Dear Access member,
We had a wonderful chat with Maria Repnikova and Access members earlier today on Slack. You can still view the chat on the #supchina_access channel — to jump straight to the beginning of the conversation, click here. Next week, a transcript will be archived along with previous Slack Q&As on the #access_qa_archive channel.
—Lucas Niewenhuis, Associate Editor
1. Beijing finds a common strategy on trade frictions and Hong Kong: Blame the U.S.
If you are following U.S.-China relations or the Hong Kong protests closely — and being an Access member, why wouldn’t you be following those issues closely — we would recommend reading two Foreign Ministry Q&As this week that revolved around those issues.
Foreign Ministry statements don’t always contain much detail beyond boilerplate, but this week they were more specific, and unusually unrestrained in attacking the U.S. The kind of language — intensely conspiratorial on Hong Kong, highly nationalistic on the trade war — being used now is becoming the “new normal” from Beijing, even as reckless nationalism risks becoming official U.S. policy toward China.
On July 30, spokeswoman Huá Chūnyíng 华春莹 elaborated on the official reasoning for why Beijing blames the U.S. for “fanning the fires” of protest in Hong Kong:
I think Mr. Pompeo obviously failed to put himself in a right position. I’m afraid he still regards himself as the CIA chief. He said the recent violent incidents in Hong Kong are appropriate because, as you all know, they are somehow the work of the US.
Let us think about what has happened. According to public reports, at the end of February and the beginning of March, the then US Consul-General in Hong Kong blatantly criticized the Hong Kong SAR government’s bill amendment and the “one country, two systems” principle and interfered in Hong Kong affairs. In March, US Vice President Mike Pence met with Hong Kong opposition lobbyists. In May, Pompeo met with Hong Kong opposition and made irresponsible remarks on the amendment matter. In June, Speaker of the US House of Representatives Nancy Pelosi even called the demonstrations in Hong Kong “a beautiful sight to behold”. Some members of US Congress once again proposed the Hong Kong Human Rights and Democracy Act. In July, Pence, Pompeo and Bolton met with opposition personnel. In the scenes revealed on media, we saw some American faces among the violent demonstrators in Hong Kong. We even saw the national flag of the US on some occasions. We all have this question: what role has the US played in Hong Kong recently? The US owes the world an explanation.
As with any good conspiracy, it comes with baffling logical flaws — for example, what qualifies an “American face” versus a Hong Kong one?
If the US indeed imposes new tariffs, China will have to take necessary countermeasures to uphold its core interests and the fundamental interests of the Chinese people. The US will be responsible for all related consequences…
Not long ago, during their meeting in Osaka, the Chinese and US Presidents agreed to restart trade consultations on the basis of equality and mutual respect with no new tariffs to be imposed by the US side. Though we still recall those words vividly, soon after the conclusion of the latest round of consultations in Shanghai, the US announced the imposition of new tariffs. It clearly runs counter to the leaders’ consensus and the correct direction. This again shows the world how flip-flopping the US can be.
As we repeatedly said, a trade war will only hurt both sides. Resorting to a trade war to settle its domestic problems, the US is in fact drinking poison to quench its thirst… American families should not be a pawn in this trade war. The tariffs will hit US consumers far harder than Chinese manufacturers.
I’d like to re-emphasize that China does not accept any maximum pressure, threat or blackmail. On major issues concerning our principles, we won’t back down even a little bit. China’s position on China-US trade talks is consistent as always. If the US wants to talk, our door is wide open. But if it insists on a trade war, we will fight to the end with firm resolve. Now the ball is in the US court. It needs to demonstrate good faith. The world is watching.
Jane Perlez at the New York Times quotes several analysts who see the increasingly unrestrained anti-American rhetoric from Beijing as part of a broader strategy:
“Blaming the U.S. for the trouble in Hong Kong signals a deliberate policy decision rather than an instinctive reaction,” said Minxin Pei, a professor of government at Claremont McKenna College in California. “It is highly unlikely that the use of such shrill rhetoric has not received endorsement from the top leadership.”
