• Indonesian leader Prabowo cancels China trip as protests spread further outside capital
• China’s senior trade negotiator calls for ‘equal dialogue’ during US visit
• Russia’s Vladimir Putin vows to deepen China ties, slams ‘distortion’ of WWII history
• Why Chinese tourism to US is still rising despite Trump: ‘hard to replicate’
• Early ‘Red Star Over China’ editions unveiled in Shanghai to mark WWII anniversary
• A new model for peace? China takes its Global Security Initiative to Africa
• China and India: love in the time of cholera
• China ‘PhD village’ celebrates after gaining another doctoral student; has 33 PhDs already
• When North Koreans raise a toast, it’s increasingly Chinese wine, as import volume surges
• Human microbiome scientist Wang Leyao leaves troubled US government agency for China
• Typhon warning: China hits out at Japan over US missile system deployment
• China’s US$22 trillion savings and global investors a potent mix for equity markets
• Chinese wife hangs banners, ‘thanking’ best friend for sleeping with husband for 5 years
• How China streamlines national labs into tech war machines: a case study of HK

Indonesian leader Prabowo cancels China trip as protests spread further outside capital

https://www.scmp.com/news/asia/southeast-asia/article/3323785/indonesian-leader-prabowo-cancels-china-trip-protests-spread-further-outside-capital?utm_source=rss_feed

Indonesian President Prabowo Subianto on Saturday cancelled a planned trip to China as days of protests spread further outside the capital Jakarta, with several regional parliament buildings set ablaze.

Prabowo had been expected to attend a “Victory Day” parade in Beijing on September 3 to mark the 80th anniversary of the end of World War II following Japan’s formal surrender.

The protests, the first major test for Prabowo’s nearly year-old government, began in Jakarta this week over lawmakers’ pay and worsened after a police vehicle hit and killed a motorcycle rider.

“The president wants to continue monitoring [the situation in Indonesia] directly and seek the best solutions,” presidential spokesperson Prasetyo Hadi said in a video statement on Saturday.

“Therefore, the president apologises to the Chinese government that he could not attend the invitation.”

Another consideration in cancelling the trip was a United Nations General Assembly session in September, Prasetyo said.

In light of the protest, short-video app TikTok, which is owned by China’s ByteDance, said on Saturday it had suspended its live feature in Indonesia for a few days.

“Due to escalating violence during protests in Indonesia, we have voluntarily introduced additional safeguards to keep TikTok a safe and civil space,” a TikTok spokesperson told Agence France-Presse.

“Out of an abundance of caution, TikTok LIVE is temporarily suspended for a few days in Indonesia.”

Jakarta had this week summoned representatives of social media platforms, including Meta Platforms and TikTok, and told them to boost content moderation because disinformation had spread online.

The government says that such disinformation has spurred protests against it.

TikTok said it would continue to monitor the situation closely.

Indonesia has one of the world’s biggest audiences on TikTok, with more than 100 million users.

In some videos of the protests posted on the service on Saturday, users complained they could not use the live feature.

Earlier on Saturday, protesters caused fires at regional parliament buildings in three provinces – West Nusa Tenggara, Pekalongan city in Central Java and Cirebon city in West Java, local media reported.

Local media Detik.com said protesters had looted parliamentary office equipment in Cirebon and police fired tear gas to disperse protesters in Pekalongan and West Nusa Tenggara.

Three people were killed on Friday in an arson attack on a parliament building in Makassar, the capital of South Sulawesi province, Indonesia’s disaster management agency said.

State news agency Antara said the victims had been trapped in the burning building, and the disaster management agency said two people were injured after jumping out of the building to escape the fire.

Local media outlet metrotvnews.com reported one further death from a fire at the Makassar parliamentary building. This could not be independently confirmed.

Protests also took place on Indonesia’s holiday island of Bali, where tear gas was used against protesters.

Local media also reported that a crowd had looted the Jakarta home of Ahmad Sahroni, a lawmaker from the political party NasDem, and taken items including household furniture.

Sahroni has faced accusations of responding insensitively to people calling for parliament to be dissolved amid anger over lawmakers’ allowances. Sahroni has labelled such critics “the stupidest people in the world”.

Additional reporting by Agence France-Presse

China’s senior trade negotiator calls for ‘equal dialogue’ during US visit

https://www.scmp.com/news/china/diplomacy/article/3323753/chinas-senior-trade-negotiator-calls-equal-dialogue-during-us-visit?utm_source=rss_feed

China and the US should manage their differences and expand cooperation through “equal dialogue and consultation”, senior Chinese trade negotiator Li Chenggang said during a visit to the United States amid a trade war truce between the two powers.

Li wrapped up his three-day visit on Friday after meeting with officials from the US Department of the Treasury, the Department of Commerce and the Office of the US Trade Representative, according to a statement from the Chinese commerce ministry on Saturday.

He also held talks with representatives from the US-China Business Council, the US Chamber of Commerce and several US companies.

China and the US are preparing for their fourth round of trade talks, to be held around November when the 90-day truce deal expires and before a potential visit by US President Donald Trump to China.

Li’s visit also came before an intense week of diplomacy in China, which will host the Shanghai Cooperation Organisation (SCO) summit in Tianjin from Sunday, followed by a grand military parade in Beijing to commemorate the 80th anniversary of the end of World War II.

The two sides “exchanged views on bilateral economic and trade relations and the implementation of prior consensus reached in Sino-American trade negotiations”, the ministry said.

Li called for both sides to pave the way for a “healthy, stable and sustainable development of economic and trade relations” by leveraging the trade talk mechanism and equal dialogue to manage differences and explore cooperation, according to the ministry.

Since being appointed as China’s international trade representative and vice-minister of commerce in April, when Trump announced a new round of global tariffs, Li has taken part in all three rounds of trade negotiations with the US – in Geneva, London and Stockholm.

As reciprocal tariffs surpassed 100 per cent, the two countries agreed in May to remove most of the heavy levies for 90 days and establish a trade consultation mechanism to ease future dialogue.

Late last month, the tariff truce was extended for another 90 days, after the most recent round of talks in Stockholm.

On Wednesday, US Treasury Secretary Scott Bessent, who has led the US delegation in trade negotiations with China, described the bilateral relationship as “very complicated”.

He said “everything is on the table” in trade talks with China, and that he would meet his Chinese counterpart again at the end of October or the beginning of November.

Beijing is gearing up for a Victory Day military parade to mark the end of World War II on September 3. America’s envoy to Beijing is expected to skip the parade, joining what appears to be a concerted effort by Western missions to opt out of the grand event despite Chinese pressure, according to sources who spoke to the South China Morning Post.

Media reports in June suggested that China had planned to invite Trump to the parade, but the Chinese foreign ministry did not confirm or deny the plan, saying it had no information. Analysts suggested at the time that Trump’s attendance could undermine Washington’s posture in the Indo-Pacific region.

Around 26 foreign leaders have confirmed their attendance at the parade, including Russian President Vladimir Putin and North Korean leader Kim Jong-un, as well as dignitaries from Vietnam, Indonesia, Malaysia, Pakistan, Belarus, Iran, Serbia, Slovakia and Central Asian nations.

China is also hosting dozens of political heavyweights in the northern city of Tianjin near Beijing for the SCO summit on Sunday and Monday. More than 20 world leaders and 10 heads of international organisations will attend, including Putin and Indian Prime Minister Narendra Modi.

Greeting UN chief Antonio Guterres in Tianjin on Saturday, President Xi Jinping said China supported the United Nations in playing a central role in international affairs and upheld “true multilateralism”, according to state broadcaster CCTV.

“[The SCO] is a priority in China’s neighbourhood diplomacy and an important component of its overall diplomatic strategy,” Foreign Minister Wang Yi wrote in Saturday’s edition of People’s Daily, the mouthpiece of the Communist Party.

While the international situation becomes “more turbulent and unstable”, the SCO will enhance its cohesion and continue to practise multilateralism, Wang wrote.

Russia’s Vladimir Putin vows to deepen China ties, slams ‘distortion’ of WWII history

https://www.scmp.com/news/china/diplomacy/article/3323776/russias-vladimir-putin-vows-deepen-china-ties-slams-distortion-wwii-history?utm_source=rss_feed

Russian President Vladimir Putin has condemned “attempts to distort” World War II history while pledging to deepen strategic collaboration with China on the eve of a state visit to the country.

During his four-day trip, described by the Kremlin as “absolutely unprecedented”, Putin is expected to join regional leaders for the Shanghai Cooperation Organisation (SCO) summit in Tianjin on Sunday, before holding bilateral talks with Chinese President Xi Jinping in Beijing on Tuesday.

On Wednesday, Putin will be the guest of honour at China’s World War II Victory Day parade in Tiananmen Square and will be seated to the right of Xi, according to the Kremlin.

In an interview with Xinhua published on Saturday, Putin reaffirmed the close cooperation between Russia and China, which is expected to be high on the agenda during his talks with Xi.

