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Saying no-no to win-win

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Dear reader,

At 69, P.R.C. marches steadily toward brighter future” is one Xinhua News Agency story that gives you the tone of the Party talking points for today’s celebration of National Day, the annual celebration of the founding of the People’s Republic. You may prefer to join the People’s Daily and revisit “10 classic quotations on patriotism” (in Chinese) from Xí Jìnpíng 习近平.

But there’s also real news happening. We summarized the big stuff below.

1. Saying no-no to win-win

“In the United States, competition is not a four letter word.” So said Matt Pottinger, senior director for Asian affairs on the American National Security Council (NSC) at a weekend event at the Chinese Embassy in Washington, D.C.

  • Pottinger speaks Mandarin, and was a China correspondent for the Wall Street Journal. He left journalism to join the U.S. Marines, where he did tours in both Iraq and Afghanistan. He joined the NSC last year, at the Trump administration’s invitation.

  • Chinese ambassador Cuī Tiānkǎi 崔天凯 gave a speech at the event that the South China Morning Post characterized as “highlight[ing] the importance of cooperation.”

  • Pottinger made less friendly noises: “We at the Trump administration have updated our China policy to bring the concept of competition to the forefront. It’s right there at the top of the president’s national security strategy.

  • To justify the change in language, Pottinger quoted Confucius in crisp, clear Mandarin, earning a few approving giggles from the audience: “If names cannot be correct, then language is not in accordance with the truth of things. And if language is not in accordance with the truth of things, affairs cannot be carried on to success” (名不正,则言不顺;言不顺,则事不成 míng bùzhèng, zé yán bù shùn; yán bù shùn, zé shì bùchéng).

  • You can watch excerpts from both officials’ speeches on YouTube here.

That short video is an interesting contrast. Cui Tiankai’s speech sounds like any official Chinese boilerplate from the last few years, all talk of win-win, cooperation, and mutual understanding. Pottinger quoting Confucius in response is really just a highfalutin way of calling BS on the old clichés.

For more on U.S.-China tensions and the trade war, see our regular update below.

2. Healthcare fury: ‘Attacks on doctors are so common that they have a name’

“I’ve always been struck by how difficult it is for people to see a doctor in China,” tweeted New York Times journalist Sui-Lee Wee 黄瑞黎. “So I spent several months standing in line outside hospitals, talking to doctors who have been stabbed and interviewing officials who are trying to change the system.”

  • The result is this report: China’s health care crisis: lines before dawn, violence and ‘no trust’ (porous paywall). The package includes a nine-minute video captioned “Homemade cancer drugs, violence in hospitals, doctor shortages: We take you inside China’s broken health care system to reveal how dire the situation is for over a billion people.”

  • Violence against doctors is a particularly disturbing sight resulting from the desperation of patients in China: The Times notes that “attacks on doctors are so common that they have a name: ‘yi nao,’ or ‘medical disturbance’” [医闹 yīnào].

  • “Healthy China 2030,” a government blueprint, was unveiled in 2016 and outlines the first long-term official effort in the PRC to address problems such as unequal healthcare access.

  • The country has a long way to go: To take one baseline statistic, “China has one general practitioner for every 6,666 people, compared with the international standard of one for every 1,500 to 2,000 people, according to the World Health Organization.”

  • But GPs don’t feel respected in China: “Among nearly 18,000 doctors, only one-third thought that they were respected by the public, according to a 2017 survey.”

  • See also on SupChina: What ails China’s healthcare system? Roberta Lipson has a detailed diagnosis.

  • Also in the news: HIV/AIDS: China reports 14% surge in new cases / BBC
    “More than 820,000 people are affected in the country, health officials say. About 40,000 new cases were reported in the second quarter of 2018 alone. The vast majority of new cases were transmitted through sex, marking a change from the past.”

3. A hooligan, or a journalist denied free speech?

This morning, I woke to a tweet from Enoch Lieu, a volunteer at Britain’s annual Conservative Party Conference (CPC):  

First day of #CPC18, managed to get slapped in the face twice, literally. I was helping in Conservative Party Human Rights Commission and Hong Kong Watch fringe event on Hong Kong, a reporter from Chinese state-owned CCTV shouted from her seat. When I asked her to leave, she refused and assaulted me.

