Facebook AI director goes to Alibaba

Access Archive

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Today’s news is below. We love feedback on anything to do with SupChina: Reply to this email to get into my personal inbox, or write to editors@supchina.com to reach our whole editorial team. You can also chat with us on our Slack channel — please write to lucas@supchina.com if you need help signing on.

—Jeremy Goldkorn, Editor-in-Chief


U.S.-China tensions are everywhere  

Once again, there is not one big story from China that commands a headline. But most of the news stories that jumped out at us today were directly or indirectly connected to the ongoing tensions between China and the United States.

All the stories we’ve selected below illustrate just some of the many ways that transpacific competition is going to dominate headlines for years to come.

Facebook AI director goes to Alibaba

Right now, human talent is perhaps the most significant factor in the U.S.-China race for dominance in artificial intelligence — and who doubts that it has become a race? Score one for China, then. The Global Times reports:

Jiǎ Yángqīng 贾扬清, a research scientist and director of Facebook’s AI Infrastructure, has officially joined Alibaba’s Damo Academy, the AI research arm of the Chinese e-commerce giant, Alibaba said on Tuesday, confirming earlier media reports.

Jia will serve as the vice president of engineering at Alibaba and lead research and development into big data computing platforms, according to Damo.

Jia has already updated his LinkedIn page.

China’s huge investment in 5G

ZD Net reports that research firm Forrester says China will “remain Asia’s largest in terms of tech spending”:

  • China will spend $256 billion on technology goods and services this year, and $273 billion in 2020, according to Forrester’s forecast. 5G will account for 57 percent of this expenditure.

  • China “has outspent the US by US$24 billion in 5G since 2015, with its three major telcos unveiling plans to launch commercial 5G networks by next year.”

China’s passenger jet to fly in Ghana?

The Ghana-based “Africa World Airlines Ltd., partly owned by China’s HNA Group Co., may agree this month to buy two Comac ARJ21 regional jets,” reports Bloomberg.

Also on Bloomberg, David Fickling writes: “Such a small order — from an airline part-owned by China’s debt-ridden HNA Group Co., no less — is hardly a ringing endorsement for a plane that’s been in development for the best part of two decades.”

VIPKid sacks foreign teachers for discussing politics

Here’s another irritant in the co-dependent Sino-American technology relationship, reported by the Wall Street Journal (paywall):

VIPKid, one of China’s most valuable online education startups, has put hundreds of its mostly American teachers on notice for using certain maps in their classes with Chinese students, and has severed two teachers’ contracts for discussing Taiwan and Tiananmen Square in ways at odds with Chinese government preferences, people familiar with the company say. Since last fall, teachers’ contracts state that discussing “politically contentious” topics could be cause for dismissal, according to one reviewed by The Wall Street Journal.

Beijing-based VIPKid says it has more than 60,000 teachers in the U.S. and Canada who teach English to more than 500,000 children ages 4 through 15, who live mostly in China. Teachers work as independent contractors and can earn between $14 and $22 an hour.  

New foreign investment law worse than underwhelming?

We titled our newsletter on Monday “The underwhelming new foreign investment law.” Perhaps it’s worse than underwhelming, according to Steve Dickinson of the China Law Blog:

The actual effect of China’s new Foreign Investment Law will be to eliminate the few remaining policies that benefit foreign investors as compared to domestic Chinese businesses. This means foreign investors will no longer be treated better than Chinese nationals; they will instead be treated the same or worse.

Note: Dickinson is a lawyer who has been advising companies large and small on their legal affairs in China for decades — his opinions are based on firsthand experience seeing companies succeed, and fail terribly.

Another Confucius Institute bites the dust

Mother Jones reports that the University of Minnesota has closed its Confucius Institute (CI), joining “the ranks of roughly a dozen other American colleges that have abandoned their partnerships with Hanban [the Chinese government entity in charge of CIs] amid increasing criticism of Beijing’s growing authoritarianism and hostility to free speech.”

Will Trump’s push for last-minute leverage doom trade talks?

