than a thousand units in 2025.

American humanoid robot makers, including Figure AI and Tesla, have similarly announced production targets of thousands of units this year.

Recognising the industry as a strategic priority, the Chinese government has been investing heavily, offering financial support and policy guidance.

Wang said the robotics industry grew rapidly in the first half of the year, with Unitree’s shipment volume seeing “significant growth” compared with last year.

But troublesome trade tensions between China and the US have threatened to slow the industry’s momentum.

US tech export restrictions could limit China’s access to advanced technologies in fields such as artificial intelligence, while its tariffs could threaten to disrupt American production, notably for companies heavily reliant on cost-efficient Chinese hardware components.

Tuesday’s briefing came with Beijing stepping up efforts to bolster the private sector, and as the country turns inward for economic momentum amid the intensifying economic rivalry with the US.

China’s economy expanded by 5.3 per cent in the first half of the year, official data showed on Tuesday. However, analysts anticipated a deceleration in the second half as domestic demand slows and the potential for more US tariffs loomed.

The tech sector appears to be carrying much of the weight when it comes to hopes of elevating the world’s second-largest economy to new highs.

“Private enterprises are playing an increasingly significant role in technological innovation,” said Liu Baiqi, founder and chairman of space launch firm Interstellar Glory, who was also at Tuesday’s press conference.

“China is increasingly prioritising the development of the private economy, and the policy environment is continuously improving,” he said, noting how more private companies had joined the commercial aerospace sector.

Xi Jinping hails ‘turnaround’ in China-Australia relations as PM Albanese visits Beijing

https://www.scmp.com/news/china/diplomacy/article/3318319/xi-jinping-hails-turnaround-china-australia-relations-pm-albanese-visits-beijing?utm_source=rss_feed

China’s relations with Australia have “turned around” after overcoming “setbacks”, President Xi Jinping told visiting Australian Prime Minister Anthony Albanese in Beijing on Tuesday.

“The most important thing we can learn from this is a commitment to equal treatment, to seeking common ground while sharing differences, pursuing mutually beneficial cooperation, serving the fundamental interests of our two countries and two peoples,” he told Albanese.

“No matter how the international landscape may evolve, we should uphold this overall direction unswervingly.”

Albanese, who is making his second visit to China as prime minister and meeting Xi for the fourth time, echoed his host’s comments about “seeking common ground while sharing differences” and welcomed the chance to “set out Australia’s views and interests”.

His six-day trip, which includes stops in Shanghai and Chengdu, comes at a time when Australia is working to strengthen economic ties following a thaw that came after years of frosty relations.

Meanwhile, China is pushing for closer ties with major trading partners, including US regional allies, as it seeks to counter the impact of Donald Trump’s policies, including tariffs.

According to the Chinese foreign ministry, Xi stressed the importance of “cooperation with mutual benefits” and urged the two sides to “move forward together”.

He said “the first priority” was to “continuously enhance strategic mutual trust”, adding: “The two sides should maintain an accurate understanding of each other... With joint efforts from both sides, the China-Australia relationship has risen from its setbacks and turned around, bringing tangible benefits to the Chinese and Australian peoples.”

Xi added that China had been Australia’s largest trading partner for the past 16 years and this had “delivered tangible benefits to the Australian economy”.

He added the two sides should “align development strategies [and] foster a more favourable business environment for companies”, while identifying new areas for cooperation.

Albanese, who was expected to meet Premier Li Qiang later on Tuesday, said dialogue should be “at the centre” of the relationship, according to a statement from Canberra.

“Australia values our relationship with China and will continue to approach it in a calm and consistent manner, guided by our national interest... It is in our national interest, and indeed in the interest of the region as well,” he said.

“It’s important we have direct discussions on the issues that matter to us, and to the stability and prosperity of our region.”

The prime minister, who was re-elected in May, was travelling with executives from the mining and tourism industries.

China is a major destination for Australian products such as iron ore, wine and seafood and, according to Albanese, buys a quarter of the country’s total exports.

But trade ties have often been complicated by security concerns and the competition for influence in the South Pacific.

Earlier in Shanghai, Albanese said Australia did not support any unilateral action in the Taiwan Strait and had a clear and consistent position on the issue. Beijing’s statement added that he had later told Xi that Australia was still committed to its One China policy and opposed Taiwanese independence.

The meeting followed a Financial Times report that the Pentagon had been pressing Japan and Australia to clarify what they would do in the event of conflict involving the US over Taiwan.

Speaking with reporters after his meeting with Xi, Albanese said the Chinese leader had not raised the reports with him. He added: “We want peace and security in the region, that is in the interests of both Australia and China.”

But the Australian leader said he had raised concerns over the Chinese navy’s short-notice, live-fire exercise in February in the Tasman Sea that separates Australia and New Zealand.

He added that Xi had replied that China “engages in exercises just as Australia engages in exercises”.

“We have strategic competition in the region but we continue to engage in order to support peace and security in the region and stability in the region,” he said.

Albanese added that he also raised the case of jailed Australian writer Yang Hengjun – who was handed a suspended death sentence last year on spying charges – but the port of Darwin was not discussed.

The Australian government plans to take back control of the port, which is held by a Chinese firm under a 99-year lease, and said during the election campaign that the government was prepared to directly intervene if it could not find a private buyer.

A forced deal could draw strong backlash from Beijing, especially after the US targeted Chinese investments in the Panama Canal.

Chinese province quintuples marriage leave to give betrothals a boost

https://www.scmp.com/economy/china-economy/article/3318285/chinese-province-quintuples-marriage-leave-give-betrothals-boost?utm_source=rss_feed

Authorities in the central Chinese province of Hubei have announced they would extend the duration of the region’s paid marriage leave to 15 days, the latest move from a local government to provide incentives for marriage and slow the country’s decline in birth rates.

The extension, which includes the national minimum of three days, is meant to foster a more “family-friendly society”, according to a document issued by the provincial government on Monday.

“To fully implement national regulations regarding marriage leave…the province will establish a reasonable cost-sharing mechanism,” the document said.

China experienced its first population decline in 60 years in 2022, with the National Bureau of Statistics reporting 9.56 million births versus 10.41 million deaths. The fall continued in 2023, but the drop was shallower in 2024 as births saw a slight recovery – partially attributed to parents’ preferences for children born in the auspicious Year of the Dragon.

Statistics for marriage show a sharper descent. In 2024, a severe 20.5 per cent drop was observed in nationwide marriage registrations, with just 6.1 million couples becoming wed.

This represents the steepest annual decline since 1978 – the year records began to be kept – and less than half the peak recorded in 2013, according to data from China’s Ministry of Civil Affairs released in February. Meanwhile, divorce registrations increased slightly to 2.6 million, up 1.1 per cent from 2023.

Despite government campaigns to limit extravagant weddings and exorbitant bride prices to lower the cost of marriage, it is still viewed as a prohibitive expense by many young couples.

This, along with uncertainty about the future, poor job prospects and declining salaries, further dampens their willingness to settle down or have children.

“Many young people simply can’t afford to get married,” said independent demographer He Yafu in a previous interview with the Post.

Last year, Beijing rolled out a series of policies to encourage marriages and births as the country faces demographic decline. As those born during the late 1960s and 1970s retire, the working-age population is shrinking in comparison to this growing elderly cohort, raising concerns over productivity and economic growth.

So far, 28 of China’s provincial-level regions have officially announced or are soliciting public opinion on measures to extend marriage leave.

Sichuan province in the country’s southwest requested public comment in June for an extension of its marriage leave – up to 25 days – and a longer period for maternity leave, with a maximum of 150 days.