“I look forward to in-depth discussions with President Xi Jinping on all aspects of our bilateral agenda, including political and security cooperation, as well as economic, cultural and humanitarian ties. And, as always, we will exchange views on pressing regional and international issues,” Putin told the Chinese state news agency.

Russia and China had taken a “common stand against discriminatory sanctions”, Putin added, in a likely reference to Western trade restrictions and economic penalties imposed after the Russian invasion of Ukraine in early 2022.

The V-Day parade is a centrepiece of events commemorating the 80th anniversary of China’s victory in the “people’s war of resistance against Japanese aggression” and the global triumph over fascism.

It is Beijing’s second event of its kind, after the 70th anniversary in 2015.

China and Russia – then the Soviet Union – had suffered “the heaviest losses” during the second world war, Putin said.

“In Russia, we will never forget that China’s heroic resistance was one of the crucial factors that prevented Japan from stabbing the Soviet Union in the back during the darkest months of 1941–1942. This enabled the [Soviet] Red Army to concentrate its efforts on crushing Nazism and liberating Europe,” he told Xinhua.

The Soviet Union lost 27 million lives during the second world war, better known in Russia as the Great Patriotic War from 1941 to 1945.

In China, the brutal war against the Japanese caused over 35 million civilian and military casualties between Japan’s invasion of Manchuria in 1931 to its formal surrender in 1945, according to official Chinese figures.

But “in certain Western states the results of the Second World War are de facto revised”, Putin said.

“Inconvenient historical facts are erased”, he alleged, adding that “historical truth is being distorted and suppressed to suit their current political agendas”.

He said Japanese militarism was “being revived under the pretext of imaginary Russian or Chinese threats”, while Europe was taking steps towards “the re-militarisation of the continent, with little regard for historical parallels”, thereby encouraging “revanchism and neo-Nazism”.

“Russia and China resolutely condemn any attempts to distort the history of the second world war, glorify Nazis, militarists and their accomplices, members of death squads and killers, or to defame Soviet liberators.

“The results of that war are enshrined in the UN Charter and other international instruments. They are inviolable and not subject to revision,” Putin asserted.

“This is our shared, unwavering position with our Chinese friends.”

Amid Western hostility fuelled by Putin’s invasion of Ukraine in February 2022, China and Russia have been characterised as revisionist powers seeking to challenge the global order established after World War II, and few Western leaders are expected to attend the September 3 parade.

Both China and Russia assert that they are the real guardians of the post-war international order while accusing the West of fomenting “bloc confrontations”.

The neighbours are also intensifying efforts to court the Global South, characterising themselves as defenders of multilateralism against what they call a crumbling world order, particularly under Donald Trump’s “America first” agenda.

Xi is expected to host more than 20 world leaders and 10 heads of international organisations in Tianjin for the August 31 to September 1 SCO summit. According to Beijing, it is “the largest” such gathering since the security grouping was established in 2001 by Russia and China alongside the Central Asian states of Kazakhstan, Kyrgyzstan, Tajikistan and Uzbekistan.

The bloc now has 10 member states, and its scope has expanded from security and anti-terrorism to trade and economy.

One notable participant in Tianjin will be Indian Prime Minister Narendra Modi, who will be on his first trip to China in seven years and has also sought to shore up strategic ties with Russia amid tariffs backlash from the United States over India’s purchase of Russian oil.

Russia and China would strive to “strengthen technological sovereignty”, Putin told Xinhua, highlighting collaboration on education and scientific innovation, especially in fundamental research and mega science projects, as well as the establishment of modern laboratories and advanced centres in priority hi-tech fields.

Russia’s trade with China reached a historic high of US$244.8 billion last year and is expected to continue the momentum, despite the challenges posed by Western sanctions and geopolitical tensions.

To expand fuel trade with China, Russia plans to launch a new natural gas route in 2027 called the Far Eastern Route. The project stems from a 2022 agreement between Russia’s Gazprom and China National Petroleum Corporation. It will increase Russian pipeline gas supplies to China by 10 billion cubic meters per year.

“Economic cooperation, trade and industrial collaboration between our countries are advancing across multiple areas,” Putin said, pledging to “certainly discuss further prospects for mutually beneficial cooperation and new steps to intensify it” during his visit.

Why Chinese tourism to US is still rising despite Trump: ‘hard to replicate’

https://www.scmp.com/economy/china-economy/article/3323643/why-chinese-tourism-us-still-rising-despite-trump-hard-replicate?utm_source=rss_feed

When Gao Huasheng, a university professor from Shanghai, began planning a two-week family holiday to San Francisco earlier this year, he worried about exposing his children to scenes of drug use or even gun violence.

But in the end, the 44-year-old decided to go ahead with the trip – and his fears turned out to be misplaced. The family’s visit to the Six Flags Discovery Kingdom amusement park and road trip down the Pacific coast went off without a hitch.

“My children said it was exciting, not crowded and not hot,” Gao said, referring to Six Flags.

Many Chinese tourists appear to be making the same call in 2025: to travel to the United States despite a host of misgivings.

Chinese tourism to the United States is up so far this year compared with 2023 and 2024 levels, confounding the expectations of many pundits. But industry insiders say a growing list of deterrents – from inflation and safety concerns to visa snags – still threatens to push the numbers downward over the long term.

In the first six months of 2025, the US International Trade Administration logged 755,225 arrivals from China, up 2.57 per cent compared with the same period last year. Arrivals reached 410,306 in the first half of 2023.

Tourist departures from China to the US in July and August are expected to total about 316,000 this year, up from 269,000 last year and 52,000 in 2023, when China was still emerging from the shadow of the Covid-19 pandemic, travel marketing and technology company China Trading Desk told the Post.

For now, at least, Chinese tourists’ desire to visit famous American landmarks appears to be overriding their concerns over US President Donald Trump’s harsh border policies, which have led Chinese nationals to face tougher visa approvals and unexpected grillings at US immigration checkpoints in recent months.

“The US possesses globally iconic tourism resources that remain difficult to replicate elsewhere,” China Trading Desk CEO Subramania Bhatt said. “Natural wonders such as Yellowstone and the Grand Canyon and cultural landmarks such as the Statue of Liberty and Hollywood exert a powerful draw, particularly for first-time visitors seeking to check in at bucket-list sites.”

On trips to the US state of Utah this month, many Chinese visitors could be seen climbing the sun-baked red rocks of Arches National Park to take photos.

Visitors from China often put Los Angeles and New York City at the top of their US travel destination lists, followed by the national parks, said Sienna Parulis-Cook, marketing and communications director with the business consultancy Dragon Trail International. Los Angeles, she said, benefits from having the “best flight connections” with China.

But many tourists are going home keenly aware of the US’ drawbacks.

Liu Xiaohan visited friends in the United States for 10 days over the turn of the year to witness the holiday season in New York and catch a professional basketball game in Washington, DC.

The 21-year-old university student was wowed by both but felt “endangered” when witnessing a bloody knife fight on the street, a fire being lit in a subway train and a general lack of public transport.

America’s prices surprised 35-year-old Chinese tourist Xie Nai, who spent about a month in the US in May – her third trip to the country in 12 years.

“The biggest takeaway from this trip is that if US prices keep rising like this, in a few years it’ll really be unaffordable,” said Nie, who visited five states including California and New York.

“You really feel it when it comes to food. Grabbing a few snacks costs US$45. Cooking two meals for four people was about US$110,” she recalled. “People living in North America tell me that’s just ‘normal’ prices.”

China’s Ministry of Culture and Tourism urged citizens to “fully evaluate the risk” of US travel in April in light of the country’s “worsening” economic ties with China. The countries have been locked in a dispute over tariffs and export controls since Trump returned to office earlier this year.

US visa processing for Chinese nationals is also getting tougher, with interview wait times averaging 289 days and the rejection rate rising to 47 per cent last year, up from 18 per cent in 2021, according to China Trading Desk.

Gao of Shanghai said it took the equivalent of two full days to do his visa application, which included an interview.

Tourism analysts said the US arrival figures were likely to flatline or drop if these obstacles persisted much longer.

Dragon Trail International projects the numbers to be “pretty stagnant or even see a slight decline” over the next six months, Parulis-Cook said.

Additional reporting by Mia Nulimaimaiti

Early ‘Red Star Over China’ editions unveiled in Shanghai to mark WWII anniversary

https://www.scmp.com/news/china/politics/article/3323770/early-red-star-over-china-editions-unveiled-shanghai-mark-wwii-anniversary?utm_source=rss_feed

The first Chinese edition of Red Star Over China, an influential book that gave people in the West an understanding of Mao Zedong and the Communist Party, is on display for the first time in Shanghai as China marks the 80th anniversary of the end of World War II.

The 1937 book was written by American journalist Edgar Snow, the first Westerner to meet Mao and other early party leaders.

In 1936, Snow visited Yanan, the party’s headquarters following the Long March, which had concluded the previous year. He documented the months he spent embedded with the Red Army in the remote hills of northwest Shaanxi province during China’s civil war.