This is not shaping up to be a good week for the outlook on U.S.-China trade talks. After Bloomberg reported that Beijing isn’t happy that it hasn’t received assurances that tariffs would be lifted, Trump did the exact opposite of reassuring: He said he is “talking about leaving” the tariffs in place even with a deal. Now CNBC reports further news of Trump pushing the line:

U.S. officials seeking a China trade deal are focused on long-term changes to that nation’s economy. But President Donald Trump is set on reducing the trade deficit, and is pushing his negotiators to get China to agree to purchase more goods, according to two people briefed on discussions.

China has offered to purchase up to $1.2 trillion in U.S. energy, agriculture and aircraft products over a period of six years. When the offer was first reported — a month and a half after it was discussed by Trump and President Xi Jinping at the G20 in Buenos Aires — the market jumped, a signal that investors viewed the offer as a substantial bargaining chip to win over the president.

But Trump has long wanted a number “double or triple” China’s $1.2 trillion proposal, these people said, requesting anonymity due to the sensitive nature of the discussions. He renewed his desire for a larger purchase deal in recent weeks, they said, following data that revealed the U.S.-China trade gap was widening.

China needs imported pork

China’s 2019 pork imports are set to double from last year to 2 million tonnes…as African swine fever hits production of the meat in the world’s top hog market,” reports  Reuters.

  • There were 113 reported swine fever outbreaks since last August, “though farmers and industry insiders say several outbreaks are going unreported.”

  • “China’s pig herd declined by 15 percent in 2018,” according to industry analysts. The country’s pork production will probably fall to around 50 million tonnes from last year’s output of 54 million tonnes.

  • Speakers at an agricultural conference in China “said the drop in output would hit feed demand hard.”

  • Soy — some imported from the U.S. — is a major ingredient of pig feed.

The questionable thesis of Trump’s favorite China scholar

Former U.S. Department of Defense analyst and author Michael Pillsbury was named by Trump last September as “the leading authority on China.” Trump named him apparently because, one month before, Pillsbury had appeared on Trump’s favorite TV channel to praise the president as “so smart,” and compare his policies toward China to “playing three-dimensional chess.” Also, Pillsbury’s book, The Hundred-Year Marathon: China’s Secret Strategy to Replace America as the Global Superpower, is reportedly well read in the Trump administration.

Many China scholars have a dimmer view of Pillsbury’s work. Jude Blanchette, now the senior adviser and China practice lead at Crumpton Group’s China Practice, wrote a highly critical review of Pillsbury’s book for the 21st Century China Program at UCSD back in 2016.

Harvard professor Alastair Iain Johnston has just published a new review of Pillsbury’s work, criticizing the “shaky foundations” of the “intellectual architecture” of the Trump administration’s China policy. The article is paywalled in an academic journal, unfortunately, but scholar Graham Webster has tweeted a thread of highlights from the work.

Johnston’s review concludes, “It is possible China’s current leaders do seek to replace the US as global hegemon. [But Pillsbury fails] to make the case that any such goal is rooted in a 100-year strategy developed in the early years of the PRC.”

On the futility of trying to contain China

For the Carnegie Endowment for International Peace, Michael D. Swaine and Ryan DeVries write:

Chinese state-society relations: Why Beijing isn’t trembling and containment won’t work

As they consider how to react diplomatically to China’s latest authoritarian turn, Western policymakers must understand the country’s complicated political history and the views of Chinese citizens more deeply. Although movement toward a more open and pluralistic society and political system, and a genuine strengthening of the rule of law, would undoubtedly create greater freedom and, eventually, greater stability in China, any serious attempt to force such change from the outside would almost certainly backfire badly.

—Jeremy Goldkorn and Lucas Niewenhuis


BUSINESS AND TECHNOLOGY:

  • “I feel Prada is not in vogue”
    Prada’s problems in China are deeper than the economic slowdown / Jing Daily
    While “other major peer brands like LVMH, Kering, and Hermès continue to see growth from this most desirable market,” Prada released a weak 2018 annual earnings report on March 18 showing its operating profit dropped 10 percent to $366 million.
    This article says Prada is struggling to “stay relevant with Chinese Millennial and Gen-Z audiences,” and has also been developing a reputation for poor quality, quoting one Shanghai fashionista: “I feel Prada is not in vogue. My budget will likely go to brands like Dior, Chanel, or Gucci.”

