Backstabbing?

Access Archive

Dear Access member,

Admin. note: If you want to get in touch with us:

  • For content inquiries, ask me.

  • For membership/subscription issues, ask Lucas.

  • For corporate or student discounts, ask Alex.

  • For Sinica and podcast issues, ask Kaiser.

You can find all of us by emailing first_name@supchina.com, e.g., jeremy@supchina.com.

If you’re in a rush today:

  • Huawei: The standoff between Canada and China over the arrest of Huawei’s CFO continues, with Beijing’s ambassador to Ottawa making new threats of retaliation.

  • Trade war: China offered to eliminate the trade deficit with the U.S. in six years, an attempt to address Donald Trump’s pet issue.

  • The religious and cultural repression targeting Muslims and Christians has arrived in Kaifeng, home to China’s tiny community of native Jews.

  • Baidu, China’s top search engine, has come under intense fire after threatening a prominent Chinese journalist with legal action if he didn’t remove a “defamatory” blog post.

Finally, we will not send a newsletter on Monday, January 21 — our New York office is closed for Martin Luther King Jr. Day.

Have a great weekend,

—Jeremy Goldkorn and team


1. Huawei: Another warning for Canada from China’s ambassador

This is the latest in the global fight over China’s beleaguered telecom company:

  • “China’s ambassador to Canada warned the Canadian government Thursday to stop recruiting international support in its feud with China and threatened retaliation if Canada bans Chinese telecommunications giant Huawei for security reasons,” reports the Associated Press.

  • “Ambassador Lú Shāyě 卢沙野 said last month’s arrest of a top Huawei Technologies executive was an act of ‘backstabbing’ by a friend.”

  • “Canada’s government on Friday dismissed China’s warning of repercussions if Ottawa banned Huawei Technologies Co Ltd from supplying equipment to 5G networks, saying it would not compromise on security,” according to Reuters.

  • “Analysts” cited by the South China Morning Post say “Beijing could set higher market entry barriers to Canadian firms and tighten scrutiny of existing businesses in retaliation for any efforts by Ottawa to rally international support against China.”

  • If you’re Canadian and doing business in China, you might want to read this from the China Law Blog (always a good source for practical business information about China): Doing business in China and hiding your company’s country identity: How Canadian do you want to be?

  • In Poland, the former Huawei executive charged with espionage says he is not guilty, reports Reuters.

  • “The University of Oxford says it will continue two ongoing partnership projects with Huawei but has decided to suspend other new research grants and donations from the Chinese telecoms giant amid growing security concerns about the company,” according to the South China Morning Post.

  • Turkey’s leading mobile phone operator Turkcell and Chinese technology giant Huawei have signed an agreement to collaborate on smart cities, Turkcell announced Tuesday,” reports the Daily Sabah.

—Jeremy Goldkorn

2. Trade war, day 197: China offers to eliminate trade deficit in six years

Though the bilateral trade deficit has very little to do with the economic benefits or drawbacks of trade, everyone knows Donald Trump is obsessed with it. And because his perception of a trade “win” is the most important deciding factor in whether the U.S. and China make a deal, it makes sense that Beijing made this offer, reported by Bloomberg (porous paywall):

China has offered to go on a six-year buying spree to ramp up imports from the U.S… By increasing goods imports from the U.S. by a combined value of more than $1 trillion over that period, China would seek to reduce its trade surplus — which last year stood at $323 billion — to zero by 2024

The offer, made during talks in Beijing earlier this month, was met with skepticism by U.S. negotiators who nonetheless asked the Chinese to do even better, demanding that the imbalance be cleared in the next two years…Economists who’ve studied the trade relationship argue it would be hard to eliminate the gap, which they say is sustained in large part by U.S. demand for Chinese products.

Also of note, on the more substantive/structural side of negotiations, per Reuters:

The United States is pushing for regular reviews of China’s progress on pledged trade reforms as a condition for a trade deal — and could again resort to tariffs if it deems Beijing has violated the agreement…

Chinese negotiators were not keen on the idea of regular compliance checks, the source said, but the U.S. proposal “didn’t derail negotiations.”

A Chinese source said the United States wants “periodic assessments” but it’s not yet clear how often…

An enforcement and verification process is unusual for trade deals and is akin to the process around punitive economic sanctions such as those imposed on North Korea and Iran.

A summary of this week’s trade-war-related developments can be found in the “Week in Review” section below.