His book featured interviews with Mao as well as Zhou Enlai, who would go on to become the first premier of the People’s Republic of China, army commander Peng Dehuai, and Red Army warriors, guerillas and ordinary people.

He “wrote of unmatched determination to fight the Japanese and described ‘a rocklike solidarity’ among the people of the region led by the Communist Party of China”, state news agency Xinhua said.

At the Shanghai Mass Art Centre, three versions of the book are on display – the original 1937 English edition, the first US edition from January 1938 and the earliest Chinese translation published in March 1938. The exhibition will run until September 21.

In 1937, Hu Yuzhi, who joined the Communist Party in 1933 and later rose through the ranks to become a vice-chairman of the Standing Committee of the Chinese National People’s Congress, led a team of 12 to translate the 300,000-word book in one month.

Collector Ge Weidong said very little information was available about the publisher, Fushe, which released the book.

According to the monthly magazine Overview of Party History, Hu established the publishing house after no other publisher would release the book due to its sensitive nature.

The Chinese translation was first published under the title Westward Journey to bypass Nationalist censorship at that time.

“Very few copies of this book remain. This copy is very complete, with no missing pages, making it a very rare historical document,” Ge said.

Accompanying the books in the exhibition are photos and items such as a vinyl record of China’s national anthem, newspaper clippings with anti-Japanese messages and a Japanese military sword.

“Although these anti-Japanese war themed artefacts may seem like ordinary paper or three-dimensional objects, the historical value they carry is immense,” said Zhang Jian, president of the Shanghai Collection Association.

“Without the collectors’ generous purchases and careful preservation, it would be difficult to share with the public many historical details of Shanghai’s war of resistance,” Zhang said of the exhibition, which is aimed at commemorating the end of the anti-fascist war.

China is commemorating the 80th anniversary of Victory Day, marking Japan’s defeat in World War II and the global victory against fascism.

China will stage a military parade in Beijing’s Tiananmen Square on Wednesday as part of its Victory Day celebrations. It will be attended by 26 world leaders from countries including Russia, North Korea, Cambodia, Vietnam, Laos, Indonesia, Malaysia, Mongolia and Pakistan, according to Xinhua.

A new model for peace? China takes its Global Security Initiative to Africa

https://www.scmp.com/news/china/diplomacy/article/3323696/new-model-peace-china-takes-its-global-security-initiative-africa?utm_source=rss_feed

When more than two dozen officers from the Somali National Armed Forces were awarded Chinese training scholarships this month, Beijing’s ambassador to Somalia Wang Yu assured them and the rest of the country that “China will not be absent” in helping the East African country achieve peace.

Since the 1991 overthrow of president Siad Barre, Somalia has been plagued by civil war and conflict with extremist groups such as al-Shabab.

The training aims to help Somalia build a self-reliant defence force to fight al-Shabab, filling the security gaps as the African Union mission prepares for a phased withdrawal.

The military scholarship programme is the latest example of Beijing’s cooperation with Mogadishu under China’s Global Security Initiative (GSI).

Just a month earlier, another group of Somali security officials completed law enforcement, internal and border security training in China. The Chinese embassy in Somalia said the training had taken place under the security initiative, adding that “China will continue to strengthen cooperation with Somalia to implement the GSI”.

In July, the embassy discussed anti-piracy cooperation with the Somali Police Force Coast Guard, an issue that aligns with China’s fishing interests in the region and naval anti-piracy patrols in the Gulf of Aden.

For China, Africa is a key testing ground for the GSI, an initiative launched by President Xi Jinping in 2022. The framework, which Beijing says promotes a vision for global security based on mutual respect and non-interference, is becoming a model for China-Africa security cooperation and is presented as an alternative to Western-led alliances.

According to Paul Nantulya, a China-Africa specialist at the US National Defence University’s Africa Centre for Strategic Studies in Washington, it is part of China’s effort to socialise, promote, routinise and ultimately flesh out the GSI.

By branding training and capacity building programmes under the GSI, “China can breathe life into it and give it substance over form”, and move the initiative beyond its conceptual stage, Nantulya said. He added that these programmes were often oriented towards domestic security, which was a key part of the GSI concept.

The training in Somalia aligns with Xi’s promise to train 6,000 military personnel and 1,000 police and law enforcement officers from Africa, and invite 500 young African military officers to visit China by the next Forum on China-Africa Cooperation summit in September 2027.

The promise also included a pledge of 1 billion yuan (US$140 million) in military assistance, as well as joint military exercises, training and patrols.

Somalia is among an increasing number of African countries, including Ethiopia and Nigeria, with deals to train their military and police officers in China as part of the GSI. Observers note that while the GSI was initially described in general and ambiguous terms, it is now slowly taking on concrete features through such programmes.

In a new study published this month, Nantulya noted the GSI’s growing role, saying that between September and June, there had been eight high-level military exchanges, including an event for 90 early-career officers from 40 African countries hosted by the People’s Liberation Army (PLA) Command College in Nanjing.

“Given how the GSI is being gradually mainstreamed into China-Africa relations, this has direct implications for China’s security cooperation efforts in Africa,” Nantulya wrote.

China now has public security and law enforcement engagements with no fewer than 40 African countries, according to Nantulya.

In 2022, for instance, Ethiopia signed an agreement to protect major Belt and Road Initiative projects, such as the Addis Ababa-Djibouti Standard Gauge Railway (SGR), while in neighbouring Kenya, the government and its Chinese partners collaborated to set up an elite Railway Police Force to protect the Chinese-funded Mombasa-Nairobi SGR.

Sun Yun, director of the China programme at the Stimson Centre think tank in Washington, noted that the GSI had a distinct category for African peace and security, and that Beijing saw the initiative as its alternative approach to global security and how it could be achieved.

“Africa, inevitably, will be a priority, given the political instability, civil wars and conflicts in Africa,” she said.

Nantulya’s study also highlights how the GSI is being made mainstream through new law enforcement programmes, such as the Ethiopia China Law Enforcement Centre that was established last year and the proposed Ghana China Police and Law Enforcement Academy.

Last year, the Chinese Ministry of Public Security launched the China East Africa Ministerial Conference on Law Enforcement and signed a joint law enforcement agreement with the 14 member states of the East African Police Chiefs Cooperation Organisation.

Ilaria Carrozza, a senior researcher at the Peace Research Institute Oslo said China’s training programmes for Somali military and security forces were intended to illustrate how the GSI could be translated from broad rhetorical principles – such as cooperative, comprehensive and sovereign-respecting security – to concrete security diplomacy.

“The programmes are part of a broader and long-standing pattern of China leveraging security force assistance and training as instruments to strengthen long-term bilateral ties and safeguard its economic interest in Africa,” Carrozza said, adding that this was not necessarily to replace Western actors, but to deepen its own footprint.

However, not all African governments are sanguine about the GSI. While some see it as an additional source of security assistance, others warn of the policy risks, according to the study.

These concerns often focus on China’s security model, which Nantulya said in his study could entrench the opposite of an apolitical military, particularly where its emphasis on regime security appealed to ruling parties.

China and India: love in the time of cholera

https://www.scmp.com/week-asia/politics/article/3323704/china-and-india-love-time-cholera?utm_source=rss_feed

China and India are having a bit of a moment. Five years after a fatal confrontation on their unresolved border pushed relations over the edge, the two sides are rushing towards a detente. They are restoring peace along the border, reversing trade and investment curbs, easing visa restrictions to promote business and tourism, resuming direct flights and orchestrating a flurry of high-level official visits to formalise the thaw.

This weekend, Indian Prime Minister Narendra Modi is visiting China for the first time in seven years, raising hopes that the tide may finally be turning on relations between these two historically antagonistic neighbours.

This unfamiliar spurt of bonhomie is partly driven by US President Donald Trump’s swingeing tariffs. China has been slapped with a 30 per cent levy, with the possibility of that figure reverting to 145 per cent in November if trade talks fail, while India is reeling from a 50 per cent tariff.

The treatment of India, which until very recently was treated as a prized American ally, has been particularly rough. Just a week after being hit with an initial 25 per cent tariff – higher than the 19 per cent imposed on Asian peers like Pakistan and Indonesia and the 15 per cent for South Korea and Japan – India found itself facing another 25 per cent duty for its trade and energy dealings with Russia.

Peter Navarro, Trump’s top trade adviser, calls India the “laundromat for the Kremlin” and is promising to give the country hell. But for Indian exporters, that hell has already arrived, with many facing closure and hundreds of thousands of jobs on the line.

The Chinese ambassador in New Delhi promptly panned US “bullying” of India and welcomed “all Indian commodities to enter the Chinese market”. India is reciprocating by fast-tracking Chinese investments, which it had rebuffed for the past five years. In keeping with the times, the spirit of “Chindia” is back.

Even the 1950s slogan “Hindi-Chini bhai bhai” (India and China are brothers) has been given a fresh, if somewhat awkward, Chinese makeover as the “dragon-elephant tango”. From official statements to media headlines, the phrase is everywhere.