In January, Shandong province stipulated that legally wedded residents are entitled to 15 days of marriage leave, with those who participate in a premarital medical examination receiving an additional three days off.

Currently, the provinces with the most marriage leave are Shanxi and Gansu, both offering 30 days. Henan and Heilongjiang provinces provide a maximum of 28 and 25 days respectively, which include optional extensions for couples who undergo a premarital medical examination.

China rolls out ‘voluntary’ cyber ID system amid concerns over privacy, censorship

https://www.scmp.com/tech/tech-trends/article/3318302/china-rolls-out-voluntary-cyber-id-system-amid-concerns-over-privacy-censorship?utm_source=rss_feed

China has officially introduced a controversial national cyber ID system, despite concerns from some experts and netizens over privacy and censorship.

The system aims to “protect the security of citizens’ identity information”, according to regulations that went into effect on Tuesday, backed by the Ministry of Public Security, the Cyberspace Administration of China, and four other authorities.

The app, whose beta version was launched last year, issues an encrypted virtual ID composed of random letters and digits so the person’s real name and ID number are not given to websites when verifying accounts. So far, it is not-mandatory for internet users to apply for the cyber ID.

Starting in 2017, Beijing started ordering online platforms to adopt real-name registration for applications such as instant messaging, microblogs, online forums and other websites that ask netizens to submit their ID numbers. Separately, official ID has been required to register a mobile phone number in China since 2010.

The new virtual ID scheme has been in the beta stage since a draft regulation was launched in July last year. Dozens of widely used apps – including Tencent Holdings’ WeChat, Alibaba Group Holding’s Taobao and Tmall, and ByteDance-owned Douyin – have since allowed account authentication via virtual ID. The final version of the regulation was released in May without significant changes.

Alibaba, Tencent and ByteDance did not immediately respond to a request for comment on Tuesday. Alibaba owns the South China Morning Post.

A total of 67 apps have adopted the new ID system, and the amount of personal information collected by them has fallen 89 per cent, Lin Wei, president of the Southwest University of Political Science and Law, wrote in an article published on Monday by the public security bureau.

Lin’s article is an apparent attempt to justify the scheme amid strong backlash from some legal experts and individual users. He wrote that other jurisdictions operate similar digital ID systems, such as the eID in the European Union and Singapore’s SingPass. Lin added that “being voluntary is one of the basic principles” of the cyber ID scheme.

The 16-article regulation states that individuals can “voluntarily” apply for it, authorities and industries can “voluntarily” promote it, and that internet platforms have “voluntarily” access to it.

However, online users have expressed concerns over privacy and censorship. On Monday, a RedNote user who goes by the pseudonym “10ya” questioned whether the system would protect privacy, while another named “Period” asked if it was a way for the government to more easily monitor what people say online.

Some legal scholars who have objected to virtual ID systems have been punished. Lao Dongyan, a law professor from Tsinghua University in Beijing, asked why such a system was necessary when more than 1 billion internet users in China had already registered under existing real-name policies.

“The true intention is to regulate people’s behaviour online. The claim of protecting personal information is merely a facade, at least not the primary goal,” she wrote on her Weibo account in July 2024, days after the draft rules were out. The post was removed and she was banned from posting on Weibo for three months.

Shen Kui, a law professor at Peking University, warned last year that mandating a uniform network identity would raise fears of a centralised surveillance system that could comprehensively track and analyse an individual’s online footprint. The article, published on the WeChat account of the university’s Centre for Constitutional and Administrative Law, was later removed.

China Merchants Bank’s brokerage arm receives virtual asset licence in Hong Kong

https://www.scmp.com/tech/blockchain/article/3318296/china-merchants-banks-brokerage-arm-receives-virtual-asset-licence-hong-kong?utm_source=rss_feed

CMB International Securities (CMBI), the brokerage arm of China Merchants Bank, said it received a virtual asset licence from Hong Kong’s Securities and Futures Commission, making it the first mainland broker to conduct cryptocurrency trading services and other activities in the city.

The licence, issued on Monday, allowed CMBI to engage in a variety of virtual asset services, including trading, custody and advisory services. In addition, it can provide guidance on risk management, regulatory compliance and investment strategies.

The licence came after Beijing was seen to be supportive of Hong Kong’s efforts to become a cryptocurrency hub, but the move will not open a direct channel for investors on the mainland, where crypto trading remains banned, to trade in the city.

“By securing this licence, CMBI gains regulated access to Hong Kong’s dynamic crypto market, yet it must operate within strict boundaries that prevent direct mainland participation, reflecting the delicate balance of innovation and legal constraint,” said Joshua Chu, a lawyer and co-chair of the Hong Kong Web3 Association.

Earlier this month, the Hong Kong government said its new stablecoin ordinance, which requires issuers of assets backed by fiat currency to be licensed, will take effect on August 1.

The city’s crypto moves came in response to a growing acceptance of digital assets by traditional financial institutions and the expansion of the surrounding industry. Mainland brokers with international operations have been ramping up efforts to acquire virtual asset licences in Hong Kong in an effort to serve more global investors.

Under current regulations, authorised mainland brokers are allowed to set up omnibus accounts, which are single accounts that combine the assets of multiple entities, on the city’s 11 licensed virtual asset trading platforms. This gives clients regulated access to prominent cryptocurrencies like bitcoin, Ethereum and various stablecoins.

In a recent interview, Christopher Hui Ching-yu, Hong Kong’s Secretary for Financial Services and the Treasury, said that the city would also facilitate additional use of tokenised financial products.

In China, delivery robots now ride the subway to restock 7-Eleven stores

https://www.scmp.com/economy/china-economy/article/3318287/china-delivery-robots-now-ride-subway-restock-7-eleven-stores?utm_source=rss_feed

Subway trains across the southern Chinese megacity of Shenzhen welcomed an unusual new set of passengers on Monday, as the city deployed a fleet of delivery robots to restock convenience stores scattered around its subway system.

Dozens of squat delivery robots have now begun riding subway trains across the network during off-peak hours, exiting at each station where a 7-Eleven is located to make deliveries, according to a report by local news outlet SZNews.

The project is the first of its kind in the world and marks the latest step in Shenzhen’s push to expand the use of robots from the factory floor to other areas of urban life, the report said.

The metre-tall robots – operated by a logistics subsidiary of the Chinese property giant Vanke, which is part-owned by Shenzhen Metro – are capable of autonomously riding lifts, entering and exiting platforms, boarding trains and delivering goods to 7-Eleven stores across the city, according to SZNews.

The 41 robots reportedly caused a stir during their first day on the job, as passengers gathered around them to snap photos as they lined up inside the carriages. But the project is not simply a public relations stunt; it aims to solve a long-standing logistical problem faced by retail outlets inside Shenzhen’s subway stations.

“In the past, delivery workers had to park above ground, unload goods, and manually push them into subway stations,” Li Yanyan, a manager at one of the 7-Eleven stores involved in the project, told SZNews. “Now, with robots, it’s much easier and more convenient.”

The robots will be used to restock more than 100 7-Eleven stores located within Shenzhen’s subway system.

“These robots are specially designed with unique chassis systems that allow them to cross gaps to enter lifts and carriages,” said Hou Shangjie, head of automation at VX Logistics, the Vanke subsidiary. “They will continue to iterate based on real-world performance.”

Shenzhen has launched the project as part of its “Embodied Intelligent Robot Action Plan”, which the local government released in March with the aim of accelerating the adoption of robots across a series of industries by 2027.

The city has long been one of China’s leading technology hubs, and it is already home to more than 1,600 robotics companies. In recent months, local officials have announced plans aiming to turn Shenzhen into a global leader in robotics and embodied artificial intelligence.