Other trade-war-related links for today:

—Lucas Niewenhuis

3. And then they came for the Jews because of course they would

Yesterday, we noted that police in Bishkek, Kyrgyzstan, dispersed an anti-China protest, and linked to James Milward’s excellent essay in the New York Review of Books: ‘Reeducating’ Xinjiang’s Muslims. A new report by Eurasianet says there were up to 250 people at the demonstration showing their “unease at the presence of Chinese laborers in the country.”

Back in China, Bitter Winter reports that the religious and cultural repression targeting Muslims and Christians has arrived in Kaifeng, home to China’s tiny community of native Jews:

When news of [a plan to reconstruct the community’s synagogue] reached the central offices of the CCP, orders came down to shut down the projects and to cut off Shavei Israel’s other efforts in the community. The Kaifeng Jews, now a rural and mostly poor people, were unable to maintain any of the reconstruction efforts.

New rules also forbade public Jewish gatherings on holidays. The Hebrew signs were torn down. A museum exhibit showcasing Kaifeng’s Jewish history disappeared under a new regulation.

—Jeremy Goldkorn

4. Baidu threatens to sue a journalist for mentioning past scandals

Baidu, China’s top search engine, has come under intense fire after threatening a prominent Chinese journalist with legal action if he didn’t remove a “defamatory” blog post. The article in question, published by Wáng Zhì’ān 王志安, an experienced reporter and prolific writer with a focus on social issues, called out Baidu for its role in facilitating the rise of Quanjian, a dodgy Chinese healthcare products maker that is under investigation for operating a pyramid scheme and false marketing.

For more, please click through to SupChina.

—Jiayun Feng

—–

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


Here are the stories that caught our eye this week:

  • A Canadian man was sentenced to death for drug trafficking by a Chinese court, in a dramatic escalation of Beijing’s retaliation against Canada for arresting Huawei CFO Mèng Wǎnzhōu 孟晚舟 in December. The Global Times warned (in Chinese) that Poland, which also arrested a Huawei employee recently, could be next to “pay…a price.” Robert Schellenberg plans to appeal his case, but law scholar Donald Clarke predicts: “the Supreme People’s Court will sit on the review decision for as long as Meng’s fate remains undetermined.” China and Canada both issued travel warnings for their citizens in the other country. It was also reported this week that another Canadian was briefly detained in Beijing, en route back to Canada, but released after two hours.

  • Regardless of the outcome of Beijing’s hostage diplomacy, Huawei clearly has a big fat bull’s-eye painted on its kitschy Shenzhen headquarters: The U.S. federal government is investigating it for stealing trade secrets, while the American congress is proposing bans on selling to the company, and the German government and Oxford University are also souring on Huawei.

  • Beijing is stimulating the slowing economy by dropping the reserve requirement ratio for banks, and promising tax cuts that could be worth hundreds of billions of dollars.

  • At least 145 parents, angry that their children received expired vaccinations, clashed with police and officials in a town in Jiangsu Province.

  • Even more evidence of a U.S.-China trade deal emerging came to light this week (SupChina identified this trend last week). Donald Trump again stated that he thinks the U.S. is going to “do a deal with China” and end the trade war, and even though U.S. Trade Representative Robert Lighthizer reportedly doesn’t see “any progress” on the most important issues in economic relations with China (including the indefinitely slow-walked approvals for American credit card companies), he is being pressed by Trump to close a deal. The Wall Street Journal even reported that the Trump administration is considering easing tariffs as part of a trade deal at the beginning of March, or even sooner as a goodwill gesture. Vice premier Liú Hè 刘鹤 is confirmed to be visiting Washington, D.C., for high-level trade talks on January 30-31.

  • Chinese tourism to the U.S. appears totally unaffected by the trade war. New York City and Los Angeles County both reported record numbers of Chinese visitors in 2018, even as foreign direct investment from China and business merger deals — particularly in technology — plummeted.

  • In New Zealand, a popular Chinese-language newspaper and website operating in a joint venture with one of the country’s leading media organizations is soft-pedaling the China news.

  • China’s lunar lander sprouted seeds in a capsule, a historic landmark for space exploration, though they died after a couple days because the lander didn’t have sufficient battery power to keep the plants warm.

  • China’s TV regulators seem to have begun a stealth campaign to censor earrings from the earlobes of male entertainers.

  • A Chinese kindergarten teacher who was dismissed last summer allegedly because of his sexual orientation has filed a lawsuit against his former employer to get his job back.