The imagery is as clumsy as the public displays of affection between these perennially hostile nations. It carries the same cloying optimism that once characterised the original “bhai bhai” period that was shattered by the 1962 war on their Himalayan border, not long after the slogan was coined. Sweet words could not overcome the suspicions and contradictions inherent in their relationship.

Sixty years on, mistrust has only deepened, layered with new insecurities and interests, and compounded by the disparity in their strengths and the burden of history.

India’s humiliating defeat in the 1962 war remained an open wound, shaping its approach to China ever since. Both countries have, over time, tried to put it behind them, maintain peace along a de facto border and focus on trade – hoping that good economics might lead, one day, to good politics.

Bilateral trade has grown by leaps and bounds, but historical grievances have refused to go away. New geopolitical realities like the tussle between China and the United States have only made these issues more intractable.

In recent decades, breaking with their own Cold War history of animosity, India and the US have drawn closer, finding common cause in balancing China. India has become a “major defence partner” of the US, and has come to be seen as an enthusiastic participant in the American strategy of encircling China.

Modi’s rise to national power in 2014 briefly triggered hopes in China of a meaningful peace with India. State media speculated that Modi might play the role of an Indian Richard Nixon, transforming the relationship. Before becoming prime minister, Modi had visited China four times as chief minister of the western Indian state of Gujarat, making no secret of his admiration for China’s development.

In 2011, Modi made a particularly high-profile five-day trip, carrying red visiting cards printed in Chinese. Beijing accorded him a welcome generally reserved for heads of state. Soon after, it even heeded his request to free most of the 22 Gujaratis who had been arrested in Shenzhen on diamond smuggling charges.

That chemistry soon fizzled out after Modi assumed national office. Differences emerged over increasing border face-offs, China’s forays into the Indian Ocean, its support for Pakistan despite India’s terror complaints, the China-Pakistan Economic Corridor passing through Pakistan-administered Kashmir – which India claims – and India’s flirtation with the South China Sea issue.

Even India’s most avid China-watchers were alarmed by the drift. In 2016, when This Week in Asia interviewed Subramanyam Swamy, then a senior leader in Modi’s party and member of parliament, he said he had warned his party and government that India risked unnecessarily ruining its relations with China by wading into the South China Sea controversy.

Swamy had recently returned from a trip to China to meet senior leaders and experts. He found the mood souring. “At this point, the Chinese are only interested in one thing: are you independent or not? Are you joining the US axis or are you on your own? We have failed this test,” he said.

What Swamy saw as a bug in the relationship was, in fact, a feature of the new design. As India’s power asymmetry with China widened, it leaned ever more heavily on the US to balance Beijing’s growing clout. China’s increasing assertiveness in the region, with territorial claims and regular run-ins with neighbours from Vietnam to the Philippines, did little to ease India’s anxieties.

Around the same time that Swamy’s Chinese interlocutors were expressing outrage over India’s US tilt, Modi was telling American lawmakers in a joint session of Congress that India and the US had “overcome the hesitations of history”.

To put it simply, India had abandoned its old policy of strategic equidistance to throw in its lot with the world’s only superpower. A succession of defence pacts in the following years deepened military cooperation. Delhi was going all in on the first Trump administration’s Indo-Pacific strategy of containing China, even as Modi continued to hold summits with Xi Jinping.

“China’s response was to activate the Ladakh border so that India’s military focus and resources would remain on land and not the sea,” said Aakar Patel, chair of Amnesty International India, in a recent op-ed.

Even before Ladakh, their growing differences had erupted in 2017 in Doklam, an area at the tri-junction between China, Bhutan and India. The two sides pulled themselves back from the brink after a tense 73-day stand-off.

Within three years, a deadly skirmish broke out in the Galwan Valley of India’s Ladakh region when Indian soldiers complained of incursions. At least 20 Indian and four Chinese soldiers were killed in the first fatal military confrontation between the two for 45 years, as some 900 soldiers fought hand-to-hand battles on snowy ridges.

Relations went rapidly downhill from there. India responded with troop deployments and a series of commercial curbs. More than 250 Chinese apps, including TikTok and WeChat, were banned. Chinese businesses faced clampdowns and tax raids, investments were cancelled, visas were barred and direct flights suspended.

All of these measures are now being reversed, but Doklam and Galwan are stark reminders of the centrality of the unsettled border to relations between the two nuclear-armed neighbours.

The root of the border problem stems from the fact that China and India do not actually have a border. Nearly 80 years after the British left, the two Asian giants have failed to untangle the colonial legacy of contested borderlands and draw a line on the ground.

What they have instead is the Line of Actual Control (LAC), an unofficial boundary based on who controls what on the ground, with multiple points of overlapping claims.

The LAC is broadly divided into eastern, western and middle sectors. In the east, China claims some 90,000 sq km (34,800 square miles) of land that India controls as Arunachal Pradesh state. In the west, India claims 38,000 sq km (14,700 square miles) of Tibetan desert known as Aksai Chin, which is under Chinese control.

The western sector, where the Ladakh conflict took place, is the most contentious. But the eastern border, quiet for the better part of six decades, has also become a source of bitter contestation in recent years due to its links to Tibet and the Dalai Lama.

Even amid the current “tango” euphoria, the Chinese embassy in Delhi last month declared the Dalai Lama remained a “thorn” in bilateral relations after he announced that he would reincarnate. Beijing and the 90-year-old Tibetan spiritual leader, who has been living in exile in India since 1959, have been at odds over his succession. Both claim the other will have no role in the matter.

A small district called Tawang in Arunachal Pradesh, which China claims as Zangnan, or South Tibet, has become a new flashpoint in the dispute as it is considered a probable site for the next Dalai Lama’s reincarnation.

This is because Tawang is the birthplace of an earlier Dalai Lama and its monastery is a subsidiary of one of Tibet’s three major temples. Beijing has invoked this same connection to lay claim to Tawang as part of Tibet.

In 2017, Dai Bingguo, China’s former top diplomat and chief boundary negotiator with India, told Chinese media the border dispute could be resolved if Delhi ceded Tawang. This growing Chinese insistence on concessions in the east further complicates the prospect of a border settlement.

The most plausible scenario for a deal – if it ever materialises – would see India relinquishing its claim on Aksai Chin in the west, in exchange for China dropping its claim on Arunachal Pradesh in the east.

Such a compromise would mean a shrunken map for both sides, a hard sell for any political leadership. This is the crux of the stalemate.

Both countries seek a comprehensive package of gains as compensation to present as a win at home, spanning regional geopolitics, commerce and more. Arriving at such a package is an even greater challenge.

Shivshankar Menon, a former Indian national security adviser and Dai’s counterpart in border talks, has long maintained that the nuts and bolts of a border agreement were ready as far back as 2012, awaiting only political sign-off.

More than a decade later, not only has the border issue become trickier to settle, so too have all other aspects of bilateral relations.

This has much to do with the ever-widening gap in state capacities of India and China. Since 2012, China’s gross domestic product has grown by an average of nearly US$700 billion more than India’s every year.

The asymmetry is clear. Indian Foreign Minister S. Jaishankar summed it up two years ago in a rare moment of undiplomatic candour: “What am I going to do? As a smaller economy, am I going to pick a fight with the bigger economy?”

Beyond their borders, this differential manifests in ambition, power projection and influence, both globally and regionally. In South Asia, where India’s influence was once unrivalled, China’s footprint has been growing, from infrastructure and trade to technology and military cooperation, triggering more Indian insecurity.

Powered by Chinese imports, electric vehicles now make up a stunning 76 per cent of all passenger vehicles in Nepal, compared to none five years ago.

China is the single largest bilateral lender in Sri Lanka. It is also Bangladesh’s main supplier of arms and military equipment, and Pakistan’s most important defence partner. During the recent India-Pakistan stand-off, the Indian army complained that China was supplying 80 per cent of Pakistan’s arsenal.

Bangladesh, a long-time Indian ally, has pivoted to China since the fall of pro-India leader Sheikh Hasina. In June, China, Pakistan and Bangladesh held a trilateral meeting in Kunming.

China’s clout is growing in Afghanistan, too. Foreign Minister Wang Yi has held two trilaterals with Pakistan and Afghanistan in just four months.

All this is a far cry from the Chinese engagement in the region in the late 1980s, when late Indian prime minister Rajiv Gandhi visited China in 1988 to thaw relations frozen since the 1962 war. India and China were of similar economic size and agreements were easier to broker. Today, China’s economy is nearly five times larger than India’s.

India accounts for just 3 per cent of global manufacturing, compared to China’s 30 per cent. China dominates global supply chains, producing more than the next nine largest manufacturers combined. It leads in 57 of the 64 critical technologies tracked by the Australian Strategic Policy Institute think tank.

These also happen to be excellent reasons for India to deepen collaboration with China. The Indian government’s think tank Niti Aayog is advocating for India to “plug itself into China’s supply chain” to boost manufacturing and has proposed allowing Chinese companies to take up to a 24 per cent stake in Indian firms without security clearance.

