An Uneasy Ceasefire

The India-Pakistan Conflict and the Dynamics of Nuclear Weapons

Friends,

As of Sunday morning, it looks like India and Pakistan have agreed to an unsteady ceasefire after four days of intensive conflict along their border. The fighting involved their air forces launching attacks from their own airspace into the other, as well as extensive use of drones. There are rumors aircraft on each side were lost, but both are withholding details.

Ground forces appeared to remain stationary, conducting artillery duels across the border, forcing residents on both sides to evacuate.

By Thursday and Friday, what had been strikes against terror training camps in Pakistan escalated to strikes against each other’s military installations.

While there are reports that some strikes were close to strategic targets and infrastructure (headquarters and systems for the protection and employment of nuclear weapons) both sides carefully calibrated their attacks.

It also appears that both sides were ready to accept a ceasefire when U.S. Secretary of State Marco Rubio reached out to both sides.

Analysis and assessments are starting to come in (here from the New York Times, here from my friend James Crabtree, and here from Reuters), so I’ll offer a few of my own observations and raise a few questions.

Observation #1 – When both sides possess nuclear weapons, the combatants avoid decisive military operations that would force serious military escalation.

While most of the reporting was about the dangers of escalation, my main take-away is that both sides appeared incredibly cautious, and their military strikes were finely calibrated. This corresponds with the eight decades of human experience with nuclear weapons. Adversaries that possess nuclear weapons carefully manage direct military confrontations with each other. This pushes their rivalries into other domains (using proxy groups to inflict damage on one’s adversary, waging economic warfare, etc.).

I’m certain there are leaders in both Delhi and Islamabad who would *like* to mount a decisive military campaign to seize the other’s capital and bring a decisive end to this long-running conflict… but both sides know that since their adversary possesses nuclear weapons, a decisive military campaign is all but impossible.

As George Orwell observed in 1945, countries that possess nuclear weapons are “unconquerable and in a permanent state of “cold war” with its neighbours.”

There is no natural law preventing the use of nuclear weapons, but the logic of mutually assured destruction does seem to place serious limits on the scope and scale of military confrontations between two nuclear armed adversaries.

Observation #2 – Geopolitical dynamics have shifted since the last major military confrontation between India and Pakistan.

The last major military conflict between Pakistan and India took place in 1999 (May-July) and was known as the Kargil War, a district within Kashmir which saw a major attack by the Pakistani Army across the Line of Control and into Indian held territory. Over a two-month period and thousands of casualties, the Pakistani Army was defeated and pushed back to their side of the Line.

The Kargil War, initiated by Pakistan, took place a year after Pakistan tested its first nuclear weapon (which took place in response to India’s second nuclear weapons test in May 1998). Islamabad was likely confident that if it could hold the territory it seized in Kashmir, that India would be deterred from retaliating in a serious way and accept the fait accompli.

But things didn’t go as planned.

Indian forces fought back, and the Pakistani Army was defeated.

The United States condemned Pakistan’s actions and began loosening the sanctions it had put in place on India over Delhi’s nuclear program.

Pakistan’s failure to achieve a conventional military victory in the Kargil War persuaded its leaders to adopt a new strategy, which traces directly to the conflict last week. Islamabad would use its intelligence agency to build and support proxy terrorist groups to attack India and weaken their enemy’s resolve, all while maintaining a degree of plausible deniability (details on Lashkar-e-Taiba (LeT), below).

This use of Pakistani government supported proxy groups has been Islamabad’s main strategy against India for the past quarter century as the nuclear standoff settled into place.

The wider geopolitical landscape has changed as well. The Kargil War took place just as NATO was waging a war against Serbia over Kosovo (in fact Pakistan initiated the war with the infiltration of its troops four days before U.S. bombs accidentally struck the PRC Embassy in Belgrade).

This was two years before the 9/11 attacks on the United States which brought American into Central Asia and on top of Pakistan in ways that had never happened before. While the Sino-Pakistan relationship was quite strong in 1999, Beijing was significantly weaker.

Observation #3 – While the fighting may stop, there will not be peace along the Indo-Pakistani border.

The military and terrorist attacks over the past few weeks won’t change the Indo-Pakistani rivalry in any significant way. The relationship between Beijing and Islamabad will likely strengthen, as Beijing seeks to use Pakistan as a proxy against India and Delhi’s partner, the United States. The relationship between Delhi and Washington will likely continue to grow closer (as it has since the Kargil War) as both countries view Beijing and Islamabad as adversaries.

Question #1 – Will (or can) Pakistan control the government-sponsored terrorist groups that the country created to wage hybrid war against India?

The Indian Government is convinced, with good reason, that the terrorist group that murdered 26 civilians on April 22 near Pahalgam is at least nominally controlled by the Pakistani intelligence agency, Inter-Services Intelligence (ISI). The group call themselves The Resistance Front (TRF) and they appear to be an offshoot of Lashkar-e-Taiba (LeT), the internationally designated terrorist organization with a long history of support and alignment with ISI.

Here is a quick list of a few of LeT attacks against India:

• December 2000 – LeT killed two Indian soldiers and one civilian at the Red Fort.

• October 2005 – LeT conducted three bombings in Dehli just after the Diwali festival killing 62 and injuring more than 200.

• July 2006 – LeT set off seven bombs on Mumbai trains killing 209 Indian civilians and injuring over 700.

• November 2008 - LeT that mounted a four-day attack on Mumbai, India’s financial capital that killed 175 people.

• December 2014 – LeT mounted a series of attacks in Kashmir to disrupt elections killing 11 Indians.