Beyond the specific issues of Hong Kong and trade, Mr. Pei said, the Chinese government is trying to construct a “meganarrative” that portrays the United States as the “principal antagonist intent on not only thwarting China’s rise with the trade war but also fomenting trouble within Chinese borders.”
MORE REPORTING ON HONG KONG:
Further strikes and protests
Calls for general strike and 7 rallies across Hong Kong on Monday, as protests escalate / Hong Kong Free Press
Thousands attend rally organised by civil servants urging Hong Kong gov’t to listen to public demands / Hong Kong Free Press
Organizers said 40,000 attended.
Trump repeats the Party line
Trump calls Hong Kong protests ‘riots,’ adopting China rhetoric / Bloomberg (porous paywall
Trump: “Something is probably happening with Hong Kong, because when you look at, you know, what’s going on, they’ve had riots for a long period of time…Somebody said that at some point they’re going to want to stop that. But that’s between Hong Kong and that’s between China, because Hong Kong is a part of China.”
A 21-minute documentary on the Yuen Long attacks
July 21: A Dark Night in Yuen Long / Wilfred Chan on Youtube
MORE REPORTING AND ANALYSIS ON THE TECHNO-TRADE WAR:
“Being tough on China is the right way to be”
That’s a quote from Chuck Schumer, the top Democratic senator in the U.S. Congress, who expressed his support for Trump’s trade war escalation, per the New York Post. Being “tough on China” will likely continue to have high bipartisan support through 2020: When asked by Axios, all Democratic presidential candidates who staked out a position were also highly critical of China, and were also all indecisive about removing Trump’s tariffs if they were elected.
How might China retaliate to more tariffs?
China’s Trump trade retaliation options include soybeans, Boeing / Bloomberg (porous paywall)
“As a first step, China could reinstate the tariff on U.S. cars that it lifted as a goodwill gesture earlier in the talks, or raise the amount on goods that have already been taxed.”
China wants to hit back at Trump. Its own economy stands in the way. / NYT (porous paywall)
“There are several things China could do. It could call for a boycott of American goods or stop buying Boeing planes. It could devalue its currency, which would in effect partially nullify American tariffs. It could make life much harder for American business and executives in China, or it could exercise its power over key parts of the global supply chain, like its dominance over key manufacturing minerals called rare earths.”
China faces limited options for retaliating against latest U.S. threat / WSJ (paywall)
“Easy targets—according to business executives and analysts—include canceling planes from Boeing Co. , which has orders from Chinese airlines for 478 of the 737 MAX passenger jets that have been grounded world-wide after two crashes. Delivery company FedEx Corp. is already under investigation by Chinese authorities—and pilloried in state media—for mishandling packages destined for telecom gear-maker Huawei Technologies Co.”
What’s Trump’s plan with the latest tariffs on China? / Foreign Policy (porous paywall)
Derek Scissors, an economist at the American Enterprise Institute, says that China doubling down on its “unreliable entity list” is still unlikely even with the next step in tariffs. Only if the additional $300 billion of Chinese imports is taxed at a higher rate than 10 percent does he expect China to “bring out the big guns and go after the big firms in China.”
Great power competition: Now with an arms race and paranoia about academic exchange
U.S. ends Cold War missile treaty, with aim of countering China / NYT (porous paywall)
The United States on Friday terminated a major treaty of the Cold War, the Intermediate Nuclear Forces agreement, and it is already planning to start testing a new class of missiles later this summer.
But the new missiles are unlikely to be deployed to counter the treaty’s other nuclear power, Russia, which the United States has said for years was in violation of the accord. Instead, the first deployments are likely to be intended to counter China, which has amassed an imposing missile arsenal and is now seen as a much more formidable long-term strategic rival than Russia.
The moves by Washington have elicited concern that the United States may be on the precipice of a new arms race, especially because the one major remaining arms control treaty with Russia, a far larger one called New START, appears on life support, unlikely to be renewed when it expires in less than two years.
American graduates of the prestigious Yenching Academy, a one- to two-year master’s degree program housed at Beijing’s elite Peking University, are being approached and questioned by the FBI about the time they spent in China. In the last two years, at least five Yenching graduates have been approached by agents to gather intelligence on the program and to ascertain whether they have been co-opted by Chinese espionage efforts.