The reporter is Kǒng Línlín 孔琳琳 (she’s on Twitter and Weibo). Kong has apparently been arrested. For more on this story:

—Jeremy Goldkorn

4. Trade war and U.S.-China relations: Day 88 is not a lucky one

It has been 88 days since the start of what we somewhat cynically dubbed the “first great Sino-American trade war of the 21st century” began.

Nearly three months into the conflict, it is clear that it is indeed great in scale, and may not be the last large-scale trade-related dispute between the countries. For example, the South China Morning Post reports that on intellectual property, one of the most concrete and long-standing points of economic tension, the U.S. and China are still “speaking different languages” and not really responding to what the other side is saying.

But the bigger narrative emerging out of the trade war is how tariffs are really just one piece of a much broader competition between the U.S. and China, which is playing out in more and more domains. As we note at the top of this newsletter, Trump administration officials such as Matt Pottinger are publicly talking about a reorientation of U.S. policy toward competition with China. And we wrote about the technological competition part of this in our Made in China 2025 explainer, which has a new video companion piece.

Here’s a rundown of the news in the trade war and U.S.-China relations.

South China Sea and souring military relations

The U.S.-China Diplomatic and Security Dialogue, scheduled originally for mid-October, has been canceled, the New York Times reports (porous paywall).

  • The cancellation “showed how quickly the tensions over an escalating trade war have infected other parts of the relationship, particularly vital strategic concerns including Taiwan, arms sales and the South China Sea,” the Times writes.

  • We are not sure exactly what prompted the cancellation, and it was likely a combination of factors, though the hundreds of billions of U.S. tariffs in the trade war is actually less a hot button for Beijing than the $330 million in spare fighter jet parts planned to be sold to Taiwan by the U.S.

  • South China Sea tensions remain high, and two days after the Times says American officials learned of the canceled talks (Friday), the U.S. went forward with two Navy warship patrols near Chinese-claimed islands in the sea (on Sunday — Wall Street Journal — paywall).

  • American security experts chattered on Twitter over the weekend that evidence is emerging that, as Rosh Doshi puts it, “a tepid US response that fell below PRC expectations may have emboldened Beijing rather than stabilized the region” during the Obama administration.

  • For more on the South China Sea, the Asia Maritime Transparency Initiative has made an interactive map outlining every oil and gas source, stakeholder, and sovereignty claim in the region. Also see in the SCMP: Beijing faces growing challenges to its South China Sea claims.

Don’t talk about economic troubles in China

China is grappling with more economic headwinds, partly as a result of the trade war. Two measures of manufacturing showed declines in September, indicating pressure on exports.

  • “The official manufacturing purchasing managers index (PMI) stood at 50.8 in September versus 51.3 in August, lower than the median estimate of 51.2 in a Bloomberg survey of economists,” according to a Bloomberg report via Caixin.

  • “The Caixin manufacturing PMI, which better reflects sentiment among smaller, private firms, declined to 50 from 50.6, the lowest since May 2017,” the same report notes.

But media in China have to be careful when reporting numbers like these: The New York Times reports (porous paywall), “A government directive sent to journalists in China on Friday named six economic topics to be ‘managed.’” The topics named:

—Worse-than-expected data that could show the economy is slowing.
—Local government debt risks.
—The impact of the trade war with the United States.
—Signs of declining consumer confidence.
—The risks of stagflation, or rising prices coupled with slowing economic growth.
—“Hot-button issues to show the difficulties of people’s lives.”

Here are a few ways the government is trying to boost the economy, according to three reports from Reuters:

  • “China’s central bank pledged to maintain its ‘prudent and neutral’ monetary policy and to use multiple tools to keep liquidity ample,” Reuters says, noting that the central bank has already “cut banks’ reserve requirements three times this year to inject more liquidity, with further reductions widely expected.”

  • “China has widened income tax exemption on reinvested profits for foreign firms, the Finance Ministry said on Sunday, to try to boost foreign investment amid trade tensions.”