While most Western media reports still consider this to be “alleged” control by Pakistan, I think we can be pretty confident that the Pakistani Government intentionally created violent proxy groups and provided them the resources to inflict damage on India while giving Islamabad plausible deniability in the court of public opinion. As discussed above, this was the strategy Pakistan adopted in the wake of the Kargil War.

These militant/terrorist groups are meant to elicit disproportionate crackdowns by India, so that India will alienate the population of Kashmir and Pakistan will appear innocent.

The conflict last week might force Pakistan to re-evaluate its own strategy but that depends on its control of these groups.

If Pakistan still maintains control of these groups and had pre-knowledge of the Pahalgam attack, then I think it is unlikely that Islamabad would change its approach to waging war against India.

If Pakistan does not have control of these groups and had no idea the Pahalgam attack was going to take place, as the Pakistani Government professes publicly, then Pakistan has to do some serious self-reflection.

Can Pakistan gain control of these groups? If so, then it must do so, or the Government will lose control over its own strategy, reacting to the designs of its proxies.

If the Pakistani Government cannot gain control of these groups, then we must question Pakistan’s own capacity to control organized violence inside its borders and beyond. Perhaps, Pakistan is falling deeper into a form of warlordism.

Perhaps the ISI is just an imperium in imperio (or a state within a state), what we might colloquially refer to these days as “the deep state.” If that is the case, then ISI has its own agenda beyond the reach of the country’s “elected” leaders or its powerful Army Chief.

If the answer to the question is: Pakistan can control these terrorist groups and their attacks are just part of a Pakistani strategy to weaken Indian control of Kashmir, then I’m fairly confident that we will see more of the same. Explosions of violence, but managed with guardrails that both Delhi and Islamabad maintain.

If the Pakistani Government is telling the truth that they cannot control these groups, even if they wanted to, that is much more concerning.

It would suggest that Pakistan is barely keeping things together… a terrifying prospect for a nuclear-armed state that is developing inter-continental ballistic missiles with the capability to strike the United States (“Developments concerning Pakistan’s ballistic-missile programm,” IISS, February 4, 2025 and “Pakistan's missile program is 'emerging threat', top US official says,” Reuters, December 19, 2024).

Question #2 – If Pakistan won’t or can’t control its government-sponsored terrorist groups, how will that effect Beijing-Islamabad relations?

While Beijing is likely pleased that its long-term strategy of supporting Pakistan to undermine India seems to be working, Beijing likely has some concerns of its own.

Attacks against Chinese interests in Pakistan are mounting, and it appears that Islamabad is trying to convince their Chinese partners that they can keep it under control. The Chinese will have to make their own assessment about the Pahalgam attack. If they judge that Pakistan can’t control these groups against India, I suspect Beijing will be deeply concerned that Islamabad can’t control attacks against the PRC.

Beijing’s solution would be to provide even more support to Pakistan, but then that risks opening itself up to further attacks by the groups Islamabad cannot control. Knowing how these militant/terrorist groups operate, it must concern Beijing that this could spread to Xinjiang and Tibet.

In many ways, Beijing’s “all weather friendship” with Pakistan is like riding a tiger, you dare not get off due to the fear of getting mauled.

Question #3 – Will this conflict degrade Delhi-Moscow relations?

Moscow seemed to be a non-player in the events over the last week.

We don’t know if Putin raised this with Xi during the Victory Day bonanza in Moscow, but I doubt that Putin was at all forceful in advocating for its long-time ally, India. Putin cannot afford a split in Sino-Russian relations, which means that Delhi’s traditional great power ally cannot be depended on at this point. Might this accelerate Indo-American relations? Perhaps.

***

It is Mother’s Day, so don’t forget to call your mom.

Thanks for reading!

Matt

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MUST READ

1. How China's military mystery can spill into Taiwan strategy
   Katsuji Nakazawa, Nikkei Asia, May 1, 2025

An expert on the island vanishes as Xi Jinping also deals with Trump's trade war.

While Xi Jinping engages in a tit-for-tat trade war with Donald Trump, one that has escalated faster than expected, the Chinese leader is also dealing with a fierce struggle within the People's Liberation Army that might be more serious and complicated than the China-U.S. confrontation.

Xi is general secretary of the Chinese Communist Party, president of China and chairman of the Central Military Commission, which oversees the PLA.

Five months have passed since Miao Hua, head of the CMC's Political Work Department and Xi's "agent within the military," was suspended from office for "suspected serious violations of discipline." There has been no announcement of any punitive measures against him or what he might have done.

More recently, a military official ranked higher than Miao disappeared from the public eye for 50 days. He Weidong is a 67-year-old vice chairman of the CMC and member of the party's powerful Politburo.

He is ranked No. 3 in China's military after Xi and Zhang Youxia, another vice chairman who also hails from the military. His whereabouts have been unknown since March 11, when the National People's Congress, China's parliament, closed this year's session. He was conspicuously absent from four important meetings that were open to the public.

After Miao was suspended, the CMC was left with five members, with He being one of them. As a vice chairman, the top-level post for those hailing from the military, He is supposed to play an important on-the-ground role should China decide to take any military action.

He once served as the commander of the Eastern Theater Command, which has jurisdiction over Taiwan. It is one of the PLA's five Theater Commands and is headquartered in Nanjing, Jiangsu province. Under a large-scale reorganization of the military structure that Xi has led since 2015, the Eastern Theater Command has taken over the district, which had belonged to the Nanjing Military Region.

Personnel from the Nanjing Military Region, especially those from the now-defunct 31st Group Army, played an important role in helping Xi get a grip on the military and make it one of his power bases. He Weidong had long worked for the then 31st Group Army, based in Amoy, Fujian province, which faces the Taiwan Strait. Miao Hua also belonged to this now-defunct army, which was incorporated into the Eastern Theater Command.