2. Why is a Spanish researcher making human-monkey hybrids in China?
The Spanish-born biologist Juan Carlos Izpisúa Belmonte, who operates a lab at the Salk Institute in California, has been working working with monkey researchers in China…to fashion animals that possess organs, like a kidney or liver, made up entirely of human cells. Such animals could be used as sources of organs for transplantation…
So far, no part-human part-monkey has been born. Instead, the mixed embryos are only being allowed to develop for a week or two in the lab, at which time they can be studied.
Pablo Ross, a veterinary researcher quoted by MIT Technology Review, thinks that there could be a different, albeit only slightly less disturbing motive for the research: to investigate “questions of evolutionary distance and interspecies barriers.”
Either way, this kind of research could likely only happen in China — in the U.S., for example, “the National Institutes of Health says federal funds can never be used to create mixed human-monkey embryos.”
3. Climate change is ‘not a policy priority at this time’
China first proposed a carbon emissions trading scheme in 2013. Its potential for implementation was teased again by top regulatory bodies in 2017 and 2018, but it still hasn’t become a reality. Caixin reports on “how China’s emissions trading scheme faltered” (paywall):
At a seminar on climate change and economy hosted by the Peking University’s National Development Research Institute this month, climate policymakers and researchers noted other challenges behind the development of the national carbon trading market. The lack of acceptance from local governments and businesses was said to be a major factor…
Environmental protection is still an important part of the policy agenda — especially with the emphasis that the environmental protection ministry has placed on inspections and rectifications. But climate change, one expert said, is not a policy priority at this time.
Here are the stories that caught our eye this week:
Beijing blamed “traitors” and foreign forces for the Hong Kong protests, and threw its support behind the Hong Kong government, while urging the city’s police to take “all necessary steps” to end the unrest. Then, rioting charges were brought against 44 protestors on July 30, leading to demonstrations outside the courtroom on July 31.
Beijing threatened military force to quash the protests with its Hong Kong garrison of the People’s Liberation Army. On July 31, the garrison released a militaristic propaganda video in which crowd control drills were interspersed with footage of missiles and snipers in action, as a soldier declared over a loudspeaker in Cantonese, “All consequences are your responsibility!” Local garrison commander Chén Dàoxiáng 陈道祥 also made his first public comments on the protests, saying that they “seriously violated the bottom line of One Country, Two Systems” and “cannot be tolerated.”
Trump escalated trade tensions on August 1 by announcing that the U.S. would impose 10 percent tariffs on $300 billion more in Chinese imports starting September 1, plunging U.S.-China relations into all-out trade war territory. The announcement caught Beijing by surprise, as the day before, U.S. negotiators had left Shanghai after talks that both sides described as “constructive,” and had made an agreement to continue discussions in September. But perhaps we shouldn’t be too surprised, as even while his negotiators were in Shanghai, Trump was tweeting insults at China and his Democratic election opponents, indicating that he largely sees his “tough on China” trade war stance as an electoral strategy.
Beijing claimed that the Xinjiang camps are nearly empty, in a new propaganda line that sharply contrasts with previous efforts to justify the large-scale forcible “re-education” of Uyghurs and other Muslim ethnic minorities, and earlier efforts to deny the mass internment altogether. The new story was received with intense skepticism by foreign media, and also wasn’t believed by Uyghurs around the world, who launched a #Provethe90% campaign for China to show their missing relatives were free. Meanwhile, the government’s campaign to “Sinicize” its Muslim population continued as restaurants were forced to cover up Arabic script on their signs.
China banned individual travel to Taiwan starting on August 1, in a surprise announcement that the government and state media later made clear is aimed at punishing Taiwanese president Tsai Ing-wen (蔡英文 Cài Yīngwén) and the Democratic Progressive Party (DPP) that she leads. Tsai had been on a global tour branded as the “Journey of Freedom, Democracy, and Sustainability,” and had visited the U.S., the Caribbean, and the U.K.