  • Singapore hopes to sign on to the Chinese answer to TPP
    Singapore hopeful for China-backed Asia trade pact this year / AFP

Singapore’s trade minister said Wednesday he was hopeful that an Asia-wide trade pact, which is backed by China and excludes the United States, could be sealed by the end of the year.

On a visit to Washington, Trade and Industry Minister Chan Chun Sing said that a clearer picture would emerge on the Regional Comprehensive Economic Partnership (RCEP) in May after elections in four countries that are part of it — India, Australia, Indonesia and Thailand.

  • Electric car quality problems
    China’s electric cars hit some potholes / Bloomberg (porous paywall)
    “The government is doing everything it can to spur sales of new-energy vehicles. First, it should stop them from spontaneously combusting,” writes Adam Minter:

For several days last week, the often distressingly poor quality of China’s electric cars was a leading topic across Chinese media. According to one survey ricocheting across the web, nearly 70 percent of respondents said they regretted buying a new-energy vehicle (NEV). Many expected the industry to be targeted in China’s wildly popular “Consumer Rights Day” gala television special, which shames corporate giants for service and quality lapses. While privacy-invading tech companies were harangued instead, the frustration of car owners continues to spill over on both social and traditional Chinese media.

Chinese authorities are stepping up efforts to fight online usury, an issue sharply criticized by state-owned broadcaster China Central Television (CCTV) in its recently annual Consumer Rights Day gala.

According to an announcement (in Chinese) released Thursday by National Internet Finance Association of China (NIFA), online financial service providers including Baidu-backed Duxiaoman, Bytedance, and Rong360 were asked earlier this week to conduct internal reviews of their practices. The government-led agency called for complete investigations by companies in the sector in order to eliminate access to “high-interest payday loan” on their platforms.

POLITICS AND CURRENT AFFAIRS:

  • Air pollution on the rise
    China’s nationwide pollution readings rise 5 percent in January-February / Reuters
    “China’s average concentrations of lung-damaging particles known as PM2.5 rose by 5.2 percent in the first two months of the year, the environment ministry said on Thursday, casting doubt over the country’s ability to meet winter targets.”
    As China’s economic growth engine slows, is its war on pollution losing steam? / SCMP
    “This winter, 39 cities across northern China, including the Beijing-Tianjin-Hebei megalopolis and the Fenwei Plain, experienced alarming surges in air pollution.”

  • Xinjiang internment camps
    After mass detentions, China razes Muslim communities to build a loyal city / WSJ (paywall)
    Josh Chin and Clément Bürge return to Urumqi, Xinjiang, for the first time since their 2017 trip, which documented how the “government has turned the remote region into a laboratory for its high-tech social controls.” They find that Uyghur markets, bookstores, and entire neighborhoods have been cleared out and demolished, and that a “sanitized version catering to Chinese tourists” has been built in their place. Their report includes an eight-minute video that is worth watching.
    They also point out that “in a single year, 2017, Urumqi’s official population fell by 15% — to 2.2 million from 2.6 million the year before, the first drop in more than three decades,” a trend attributable to both mass internment and forced relocations of Uyghurs.
    Uyghur detainees from Xinjiang ‘placed in nearly every prison’ in Shandong province / Radio Free Asia
    “Ethnic Uyghurs held in political ‘re-education camps’ in northwest China’s Xinjiang Autonomous Region (XUAR) are being sent to jail in Shandong Province, prison officials have confirmed, as new details emerge of the system authorities use to transfer detainees out of the region.”
    On Xinjiang, Atajurt, and Serikjan / Art of Life in Chinese Central Asia
    The scholar Gene Bunin appears in a video to “convey the importance of what’s happening right now — here in Kazakhstan, in Almaty and also in Astana — regarding the volunteer group Atajurt and its leader Serikjan Bilash, whom as many of you know has been arrested.” A transcript of his remarks is included.