Fujian is where Xi began to climb the ladder of success. He worked in the province for 17 years beginning in the mid-1980s, marrying Peng Liyuan, a former star singer belonging to the PLA.

At the start of his career in Fujian, Xi was just another local official, although he was a "princeling," as children of senior party officials are known, and a "second-generation red," a group of children of revolutionary-era party leaders. What helped him lay the groundwork for his advancement to the central stage of Chinese politics were the connections he made with military officials in Fujian, including those of the 31st Group Army.

Before Taiwan's first direct presidential election in March 1996, China held military exercises off the coast of Fujian, facing the Taiwan Strait. The drills, which were intended to send a warning to Taiwan, were the first to involve the PLA's army, navy and air force.

At that time, many military officials in Beijing, including vice chairmen of the CMC, visited Fujian. Xi, then deputy secretary of the province's party committee and provincial governor of Fuzhou, "did not miss such a great opportunity" for his political career, recalled one source who is familiar with the situation.

Xi would go on to build personal connections with party officials that later enabled him to climb to his current positions. It is only natural that Xi has a personal attachment to the 31st Group Army, the core of the military stationed in Fujian. Xi, who has sought the unification of Taiwan since becoming China's top leader more than a decade ago, has promoted many from the 31st Group Army to high-ranking military posts.

But now, He Weidong, hailing from the 31st Group Army and an expert on Taiwan strategy, has long been absent from the public eye. With his whereabouts unknown, the Eastern Theater Command suddenly announced on April 1 that large-scale military drills would be held near the democratic island.

The exercises may have been conducted without the involvement of high-ranking military officials and generals who are well-versed in Taiwan issues. At the time, many officials with connections to the 31st Group Army -- which had nurtured Taiwan specialists -- were involved in Xi's anti-corruption campaign.

The unusual circumstances linger. The Politburo on Friday held a meeting to discuss the tariff issue. At the same time, it held a group study session on artificial intelligence, which China wants to wield militarily and economically.

The study session, the first in two months, was reported by the state-run China Central Television the next day. But He Weidong was not seen in the news footage. Another CMC vice chairman, Zhang Youxia, was present.

The Politburo has 24 members, including seven on the Standing Committee, the highest leadership team. Only Wang Yi, the foreign minister who was visiting central Asian countries, and He were absent from Friday's meeting.

In promoting He, Xi is believed to have paid him special consideration, which was described in a social media post that went viral a few months before the party's national congress in October 2022.

"He Weidong was lucky in many aspects," the post says. "Above all, he could get promoted just before his retirement age." In late 2019, He became the commander of the Eastern Theater Command and a general, the highest military rank.

The post continues: "If he can not ascend to a member of the Central Military Commission [at the party's national congress in 2022], he will reach retirement age and step down as leader of the command."

The post also praises efforts made by He, who entered the military at the age of 15 without any notable academic record, but emphasizes that He relied mostly on luck.

It suggests that a figure from high above acted like god and kept giving a helping hand to a low-profile military officer until that officer attained the highest rank.

Contrary to the social media post's forecast, He was promoted to a CMC member and, unexpectedly, a Politburo member at the 2022 national congress.

Despite Xi's supposedly strong attachments to the 31st Group Army, Miao Hua has been suspended, He Weidong's whereabouts are unknown and other high-ranking military officials with connections to the group army have also vanished from public view.

But it is hasty to think Xi, as CMC chairman, is having difficulty assuming full responsibility for military affairs. He's the one who is giving final orders, including those to crack down on high-ranking officials.

Still, recent affairs involving military officials leave many questions. That Xi has to oust close aides he has promoted means the personnel allocations he made at the party's 2022 national congress have not been functioning well. In other words, after two and a half years Xi is now covering up his personnel mistakes.

All eyes are on the tariff war between China and the U.S., but the internal conflict within the Chinese military also deserves to be monitored. This complicated, behind-the-scenes political struggle will eventually influence the Taiwan issue and then the confrontation between Beijing and Washington.

COMMENT - If one of the two CMC Vice Chairman has been sacked and purged, that would indeed be a big deal.

2. China’s Xi Jinping likens ‘US hegemony’ to ‘fascist forces’ ahead of Vladimir Putin summit

   Joe Leahy and Max Seddon, Financial Times, May 8, 2025

Chinese and Russian presidents to signal strength of their alliance in Moscow meeting.

Xi Jinping has drawn a parallel between modern-day US “hegemony” and the “arrogant fascist forces” of 80 years ago, ahead of Thursday’s Moscow summit with Vladimir Putin and second world war “Victory Day” celebrations.

The Chinese and Russian presidents are using the visit to signal the strength of their alliance against the US-led international order, as President Donald Trump unleashes tariffs on Beijing and tries to push Moscow towards a peace deal with Ukraine.

“The just forces of the world, including China and the Soviet Union, fought bravely and defeated the arrogant fascist forces side-by-side,” Xi wrote in an article published in Russian and Chinese media before his arrival in Moscow on Wednesday.

He added: “80 years later, unilateralism, hegemony and bullying are extremely harmful. Humanity is once again at the crossroads.”

Moscow struck a similar note in the run-up to Thursday’s summit, the first between Putin and Xi since Trump took office in January and stepped up the trade war.

The meeting will “send a powerful signal against attempts to rewrite the results of the second world war” while Europe was “preparing for war with Russia like the Third Reich once did”, said Russia’s foreign ministry, according to state newswire Tass.

The two leaders will have to overcome challenges, however, as China looks to improve relations with Europe after being hit with US tariffs. Beijing also fears a Trump-Putin détente could affect its partnership with Russia.

On Friday, Xi will attend a Red Square parade for the 80th anniversary of the Soviet Union’s second world war victory alongside 28 other foreign leaders including Brazil’s Luiz Inácio Lula da Silva, Serbia’s Aleksandar Vučić and Slovakia’s Robert Fico.