China is a promising source of foreign direct investment at a time when India’s net FDI has crashed 96.5 per cent to a record low and Trump’s America is expected to further constrain investment flows. With India facing a structural slowdown and high unemployment, it stands to gain from a share of the US$160 billion in annual Chinese outbound FDI.

The logic for deepening economic ties between the world’s second- and fourth-largest economies seems irrefutable, especially as a bulwark against global shocks. But the past decade has shown that more trade does not necessarily produce calmer borders. If anything, it can create more complications.

Annual trade between India and China now exceeds US$130 billion, but the balance is heavily tilted in China’s favour. India runs a trade deficit of nearly US$100 billion. As Chinese imports flood its market, Indian micro, small and medium-sized enterprises face an existential threat. The Global Trade Research Initiative think tank estimates that over 50 per cent of glassware, leather goods and toys in India now originate in China.

India has long demanded greater access to the Chinese market – another persistent source of friction – but the widening trade deficit also reflects the growing gap in capabilities. Owing to Chinese advances, India is now dependent on China for a vast array of technology and merchandise, from electronics and machinery to solar cells and fertiliser.

Indian security pundits warn of the leverage this dependence grants China. The Indian auto industry, for example, has suffered a severe production crisis since China restricted exports of rare earth magnets. Agriculture has similarly struggled amid Chinese restrictions on fertilisers.

This dependence is equally pronounced in pharmaceuticals. India imports more than 70 per cent of its active pharmaceutical ingredients, the main substances in medicines, from China. Even without a “tango”, China is leading the dance.

Deepening economic ties with China, then, as an antidote to Trump’s tariff shock is hardly the obvious solution for India. The side effects could arguably prove worse than the disease. The rewards of integrating with China’s mighty supply chains are substantial for India, but so are the risks of being shackled to them.

Yet an avalanche of economic opportunities beckons if the two nations can agree to work together.

Chinese investment and technological prowess could jump-start the manufacturing boom India so badly needs. Indian conglomerates are reportedly already seeking Chinese technology transfers, while India’s own burgeoning tech sector is attracting Chinese venture capital.

Meanwhile, India’s vast, underdeveloped market could be a godsend for Chinese businesses operating in an economy that has been decelerating for more than a decade. China’s growth is projected to dwindle to around 1 per cent by 2050 as its population shrinks and urbanisation peaks. India’s urbanisation, on the other hand, is still in its early stages – 35 percent compared to China’s 66 per cent.

The complementarities are real, as are the complications. But the real question is not whether China and India can strike a grand bargain, but whether they even want one. For both, the grand bargain that truly matters is the one with the US. America is far more important to China and India individually than they are to each other.

India’s strategic vulnerability to a rising China makes America an indispensable partner. This weakness is already evident in India’s haste to patch things up with China, even at the cost of multiple climbdowns.

Delhi denies it, but opposition parties and security analysts argue that last October’s border “disengagement” that set the thaw in motion was negotiated on unequal terms and India had to cede territory in Ladakh. Swamy has moved the Delhi High Court demanding to know how much land has been lost.

Not long ago, members of Modi’s party were calling for a boycott of Chinese goods in protest at China’s backing of Pakistan at the UN. Today, his government is willing to overlook China’s material support of Pakistan in its war against India for the sake of more commerce.

But however bad it looks now, if and when Trump comes around and India regains some of its old mojo, the case for a dance with the dragon may look far less compelling – or even possible, depending on Trump’s terms.

For China, the stakes are higher still. The elephant in the room for India is what happens if China and the US reach a grand bargain. Trump has shown an inclination for what former CIA director Bill Burns calls “great-power suicide”, but what many others see as a preference for a coalition of rival great powers dividing the world into spheres of influence.

It is hardly a new idea; that’s how the “Concert of Europe” kept peace on the continent for four decades in the 19th century. A deal with China that allows for a limited US retrenchment in Asia is not inconceivable in this scheme of things. That would leave India with little choice but to dance to the dragon’s tune.

None of these issues is insurmountable if there is the political will to overcome the hesitations of history and new complexities and move towards a meaningful relationship, starting with settling the border.

The best chance of that happening is under Xi and Modi, the most powerful leaders their countries have had in decades. But that has been the case for 10 years now, and nothing has happened. So temper your excitement. Nobody is breaking out into a dance just yet.

Rather than dance, what China and India are more likely to do is tread carefully as a new world order takes shape. This latest turn may simply restore their more manageable relationship of a decade ago – until the next crisis flares along the border.

China and India have perfected the art of going round and round, forward and back, embracing and parting. Tango could be one name for it.

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China ‘PhD village’ celebrates after gaining another doctoral student; has 33 PhDs already

https://www.scmp.com/news/people-culture/trending-china/article/3323707/china-phd-village-celebrates-after-gaining-another-doctoral-student-has-33-phds-already?utm_source=rss_feed

A village in southeastern China has earned the nickname “PhD Village” due to its remarkable achievement of producing 33 offspring who have obtained doctoral degrees from prestigious universities, both domestically and internationally.

Pengdao Village, part of Nanan City in Fujian province, gained widespread attention at the end of August after a video showcasing a grand scholarship presentation held at the local ancestral clan hall went viral, as reported by the Xiaoxiang Morning Herald.

This ceremony, marking the second occurrence in its history, is sponsored by the Guo Family Education Fund, reflecting the dominant presence of individuals surnamed Guo in the village.

This year’s award recipients included one student admitted to Tsinghua University as a PhD candidate, 15 who will begin their master’s degree studies, and 46 undergraduates set to enter university in September.

During the ceremony, these accomplished students donned red sashes inscribed with the Chinese characters wu zu zhi guang, translating to “the glory of our ancestral clan.” They were filmed holding incense and bowing before the memorial tablets of their ancestors.

In total, the scholarship fund awarded a combined 217,000 yuan (US$30,000), with the highest individual grant reaching 8,000 yuan.

To date, 33 residents from this small hamlet have earned PhD degrees from esteemed institutions, including Tsinghua University, Hong Kong University, Cambridge University in Britain, and Cornell University in the US.

Red scrolls bearing the names of these PhD graduates and their respective schools were hung prominently on a major building in the village.

Nestled in a remote mountainous area, the village is home to around 6,000 residents. Historically, it struggled with poverty due to limited arable land, prompting locals to prioritise education for generations.

Guo Dongyu, director of the local Guo Family Education Fund, shared that the village has a long-standing tradition of valuing education, with parents emphasising the importance of guiding their children from an early age.

“Our award is designed to inspire students to cherish our country and hometown, engage in charitable acts, and work diligently,” Guo commented.

Rural communities in China often commemorate top students with grand ceremonies.

For instance, in July, a student from eastern Zhejiang province, who was accepted into the prestigious Peking University, captured social media attention when his ancestral clan organised a major celebration, marking him as the first student in a century from his family to achieve this milestone.

The Fujian PhD Village has become a sensation on mainland social media.

“Many attribute their success to good feng shui. However, I believe it is a result of a supportive atmosphere where everyone strives for excellence,” remarked one online observer.

Another user expressed admiration, stating: “What a wonderful place! I would love to move there with my child.”

When North Koreans raise a toast, it’s increasingly Chinese wine, as import volume surges

https://www.scmp.com/economy/global-economy/article/3323645/when-north-koreans-raise-toast-its-increasingly-chinese-wine-import-volume-surges?utm_source=rss_feed

North Korea, one of the world’s most isolated and heavily sanctioned countries, has remained a major destination for Chinese wine exports this year, as the nation has few alternative options to source alcoholic drinks.

North Korea bought 157,393 litres of wine from China in the first seven months of 2025 – more than double the volume imported during the same period last year – making it the second-largest buyer of Chinese bottled wine so far this year, trailing only Hong Kong, according to customs data.

In terms of value, North Korea ranked fifth with purchases totalling US$544,980, behind Hong Kong, Singapore, Macau and France.

Unlike many other countries and regions, China has not imposed restrictions on wine sales to its long-time ally and neighbour, which has remained a major buyer for years.

North Korea was also China’s second-largest wine importer by volume in 2023 and 2024, official trade data showed. By value, it ranked fourth in 2024 and third in 2023.

The United Nations has banned luxury goods from entering North Korea since 2006, but alcohol is not included on its list, which covers items such as luxury watches, personal watercraft and recreational sports equipment.

UN resolutions noted that the definition of luxury goods is not limited to those on the list. As a result, member states interpret and implement these requirements through their own export-control regulations.

For example, the European Union expanded its sanctions on the peninsula nation in 2017 by adding wine, beer and spirits to a list of 22 banned luxury items, cutting off North Korea’s direct access to fine European wines.

Compliance experts and scholars have said that differing regulations across countries create loopholes that North Korea could exploit to bypass import bans through re-exports via intermediaries.

China remained North Korea’s top trading partner in 2024, accounting for 98 per cent of its total trade. Argentina, Vietnam, the Netherlands and Nigeria followed as the next four largest partners, South Korea’s Yonhap News Agency reported in July, citing official data.