  • Dozens of Fortune 500 companies were identified as having the “wrong listing of Taiwan” on their websites, in a second wave of what the Trump administration last year dubbed “Orwellian nonsense” from Beijing.


BUSINESS AND TECHNOLOGY:

POLITICS AND CURRENT AFFAIRS:

SOCIETY AND CULTURE:


VIDEO ON SUPCHINA THIS WEEK


FEATURED ON SUPCHINA

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This year, a record 15 NBA teams will officially mark the Chinese New Year at their arenas for what is part of the league’s eighth CNY celebration. Also: China is safely through to the knockout stages of the AFC Asian Cup, with a very winnable game next against Thailand on Sunday, and X Games creator ESPN has partnered with Chinese sports platform REnextop to bring the coolest names in the action sports world to the Middle Kingdom this year.

The Venezuela-China relationship, explained: Belt and Road

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Hanshan: Investigating the life of Chinese literature’s most mysterious poet

The poet Hanshan 寒山, a name meaning “Cold Mountain,” ranks as one of the most eccentric and mysterious figures of Chinese literature. He is said to have lived during the Tang dynasty (618–907), dwelling in a cave or hut on Tiantai Mountain near modern-day Taizhou, Zhejiang. In Chinese and Japanese art, he is often depicted as dirty and raggedy, smiling mischievously with his friend Shide 拾得. His poetry, written in a direct, colloquial style, was satirical and spiritual, touching on both Buddhist and Daoist themes. Hanshan also wrote poems about his own life, but his real identity is completely unknown. His name, in fact, is a pseudonym that refers to a place on Tiantai Mountain.

Flavor is more than skin deep: The many ways in which Chinese eat offal

China and the United States are among the world’s biggest meat consumers, but there’s a big difference in what each country is willing to eat. American meat consumption is limited to skeletal muscle and mostly excludes offal, or the organs (heart, liver, intestines, etc.) and extremities (brain, tongue, feet, etc.). In contrast, Chinese carnivores seem to be enthusiastic about making nose-to-tail use of their livestock. Here are five Chinese preparations of the fattiest type of offal — large pork intestine — spanning across various culinary regions.

China Business Corner: WeChat founder Allen Zhang and the Tencent conference

In the wake of Tencent’s recent annual conference, it’s WeChat mastermind Allen Zhang week here at China Business Corner. First we’ll take a look at an extended profile of the man himself, whose product decisions about WeChat have more immediate impact on Chinese people’s daily lives than most political decisions (the article, incidentally, was censored after one day), then turn to his recent four-hour speech at the Tencent conference, which some critics have argued is a “reality distortion field” that doesn’t address WeChat’s fundamental problems.

Luckin Coffee continues ambitious rampage: Is it really China’s Starbucks — or the next Ofo?

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Chinese Corner: The women who spoke out against sexual misconduct

What happens to a Chinese woman after she speaks out against sexual harassment and assault? This is the question at the center of a recent profile of a cohort of brave women who have come forward as victims of sexual misconduct in support of China’s fledgling #MeToo movement. This and other stories in Chinese Corner, Jiayun Feng’s review of interesting nonfiction from this past week on the Chinese internet.

Kuora: Yunnan, with all its history, is more than a vacation getaway

This week’s Kuora explores one of the most beautiful provinces of China — Yunnan, which was incorporated into the Han dynasty (206 B.C.E. to C.E. 220) in the 2nd century B.C.E., came to be dominated by semi-sinicized tribal people for a while, came back to Han Chinese rule in the 14th century, but soon after became a feudatory under a Chinese general…and so on and so forth. It’s an interesting story. Check it out.


SINICA PODCAST NETWORK

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This week on Sinica, Kaiser and Jeremy chat with Christina Larson, a science and technology reporter for the Associated Press, about a major story that her team broke: the announcement by the Chinese scientist Hè Jiànkuí 贺建奎 that he had edited the genes of embryos conceived in vitro, and that twin girls had been born, making them — if his claims are true — the world’s first gene-edited babies.

  • Subscribe to the Sinica Podcast on Apple Podcasts, Overcast, or Stitcher, or plug the RSS feed into your favorite podcast app.

  • Access members can get an exclusive early preview of Sinica each week by plugging this RSS feed directly into their podcast app.

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PHOTO OF THE DAY

Exercise time

Students prepare for their daily physical exercises at the Laojuntang Elementary School in Chaoyang District in Beijing in October 2018. Photo by Lavinia Liang, who is @lavinianshores on Instagram.