The preparations have been marred by three days of Ukrainian drone strikes in Russia that forced the closure of Moscow airports for several hours.

Aside from railing against the US on trade, Xi will use the Victory Day celebrations to remind the world of Beijing’s claimed sovereignty over Taiwan, against which it has threatened to use force.

The Kremlin wants the image of Xi observing Russia’s military might to underscore how it has overcome years of western attempts to isolate Moscow over the invasion of Ukraine. Putin has justified the war through baseless comparisons of Kyiv’s government to Nazi Germany.

Beijing has not openly taken sides in the war but has helped Moscow weather sanctions, with bilateral trade soaring from $147bn in 2021 to $245bn last year.

In recent months, however, bilateral exports have slowed to their lowest level since the start of the invasion due to falling prices for Russia’s hydrocarbons and slumping Russian demand for Chinese cars.

“The economic relationship between China and Russia is already very high, in part because of the war in Ukraine, and there may not be a lot of additional potential,” said Li Mingjiang, a professor at Nanyang Technological University in Singapore.

To grow trade with Russia significantly, China would need to consider ambitious infrastructure projects such as the long-delayed Power of Siberia-2 gas pipeline — which it has been reluctant to do, said Alexander Gabuev, director of the Carnegie Russia Eurasia Center.

Russia, struggling with high inflation driven by the war, has limited capacity to absorb even greater volumes of Chinese goods, he added.

But if Trump refuses to strike a deal with China on tariffs, Beijing could “stop caring” about US sanctions on Russia, Gabuev said. “If there are 125 per cent tariffs, they can just tell the US to screw themselves and do whatever they want with Russia,” he said.

The US trade war has also pushed Beijing closer to Europe, potentially limiting how far Xi can deepen ties with Russia. Some Chinese experts said the country would be keen to see Russia sign a US-brokered peace deal with Ukraine, if only to simplify its relations with Europe.

“If the war could be ended then China could finally finish this tightrope act with Russia and the west and get back to smoother relations between the great powers. The Ukraine war is always haunting China,” said Zhu Feng, dean of the School of International Studies at Nanjing University.

Nanyang Technological University’s Li said while China would not openly split with Russia, “I wouldn’t be surprised if Chinese officials quietly . . . deliver certain messages that may help reassure the Europeans that China will try to quietly play a helpful role in terms of a ceasefire deal”.

Xi did not mention Ukraine in his article. Instead, he attacked the “war criminals” of the second world war, describing China and Russia as “constructive forces in maintaining global strategic stability” and calling for the upholding of the UN Charter.

But analysts said his message would raise some eyebrows given that Putin has launched Europe’s biggest conflict since the second world war, in violation of UN rules, and been accused of war crimes himself.

“People will see the irony and the contradictions,” Li said. “That would definitely, for the rest of the international community, weaken the effectiveness of these Chinese narratives.”

3. Chinese Hacking Competitions Fuel the Country’s Broad Cyber Ambitions
   Jamie Tarabay, Bloomberg, April 30, 2025

Participants are required to turn findings over to the Chinese government.

Dustin Childs can still describe the best demonstration of a winning hack at an international tournament he’s ever seen. It happened almost a decade ago.

The participants had to find a way to break into a Windows workstation that was hardened with firewalls and up-to-date software to make it more secure. One member of a team from China typed an IP address into the Windows browser, he said, “and took their hands off the keyboard and that was it.”

The address triggered computer code that turned the Chinese team’s access from “guest” to “host,” giving them administrator rights and the ability to install whatever code or software — or malware — they wanted.

That was in 2017 at Pwn2Own, a hacking competition that drew entrants from around the world — analysts and researchers from cybersecurity firms, primarily — to find new ways to exploit popular software and mobile devices. By then, teams from China had been competing for years, and dominating. They came from universities, companies and elsewhere, said Childs, the head of threat awareness at the cybersecurity firm Trend Micro Inc.

The top title at the tournament was called “Master of Pwn,” said Childs, who has been affiliated with the tournament since 2009 and is part of the Zero Day Initiative that runs it.

“We implemented that title in 2016. The Chinese companies won it at every competition until they stopped participating,” he said.

That international acclaim also drew the attention of critical eyes back home.

In 2017, the billionaire founder of Chinese cybersecurity firm Qihoo 360, Zhou Hongyi, publicly criticized Chinese participation in overseas hackathons, arguing that vulnerabilities discovered by Chinese experts should remain within that country’s borders. The criticism from Zhou, a member of a political advisory board to the Communist Party government, didn’t go unnoticed.

The following year, there were no Chinese teams competing at Pwn2Own. Instead, China started its own hacking tournament, called the Tianfu Cup. Participants were encouraged to hack into Apple operating systems, Google phones and Microsoft networks, according to media reports.

But there was a difference. At Pwn2Own and other hacking competitions, the findings are reported to the companies that make the software or devices so they can fix them before hackers take advantage.

Participants in Chinese hacking competitions are required to report them to the government first, according to a 2018 regulation. “In practice, this meant vulnerabilities were passed to the state for use in operations,” said Dakota Cary, a China-focused consultant at the US cybersecurity company SentinelOne.

One example, cybersecurity experts said, occurred in 2019, when Google reported that a flaw uncovered at the inaugural Tianfu Cup bore striking similarities with a hacking campaign targeting China’s persecuted Uyghur ethnic communities.

More recently, files attributed to a Chinese cybersecurity firm called i-Soon were posted on the code-sharing site GitHub, a purported data leak that suggested the contests, the government, and the cyber firms that were given access to those vulnerabilities were all connected. Among the chat records was a discussion between i-Soon employees noting a request to China’s Ministry of Public Security, the country’s main police agency, for zero-day vulnerabilities discovered at Tianfu Cup.