Wine imports account for a tiny share of North Korea’s imports from China – less than 1 per cent in 2024 – while the top three categories by value were wig-making hair; soybean oil and its derivatives; and polymerised vinyl chloride flooring, China’s customs data showed.

Human microbiome scientist Wang Leyao leaves troubled US government agency for China

https://www.scmp.com/news/china/science/article/3323594/human-microbiome-scientist-wang-leyao-leaves-troubled-us-government-agency-china?utm_source=rss_feed

Epidemiologist and human microbiome scientist Wang Leyao, a scholar for the US National Institutes of Health (NIH), has returned to China amid drastic research funding cuts initiated by the White House.

Wang joined the Shenzhen Medical Academy of Research and Translation (Smart) as a senior research fellow at the Institute of Human Immunology last month, according to an announcement on Smart’s official social media account on Monday.

The academy stated that Wang “has long been dedicated to the study of the human microbiome” and has made significant contributions to understanding the regulatory role of microbes on immune responses and the impact of climate change on the microbiome.

Before joining Smart, she was an assistant professor of epidemiology at the University of Massachusetts Amherst (UMass) and a member of the 2024-2025 NIH climate and health scholars cohort.

Wang is part of a recent wave of senior researchers who left the US to join Smart this summer, joining award-winning HIV scientist Shan Liang – who now heads the human immunology institute – and former NIH senior investigator Lu Wei.

The US medical research agency has been embroiled in controversy since the start of President Donald Trump’s second term, which has left thousands of researchers in limbo due to funding cuts and policy shifts.

In February, the Trump administration initiated funding cuts that impacted hundreds of millions of dollars in federal grants to the NIH, prompting the agency to terminate thousands of research grants, particularly for research on topics such as Covid-19 and diversity, equity and inclusion.

This prompted US states, researchers, and organisations to file lawsuits challenging the NIH’s cuts, leading the Massachusetts District Court to rule the cancellations as unlawful and order a reinstatement of the grants in June, according to a report by Science.

On August 21, the US Supreme Court ruled that district courts lacked jurisdiction to hear challenges to the NIH’s grant terminations, allowing these to proceed.

In response, the Association of American Medical Colleges stated the same day that the court had turned a blind eye to this “grievous attack” on science and medicine, and had “made the wrong choice”.

Wang’s research has largely focused on the human microbiome, including the association between the microbiome and lung conditions including asthma.

Wang’s team has established cohort studies to investigate the association between microbial alterations and asthma and respiratory infections, and aimed to develop microbiota-based therapeutic approaches to treat lung diseases, according to her UMass profile.

According to the university, she is also interested in evaluating the impact of climate events on the human microbiome and how it relates to increased disease risks.

In 2018, Wang and her collaborators at the San Juan City Hospital in Puerto Rico began a birth cohort study that used the devastating Hurricane Maria as a natural experiment to investigate how major disasters can alter the human microbiome in early infancy.

At the end of last year, Wang was one of 13 researchers selected for this year’s NIH climate and health scholars cohort, which stimulates research on climate-induced health threats and building health resilience, particularly for high-risk communities.

Wang told UMass that it was “a great honour and an opportunity” to work with the NIH to advance research and solutions for climate change.

She obtained a bachelor’s degree in biotechnology from Nankai University in 2003 and a doctorate in molecular virology and immunology from Fudan University in 2008.

In 2011, Wang earned a master’s degree in epidemiology from Johns Hopkins University’s Bloomberg School of Public Health, after which she became a teaching and research assistant at the university until 2013.

From 2013 to 2017, Wang served as a postdoctoral fellow at the Yale School of Public Health.

In 2018, she joined the Washington University School of Medicine in St Louis, Missouri as an instructor and was later promoted to assistant professor in 2022.

In September last year, she joined UMass as an assistant professor with a joint appointment at the Department of Biostatistics and Epidemiology and the Institute for Applied Life Sciences.

Smart said that Wang’s research would continue to focus on the human microbiome, including uncovering mechanisms behind microbe, host and pathogen interactions.

The academy said her team would combine population cohort studies, molecular immunology techniques and “cutting-edge bioinformatics analysis methods” to study the role of the human microbiome in infectious and chronic diseases.

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Typhon warning: China hits out at Japan over US missile system deployment

https://www.scmp.com/news/china/military/article/3323657/typhon-warning-china-hits-out-japan-over-us-missile-system-deployment?utm_source=rss_feed

Japan is expected to deploy the US-made Typhon missile system for the first time during joint military exercises with the United States next month, according to Japanese media.

Analysts view the move as a strategic signal against Beijing, especially in the event of a conflict over Taiwan.

The Chinese foreign ministry criticised the move on Friday, saying Beijing firmly opposed “the US deployment of the Typhon intermediate-range missile system in Asian countries”.

“The deployment of the system in Japan will further undermine the legitimate security interests of other countries. The US and Japan must not introduce the Typhon missile system,” it said.

Kyodo News reported on Wednesday that the Japan Ground Self-Defence Force and US Marine Corps would conduct a large-scale field training exercise with China as its notional enemy in September. The Typhon system would be deployed at the US’ Iwakuni base in Yamaguchi prefecture during the drills, it said, citing multiple Japanese and American sources.

The system is scheduled to be withdrawn from the base at the end of the exercise, the report said.

The missile system is capable of firing Tomahawk land-attack cruise missiles and SM-6 surface-to-air missiles, with a range of up to 2,000km (1,240 miles). This would bring parts of the Taiwan Strait and eastern coastal regions of mainland China within its strike range.

Beijing’s defence ministry responded to the news on Thursday. “In recent years, Japan has continuously breached the constraints of its pacifist constitution and its commitment to exclusively defensive defence…This has led to growing concerns that it may return to the evil path of militarism,” it said.

On Friday, Beijing’s foreign ministry said China firmly opposed “the US deployment of the Typhon intermediate-range missile system in Asian countries”.

“The deployment of the system in Japan will further undermine the legitimate security interests of other countries. The US and Japan must not introduce the Typhon missile system.”

Analysts say the military exercise underscores the growing US-Japan cooperation in their Asia-Pacific strategy, which will increase Beijing’s security risks, particularly around the Taiwan issue.

Zhu Feng, dean of the school of international studies at Nanjing University, compared the actions of the US and Japan to the confrontational missile deployments by the US and the Soviet Union during the Cold War.

During the Cold War, the US and the Soviet Union deployed medium-range and strategic missiles near each other’s spheres of influence to deter them, primarily in Europe and surrounding areas. A famous example is the 1962 Cuban Missile Crisis, when the Soviet Union secretly deployed nuclear missiles in Cuba to counter US missile bases in Turkey and Italy.

The United States, by “deploying this missile system around China, sends a fairly clear signal”, Zhu said. “Tokyo and Washington are converging on the issue of containing China. The two countries are explicitly strengthening both their willingness and capability to prepare for military intervention in the Taiwan Strait.”

Timothy Heath, a senior international defence researcher at the US-based Rand Corporation, said the deployment “shows that the US continues to aid its ally Japan in strengthening its defences against potential Chinese attack”.

The US deployed the Typhon missile system in April last year to the Philippines, which has since used it for training.

The deployment was criticised by China’s foreign ministry, which called the Typhon system an “offensive weapon”.

It said the Philippines’ introduction of a medium-range missile system was intended to create regional confrontation and tension, while urging Manila to withdraw the system as soon as possible and “not go further down the wrong path”.

Heath said China might feel some threat from the Typhon missiles.

“[The] most vulnerable could be ships operating in disputed waters near the Senkakus [Tokyo-controlled islands claimed by Beijing as the Diaoyu Islands] if Japan deploys the missile close to the islands,” he said.

In 1987, Cold War rivals the US and the Soviet Union signed the Intermediate Range Nuclear Forces Treaty, which prohibited either side from developing, deploying or testing ground-launched missiles with ranges between 500km and 5,500km.

However, the treaty collapsed in 2019, after then-US president Donald Trump, dissatisfied that China was not bound by similar restrictions, withdrew from it. The US carried out its first deployment of such missiles in the Philippines last year.

“China will probably respond by expanding its air-defence network to include HQ-29 missiles. It may add more [intermediate-range ballistic missiles] as a deterrence as well,” Heath said.

The HQ-29 is believed to be China’s most advanced interceptor missile to date, and there is speculation it will be displayed during the Victory Day parade in Beijing on September 3.

The system has not been officially confirmed, but it is believed to be more advanced than known Chinese missile defence systems, including the HQ-19, which is similar to the US Terminal High Altitude Area Defence (THAAD) system.

Analysts believe the HQ-29 is a strategic midcourse interceptor designed to destroy ballistic missiles outside the Earth’s atmosphere.

Song Zhongping, a military commentator and former PLA instructor, said the Typhon system deployment “reflects the inertia of US-Japan Indo-Pacific strategic cooperation during the [Joe] Biden era”.