Driver in China criticised for turning car bonnet into ‘fish tank’

https://www.scmp.com/news/china/article/3318280/driver-china-criticised-turning-car-bonnet-fish-tank?utm_source=rss_feed

A driver in northern China’s Liaoning province put a transparent coating over the bonnet of his car, then filled the gap with water, turning it into a fish tank. He was criticised online after sharing clips of it on social media.

China charts course to boost legal arsenal against foreign sanctions, interference

https://www.scmp.com/news/china/politics/article/3318272/china-charts-course-boost-legal-arsenal-against-foreign-sanctions-interference?utm_source=rss_feed

China’s ruling Communist Party has told the country’s top judicial bodies to better research and understand international and foreign laws to fortify the nation’s legal arsenal against foreign sanctions, interference and “long-arm” jurisdiction.

The opinion paper written by the Central Committee, the party’s top decision-making body, was made available to the public on Monday. It is aimed at refining China’s judicial toolkit so that Beijing can better learn from and challenge the trade and technology sanctions imposed by the United States and its allies against Chinese companies.

The guidance document was first circulated within the party in February, according to state news agency Xinhua.

The paper is part of Beijing’s overall plan to “sharpen its legal tools to protect its overall national interests”, according to Deng Yuwen, former deputy editor of Study Times, the official publication of the Central Party School, the party’s top ideological training centre.

Deng said this latest paper completed the documentation of directives for the country’s entire judiciary system, a major political priority for Chinese President Xi Jinping, who has stressed “law-based governance”. The party issued similar guidance documents to direct the work of police in 2019 and for prosecutors in 2021.

“[We should] strengthen the accurate application of international treaties and common practices, and establish an advanced system to understand and engage in foreign law,” the directive said.

The paper also pledged to improve judicial measures to counter sanctions, interference, and long-arm jurisdiction, and increase “judicial protection for China’s overseas interests and overseas Chinese people’s interests”.

The document has also urged China’s judiciary authorities to improve international judicial exchanges and cooperation, and take part in developing international rules in areas such as international trade, intellectual property rights, environmental protection and cyberspace.

China still has “a long way to go” to build a capable team of international law experts that can understand and work within international treaties, laws and practices, according to a Beijing-based international law specialist who declined to be named.

“Many students who were trained in our law schools are unable to perform well in international courts since China’s law schools focus on domestic law. Given the rising geopolitical tensions around China, we need more lawyers who can competently defend national interests or the overseas interests of Chinese companies in international courts,” he said.

The guidance document also directs China’s Supreme People’s Court to “strengthen international commercial judiciary collaboration” with key regions, improve coordination for international commercial mediation and arbitration, and “promote the creation of an optimal place for international commercial dispute resolution”.

Beijing approved what it said was the world’s first intergovernmental organisation on mediation in Hong Kong at the end of June, a month after the Convention on the Establishment of the International Organisation for Mediation was signed in the city.

The new organisation has been hailed as a boost to Hong Kong’s status as a dispute resolution hub, enabling the city to handle disagreements between states, as well as those between investors and governments, amid increasingly fraught geopolitical tensions.

The Communist Party’s directive said the country’s top court should continue to improve the “inter-regional judicial assistance system with Chinese characteristics” by deepening judicial exchanges and cooperation in the Guangdong-Hong Kong-Macau Greater Bay Area, and build better bridges between rules and practice.

In China’s party-state political system, “opinion” papers from the party’s Central Committee are usually seen as directives or instructions from the party’s top leadership. Relevant agencies are expected to thoroughly implement such directives.

The document also directed the courts to work on many domestic priorities, including cracking down on violent crime and scams to maintain social stability, protecting the private sector and improving the business environment, and boosting the judiciary’s role in protecting the financial sector, intellectual rights, the environment and the rights of juveniles.

Market manipulation should be severely punished, according to the paper, while insider trading, illegal fundraising, loan fraud, money laundering and other financial crimes would remain a priority.

China should also improve the rules for hearing financial disputes in emerging fields such as digital currencies, mobile payments, internet finance, and cross-border financial asset transactions, the document said.

Chinese firms’ Hong Kong stocks trade at smallest discount to onshore shares in 5 years

https://www.scmp.com/business/china-business/article/3318254/chinese-firms-hong-kong-stocks-trade-smallest-discount-onshore-shares-5-years?utm_source=rss_feed

The Hong Kong shares of dual-listed Chinese companies are trading at the smallest discount to their onshore peers in nearly five years, as a weaker US dollar spurs inflows and mainland investors snap up these stocks.

The H shares of 160 firms, including Industrial and Commercial Bank of China and BYD, are trading 22 per cent below their mainland-listed A shares, according to a Hang Seng gauge tracking the disparity between the two markets. That marked the smallest gap since June 2020, as trading averaged 29 per cent over the past year.

For dual-listed Chinese companies, their Hong Kong-traded stocks are known as H shares and the mainland tranche is referred to as A shares.

The narrowing discrepancy reflects how H shares have enjoyed bigger gains since the start of the year, with the Hong Kong stock market benefiting from global investors’ efforts to diversify investments amid a weakening US dollar, as the Trump administration’s erratic tariff policy dented the dollar’s status as a reserve currency.

China’s onshore investors have also rushed to H shares in droves to gain exposure to the nation’s biggest technology companies, which stand to thrive on breakthroughs in the field of artificial intelligence.

“We are still positive on Hong Kong stocks, which are below the historical average in valuation and are set to benefit from a rebalancing of global capital allocations,” said Bao Chengchao, an analyst at Guolian Minsheng Securities. “In terms of liquidity, the interest-rate cuts by the Fed are pencilled in for this year and mainland buying is expected to gain momentum in the long run.”

Mainland investors bought HK$731.2 billion (US$93 billion) worth of Hong Kong stocks in the first six months of the year via the cross-border exchange link programme, approaching the record of HK$808 billion for the whole of 2024. The US dollar index dropped 11 per cent in the first half, its worst start in more than five decades.

The Hang Seng Index has risen more than 20 per cent this year, beating the less than 2 per cent gain in the CSI 300 Index of A shares that are denominated in yuan. A slew of blockbuster listings of the biggest Chinese companies this year has also boosted the appeal of the Hong Kong market, as Contemporary Amperex Technology (CATL) and Jiangsu Hengrui Pharmaceuticals Group generated overwhelming demand from investors.

Among the 160 dual-listed companies, the H shares of only five firms command premiums to their underlying A shares, according to financial data provider Shanghai DZH. The premiums for CATL and Jiangsu Hengrui were the highest at about 20 per cent, the data show.

Historically, China’s A shares have traded at premiums over H shares, as mainland investors have limited investment channels beyond stocks and existing restrictions on investing overseas. It was only during the years 2006 and 2014, when A shares traded cheaper than H shares.

The gap between A and H shares is expected to continue to narrow in the second half of this year, as sluggish mutual fund issuances on the mainland put yuan-denominated stocks on the back foot, according to UBS Group. New fund sales totalled 92 billion yuan (US$12.8 billion) in the first half, well below the average of 513.8 billion yuan from 2020 to 2022, the Swiss bank said.

“In the second half, with the US dollar likely to weaken further, the A/H premium could sustain at the medium-term low, unless a significant amount of additional liquidity flows into A shares,” said Meng Lei, a strategist with UBS.

Why millions in China are still quitting the national health insurance scheme

https://www.scmp.com/economy/china-economy/article/3318270/why-millions-china-are-still-quitting-national-health-insurance-scheme?utm_source=rss_feed

More Chinese people dropped out of the voluntary health insurance scheme for urban and rural residents last year, the latest available data shows – piling pressure on the system amid economic challenges and declining public trust.