The documents indicated that the Tianfu Cup was a “likely vulnerability feeder system” for the ministry, said Winnona DeSombre Bernsen, a fellow at the Atlantic Council’s Digital Forensics Research Lab, who studied the logs.

In March, several employees of i-Soon were charged by US authorities for carrying out cyberattacks at the direction of Chinese intelligence agencies. China rejects the allegations. I-Soon hasn’t responded to the charges and didn’t respond to requests for comment.

Asked about vulnerability disclosures, a spokesperson for China’s Ministry of Foreign Affairs said the reporting regulations “aim to prevent the leakage and unauthorized disclosure of vulnerable information.”

The regulations “explicitly support the direct provision of security vulnerability information to network product providers, including foreign organizations and individuals,” the spokesperson told Bloomberg reporters in Beijing.

Representatives for the Tianfu Cup could not be located for comment.

Flaws in computer software and mobile devices are relatively common, prompting periodic patches to the software and updates to the devices to fix them. For criminal hackers and cyber spies, flaws that aren’t previously known to the developers — known as zero days — are particularly valuable because no fix is immediately available, leaving systems exposed.

Some companies specialize in finding zero days and selling them to government intelligence agencies.

Pwn2Own was created in 2007 to investigate potential security flaws in Apple’s Mac OS X operating system. Since then, winners have been paid cash prizes for finding vulnerabilities, which are then shared with the software company or device maker to fix.

All the participants, including those from China, adhered to those rules. But the first year they were gone from Pwn2Own, in 2018, Beijing stated that vulnerabilities discovered at Chinese hacking competitions must be reported to the government, said Sentinel One’s Cary.

Three years later, data security laws that went into effect required that vulnerabilities discovered by Chinese researchers — whether they were found in contests or in the course of their work — went straight to the Chinese Ministry of Industry and Information Technology. The laws also restrict companies from sharing vulnerability information with anyone before the Chinese government has had a chance to address them — with a 48-hour reporting deadline. There are stiff financial penalties and potential legal action for anyone who doesn’t comply.

China’s policy of requiring researchers to disclose computer bugs they find to the government distinguishes it from the US and other Western countries, experts said.

“The NSA doesn’t force us to disclose anything along those lines to them,” said Childs, referring to the US National Security Agency.

While it doesn’t force vulnerability disclosure, the NSA, the leading cryptology and signals intelligence organization in the US government, does its fair share of vulnerability hoarding, said Greg Austin, who has consulted with governments on China’s cyber and foreign policy for more than a decade. In one incident in 2016, a group called the Shadow Brokers released a cache of secret software exploits — essentially hacking tools — that were allegedly stolen from the NSA.

“We’re talking about agencies like the Central Intelligence Agency and the National Security Agency who have discovered vulnerabilities that they don’t want to reveal so that they can attack systems in other countries,” he said. “China’s the same.”

Since the data laws have come into effect, China’s hacking breakthroughs have slipped further behind a wall of secrecy, experts said.

“There is a veil on the front side so we can’t see what they’re working on and what they’re working towards. We only see the results of it when it gets into the wild and actually gets demonstrated against a real live party,” Childs said.

Chinese hacking competitions have also evolved in recent years. Along with challenging participants to break into a Tesla or security software, now the events include Chinese electric vehicles, phones and computers, said Eugenio Benincasa, a senior cyber defense researcher at the Center for Security Studies at ETH Zurich, who closely monitors online reporting of these contests for clues about the challenges and what, if any, results are publicized.

The increased focus on Chinese domestic products aligns with Beijing’s broader policy objective known as “Delete America,” aiming for self-sufficiency in advanced technologies and reducing reliance on foreign suppliers, Benincasa said. It also comes as the US and China continue to restrict exports of key technology components to each other.

“It highlights the goal of fully domesticating China’s IT infrastructure, and replacing foreign-made core components, such as semiconductors, software, and databases, with Chinese-made ones,” Benincasa said.

COMMENT - We have yet to develop an effective way to handle cyberattacks and cyber-enabled economic espionage.

4. U.S. to Overhaul Curbs on AI Chip Exports After Industry Backlash

   Liza Lin, Amrith Ramkumar, and Corrie Driebusch, Wall Street Journal, May 7, 2025

Rule limiting many countries’ access to American technology was set to take effect next week.

The Trump administration plans to overhaul controversial regulations that would limit how many artificial-intelligence chips individual countries can buy, giving companies such as Nvidia NVDA 0.26%increase; green up pointing triangle a potential reprieve from tight export controls.

The Commerce Department plans to replace the rule, which imposed caps on how many chips could go to countries such as India, Switzerland, Mexico and Israel, a spokeswoman said. “The Biden AI rule is overly complex, overly bureaucratic and would stymie American innovation,” she said.

The decision is at least a temporary boon for tech titans that have fought the rules and been buffeted by a wave of export restrictions in recent years. Seamless chip sales to countries friendly with the U.S. are critical to their businesses but would be jeopardized by the new regulations, they have said.

Nvidia shares rose by more than 3% as news surfaced of the administration’s plans.

Many industry executives are still bracing for tight export controls that take a different form from the Biden team’s proposal. The Trump administration recently cracked down on Nvidia selling a specialized AI chip to China, prompting the company to record a $5.5 billion charge related to the change.

The rule, commonly known as AI diffusion, had been set to go into effect May 15. Focus will now turn to the Trump team’s plan to remake it, which could take a couple of months, people familiar with the matter said. Policymakers are weighing how to block adversaries such as China from accessing advanced chips without hurting American technology companies.