Xi Jinping’s cousin Ming Chai is a high roller at Australia’s Crown Casino, it was revealed in an investigation by the Australian 60 Minutes TV show, and the newspapers The Age and Sydney Morning Herald. The Chinese name of Ming Chai, Qí Míng 齐明, was later published by the overseas Chinese website Mingjing.
Aluminum magnate Liú Zhōngtián 劉忠田 was indicted by the U.S. Justice Department for evading $2 billion in tariffs since 2008. Because he is in China, which does not have an extradition treaty with the U.S., there would have to be a political negotiation for him to face trial — so his case could factor into future trade talks.
China released new cybersecurity rules and standards that are restrictive for foreign businesses. It could be a way to punish American companies in the trade war.
Two New Zealand universities found themselves in China-related controversies this week, in a trend that will only strengthen throughout the English-speaking world.
A Japan-worshipping subculture, known as jingri (jīngrì 精日), was cracked down upon in multiple cases this week.
In South Africa, the Chinese ambassador made an exception to Beijing’s official policy of not commenting on the internal affairs of other countries, and said that South African President Cyril Ramaphosa is the “last hope of this country.”
North Korean residents are fans of WeChat, a situation that presents interesting surveillance opportunities for Beijing.
A second foreign soccer player became a Chinese citizen, this time emigrating from Britain.
BUSINESS AND TECHNOLOGY:
Shrinking hopes for Xiaomi
In depth: A year after it went public, investors aren’t buying the Xiaomi story / Caixin (paywall)
Xiaomi Corp. was a big disappointment when investors valued it at just $54 billion following its first trading day in Hong Kong last July — far below the $100 billion some had expected for the world’s No. 4 smartphone-maker.
Now, more than one year later, that disappointment has only deepened as Xiaomi’s stock struggles with no sign of a turnaround.
The company’s shares plunged in January when a six-month lockup period ended, wiping out $14 billion in market value. The stock now trades around HK$9 ($1.15), or just over half of its listing price of HK$17, giving Xiaomi a market value of around $30 billion.
Bike quotas to prevent bike graveyards
Beijing cleans up 388,000 shared bikes in first half of 2019 / Caixin Live
“Beijing has capped the number of shared bikes allowed in the city at 1.91 million — but that’s still too many for the capital’s already-crowded streets. Companies are assigned bike quotas that can be reduced as punishment if operators fail to comply with regulations.”
The challenges of pursuing rural markets
China gas evokes Huawei’s early days to defend its rural plan / Bloomberg (porous paywall)
“China Gas Holdings Ltd. is holding fast to a strategy to expand in rural markets deemed too challenging by its rivals, and is evoking the experience of national technology giant Huawei Technologies Co. to help make its point.”
Nintendo in China
Nintendo and Tencent reveal Switch release plans for China / The Verge
“What is still not known is when the Switch will actually be released in China or how much it’ll cost. There are still various layers of regulatory approval that Nintendo and Tencent need to work their way through before the launch can take place, but the potential upside is huge.”
An electric vehicle company in trouble
Nio lays off employees, sells racing team amid cash crunch / TechNode
“Chinese electric vehicle maker Nio is reportedly cutting up to 40% of employees on its payroll focused on the research and development and marketing teams, while it will also sell its Formula E team as it deals with a liquidity crisis.”
Application of social credit in logistics
China proposes social credit blacklist to combat data mishandling in its logistics sector / TechNode
“China’s logistics sector is driven by the world’s largest e-commerce market. Given the volume of personal information needed to collect and deliver goods, there is room for mishandling and leaking private information.”
Artificial intelligence processing
Chinese researchers develop hybrid AI chip to ‘stimulate AGI development’ / TechNode
“While the researchers’ claim that the chip could lead to artificial general intelligence (AGI) — intellect that is typically at least on par with human-level cross-domain intelligence — is probably overblown, the processor does draw attention to China’s progress in developing chips designed to run AI algorithms.”
Fraud in hospital equipment supply business
Exclusive: Medical tycoon arrested for fraud investigation / Caixin (paywall)
“Police in southwestern Guangxi Province arrested Remote Horizon Group Chairman Han Shanchun Wednesday in Beijing and are sending him to Guangxi, where he and his company were sued by a hospital for contract fraud involving more than 26 million yuan ($3.77 million).”