The downward trend in participation – in a scheme designed for farmers and the unemployed – continued in 2024, with 15.8 million fewer people enrolled compared with 2023, according to figures released by the National Healthcare Security Administration (NHSA) on Monday.

China’s basic medical insurance, which also includes a separate programme for urban employees, covered 1.326 billion people in total – down 7.27 million from 2023, the NHSA said.

The falling participation rate poses a challenge for China’s health insurance system, which is already under strain from a rapidly ageing population and a shrinking workforce.

Enrolment among urban and rural residents has declined in recent years, driven by rising premiums and stagnating incomes.

“The trend of less interest in participation continues because the economic conditions have not changed – it’s a financial burden for a rural family if the breadwinner doesn’t see their income increase,” said Professor Xiong Wansheng, an expert on rural development at the East China University of Science and Technology.

Residents paid 400 yuan (US$56) each last year to join China’s urban-rural medical insurance scheme, with a government subsidy of 670 yuan bringing total annual funding to 1,070 yuan per person. Individual contributions increased by 5 per cent compared with the previous year.

“Another reason why people are weary is that they don’t trust the medical system. As premiums increase and medical treatment becomes more expensive, they find the scheme is not helping much,” Xiong said.

The NHSA said the overall participation rate in the basic medical insurance programme remained above 95 per cent, without specifying any year-on-year change.

In contrast to the 7.27 million drop in enrolment, China’s total population saw a much milder decline in 2024 – down by 1.39 million from the year before.

Meanwhile, the closely watched fund pool for the scheme faces a growing gap, as spending outpaces income. In 2024, it recorded 2.373 trillion yuan (US$330 billion) in income – a 3.5 per cent rise from 2023 – while spending rose 7.6 per cent to 1.910 trillion yuan, the administration said.

In response to public concerns last year, the NHSA said the wave of cancellations was only a “slight fluctuation” caused by technical improvements and structural adjustments.

China on track to issue record amount of exchange-traded funds in 2025 amid booming demand

https://www.scmp.com/business/markets/article/3318240/china-track-break-etf-issuance-record-amid-booming-investor-demand?utm_source=rss_feed

China is likely to issue a record number of exchange-traded funds (ETFs) this year, having already crossed the halfway mark of the all-time high of 277 ETFs launched four years ago, spurred by favourable regulations and growing investor demand.

Fund managers in mainland China launched 166 ETFs tracking stock indexes, bonds and overseas markets up to the end of June, according to ETFGI, a research and consulting firm.

“If the pace of launches continues, we will see the previous record of 277 ETFs in 2021 being surpassed,” said Deborah Fuhr, founder and managing partner at ETFGI.

The surge in ETF listings in China reflects a broader global trend, with more than 1,300 ETFs launched worldwide in the first half of the year, putting the industry on track for a potential record.

ETFs are investment funds traded on stock exchanges, typically holding a basket of assets such as stocks, bonds, commodities, or a mix. Most of the ETFs launched on the mainland this year track equities, with the rest tracking bonds and foreign stocks, according to Z-Ben Advisors, a Shanghai-based fund tracker.

In China, favourable regulations – such as streamlined approvals and reduced fees – along with growing investor demand for returns, were all contributing to the momentum, according to analysts.

China issued a sweeping nine-point guideline in April 2024, outlining a blueprint for the long-term development of its capital markets, including a fast track approval channel for ETFs to promote index investing and measures to reduce fees for mutual funds.

Index-tracking ETFs are considered passive investments, which aim to replicate the performance of a specific index and are viewed as less risky. In contrast, active ETFs select specific stocks or bonds in an effort to outperform the market.

Chinese pension funds and insurers were investing more in ETFs, according to Cora Cui, an analyst with Morningstar.

In April, state-owned investment vehicles and insurance companies stepped in to buy ETFs to support the Chinese stock market after US President Donald Trump’s sweeping tariffs on the country’s trading partners, including China, unsettled markets globally.

Meanwhile, many retail investors had learned painful lessons from holding “highly concentrated portfolios” in volatile markets, Cui said. This had allowed “ETFs to present themselves as a go-to tool for diversification and asset allocation”, she added.

Searches for ETFs on the Chinese search engine Baidu jumped nearly tenfold in early April, according to Baidu Index, which analyses user behaviour data on search trends, similar to Google Trends.

Young Chinese retail investors were investing in ETFs to take advantage of opportunities in sectors such as AI and electric vehicles – areas that Beijing was supporting to help boost the economy, according to Shen Meng, a director at Beijing-based investment firm Chanson & Co.

With low prices, sometimes just 1 or 2 yuan per unit, ETFs were more accessible to investors with limited funds, he said. “By investing in ETFs, they can participate in popular investment themes with a much lower entry threshold,” he added.

Based on the indexes tracked by ETFs, the top three by issuance volume in the first half of this year were digital economy, AI and semiconductor materials and equipment, according to Ping An Fund Management.

The outlook for technology sector ETFs like AI and consumer electronics was strong, the fund manager said.

‘China’s Ozempic’ pioneer inks deal with JD Health for online distribution

https://www.scmp.com/business/article/3318242/chinas-ozempic-pioneer-inks-deal-jd-health-online-distribution?utm_source=rss_feed

Innovent Biologics, the first Chinese company to win regulatory approval to sell a GLP-1 drug for weight loss and diabetes, will leverage JD Health’s online distribution network as it seeks to grab a slice of a market that could be worth 40 billion yuan (US$5.6 billion) in a decade.

The companies will collaborate on supply chain and sales channel development ahead of Innovent’s launch of mazdutide, as well as engage in a consumer education campaign.

“Innovent and JD Health will join hands to popularise knowledge about weight loss and blood sugar control via on and offline channels,” Innovent said in a statement posted on its WeChat account on Tuesday.

Late last month, eastern Jiangsu province-based Innovent said it received Chinese regulatory approval for mazdutide, which it claimed was the world’s first to mimic the natural hormones of GLP-1 and glucagon, with the latter playing a crucial role in regulating blood glucose levels.

GLP-1 drugs mimic the actions of the naturally produced hormone glucagon-like peptide-1, which regulates blood sugar levels, suppresses appetite and slows digestion.

“Innovent will make its breakthrough dual-target, liver fat-reducing weight loss therapy available to obese patients as soon as possible, to contribute towards the weight management and healthy China initiatives,” said chairman Michael Yu Dechao, without giving a time frame.

Some 34.3 per cent of mainland Chinese adults were estimated to be overweight and 11.2 per cent were obese, according to a 2022 study involving nearly 63,000 participants in 10 provinces. The results were published in 2024 by Public Health, a peer-reviewed journal.

Over 70 per cent of the population would be overweight or obese by 2030, and if the problem was not addressed effectively, it would consume 22 per cent of the nation’s total healthcare budget, according to the National Health Commission.

Last April, Beijing launched a nationwide weight management campaign as part of its “healthy China” 2019-2030 action plan, saying obesity had become “a major public health threat”.

China’s weight loss drugs market could grow to 40 billion yuan in 2035, according to Chen Ziyi, Goldman Sachs’ head of Asia healthcare research.

Currently, sales are primarily driven by Denmark-based Novo Nordisk, which reported US$285 million in GLP-1 drug sales for diabetes in China in the first quarter, and US$11 million in sales for weight loss applications. Dozens of Chinese firms are conducting clinical trials on both generic and novel alternatives.

Globally, industry estimates for sales of anti-obesity drugs range from US$100 billion to US$150 billion by 2035.