Thursday’s announcement came ahead of Trump’s planned visit to the Middle East. Countries such as Saudi Arabia and the United Arab Emirates also would have faced limits on chip purchases under the Biden-era rule, fueling speculation that the Trump administration will discuss access to advanced chips on the trip.

“We might be doing that, yeah,” Trump said Wednesday when asked by reporters about easing chip restrictions. “And it will be announced soon.” The U.A.E. announced a $1.4 trillion commitment to invest in the U.S. in late March.

The delays in completing restrictions have had a destabilizing effect across the industry, experts say. Some nations were likely pulling forward chip purchases ahead of the rule’s implementation, said Lennart Heim, a researcher at Rand. Heim analyzed trade data from Taiwan and said it showed a large increase in shipments of data-processing equipment that likely included AI chips from Taiwan to Malaysia in March.

The total value of such exports hit $1.87 billion in March, up several-fold from a year ago, Heim said.

The Bureau of Industry and Security, the Commerce Department unit implementing export controls, is working on a separate rule to crack down on countries diverting chips to China, according to a person familiar with the plan. BIS is planning a public advisory warning against training Chinese AI models with advanced U.S. chips. It is also expected to state that using AI chips made by China’s Huawei will likely violate U.S. export control rules, the person said.

Fears that other countries would route U.S. chips to adversaries such as China led to the diffusion rule, which was announced in the final days of the Biden administration. It built on previous restrictions on the sale of advanced American chips to China that began in 2022. Lawmakers and national-security officials have said export controls are key to maintaining America’s advantage over rival nations in AI.

Tech companies such as Microsoft and Oracle quickly protested the diffusion rule, arguing it would deprive American companies of business opportunities abroad without doing much to hamper China, the main target.

The system would have split countries into three different buckets. One relatively small group of U.S. friends and allies could freely purchase advanced AI chips from the U.S. Adversaries, including China and Iran, would be barred from buying the chips. The third category included all other countries, an expansive group that includes many of the friendly nations. They would be limited in how many chips they could buy.

In addition, sharing data that underpins the most sophisticated AI systems would have required approval from the Commerce Department.

In recent weeks, the Trump administration has considered scrapping the tiered system in favor of bilateral agreements with individual countries, people familiar with the matter said.

The Trump administration has also put chip-export issues on the table in trade talks with some countries, pressuring them to commit to helping the U.S. keep chips out of the hands of adversaries in exchange for more favorable tariffs, the people said.

COMMENT - I’m very concerned that the AI Diffusion regime was withdrawn at the last minute (it was supposed to go into effect next week) without a replacement set of rules and regulations.

The Trump Administration could have let the restrictions go into effect and then determine what changes were necessary based on real-world impacts. Instead, it looks like companies successfully lobbied that the sky would fall to prevent the rules from taking effect, which buys them time to water-down any replacement.

These rules should have been allowed to go into effect AND the Biden Administration should have implemented them in 2023, instead of waiting until January 15, 2025 to announce them as they were walking out the door.

5. Satellite images reveal Huawei’s advanced chip production line in China
   Eleanor Olcott, Zijing Wu and Chris Cook, Financial Times, May 3, 2025

Rapid expansion of Shenzhen facilities designed to break dependence on foreign technologies.

Huawei is building a production line for advanced chips as part of a network of semiconductor facilities in Shenzhen that seeks to break China’s dependence on foreign technologies.

The tech group is the key player behind three manufacturing sites in Guanlan, a district of the southern city where Huawei is based, according to multiple people familiar with the matter and visits near the locations by the Financial Times.

Satellite imagery obtained by the FT shows how the Guanlan factories, built in the same distinctive style, have been rapidly developed after construction started in 2022.

The facilities, details of which have not been reported previously, demonstrate Huawei’s ambitions to become a semiconductor leader, boosting China’s effort to challenge the US in developing technologies such as artificial intelligence.

“Huawei has embarked on an unprecedented effort to develop every part of the AI supply chain domestically from wafer fabrication equipment to model building,” said Dylan Patel, founder of chip consultancy SemiAnalysis. “We have never seen one company attempt to do everything before.”

Huawei operates one of the sites, according to people with knowledge of the matter, who said it would make its 7-nanometre smartphone and Ascend AI processors — the company’s first effort to manufacture its own high-end chips.

Two other sites completed last year are operated by chip equipment maker SiCarrier and memory-chip maker SwaySure. While Huawei denies links with the two start-ups, industry insiders said the company was connected to the groups by helping to raise investment and sharing staff and technology.

The facilities also have financial backing from the Shenzhen government, according to those with knowledge of the sites.

Huawei is involved in projects that aim to develop alternatives to technology from chip designer Nvidia, equipment maker ASML, memory-chip maker SK Hynix and contract manufacturer Taiwan Semiconductor Manufacturing Company.

Huawei’s chip efforts accelerated after Washington imposed sanctions in 2019 and cut the company off from critical foreign technology. Its work forms part of a broader government push to localise critical components in the face of US export controls designed to stymie Chinese tech development.

“I thought that Huawei was done once the US went after it,” said a company executive. “But its ambitions have only grown, and the strides it is making have been extraordinary.”

The sites are close to fabrication plants — or foundries — operated by logic-chip makers Pengxinwei (PXW) and Shenzhen Pensun (PST) that the US government alleges are linked to Huawei.

The company has also invested in semiconductor manufacturing facilities in Shanghai, Ningbo and Qingdao, according to those with knowledge of the effort.

Some industry insiders are sceptical that Huawei can realise its lofty ambitions given its relative inexperience in semiconductor manufacturing compared with domestic and international competitors.

“This is a big project that has had a lot of state support,” said a chip investor. “But there are rival companies in China working on the same thing for decades without managing to match ASML and TSMC.”

