Links for Tuesday, May 12, 2020 - SupChina
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Links for Tuesday, May 12, 2020

BUSINESS AND TECHNOLOGY:

China’s factory prices fell at the sharpest rate in four years in April, highlighting weakening industrial demand in the world’s second-largest economy as the coronavirus pandemic slams global growth.

The producer price index (PPI) fell 3.1% from a year earlier, the National Bureau of Statistics said in a statement on Tuesday, compared with a 2.6% drop tipped by a Reuters poll of analysts and a 1.5% decline in March.

Jenny Zhiya Qian [Qián Zhìyà 钱治亚], who has run Luckin since November 2017, and Jian Liu [刘剑 Liú Jiàn], chief operating officer for the past two years, have been let go after the company said an internal investigation had uncovered more information about hundreds of millions of dollars worth of sham transactions.

Six other employees, who were involved in or had knowledge of the transactions in question, had been suspended or put on leave, Luckin said on Tuesday.

The National Basketball Association (NBA) has appointed a Chinese national as its China branch boss, but prominent commentators and fans noted if it wants to win its way back to the Chinese mainland market, it should properly handle Houston Rockets general manager Daryl Morey — who tweeted in support of Hong Kong rioters last year, leading to significant disappointment and a boycott by the Chinese public, including major broadcasting partners.

China will exempt additional tariffs on U.S. aircraft radar and some other radar equipment imposed during the trade dispute with U.S., State Council’s tariff office says Tuesday.

According to the new list on tariff exemption, 79 items including medical disinfectants, rare-earth ore, silver and gold ore and concentrate, some nickel, aluminum alloy products were added.

In its newly released quarterly report, TME [Tencent Music Entertainment] said it has made “significant progress in expanding” its audio library by adding thousands of new adaptions from popular IP pieces and works from independent producers. IP is an edge that TME holds over its competitors, bolstered by a strategic partnership with China Literature, the country’s leading online publisher. TME’s foray intensifies competition in what is already a crowded space.

Internet giant Tencent is delving into one of Canada’s more low-tech institutions by helping coffee chain Tim Hortons expand into the competitive Chinese market.

According to an announcement [in Chinese] published Tuesday on the microblogging site Weibo, Tim Hortons said it plans to use the fresh capital from China’s leading game company to upgrade its digital infrastructure and open more stores in the country, where coffee consumption still lags far behind that of North America and represents a big growth opportunity.

Even before the coronavirus outbreak, Chinese medical equipment makers were growing rapidly. Medical device exports from the country more than doubled to $28.7 billion last year from a decade ago. But to meet the surge in demand this year, they began increasing production even more, filling the vacuum created as industry leaders such as Medtronic and GE struggled against production constraints.

As billionaire Hui Ka Yan [Xǔ Jiāyìn 许家印] steers China’s most indebted real estate company through the worst economic slump in decades, he’s getting support from some familiar faces: his fellow property tycoons.

Hui’s China Evergrande Group has been increasing financial ties with real estate empires run by three other Chinese magnates, according to company filings and media reports. Known locally as the Big Two Club because of their fondness for a Chinese poker game of the same name, the group includes Chinese Estates Holdings Ltd.’s Joseph Lau [Liú Luánxióng 刘銮雄], New World Development Co. billionaire Henry Cheng and C C Land Holdings Ltd.’s Cheung Chung Kiu [Zhāng Sōngqiáo 张松桥].

On May 1, U.S. Customs and Border Protection (CBP) announced it had issued a withhold release order (WRO) against hair products manufactured by a Xinjiang company called Hetian Haolin Hair Accessories Co. Ltd. (Haolin). The WRO was issued under the authority of 19 U.S.C. 1307, which prohibits importing merchandise produced by forced labor…

We are not privy to the specific information that supports the WRO against Haolin. However, if there is one place in the world at the moment where an allegation of forced labor pretty much always must be taken seriously, it is Xinjiang.

The weekslong lockdown prompted by the coronavirus forced millions of people in China to work remotely in February, a first for many employers in the country, where it is unusual to operate entirely online. That has turbocharged the quest for investors to find promising homegrown enterprise software startups, especially in the category of software as a service, which many investors see as the sector’s future.

SCIENCE, HEALTH, AND THE ENVIRONMENT:

Chinese authorities have published a litany of environmental violations by the state-owned metals and minerals behemoth China Minmetals Corp. and its subsidiaries, illustrating the ongoing challenges of pivoting the world’s second-largest economy onto a greener footing.