“It may increase the likelihood of future military frictions and risks between China and the US, as well as between China and Japan. It remains unclear whether a future Trump administration would continue to push forward this process,” he said.

Zhu believed the Victory Day commemoration was a factor.

“Next month’s Japan-US military exercises may be in response to China’s September 3 military parade, which Japan has always had strong opinions about,” he said.

The parade is one of the events marking the 80th anniversary of the victory in the “Chinese people’s war of resistance against Japanese aggression”. Leaders from 26 countries, including Russian President Vladimir Putin and North Korean leader Kim Jong-un, are expected to attend.

China is expected to showcase a range of advanced military equipment during the parade, including military vehicles, fighter jets and nuclear missiles.

Tokyo has reportedly asked foreign leaders not to attend the parade in Beijing, warning that the Victory Day events carried anti-Japanese overtones.

According to official Chinese figures, the country suffered up to 35 million civilian and military casualties from the first Japanese invasion in 1931 until the end of the war.

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China’s US$22 trillion savings and global investors a potent mix for equity markets

https://www.scmp.com/business/china-business/article/3323579/chinas-us22-trillion-savings-and-global-investors-potent-mix-equity-markets?utm_source=rss_feed

In the second instalment of the two-part series on the outlook for the Hong Kong and mainland Chinese stock markets, Zhang Shidong and Yulu Ao look at the catalysts that could underpin the rally. Read part one

When Chinese stocks hit a 10-year high this week, Jian Shi Cortesi saw it as a sign that the rally could continue as overseas investors returned to the nation’s onshore and offshore equities, which are worth a combined US$20 trillion.

The Switzerland-based investment director at GAM Investments expects a further uptick in stocks, which will be underpinned by domestic investors’ rotation out of fixed-income products, whose yields have fallen to record lows, and Beijing’s push for technological innovation.

“Globally, almost all major stock markets are trading at or near historical highs [and] Chinese equities – both A and H – have much room to catch up,” said Cortesi, referring to mainland traded A shares denominated in yuan and H shares listed in Hong Kong. Her firm oversees US$15.8 billion of assets.

“Most importantly, we believe China offers ‘undervalued innovation’ to investors, including advanced manufacturing, AI and robotics,” she added. “This will gradually become clear to the investment community.”

Cortesi is among the global asset managers who have turned positive on Chinese stocks after the Shanghai Composite Index’s stellar run this month, reversing years of underperformance that was compounded by the exodus of foreign investors. China’s oldest benchmark of onshore stocks on Monday ascended to a level not seen since August 17, 2015. Morgan Stanley said earlier this month that overseas buying would gather further pace after the summer following two consecutive months of inflows in June and July.

The turnaround in Chinese equities is largely a result of liquidity chasing better investment alternatives. A low-yield environment has prompted the nation’s whopping 160 trillion yuan (US$22.3 trillion) of household savings, most of which are invested in bonds and bank deposits, to switch to riskier assets.

Currently, the Shanghai Composite Index returns a dividend yield of 2.4 per cent on a trailing 12-month basis, according to Bloomberg data. In comparison, China’s 10-year government bond yields 1.782 per cent, while the one-year deposit rates offered by the nation’s biggest commercial banks have fallen below 1 per cent.

There are clear signs of a dispersion from safe assets. M1 – a money-supply measure of China’s demand deposits that can be withdrawn from banks anytime – rose 5.6 per cent in July, the fastest pace in more than two years, according to central bank data. The acceleration suggests that more money was being positioned for investment after being converted from term deposits. The central bank’s data also showed that household savings decreased by 1.11 trillion yuan last month, while deposits at non-bank financial institutions, such as brokerages, insurance and trust firms, increased by 2.14 trillion yuan. The divergence implied that part of the savings was being channelled into either stocks or mutual funds.

“Chinese citizens have US$20 trillion in savings, which could be used to buy shares,” said Brook McConnell, president and chief investment officer at South Ocean Management. “Infrastructure development and technological innovations in China have significantly and rapidly improved the outlook for China’s future. These transformative improvements are filtering down into the operations of certain [stock index] constituents.”

About 5.5 trillion yuan of bank savings may be funnelled into stocks this year amid falling interest rates and a slumping property market, according to Aberdeen Investments.

Meanwhile, sceptics point to July’s broad-based economic slowdown as evidence that the stock rally may soon run out of steam. While retail sales, industrial output and fixed-asset investment all fell short of economists’ estimates, the first monthly contraction of new loans in two decades was even more troubling, indicating weakening overall demand and the reluctance by corporations and households to take on debt.

“The divergence between the economy and [stock] markets will not last long, as some key macro themes will likely dominate markets once again, sooner or later,” said Lu Ting, chief China economist at Nomura Holdings.

That warning brings to mind two fleeting stock rallies spurred by the reopening of the economy in December 2022 and a policy blitz in September last year, both of which quickly fizzled out after the growth outlook deteriorated.

The most infamous liquidity-driven rally without fundamental support occurred a decade ago, when the Shanghai Composite Index more than doubled within 12 months after the central bank cut interest rates and leveraged buyers swarmed in. The bubble burst after the securities regulator cracked down on illegal margin trading and investors realised that the gains had overshot the economic fundamentals.

For Hong Hao, chief investment officer at Lotus Asset Management in Hong Kong, the current rally is somehow different from the ones in 2022 and 2024. He said the gains were likely to be more sustainable given the widening breadth of rising stocks.

“As the indexes continue to rise, the market breadth is spreading out from mega caps like the traditional financials to small and micro-caps,” he said. “A lot more stocks are participating in this rally, not just speculative ones. It is possible to have a slowing economy and yet a rising stock market.”

In a sign of the prevailing risk-on mood, a benchmark of the tech-heavy Shanghai Star Market rose to a three-year high, while a measure of start-ups on the Shenzhen exchange’s ChiNext board touched a level not seen since 2022.

A similar pattern of rising stocks against the backdrop of a wobbling economy was also seen in 2005, when a decline in banks’ new loans preceded the biggest bull run in China’s markets, Hong said. The Shanghai Composite Index surged more than sixfold from 2005 to 2007, as growth picked up and the government implemented a share-structure reform to align the interests of state shareholders with those of public investors.

Morgan Stanley echoed Hong’s argument. The US investment bank said that rising yields on China’s benchmark government bonds made the current stock gains unique and that the retreat in the debt market suggested some investors had recalibrated their view of China’s growth prospects.

The yield on the 10-year sovereign debt has risen by 8.7 basis points since a June low, and by 23 basis points on the 30-year note. Debt yields barely budged in last September’s equity rally sparked by the central bank’s move to create new funding tools for stock purchases and cuts to mortgage rates.

Morgan Stanley said that investors should keep an eye on bond yields, policy catalysts and outstanding leveraged stock buying for clues on the momentum continuing.

China’s equity market would also benefit from accelerated foreign inflows, as global investors seek to diversify from richly valued US stocks, which could drive up Chinese stocks by another 20 per cent, according to Gary Dugan, CEO of The Global CIO Office in Dubai, which advises family offices, wealth managers and ultra-high-net-worth individuals.

“The more likely scenario is that they tire of the US equity market with stretched valuations and the prospect of inflation slowing the pace of monetary policy easing,” he said. “As we saw with the run-up in European equities, global investors can be prepared to recommit to markets that offer value. Chinese equities offer a bundle of value for global investors at present.”

Even after the gains, Chinese stocks are undervalued. The Shanghai Composite is valued at 18.1 times earnings and the Hang Seng Index at 11.8, while the multiple for the S&P 500 is 25.4, according to Bloomberg data.

Cheaper Hong Kong stocks are likely to play catch-up with their mainland counterparts after the summer, according to Morgan Stanley. But this is subject to a further easing of China-US trade tensions, clarity from Beijing on policies for cutting excess industrial capacity and rebalancing the economy, and a continuing boom in initial public offerings in the city.

The Hang Seng Index has been stuck in a narrow range after rising to a four-year high in July amid expectations of an interest-rate cut by the Federal Reserve. The benchmark has barely moved over the past month, while the Shanghai Composite Index has risen more than 6 per cent.

While investors are keeping a close watch on the liquidity – the bedrock for any stock rally – they are also monitoring developments on the policy front to tackle some deep-rooted issues in the economy, such as lingering deflation and overcapacity in a range of green-energy industries.

If the government can get a handle on these issues, it will provide additional impetus to the rally that is devoid of a strong recovery in earnings growth.

Every 1 per cent increase in producer prices would drive up corporate profit growth by 2 per cent, and the ongoing “anti-involution” campaign to eliminate unnecessary output in the solar, electric vehicle and lithium battery industries, if implemented well, could boost the profits of these sectors by 53 per cent by 2027, according to a Goldman Sachs report last week.

For now, 228 companies on the CSI 300 Index have disclosed interim results. Their profit growth averaged 2.7 per cent in the first half, compared with an 8 per cent increase in the first quarter, according to Bloomberg data.