POLITICS AND CURRENT AFFAIRS:
‘Once their mental state is healthy, they will be able to live happily in society’ / ChinaFile
Scholar Timothy Grose’s analysis of “How China’s government conflates Uighur identity with mental illness.”
Hindu nationalist group says India unlikely to accept China-led trade deal / Reuters
“Trade ministers from 16 countries are trying this week to negotiate the terms of the Regional Comprehensive Economic Partnership (RCEP) in Beijing in a new effort to break down barriers in an area home to 45 percent of world population. But progress has been slow, in large part because of disputes between China and India over access to markets and lists of protected goods.”
Taiwan releases missile test video shortly after China’s drill / Focus Taiwan
“The video, which the MND released alongside its statement, showed the launch of Sky Bow air defense missiles, HAGM-84 Harpoon missiles, MIM-104 Patriot surface-to-air missiles and the Sky Sword II air-to-air missiles. The fire power of the projectiles was also demonstrated, as they were pictured hitting and destroying ships, in the 68-second video.”
Canadian and Chinese ministers meet amid tensions, pledge to continue talks / Reuters
“The diplomatic dispute has intensified in recent months and is a nagging problem for Liberal Prime Minister Justin Trudeau, who faces a tight race for re-election in October.”
SOCIETY AND CULTURE:
The street photographers shooting for the high road / Sixth Tone
“Amid a social media-driven craze for newer street photography, China’s shutterbugs still take photos for the thrill of it.”
Dog ownership regulations in Beijing
Ruh-roh! Beijing bans dog walking in public parks / That’s Beijing
“The new regulation is the result of ongoing complaints about unruly dog behavior that puts park goers in danger, such as biting, as well as irresponsible owners who set their dogs loose and refuse to pick up after them.”
Colombian kindergarten teacher jailed in eastern China for molesting child / SCMP
“A Colombian teacher has been sentenced to five years in prison for molesting a kindergarten pupil in eastern China, local media reported on Friday.”
Lu Xun on Twitter
A bot tweeting passages from modern China’s most famous writer has been silenced / Quartz
“The account operator of a bot called @luxunbot25 said he’s been asked to have a conversation with Shenzhen’s internet police. The account, which has 126,000 followers, won’t be tweeting anymore, according to a Tweet today (July 24). It’s unclear where the operator is based, or what has prompted the policing. Quartz couldn’t immediately contact the operator.”
Tsingtao: China’s king of beers / World of Chinese
“Tsingtao’s status as ‘China’s favorite beer’ is constantly undergoing challenges. But one thing no one can take away is the history and legacy of this iconic brand.”
FEATURED ON SUPCHINA
‘Beijing Bastards’: An unsavory portrait of ’90s Beijing with legendary rock star Cui Jian
It can seem slapdash and aimless — it is not a great film, after all — but Beijing Bastards, with its grimy aesthetic, successfully captures a time, place, and subculture, when inertia and despair played itself out in Beijing’s shadowy alleyways and sleazy apartments. Hong Kong director Shu Kei 舒琪, Australian cinematographer Christopher Doyle, and rock star Cui Jian all helped to produce it, while funding was provided by foreign investors. Adding to its authenticity, Zhang also decided to cast real rock musicians, including Cui and 1989 front man Zang Tianshuo 臧天朔.
A campus divided: Hong Kong University students spar over city’s future
As protests in Hong Kong escalate in scale and intensity, tensions are mounting in other parts of the city, particularly on campuses where local students and those from mainland China share close quarters. This is most apparent at the University of Hong Kong (HKU), where a series of on-campus protests and counter-protests has fractured the community.
‘Communism is a faith’: Notes on the Chinese Communist Party
The Chinese Communist Party was established in 1921, with the first of July designated as its official birthday. Today, 90 million people are officially members. But, Yangyang Cheng writes in her most recent column, no one in China exists free from the Party, regardless of their membership status. For the average Chinese citizen, life inside the Party is a constant tug-of-war between convenience and compromise. They face a complex reality, victimized by an oppressive system but also contributing to their own oppression by becoming part of the system.