JD Health’s cold storage facilities in some 300 cities across the mainland could meet Innovent’s requirement for GLP-1 drugs to be stored at 2 to 8 degrees Celsius when in transit, Innovent said.

Innovent, among the first batch of biotech firms that went public in Hong Kong in 2018, has since launched 16 novel drugs for various types of cancer, as well as for autoimmune, metabolic and eye diseases.

Beijing-based JD Health operates one of China’s largest online healthcare platforms, with 183.6 million annual active users and an average daily online medical consultation volume of 490,000 last year. Its distribution network spans over 100,000 third-party merchants.

Last year, JD Health helped multiple global pharmaceutical firms distribute new drugs in China, including US-based Eli Lilly’s GLP-1 diabetes and weight loss drug tirzepatide, a rival to Novo Nordisk’s semaglutide.

Semaglutide is formulated and marketed as Ozempic for diabetes and Wegovy for weight loss.

China woman, left school at 15 to support her family, gets 7 million fans selling produce online

https://www.scmp.com/news/people-culture/trending-china/article/3316694/china-woman-left-school-15-support-her-family-gets-7-million-fans-selling-produce-online?utm_source=rss_feed

A woman from central China who started doing chores at the age of five and left school at 15 to support her disabled parents has gone viral for selling vegetables in her village.

Li Yayun, 27, from Henan province, is known online as Li Fugui. Her videos of rural life and heartfelt interactions with elderly villagers have earned her over 7 million followers on mainland social media.

Admired for her beauty and warm personality, fans have nicknamed her the “Vegetable Xi Shi” in reference to one of ancient China’s legendary beauties.

According to the mainland media outlet Jiupai News, both of Li’s parents have severe intellectual disabilities.

Her mother requires full-time care, while her father, who has the mental capacity of a six-year-old, can cook simple meals and ride an electric tricycle.

Li started doing household chores at the age of five and left school at 15 to support the family, taking jobs in sales, barbecue stalls and as a make-up artist.

She married at 19 but divorced a year later when her husband refused to share carer duties. After her grandmother died in 2020, she and her grandfather took over the care of her parents.

In recent years, Li has walked from village to village with a small cart, selling essentials to elderly residents who cannot travel far. With most young people working away, many elderly live alone.

“In the past, they had to walk hours to reach a market. I just want to make life easier for them. I am not in it for the money,” said Li.

She sells tofu, cold noodles, vegetables and pastries, often for just a few yuan.

In her videos, Li is often seen slipping extra tofu to elderly villagers or letting them try food for free. She also helps them dry wheat, make calls and fix phones.

Many treat her like their own daughter and often invite her to meals.

Years of working under the sun have left her hands calloused and her skin deeply tanned.

Every day, Li cooks for her parents, teaches her father to write and helps her grandfather care for fruit trees.

She also sells produce online and once used her earnings to take her grandfather on a trip to Beijing.

In June, Li dispelled rumours that she earns more than one million yuan (US$140,000) a year, saying her income is only slightly higher than that of an average office worker.

She said that all of her income comes from online sales and that she never accepts advertisements.

Li also said she is not looking for sympathy, only trying to make life brighter for her family.

“Many people with disabilities have it even harder, yet they still embrace life. I have no reason not to do the same,” she said.

Li’s story has captured widespread attention online, with related posts garnering more than 10 million views.

One online observer said: “The simplicity and sincerity of Li and the elderly villagers always move me. You just do not find that in fast-paced city life.”

“She is like a sunflower blooming in barren soi, strong, independent, and graceful,” another commented.

EU chief for Asia-Pacific set to leave role after China summit, sources say

https://www.scmp.com/news/china/diplomacy/article/3318236/eu-chief-asia-pacific-set-leave-role-after-china-summit-sources-say?utm_source=rss_feed

The European Union’s top official for Asia is to leave his role after a summit with China next week to take up a post in Sweden, the Post has learned.

Niclas Kvarnström, managing director for Asia and the Pacific in the European External Action Service, the bloc’s diplomatic corps, is returning to his homeland for a senior position in the government there, according to nine people familiar with the situation.

A summit in Beijing on July 24 will be his last official engagement in the role, a fitting finale for a diplomat who has helped steer the EU through ever-trickier ties with China. A search will then begin for his successor, with deputy managing director Paola Pampaloni set to take the helm on an interim basis.

Kvarnström, a fluent Chinese speaker, has become a respected and influential figure over two years working in the top Asia job in Brussels, before which he was head of the Asia-Pacific department of the Swedish Ministry of Foreign Affairs.

There, he played a key role in organising the EU’s first Indo-Pacific summit in Stockholm in 2023. Another such summit is planned for November under the steer of the EEAS with assistance from the Danish government, which is the holder of the rotating EU presidency.

One insider said the departure was “quite sudden”, while several suggested that the Swede would leave a big hole in the EU’s small China policymaking machine, despite his relatively short stint there.

It is generally agreed that Kvarnström, who spent several years in China working for the Swedish foreign ministry and was his country’s ambassador to Singapore, added depth and experience on Asia to the Brussels bubble’s relatively shallow pool of specialists.

With frequent trips to Asia, meetings with high-level figures in China’s foreign ministry, and regular engagement with Chinese diplomats in Brussels, he spearheaded a diplomatic re-engagement with Beijing after the pandemic years in which in-person contacts ground to a halt.

But his tenure also coincided with a broad decline in ties with China. Irked by Beijing’s close ties with Moscow and frustrated by its apparent refusal to take its concerns on trade more seriously, the EU has adopted a more hardline policy during the last couple of years.

He took on his role in the wake of a March 2023 speech by European Commission President Ursula von der Leyen, during which she announced that the bloc would “de-risk” its ties with China. The phrase quickly became a mantra in the Belgian capital, as the commission launched a blitzkrieg of investigations into Beijing’s trade practices.

Kvarnström was an outspoken critic of China’s perceived support for Russia’s invasion of Ukraine. He was often seen by the side of top EU diplomat Josep Borrell and his successor Kaja Kallas as they engaged and often sparred with Chinese Foreign Minister Wang Yi.

During a bruising encounter between Kallas and Wang this month, where the pair clashed strongly over Russia, he can be seen two seats down from the former Estonian prime minister, who was briefed before meeting the veteran Chinese diplomat by Kvarnström and his team.

He was dispatched to Beijing in February to help lay the groundwork for Kallas’ first short meeting with Wang in Munich that month, during which he met Liu Jianchao, who heads the Communist Party’s International Department.

The Swede departs with the relationship delicately poised. The summit in Beijing is expected to be a testy affair, with insiders expecting few concrete deliverables beyond, perhaps, the climate realm, which is seen as a separate track to thorny trade and geopolitical issues.

Even on this front, things are not plain sailing. On a trip to Beijing on Monday for talks on climate and the environment European Commission Vice-President Teresa Ribera warned her hosts against dumping electric vehicles in the EU market.

“We need to preserve an open economy, an open market such as the European one on the basis of transparency, predictability, rule of law, and level playing field,” she said, in remarks reported by the Irish Times.

“There is this assumption that counting on cheap equipment could be good to boost the potential of new developments and new decarbonisation pathways in the European market that could be beneficial. And there may be truth on one side, but as you also know, it may be difficult in terms of how it could impact on the capacity to ensure a level playing field. So we cannot accept any type of dumping practices,” she added.

China’s June new-home prices fall by the most in 8 months as weak sentiment grips market

https://www.scmp.com/business/article/3318235/chinas-june-new-home-prices-fall-most-8-months-weak-sentiment-grips-market?utm_source=rss_feed

New home prices across major cities in mainland China made the biggest decline in eight months in June, exacerbating the weak sentiment in the economy and renewing calls for stimulus measures to resume growth.