Guanlan locals referred to sites run by SiCarrier and SwaySure as belonging to Huawei, though the tech giant has denied links to the start-ups. Industry insiders said while the companies had different shareholder bases and structures, they had other close connections.

Huawei provides early support to the start-ups by dispatching management and technical teams, helping with fundraising and, in some cases, transferring technology, according to people familiar with the developments. The association with Huawei, in turn, gives state funds the “confidence” to invest, one of the people said.

This arrangement enables state funds to invest in Huawei’s chip development plans through its network of chip start-ups, without the conglomerate itself having to take on external investment and dilute its shareholder base.

“These companies will be cut off from Huawei once they reach a certain stage of development,” said a person with knowledge of its operations. “During the process, Huawei empowers them through providing personnel, technology and systems. This helps speed up the technology iteration and improves their chances of success.”

SiCarrier was spun out of a Huawei lab with the backing of a Shenzhen state fund, according to people familiar with the matter. It was registered as a company in 2021. Bloomberg previously reported the links between Huawei and SiCarrier.

It maintained a low profile until March, when it unveiled about 30 tools including etch, testing and deposition equipment at the Semicon conference in Shanghai.

SiCarrier has several subsidiaries, including the Shanghai government-backed Yuliangsheng, which specialises in lithography technology. Former Huawei engineers lead Yuliangsheng and are developing a deep ultraviolet lithography machine, according to people with knowledge of the development. SiCarrier has not made its DUV efforts public.

A second site is operated by SwaySure, which supplies Huawei with memory chips for cars and consumer electronics.

Huawei declined to comment on detailed questions related to this article but said: “It is not factually correct to attribute all [these] Shenzhen semiconductor-related activities to Huawei. Furthermore, SiCarrier, SwaySure, UEA, PXW and PST are not affiliated with Huawei.”

SiCarrier and SwaySure did not respond to requests for comment.

The third site is Huawei’s self-operated facility, which will include manufacturing lines for its smartphone and Ascend AI chips, as well as technology related to its autonomous driving business, said two people.

SemiAnalysis said its architectural style matched those of other Huawei-affiliated foundries.

Additionally, the so-called wafer bridges connecting buildings on the site’s north side and nearby utilities bear the hallmarks of a chip manufacturing facility.

Construction is due to be completed in the coming months, but it will take at least a year to start operating, as Huawei seeks to use mostly domestically made equipment that is still being tested, according to people with knowledge of the facility.

Huawei’s attempt to manufacture its own chips was prompted by its frustration at the low output of its local fabrication partner, Semiconductor Manufacturing International Corporation.

The need for Huawei to boost fabrication capacity for the Ascend chip is more urgent after it was exposed last year for using a third-party company to circumvent sanctions to use TSMC to make its AI chips.

Many partners and rivals, including SMIC and Shanghai Micro Electronics Equipment, have been drawn in to bring critical engineering expertise to Huawei’s project.

An industry insider said Huawei’s political influence meant companies were expected to assist, even when it meant helping a competitor.

SMIC has dispatched engineering teams to assist in setting up the facilities. Meanwhile, SMEE, the leading domestic provider of lithography tools, has been providing support, even after Huawei poached many of its technical staff, said two people. Both companies did not respond to a request for comment.

The US government has targeted the Huawei network. In December, Washington placed SiCarrier and SwaySure on the “entity list”, barring American companies from selling technology to them.

The government alleged they were aiding Huawei’s efforts to build advanced chip technology for military modernisation.

COMMENT – The frustrating thing is that the Biden Administration had access to these details of Huawei’s efforts to circumvent their export controls nearly two years ago and decided to do very little about it.

None of these subsidiaries were blocked from acquiring American semiconductor tools and equipment.

The Trump Administration has the opportunity to take action, will they?

6. How Bad Is China’s Economy? The Data Needed to Answer Is Vanishing
   Rebecca Feng and Jason Douglas, Wall Street Journal, May 4, 2025

Beijing has stopped publishing hundreds of statistics, making it harder to know what’s going on in the country.

Not long ago, anyone could comb through a wide range of official data from China. Then it started to disappear.

Land sales measures, foreign investment data and unemployment indicators have gone dark in recent years. Data on cremations and a business confidence index have been cut off. Even official soy sauce production reports are gone.

In all, Chinese officials have stopped publishing hundreds of data points once used by researchers and investors, according to a Wall Street Journal analysis.

In most cases, Chinese authorities haven’t given any reason for ending or withholding data. But the missing numbers have come as the world’s second biggest economy has stumbled under the weight of excessive debt, a crumbling real-estate market and other troubles—spurring heavy-handed efforts by authorities to control the narrative.

China’s National Bureau of Statistics stopped publishing some numbers related to unemployment in urban areas in recent years. After an anonymous user on the bureau’s website asked why one of those data points had disappeared, the bureau said only that the ministry that provided it stopped sharing the data.

The disappearing data have made it harder for people to know what’s going on in China at a pivotal time, with the trade war between Washington and Beijing expected to hit China hard and weaken global growth. Plunging trade with the U.S. has already led to production shutdowns and job cuts.

Getting a true read on China’s growth has always been tricky. Many economists have long questioned the reliability of China’s headline gross domestic product data, and concerns have intensified recently. Official figures put GDP growth at 5% last year and 5.2% in 2023, but some have estimated that Beijing overstated its numbers by as much as 2 to 3 percentage points.

To get what they consider to be more realistic assessments of China’s growth, economists have turned to alternative sources such as movie box office revenues, satellite data on the intensity of nighttime lights, the operating rates of cement factories and electricity generation by major power companies. Some parse location data from mapping services run by private companies such as Chinese tech giant Baidu to gauge business activity.