Minmetals failed to ensure environmental compliance at its affiliates and turned a blind eye to illegal pollution and emissions fraud over several years, according to a report (link in Chinese) published by the Ministry of Ecology and Environment (MEE) on Monday.

POLITICS AND CURRENT AFFAIRS:

U.S. President Donald Trump ended a White House press conference abruptly after a heated exchange with a reporter of Chinese descent, whom the president instructed to “ask China”…

“Why is this a global competition when, every day, Americans are still losing their lives?” [CBS News reporter Weijia Jiang] asked after Trump pointed out that the U.S. has done more coronavirus tests than any other country.

U.S. President Donald Trump said on Monday he opposed renegotiating the U.S.-China “Phase 1” trade deal after a Chinese state-run newspaper reported some government advisers in Beijing were urging fresh talks and possibly invalidating the agreement…

The Global Times tabloid reported on Monday that unidentified advisers close to the talks have suggested that Chinese officials revive the possibility of invalidating the trade pact and negotiate a new one to tilt the scales more to the Chinese side.

China is stepping up purchases of soybeans from the U.S. as Brazilian sales start to wane and the Asian nation seeks to meet its pledges under the trade deal with Washington, according to people familiar with the matter.

State-run buyers have purchased more than 20 cargoes, or over 1 million metric tons, of American soybeans in the past two weeks, said the people, who asked not to be identified because the information is private.

The Justice Department accused a professor in Arkansas on Monday of improperly accepting funds from the Chinese government and has accepted a guilty plea in a similar case, the latest examples of the department’s effort to combat China’s influence in American academia.

One of the professors, Simon Ang of the University of Arkansas, was arrested on Friday and charged on Monday with wire fraud. He worked for and received funding from Chinese companies and from the Thousand Talents program, which awards grants to scientists to encourage relationships with the Chinese government, and he warned an associate to keep his affiliation with the program quiet, court papers said.

Recently, an official notice circulated by the government education authority in the Xinjiang Uyghur Autonomous Region (XUAR), stating that all preschools in Hotan (in Chinese, Hetian) prefecture’s Qaraqash (Moyu) county are to be converted into boarding schools, has spread widely on WeChat and other social media platforms in China… The notice has prompted concerned discussion among Uyghur-language accounts and groups on social media, including Uyghurs in the diaspora.

China could face isolation from the post-coronavirus global economic order, according to the man who helped secure its place in the World Trade Organization in 2001.

The warning by Lóng Yǒngtú 龙永图, the country’s former chief trade negotiator, adds to a chorus of influential domestic voices who are increasingly concerned about the country being frozen out in the fallout from the pandemic.

China has issued a lengthy rebuttal of what it said were 24 “preposterous allegations” by some leading U.S. politicians over its handling of the new coronavirus outbreak…

A 30-page, 11,000-word article posted on the ministry website [in Chinese] on Saturday night repeated and expanded on the refutations made during the [foreign ministry’s] press briefings, and began by invoking Abraham Lincoln, the 19th century U.S. president…

The article also cited media reports that said Americans had been infected with the virus before the first case was confirmed in Wuhan. There is no evidence to suggest that is the case.

  • People’s Liberation Army has officially recorded no infections but disease fears have delayed recruitment, training and operations.
  • Analysts say SARS experience guided military’s prompt response, but combat effectiveness has been affected.

Democrats, and Republicans who truly put American security first, face a choice. Joe Biden in particular [porous paywall] will decide whether to lead his party into Mr. Trump’s trap or play a different game. Attempting to out-hawk far-right hawks failed Democrats in the war on terrorism, leaving Mr. Biden with the stain of having supported the Iraq war. More important, a bipartisan addiction to military action and fearmongering failed the country.

The Zimbabwean government is managing the COVID-19 pandemic better than other regional countries owing to the assistance from China, according to officials.

“We have a good relationship with China and the moment we heard about the pandemic, we started monitoring closely.

“We got medical expert advise and some Chinese handbook, that’s why we seem to be doing better than other regional countries,” Deputy Health Minister Dr. John Mangwiro said.

SOCIETY AND CULTURE:

China’s education ministry has renewed its push to reduce the academic burden on the country’s schoolchildren as they return to class after the coronavirus lockdown.

Primary and middle schools have been issued with a detailed list of what not to teach, in the latest effort to stop the widespread practice of getting young children ahead of the curriculum in the hope of giving them a head start in the all-important National Higher Education Entrance Examination, or gaokao [gāokǎo 高考].

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