A price gauge of newly completed homes in 70 major cities fell 0.3 per cent last month from May, faster than the 0.2 per cent decline the previous month, according to data published by the government’s statistics bureau on Tuesday. That was the worst monthly drop in eight months. June’s prices retreated 3.2 per cent from a year earlier.

The so-called first-tier cities of Beijing, Shenzhen and Guangzhou – often held as the bellwether of China’s economy – bore the brunt of the declines, with prices falling 0.3 per cent last month, compared with the 0.2 per cent drop in May. Shanghai, the mainland’s premier commercial city, bucked the declining trend. Prices fell 0.2 per cent in the second-tier cities comprising provincial capitals, and retraced by 0.3 per cent in the third-tier cities.

Falling prices in Shenzhen, a technology metropolis often touted as “China’s Silicon Valley,” underscored why the city’s largest developer, China Vanke, said it could post a first-half net loss of between 10 billion yuan (US$1.4 billion) and 12 billion yuan this year. The developer, which reported a first-half net loss of 9.85 billion yuan last year, continued to struggle with a significantly lower volume of project deliveries.

The disappointing data weighed on mainland Chinese property stocks on the Hong Kong stock exchange today, with Longfor Group retreating 3.3 per cent to HK$10.10 while China Resources Land fell 2.5 per cent to HK$28.75 in recent trading.

The number of cities recording a drop in home prices increased in June, which reflected a more urgent need to strengthen the stabilising trend of housing prices, said Yan Yuejin, vice-president of E-House China Real Estate Research Institute in Shanghai.

China has been ramping up support for the housing market to reverse a five-year slump, triggered by the government’s policy in August 2020 to control excessive debt among the weakest developers. While Beijing aimed to prevent systemic risk to the system, the campaign fanned a liquidity crunch and loss of confidence among homebuyers.

Those support measures included a liquidity injection to boost lending capacity, funding lifelines for approved housing developers, interest rate cuts, easier mortgage financing limits and looser requirements for home ownership.

The State Council, China’s cabinet, pledged in a meeting on June 13 to conduct a nationwide survey of land for development and property projects under construction to enhance policy effectiveness.

“Without new strong supportive measures, home prices in China are still under pressure and are expected to drop more, especially as both the job market and household incomes are very challenging,” said Raymond Cheng, an independent analyst.

The closely watched gross domestic product (GDP) figures, released by the National Bureau of Statistics (NBS) on Tuesday, expanded by 5.2 per cent in the second quarter, keeping it broadly on track to meet this year’s growth target.

The second-quarter growth – which marked a slight deceleration from the 5.4 per cent expansion recorded in the first three months of 2025 – brought China’s first-half growth to 5.3 per cent, according to the NBS.

China’s Tianlong-3 rocket passes critical stress test a year after explosive mishap

https://www.scmp.com/news/china/science/article/3318085/chinas-tianlong-3-rocket-passes-critical-stress-test-year-after-explosive-mishap?utm_source=rss_feed

A year after its rocket accidentally lifted off and then crashed during a test, Beijing-based start-up Space Pioneer has redesigned the vehicle and shown that it can withstand the intense forces of launch.

In a recent ground-based test in central China, the company used the rocket’s nine-engine first stage – which produces nearly 900 tonnes of thrust combined – to simulate key mission phases, including fuelling, lift-off, flight and recovery.

The structure held up under all test conditions, the company said on its social media account on Friday.

On June 30 last year, the company conducted a static-fire test with the first stage of its new Tianlong-3 rocket in Gongyi, a city of about 800,000 people in Henan province.

The rocket was supposed to remain anchored during the test, but instead lifted off unexpectedly and crashed in a hilly area nearby, creating a massive fireball that was captured on video by onlookers.

While Space Pioneer had previously blamed the crash on a “structural failure between the rocket and the test stand”, it has since added that the incident was the direct result of the weak design of the rocket’s tail section.

Space Pioneer said the rocket’s tail section – where all nine engines are mounted – must endure enormous stress during ignition. It also has to handle a wide range of forces throughout the mission, from standing upright in high winds and bearing the rocket’s full weight to the shaking and bending of ascent, and the impact of landing during reuse.

“Balancing all these demands makes the tail section one of the hardest parts to design on a large reusable rocket,” the company said.

Space Pioneer said that since the crash, it has carried out more than 100 technical upgrades to improve reliability, including structural reinforcements, backup systems and better diagnostics for engine health and control systems.

It also introduced 13 new ground tests to validate the changes. “Our goal is to turn Tianlong-3 into a rocket that’s not only affordable but also dependable and trusted by customers,” it said.

The company did not confirm a date for Tianlong-3’s maiden flight. But at an aerospace expo in Shanghai in April, brand director Su Shenghua said the company aimed to launch Tianlong-3 in July or August.

“We’re directly aiming to match Elon Musk’s Falcon 9,” Su said. “It can carry up to 17 tonnes to low-Earth orbit and 14 tonnes to sun-synchronous orbit – making it the most powerful liquid-fuelled rocket in China’s commercial space sector right now.”

Su also revealed that the company was developing a crewed version of the rocket, called the Tianlong-3M series. “The plan is for it to fly up to 14,000km [8,700 miles] and carry around 60 passengers,” he said.

“It’s a product designed to one day make rocket travel part of everyday life – where ordinary people can take a rocket like they take a plane, making global one-hour travel possible. For example, flying from Shanghai to New York in under an hour,” he said.

Viral knife attack on Chinese student shocks Malaysia

https://www.scmp.com/week-asia/people/article/3318227/viral-knife-attack-chinese-student-shocks-malaysia?utm_source=rss_feed

Malaysian police arrested a 21-year-old Chinese national on Monday on suspicion of slashing his ex-girlfriend’s neck with a knife at Taylor’s University on the outskirts of Kuala Lumpur.

Footage of the attack posted by students to Reddit and RedNote showed the victim, aged 20 and also Chinese, sprawled on the floor, clutching her neck as friends desperately called for help. Other students restrained the suspect, who was still holding a knife, until authorities arrived.

Subang Jaya police confirmed that the victim had suffered a slash wound to the left side of her neck but said she was in a stable condition.

“She was taken to the emergency unit of University of Malaya Medical Centre (PPUM) and placed in the red zone for further treatment,” district police chief Wan Azlan Wan Mamat said in a statement.

A Taylor’s University student, speaking on condition of anonymity, said the relationship between the victim and suspect had soured dramatically after their break-up, with the suspect allegedly threatening his ex-girlfriend’s pet cat if she insisted on ending the relationship.

“He sprayed the cat with bug spray. I think it really died. There’s a video of the incident being shared among students,” the student told This Week in Asia. The victim was reportedly being detained against her will before the attack.

Police said the suspect was apprehended at the scene and that the motive was still under investigation.

The case is being investigated under Section 324 of Malaysia’s Penal Code for causing hurt with a dangerous weapon, an offence that carries a prison sentence of up to 10 years upon conviction.

News of the attack has shocked the Malaysian public, fuelling debate online about campus safety and student behaviour. Many questioned whether universities were adequately protecting students given the recent spate of “very risky” incidents.

The latest incident comes just weeks after the high-profile murder of University of Cyberjaya physiotherapy student Maniishapriet Kaur Akhara on June 23.

Prosecutors allege that Maniishapriet was killed by her housemate’s boyfriend, Sri Darvein Manthavan, 19, helped by her housemate, Thineswary V. Devendran, also 19.