  • Italian Belt and Road dreams
    Italy aims to add 7 billion euros in exports to China: junior minister / Reuters
    “Italy hopes to increase exports to China by 7 billion euros ($8 billion), junior Industry minister Michele Geraci said hours before Chinese President Xi Jinping was due to arrive in Rome at the start of a 3-day visit. Xi is expected to sign a preliminary accord with Prime Minister Giuseppe Conte on Saturday, hooking Italy up to his giant Belt and Road infrastructure project.”

  • Indonesia sets requirements for Belt and Road projects
    Billions on offer for Belt and Road / The Jakarta Post (registration required)
    Coordinating Maritime Affairs Minister Luhut Pandjaitan says that the Indonesian government will propose 28 Belt and Road projects, stating, “We expect to reach a deal on at least two to three projects.”
    As summarized by Tom Baxter on Twitter, the Indonesian government also set forth four requirements for Belt and Road projects:

1. Must use “enviro friendly tech”

2. Maximise use of local labour

3. Transfer of knowledge & tech to local partners

4. Must create added value upstream & downstream

In the wake of last Friday’s shootings at two mosques in Christchurch, New Zealand, a wave of celebration hit Chinese social media. On Weibo — China’s Twitter equivalent, with 446 million monthly active users, 120 million more than Twitter — mainstream coverage of the attacks was barraged with comments that expressed anti-Muslim rhetoric and support for the shooter. The top comment under a video clip posted by People’s Daily likens Muslims to “cancer cells” and asks the Chinese government to avoid making the same mistakes as New Zealand.

Two former Philippine officials have taken the bold step of filing a complaint with the International Criminal Court (ICC) accusing Chinese President Xí Jìnpíng 习近平 of crimes against humanity over his government’s assertive actions in the disputed South China Sea, which they say have deprived thousands of fishermen of their livelihood and destroyed the environment.

Former Foreign Secretary Albert del Rosario and chief anti-corruption prosecutor Conchita Carpio Morales said on Thursday that they filed the complaint with the tribunal last week, before the current Philippine president’s move to withdraw the country from the tribunal took effect last weekend…

…There was no immediate reaction from China.

SOCIETY AND CULTURE:


VIDEO ON SUPCHINA

Price of Chinese mahogany leaves drops after ‘xiangchun freedom’ hype

Chinese mahogany tree leaves, or xiangchun in Chinese, are used in many dishes in China. They taste a bit like basil, and have gained attention online — and comparisons to avocado — for their sometimes exorbitant price.

Watch this artist make figures out of dough!

Dough modeling is a traditional form of art in China, and Zhanhang Xiao, age 60, is a third-generation practitioner of it. Take a look as he turns colored dough into lifelike figures!


FEATURED ON SUPCHINA

A testament to failed compromise: The KMT museums of Guangzhou

The district of Yuexiu in Guangzhou is a diorama of the early history of the CCP and the KMT. It is a bloodstained landscape in miniature, however, and one that looks capable of repeating itself. Xi Jinping’s repeated emphasis on the inevitability of reunification, this time with Taiwan, reeks of repeating unnecessary historical folly.

Chinese or Taiwanese? Nana Ou-Yang is at the center of a political firestorm

Nana Ou-Yang 欧阳娜娜, the 18-year-old Taiwanese celebrity who has around 14 million followers on Weibo and over 2.2 million followers on Instagram, has found herself caught in a bizarre and messy political storm where she had to speak out about her views on the Taiwan-Mainland China imbroglio.


SINICA PODCAST NETWORK

Sinica Podcast: China, the U.S., and Kenya

This week on the Sinica Podcast, Kaiser and Jeremy are joined by Eric Olander, host of the China in Africa Podcast from the China Africa Project, and by Anzetse Were, a developmental economist based in Nairobi. They explore questions related to Kenyan debt and development as well as Sino-American competition in East Africa.


PHOTO OF THE DAY

Beach days

Family members play in the sea and get splashed by the waves in Shandong Province. Photo by Daniel Hinks.