  • “China will cut import tariffs on textile products and metals, including steel products, to 8.4 percent from 11.5 percent, effective Nov. 1, the finance ministry said on Sunday.”

Other trade war and U.S.-China news:

—Lucas Niewenhuis

5. Whither Tencent?

WeChat user growth must be slowing — it’s difficult to add new customers when nearly the whole population already uses the service.

—Jeremy Goldkorn

—–

Our whole team really appreciates your support as Access members. Please chat with us on our Slack channel or contact me anytime at jeremy@supchina.com.

—Jeremy Goldkorn, Editor-in-Chief


BUSINESS AND TECHNOLOGY:

POLITICS AND CURRENT AFFAIRS:

SOCIETY AND CULTURE:

  • Philanthropy: AIDS orphans
    ‘I was lucky, they weren’t’: Why a Wall Street banker quit his high-flying job to help China’s AIDS orphans / SCMP
    “Since 2002, his Hong Kong-registered Chi Heng Foundation has sponsored more than 23,000 Chinese AIDS orphans to go to school, of whom 5,000 have entered university or college, at a cost of more than 200 million yuan (US$29 million).”

  • Beautified selfies and cultural differences
    Foreign criticism of iPhone XS’ “beauty filter” stumps Chinese media / TechNode
    “Chinese media outlets are reporting on some user backlash against a perceived skin-smoothing feature on the new iPhones. Coming mainly from English-speaking Apple customers, the complaints say that new models XS and XS Max automatically brush up selfies without users’ consent… For Chinese users, a new, automatic beauty filter in the new iPhones might seem commonplace — it’s others’ backlash that’s surprising.”

  • Communist folk heroes
    Chinese idol / World of Chinese
    “Even in China, ‘Iron Man’ is famous. There are now whole websites dedicated to the armored American industrialist-turned-warrior. But in another era, the title belonged to a homegrown hero—a brash, plain-spoken ‘model worker’ and amateur poet named Wáng Jìnxǐ 王进喜.”

  • Chinese love letter washes up on Australian shores
    Chinese message in a bottle makes waves in Queensland / BBC
    After being translated, it was revealed to be “a love letter written by a sailor to his fiancée.” (See the original letter on Facebook.)


FEATURED VIDEO EXPLAINER

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SupChina explains Made in China 2025

What is Made in China 2025? Why are we talking about it? SupChina explains.


ON SUPCHINA

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Kai-Fu Lee is the chairman and CEO of Sinovation Ventures, which he founded in 2009; before that, he was the president of Google China. He recently spoke with Young China Watchers about his new book, AI Superpowers: China, Silicon Valley, and the New World Order, and how big data and AI will shape the future.

Kuora: Celebrating Deng Xiaoping, who saved contemporary China

As the Chinese celebrate the 69th anniversary of the founding of the People’s Republic of China, we take a look at the man without whom New China would not be what it is: Deng Xiaoping. How did he save China, and how is he regarded today?

Pictures of the Day: Gubei Water Town

Our story on Friday about the “imminently Instagrammable” Gubei WTown prompted one reader to submit her own photos of this “water town,” which was built in 2010 and has become a popular destination for Beijing weekenders. As today is the eve of a national holiday in China — it’s Golden Week, with the Beijing skies looking very much like in these pictures — we thought we’d share.

Friday Song: ‘I love, therefore I exist’

If Stevie Wonder and the Backstreet Boys came together to create a Chinese pop band, the result would be Khalil Fong (方大同 Fāng Dàtóng). In 2006, Khalil released his sophomore album, This Love. The album’s title track — “love love love” (in Chinese, 爱爱爱) — is one of his most-played songs, and speaks to his multicultural style of music.


PHOTO FROM MICHAEL YAMASHITA

Fall color

Fall foliage in Gyarong Valley, in the far west of Sichuan Province.

Jia Guo

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Jeremy Goldkorn

Jeremy Goldkorn worked in China for 20 years as an editor and entrepreneur. He is editor-in-chief of SupChina, and co-founder of the Sinica Podcast.