The accused allegedly robbed Maniishapriet after the murder and withdrew cash using her bank cards. Both face the death penalty if convicted, or alternatively, a prison term of 30 to 40 years and not less than 12 strokes of the cane.

Tech war: Nvidia says it will resume sales of H20 graphic processing chips to China

https://www.scmp.com/tech/tech-war/article/3318215/tech-war-nvidia-says-it-will-resume-sales-h20-graphic-processing-chips-china?utm_source=rss_feed

Nvidia will resume selling its H20 chips in China and release a new graphics processing unit (GPU) for the country in compliance with US export restrictions, according to a statement amid the visit by its CEO Jensen Huang to Beijing.

Nvidia has applied to sell the H20 GPU again, and the US government has “assured Nvidia that licenses will be granted” and Nvidia is expected to start deliveries soon, according to a company statement on Tuesday. Nvidia “hopes to start deliveries soon”, it said.

Huang also announced a “new, fully compliant” Nvidia RTX PRO GPU that “is ideal for digital twin AI for smart factories and logistics”.

Huang is visiting Beijing and will attend a big supply chain conference as a guest of honour.

More to follow ...

Can a superalloy technique fix China’s aircraft engine woes, even for sixth-gen fighters?

https://www.scmp.com/news/china/military/article/3318157/can-superalloy-technique-fix-chinas-aircraft-engine-woes-even-sixth-gen-fighters?utm_source=rss_feed

Chinese researchers working on a new superalloy processing technique say their lab results suggest it could be used to build stronger and longer-lasting aircraft engines, according to state media.

Superalloy turbine discs are a core component of aircraft engines and the new technique to cool down the metal alloy faster during manufacturing could significantly improve performance, the official Science and Technology Daily reported on Friday.

It said the new technology had the potential to be used in the engines powering the country’s new sixth-generation fighter jets.

With at least two of these next-gen fighter jets currently under development, there is an urgent need to develop advanced, high-performance aircraft engines – an area where China has lagged behind the West.

To do this, the team at Dalian University of Technology in northeast China tackled a key challenge in the manufacturing process: finding a way to rapidly cool the forged turbine discs made of superalloy.

These discs are among the heaviest and most technically demanding parts of an aircraft engine. Their quality and durability has long been an obstacle for the industry since this determines the engine’s power, efficiency and lifespan.

In an aircraft engine, the turbine discs are the base on which turbine blades are mounted. The discs convert the thermal energy generated by fuel combustion into the rotational force needed to propel the aircraft.

That means the superalloy the discs are made from must be able to withstand extreme temperatures, high pressure and high rotational speeds.

During manufacturing, faster cooling produces smaller and more evenly distributed grains in the metal alloy, which translates to stronger, smoother surfaces and a longer lifespan.

The team in Dalian have developed a technique where multiple high-speed jets of water are used to cool the superalloy in a fine, uniform mist. A computer simulation model is used to optimise placement of the nozzles and jet settings so that the process is precisely controlled, according to the report.

The team said their experiment data showed the cooling speed was 3.75 times faster using this method, and there was a more than a fourfold improvement in crystal grain size distribution.

An ultra-high temperature disc at 1,200 degrees Celsius (2,192 Fahrenheit) cooled down by 673 degrees per minute using this approach, the report said.

“Our cooling speed has met the demands of the new generation of aviation engines,” said Shi Jinhe, a leader of the research team. “We will … accelerate the application and transformation of the lab results.”

The report did not say how much difference that could make to the performance of turbine discs in terms of temperature resistance and reliability.

Aircraft engines have been a challenge for China. Its fifth-generation fighter jet, the J-20, was plagued for years with engine troubles referred to as “heart disease”.

Development of its WS-15 engine was repeatedly delayed and the fighter jet instead had an inferior engine that was said to have held it back from reaching its full potential, especially when it came to manoeuvrability and stealth capacity at supersonic speed. It was not until July 2023 that the first J-20 prototype fitted with two WS-15 engines began testing – more than 12 years after the J-20’s maiden flight.

Aircraft engine technology has been designated as a key priority in various state strategies as Beijing tries to push the sector to make progress and catch up with other nations. That has seen advances in powder metallurgy processing and the DD6 superalloy, which was used for the turbine discs of the WS-15 engine.

Researchers are said to be developing a DD9 superalloy for China’s next-generation fighter jet engine. That superalloy is reportedly able to withstand temperatures of up to 1,200 degrees, which would put it on par with the XA100 engine made by GE Aerospace for America’s F-35 fighter jet.

China’s drug prowess on show at global event, drawing industry ‘shoppers’: Jefferies

https://www.scmp.com/business/article/3318179/chinas-drug-prowess-show-global-event-drawing-industry-shoppers-jefferies?utm_source=rss_feed

China’s cost and efficiency advantages in drug development have been recognised at the world’s largest cancer research conference in the US, where companies were eagerly shopping for Chinese innovations, according to a new report.

Nearly a third of the presentations at the American Society of Clinical Oncology’s annual meeting last month involved drug candidates from Chinese companies, American brokerage Jefferies said on Monday in its “Shopping in China’s Biotech Supermarket” report. Chinese firms made 73 presentations at this year’s event, up from one a decade ago, it noted.

The event allowed novel drug developers to showcase their latest research findings and find potential partners to accelerate the development of drug candidates across global markets.

“Increasingly, multinationals are turning their attention to Chinese biotech companies and assets, given their cost efficiencies, accelerated timelines and promising quality,” said lead author Cui Cui, Jefferies’ head of healthcare research for Asia, in the report.

Multinationals, facing rising pressure from potential sharp declines in prices as patents expire on their top-selling drugs, are finding China an increasingly attractive place to acquire development rights through licensing deals, she said.

Such deals typically give the acquirers exclusive rights to develop drugs that have already shown promising efficacy and safety by conducting large-scale clinical trials and applying for approval in certain agreed markets. In general, the Chinese firms that discover the compounds retain the rights in their home market.

Chinese drug developers landed 33 deals with overseas peers in the year’s first three months, up from 28 a year earlier, with the transactions totalling US$36.2 billion, according to mainland pharmaceutical consultancy DrugTimes.

Leading Chinese firms could deliver a drug candidate ready for clinical trials in 12 to 20 months, compared with a global industry average of 24 to 36 months, the report said, citing data from consultancy McKinsey.

China’s large population also made it possible to enrol patients in oncology clinical trials two to five times faster than elsewhere in the world, while lower salaries for biochemical researchers and supply chain cost advantages also reduced drug development costs, it added.

Despite the average value of a licensing deal for a Chinese drug candidate increasing 25 per cent in this year’s first five months to US$521 million, compared with 2024, Chinese biotech assets continued to trade at discounts of 40 to 50 per cent to comparable global transactions, Jefferies said.

This reflected concerns about data credibility and the need for Chinese firms to demonstrate the clinical superiority of their candidates and overcome regulatory hurdles for overseas commercialisation, it added. Only a handful of drugs discovered by Chinese firms have achieved global commercial success so far.

Countering the scepticism, Guangzhou-based Akeso’s lung cancer immunotherapy drug outperformed US-based Merck’s Keytruda in clinical trial results published in March, helping patients survive longer without their condition worsening. The drug was approved for sale in China, but more trial results are needed for approvals overseas.

The talent gambit: how the US’ brain drain is China’s brain gain

https://www.scmp.com/news/china/science/article/3318178/talent-gambit-how-us-brain-drain-chinas-brain-gain?utm_source=rss_feed

This year, Beijing’s Tsinghua University is up two spots to be just outside the top 10.

Peking University and Zhejiang University have also moved up the list, climbing to 25th and 45th respectively.