Looking at the past, a rally in mainland shares lasted as long as 12 months in a weak economy, according to James Wang, head of China strategy at UBS Group. He added that this could be extended further as leveraged positions had yet to reach extreme levels and more individual investors chased the momentum. Risks of a pullback could come from regulatory intervention, if sentiment became overheated, and a significant decline in overseas markets, he cautioned.

For GAM’s Cortesi, signs of stocks extending gains were palpable. She pointed to the broad-based CSI 300 Index as a better gauge to track onshore stocks. The gauge’s underperformance against the Shanghai Composite implied more upside for the markets broadly. The CSI 300 has only now touched a three-week high.

“Domestic investors have huge amounts of savings in the banks, and they have started to move money into the stock market,” she said. “If this continues, A shares can rally strongly.”

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Chinese wife hangs banners, ‘thanking’ best friend for sleeping with husband for 5 years

https://www.scmp.com/news/people-culture/trending-china/article/3323683/chinese-wife-hangs-banners-thanking-best-friend-sleeping-husband-5-years?utm_source=rss_feed

A Chinese wife displayed red banners on the fence of a residential complex in Changsha, in central China’s Hunan province, sarcastically expressing gratitude to her best friend for having an affair with her husband.

Alongside the banners, there were pennants revealing that the wife’s best friend, surnamed Shi, works in the finance department of a tourism management office in the Hongshan community.

One banner states: “Shi violates public order and good morals, having an affair with her best friend’s husband,” attributed to “Wife.”

It remains unclear whether this was the neighbourhood where the alleged mistress lives.

Additionally, red pennants were found on a car within the compound. Again, it is uncertain if the vehicle belonged to the alleged mistress.

One reads: “Shi has been my best friend for 12 years and has provided sexual services to my husband for five years.”

Another pennant claims: “Shi went to hotels with her best friend’s husband during office hours.”

A staff member from the tourism management office in the Hongshan community informed Chinese media outlet The Paper that they do employ someone named Shi, and an investigation into the matter is underway.

The red banners and pennants were removed shortly thereafter.

The identities of the wife and her husband have not been disclosed.

Lawyer Zhao Liangshan from Shaanxi Hengda Law Firm noted that the banners could potentially infringe upon Shi’s rights to privacy, reputation, and personality, especially if they contain fabricated facts or defamatory content.

Moreover, if the act of displaying the banners draws a large crowd and obstructs public areas, it may violate the Public Security Administration Punishment Law, exposing the instigator to a warning or a fine of up to 200 yuan (US$28).

In severe cases, individuals who hang such banners could face detention for up to 19 days and fines of up to 500 yuan (US$70).

In 2023, a Chinese man was detained for 10 days for putting up a banner that insulted his ex-girlfriend, mocking her for having “two-timed” another man.

The lawyer advised that individuals whose rights are violated should seek resolution through legal channels.

“It is illegal, but I support the wife’s revenge,” commented one online observer.

“The best friend is a public servant; she must be facing serious consequences from her workplace,” speculated another.

A third remark stated: “How was the wife insulting her best friend? She was merely expressing gratitude.”

In China, red pennants are traditionally sent as a sincere gesture of thanks to those who have assisted.

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How China streamlines national labs into tech war machines: a case study of HK

https://www.scmp.com/news/china/science/article/3323633/how-china-streamlines-national-labs-tech-war-machines-case-study-hk?utm_source=rss_feed

Hong Kong’s once sprawling and diffuse network of state-backed research labs has undergone a surgical transformation – streamlined, repurposed and laser-focused on Beijing’s strategic technology ambitions.

In a move emblematic of China’s broader overhaul of its national scientific apparatus, the city has dismantled underperforming labs, rebranded legacy institutions and launched three cutting-edge facilities dedicated to quantum materials and climate resilience – all under tightened alignment with national priorities.

This quiet revolution is part of a nationwide push since 2022 to convert China’s bloated system of State Key Laboratories (SKLs) from academically driven, siloed entities into lean, mission-oriented “tech war machines” to make advances in critical fields such as artificial intelligence, quantum technology and brain science.

With around 500 labs now approved nationwide under a restructured programme, the old model of loosely defined research has given way to a new doctrine: clear mandates, centralised funding and direct accountability to Beijing’s science supremacy agenda.

A ceremony in Hong Kong on Monday attended by Science and Technology Minister Yin Hejun, gives clues on the national strategic vision guiding the new developments of SKLs.

On Monday, Yin presented plaques to the directors of the revamped labs in Hong Kong and urged the city to support national development through innovation.

“I hope the state key laboratories in Hong Kong will further bolster their mission positioning [and] focus on scientific challenges arising from national demands … to seize the commanding heights in the global scientific and technological competition,” he said.

As China engages in an intense science and technological race with the United States, the refocusing of research directions and resources of SKLs will support the country’s scientific goals. The SKL programme changed its Chinese name to emphasise a broader national scope, while the English name remained.

A year after the national revamp started, Hong Kong followed suit “to align with the overall national development plan”, according to a paper provided by the Hong Kong government to the Legislative Council in March.

“This allows the relevant universities to explore how to leverage on Hong Kong’s geographical advantages by improving existing SKLs or setting up new ones to meet national needs,” it added.

To be an SKL, a laboratory must show “clear positioning that aligns with the overall national development strategy” and “the ability to play a significant role in supporting major national needs, critical core technologies and broadening the understanding of natural boundary”.

Of 22 applications from universities, the Ministry of Science and Technology approved the establishment of three new SKLs and the restructuring of 16 existing SKLs into 12. The 15 SKLs have been in operation since July.

“For those applications not approved, their main inadequacies include the relatively small size of the research team, a need for clearer goals and positioning, and the failure to identify a research focus due to scattered research directions,” the paper said.

The four labs that are no longer designated as SKLs studied brain and cognitive sciences, research on bioactivities and clinical applications of medicinal plants, chemical biology and drug discovery, as well as environmental and biological analysis.

Meanwhile, the SKL of molecular neuroscience has been renamed to SKL of nervous system disorders, while the marine pollution lab now studies marine and environmental health, and the lab of advanced displays and optoelectronics technologies has its name shortened to cover displays and optoelectronics.

The three new labs are: SKL of Optical Quantum Materials at the University of Hong Kong, SKL of Quantum Information Technologies and Materials at the Chinese University of Hong Kong and SKL of Climate Resilience for Coastal Cities jointly set up by Hong Kong Polytechnic University and Hong Kong University of Science and Technology.

Three university chiefs in Hong Kong, who also lead SKLs, voiced their commitment to driving research and innovation in support of Beijing’s goal of becoming a scientific powerhouse.

HKU president Xiang Zhang, who heads the new optical quantum materials lab, said the university was committed to “contributing to our city, our nation and the global community”.

“HKU is dedicated to nurturing research talent across diverse disciplines, not only by supporting our laboratories but also by spearheading fundamental research initiatives that align with national development strategies and address critical national needs.”

CUHK president Dennis Lo Yuk-ming, who leads the SKL of Translational Oncology, which dates back to 2006, said the university was “leveraging its unique strengths to integrate itself into national development”.

“Through collaboration, talent exchange and a refined innovation ecosystem, cooperation between Hong Kong, Macau and mainland China will play an increasingly important role in the journey towards building a nation that is strong in science and technology and realising self-reliance and self-improvement.”

HKUST president Nancy Ip Yuk-yu, directs the renamed SKL of Nervous System Disorders, which was set up in 2009 and has developed a blood-based diagnostic technology for Alzheimer’s disease and a whole-brain gene-editing system. Ip said the SKL programme enabled Hong Kong to serve national strategic priorities with its international connectivity.

“HKUST will continue to align with national strategic needs … and contribute meaningfully to building China into a leading science and technology powerhouse and elevating Hong Kong’s role as an international innovation and technology hub,” she said.

In 2023, Chinese Academy of Sciences researchers said studying the funds allocation of SKLs was key for the country to achieve sci-tech self-reliance and self-strengthening at higher levels, revamping the scheme launched in 1984.

“SKLs have produced significant achievements and hold an important place in China’s scientific history after decades of development, but they face challenges with rapid changes in national demands and international circumstances,” they wrote in a policy research paper in the Bulletin of Chinese Academy of Sciences.

These issues included difficulties in quickly responding to urgent national needs, inadequate systematic layout, homogenisation in development, loss of innovative vitality, weak independence and overlapping functions with other innovation platforms, they said.

“In the previous practice, China’s allocation of funds for state key laboratory had four problems, including poor correlation between fund allocation and the mission orientation of institutions and a high proportion of competitive funds.”

Drawing upon successful strategies from European and American national laboratories, the team proposed measures to enhance resource allocation.

These include offering consistent funding to laboratories that have undergone strict approval procedures to mitigate competition while they are in operation. They also suggested directly assigning tasks and allocating funds to SKLs so scientists do not have to spend extra time on project applications.

In Hong Kong, the government’s Innovation and Technology Commission will continue to provide annual funding of HK$20 million (US$2.5 million) for each SKL for staff, equipment, consumables and services for research.

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