China’s gaming industry, explained
With nearly 620 million players who spent over $37 billion on mobile and PC games in 2018, China currently boasts the world’s largest gaming market. To put that in perspective, the number of Chinese people who played video games last year was almost twice the size of the U.S. population.
Op-ed: Chinese Americans are increasingly siding with Trump. Here’s how liberals can win them back
Rong Xiaoxing writes: Many Chinese Americans are beginning to think their middle-class lives and the future of their children are threatened by a slew of progressive programs, in particular, affirmative action. But what has really accelerated the growth of conservatism among new Chinese immigrants — people who have little experience with racism and don’t care to fight against white privilege — is a feeling that liberal decision-makers aren’t interested in listening to them. They are turning to Donald Trump as a result.
Kuora: Will China ever be ready for democracy?
There’s no question that at present there aren’t institutions in place that could handle multiparty elections in China, no guides for how the state would actually operate. And there’s no semblance of a pluralistic political culture. But it is possible for China to reach a point where multiparty democracy is possible — it’s just that there’s no easy glide path to it from here. As Hu Shi once said, the only way to have democracy is to have democracy, and no “period of tutelage,” as Sun Yat-sen envisioned, is going to bring it about, especially not when the party in power is so dead set against it.
What’s it like being part of the Jackie Chan Stunt Team?
Wang Zhenwei 王振威 is a stuntman on the Jackie Chan Stunt Team, living in Tianjin and training at the Jackie Chan Stuntman Training Center. (Yes, Jackie Chan uses stuntmen.) You might recognize Wang as the antagonist who gave Jaden Smith a beating in the 2010 remake of “The Karate Kid,” though he has a number of other credits to his name, including “Operation Red Sea,” “Project X,” and “Animal World.” Victor Zheng recently sat down with him to talk about his career, how he got his start in the film business, and other fun stories from the job.
SINICA PODCAST NETWORK
Sinica Podcast: China correspondent Emily Feng: From the FT to NPR
Emily Feng is one of the rising stars among China reporters. She’s about to take up her post in Beijing as National Public Radio’s correspondent after an illustrious run with the Financial Times. In a show taped a few months ago, Emily speaks with Kaiser and Jeremy about her most recent reporting for the FT, covering important topics related to Xinjiang and technology. She also reflects on why, as a Chinese American, she feels like she’s under added pressure to present accurate and balanced reporting on China.
TechBuzz China: Ep. 49: China’s Gen-Z and its newest poison: sneakers
In episode 49 of TechBuzz China, co-hosts Ying-Ying Lu and Rui Ma continue their exploration of the converging trends between the U.S. and China’s ecommerce sectors, this week covering the topic of the resale market for sneakers and streetwear.
ChinaEconTalk: The Party in cyberspace: China’s digital ecosystem
This week, Jordan speaks with Graham Webster, a China digital economy fellow and coordinating editor of the DigiChina project at New America. He was previously a senior fellow and lecturer at Yale Law School’s Paul Tsai China Center. The two talked about Graham’s work at DigiChina, artificial intelligence in China and its complex legal infrastructure, the facts (and fiction) behind China’s controversial social credit system, and the potential for a new cold war between the U.S. and China.
Middle Earth #16: Metacast: A podcast episode about podcasts
In this episode, the Middle Earth Podcast invites podcast hosts to talk about their favorite subject: themselves. Podcasting is rapidly becoming the next boom industry in China, with approximately 80 million daily downloads of podcasts and a projected audience of 486 million total.
The Caixin-Sinica Business Brief, episode 93
This week on the Caixin-Sinica Business Brief: Hong Kong’s pick of the next head of its de facto central bank, a recent investigation into FedEx, Huawei’s 5G-ready smartphone, Tianyu Fang on Chinese cryptocurrency entrepreneur Justin Sun, and more.
PHOTO OF THE DAY
BE京jing No. 10: In the night
This photo from Andingmen in June 2018 is part of BE京jing, a 30-part photo essay project by Gregorio Soravito. It’s about everyday life on the streets of the Chinese capital, a narration about the people who live in this unpredictable city and are constantly growing, changing, and upgrading.