The rankings are the latest list of the Best Global Universities compiled by American media company US News and World Report, which looks at 2,250 top institutions from 105 countries.

The assessment focuses exclusively on the overall academic research and reputations of the universities, weighing up 13 factors, from publications to citation impact.

This year’s results show just how far Chinese universities have come in a few short years. In 2018, Tsinghua University was 50th and Peking University 68th, the only two in the top 100. Now they are among 15 Chinese universities in the top 100, with Tsinghua leading the pack at 11th.

It has been a steady rise for Chinese institutions up these kinds of ladders in recent decades, one built on sustained investment in education, students and recruitment of overseas staff.

That brain gain is growing in momentum, as the administration of US President Donald Trump flip-flops on visas for international students and cuts research funding, deterring more of China’s best and brightest from study and research in the United States.

The decline in Chinese students heading to the US has been particularly stark over the past five years.

In the 2019-20 academic year, China accounted for the largest group of international students in the United States, with 372,532 crossing the Pacific for further studies. By the 2023-24 school year, that number had fallen to 277,398, a decline of more than a quarter over that period.

So much so that India now sends more students to the US than China.

Similarly, almost 20,000 scientists of Chinese descent left the US for other countries between 2010 and 2021, according to a study by Princeton University sociologist Yu Xie.

The rate jumped after 2018 when the US government launched the “China Initiative” in what it framed as an effort to uncover “Chinese economic espionage” threatening US national security.

The China Initiative was launched during Trump’s first term and reportedly involved US Department of Justice investigations of thousands of scientists suspected of hiding Chinese connections. Most cases were quickly dropped due to lack of evidence, and the programme was scrapped in 2022 under Trump’s successor, Joe Biden.

However, the academic chill between China and the US is also apparent at the institutional level. In January, the University of Michigan ended a two-decade partnership with Shanghai Jiao Tong University over what it said were national security risks.

The University of California, Berkeley, recently announced it was decoupling from the Tsinghua-Berkeley Shenzhen Institute after the US government began investigating millions of undisclosed dollars given to the institute by the Chinese government.

And in September 2024, the Georgia Institute of Technology announced the end of its participation at the China-based Georgia Tech Shenzhen Institute, also due to national security concerns.

The effect could be lasting.

While the most popular American universities – Harvard, the Massachusetts Institute of Technology, and Stanford – continue to dominate the top spots in the US News university rankings, “visa challenges and government scrutiny could deter talented Chinese students and researchers from choosing to study in the US in the future”, according to Rick Carew, adjunct professor of finance and economics at Fordham University’s Gabelli School of Business in New York.

“China-born scholars contribute immensely to academic research in the US. The heightened US-China political tensions have made them a target for scrutiny,” Carew said.

“Generous funding and the opportunity to teach the next generation of top Chinese students in their native language have made offers to return to Chinese universities attractive for some top scholars more interested in conducting research than geopolitics.”

One of the major pull factors for returning to China – the increase in funding – stems from Beijing’s efforts to ramp up domestic innovation and development. China is seeking to move up the industrial value chain and is counting on investment in high technology to help get it there. At the National Science and Technology Conference in the capital last year, Chinese President Xi Jinping set a 2035 goal to develop the country’s science and technology sectors into world-leading research hubs.

That involves a bigger emphasis on research. According to a report released in March by the Organisation for Economic Cooperation and Development, China spent more than US$780 billion on research and development in 2023, reaching 96 per cent of US R&D spending, measured in terms of gross domestic expenditure. That compared with just 72 per cent 10 years earlier.

In 2017, China surpassed the US in terms of research output, and since then has generated an increasing number of cited publications, a sign that Chinese research is attracting more attention from the international research community, according to the Springer Nature 2024 China Impact Report.

Xiong Bingqi, dean of the 21st Century Education Research Institute in Beijing, said conditions for researchers had improved over the past five years, with incentives such as higher salaries, better research funding, and benefits like housing subsidies and healthcare.

“The good scientific research environment has attracted a large number of foreign academic talent to teach in China, and the talent attraction policies are also quite helpful,” Xiong said.

Zhejiang University, a cradle of tech start-ups in China, has been on the receiving end of some of the research funding and has attracted notable scientists from the US. That reputation was burnished this year when university engineering graduate Liang Wenfeng made the world sit up with his AI start-up DeepSeek and its cost-effective, open-source and competitive approach to large language models.

Notably, many of the people at DeepSeek were young and educated wholly in China. In an interview with The China Academy, an academic networking hub, Liang said his hiring practice was to pick and nourish fresh young graduates from the very top Chinese universities but with little to no work experience.

Apart from DeepSeek, Zhejiang University graduates have been at the forefront of other innovative tech start-ups such as Deep Robotics, known for specialising in robot dogs and pioneering autonomous inspections of electrical substations and dangerous high-voltage environments. Both companies are part of the “Six Little Dragons”, the Hangzhou-based tech firms whose successes have come to embody China’s tech aspirations.

“China produces an estimated 1.4 million engineering graduates each year, providing fresh talent to technology firms like Huawei and BYD competing with Silicon Valley,” Carew said.

“Chinese tech innovation has benefited from a combination of engineering talent, China’s advanced manufacturing ecosystem in Zhejiang and Shenzhen, and government policies supporting investment in hard tech industries.”

In addition, US controls on technology exports to China, such as a ban on sales of some advanced chips, introduced in 2022 were supposed to help secure technological leadership, but they ended up costing US companies billions of dollars in market capitalisation while boosting Chinese domestic innovation and self-reliance, according to a 2024 report by the Federal Reserve Bank of New York.

But this has not always been the case. China-US relations, arguably one of the world’s most important sets of bilateral ties, boast decades of strategic academic cooperation and competition.

In 1979, the two countries signed the US-China Science and Technology Cooperation Agreement. That agreement was renewed late last year after much delay and some changes but the extension signalled a continued willingness to cooperate.

And in May, Beijing’s Tsinghua University opened four new residential colleges aimed at developing talent in science, engineering and AI, with one of them designed specifically for international students. The colleges were part of a global strategy launched in 2021 to boost worldwide competitiveness.

“Promoting internationalisation is an important part of efforts by Chinese universities to enhance their competitiveness,” Xiong said.

Attracting American students to China is one of Xi’s goals. In late 2023, Xi said China was ready to invite 50,000 young Americans to China on exchange and study programmes in the next five years to increase exchanges between the two peoples, especially between the youth.

The number of American students studying in China is a shadow of just a decade ago.

In the 2023-24 academic year, 800 US students were enrolled in Chinese universities, according to a 2024 American Chamber of Commerce in China report. Enrolments peaked in 2011, when around 15,000 Americans studied in China. The drastic decline was attributed mostly to three years of the zero-Covid policy and ongoing bilateral tensions. Just before the pandemic, 11,000 American students had been studying in China, according to the report.

Improving those numbers would not just benefit international relations.

Xiong, from 21st Century Education, said that maintaining a global education push was “a strategic step in building a strong country”.

“The tensions will have a severe impact on Chinese universities to achieve joint international cooperation in scientific research and talent cultivation,” Xiong said.

And university rankings may not be the best way of measuring that success.

Xiong said that rating systems could have a negative influence on university operations, leading to more pressure for quantity over quality and more frequent cases of fraudulent research papers.

“Ranking universities by using indicators such as the number of papers published and the number of citations is a simplistic and quantitative approach, but the spiritual qualities and traditions of a university cannot be quantified,” Xiong said.

“Talent development is the key to competitiveness. We cannot have first-class scientific research without first-class talent.”

Additional reporting by Carl Zhang