One economist said he has been assessing the health of China’s services sector by counting news stories about owners of gyms and beauty salons who abruptly close up and skip town with users’ membership fees.

COMMENT – When folks don’t have data to make decisions, they tend to make bad decisions. While the Party is desperate to conceal its incompetence from the public, it is likely to compound its challenges by making it harder for anyone to correct what’s wrong.

I think there is good reason to believe that the PRC is not in a good place.

7. Fentanyl Crisis Provided Opening for U.S.-China Trade Talks

   Lingling Wei, Brian Schwartz, and Alex Leary, Wall Street Journal, May 7, 2025

Planned meeting in Switzerland to be first direct talks over trade during Trump’s second term.

Beijing’s outreach to Washington over fentanyl created an opening for trade talks between the two nations, according to people in both capitals who are familiar with the matter, paving the way for a bilateral meeting in Switzerland this weekend.

For weeks, the U.S. and China have been looking for ways to walk back from what were essentially tit-for-tat trade embargoes. The Chinese in late April sent the Trump administration questions seeking clarity on how the president wants China to crack down on trafficking of the chemical ingredients used to make fentanyl, the people said. In response, the White House gave Beijing a list of suggestions.

Chinese leader Xi Jinping’s security czar, Wang Xiaohong, had privately expressed interest in further engaging with Trump officials to address the issue by potentially meeting with them in the U.S. or another country.

The Trump team’s list included a request that Beijing send a strong message to those involved in trafficking the chemicals, known as precursors, according to the people familiar with the matter. Such messages could involve warnings of severe punishment. Precursors produced by Chinese companies, often sold over the internet, flow from China to criminal groups in Mexico and elsewhere that produce fentanyl and traffic it into the U.S.

Now both sides are readying for what will be the first direct talks over trade between senior officials on both sides during President Trump’s second term.

“The United States has been clear about our expectations with regards to stopping the flow of chemical precursors from China to illicit drug producers in Mexico,” National Security Council spokesman James Hewitt said. A White House spokesperson didn’t respond to a request for comment.

A positive step

The exchanges on fentanyl have been viewed by both sides as a step toward finding a way out of the hostilities between the world’s two largest economies that have rattled global markets and businesses. Against that backdrop, people familiar with the matter said, Treasury Secretary Scott Bessent and U.S. Trade Representative Jamieson Greer and their Chinese counterpart, Vice Premier He Lifeng, agreed in the past few days to meet in Switzerland late this week.

The meeting comes after Bessent on Sunday told people at a private event at the Peninsula hotel in Beverly Hills, Calif., that his priorities include striking new trade deals with countries in Asia, according to one person there. Bessent told the crowd, which was gathered on the sidelines of the Milken Institute Global Conference, that he has been particularly impressed with Indonesia’s trade framework, without providing further details, the person added.

COMMENT – So I guess this means the Chinese blinked first.

8. Mapping a decade’s worth of hybrid threats targeting Australia

   Fitriani and Shelly Shih, The Strategist, May 7, 2025

Hybrid threats, enabled by digital technologies and fuelled by geostrategic competition, are reshaping international security and global norms. Most often, states (commonly working through non-state proxies) are exploiting cybersecurity vulnerabilities and engaging in economic coercion, information warfare and even physical sabotage. They do so in order to advance their strategic ambitions and undermine the interests of others, while avoiding the threshold for conflict.

ASPI has been collecting open-source data to examine the nature and frequency of hybrid threats targeting Australia. We’ve built a database that spans nine years, from March 2016 to February 2025, and in that time we have tracked 74 activities. Understanding the scale that confronts us is the first step to strengthening public awareness and building an effective national response.

We collected data from sources including government statements, media reports, cyber firm alerts and think tank reports. We also cross-checked reports, making sure the counted activities were reported across multiple credible sources. We assessed whether these past hybrid activities were state-linked and sorted the activities into six threat categories: economic coercion; foreign interference; narrative and information campaigns; cyberattack; military and paramilitary coercion; and diplomatic coercion.

Due to their nature, covert or unreported hybrid activities were not captured.

COMMENT – The Chinese Communist Party hates reports like this that catalogue their aggression against their neighbors. It is why the CCP is so committed pressuring the Australian Government into shutting down the Australian Strategic Policy Institute (ASPI).

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Authoritarianism

9. Putin and Xi Rebuke U.S. and Vow to Strengthen Ties

   Paul Sonne and David Pierson, New York Times, May 8, 2025

President Vladimir V. Putin of Russia and Xi Jinping, the leader of China, issued a joint rebuke to Washington on Thursday, a day before celebrations in Moscow to mark the 80th anniversary of the Soviet victory over Nazi Germany in World War II.

The leaders held talks at the Kremlin, part of a state visit that Moscow organized for Mr. Xi before his attendance alongside other foreign leaders on Friday at a military parade in Red Square.

In a joint statement issued after their talks, Mr. Putin and Mr. Xi rejected what they described as Washington’s attempt to contain them. They vowed to “increase interaction and strengthen cooperation” to counter such U.S. efforts.

Both Mr. Putin and Mr. Xi are grappling with the unpredictability of President Trump — the Russian president in talks over Ukraine, and the Chinese leader in a bruising trade war. Each has sought to present their countries as alternative world powers looking to bring about what they call a more equal, multipolar world in the face of U.S. hegemony.

Part of their message Thursday seemed to be that they would stand together, even as Mr. Trump embraces Mr. Putin but pressures Mr. Xi.

After the talks, Mr. Xi spoke pointedly of the importance of the two leaders remaining trusting friends.

The Russian and Chinese leaders also jointly called Mr. Trump’s plans for a “Golden Dome” missile defense shield over the United States “deeply destabilizing,” arguing in their joint statement that such new U.S. defenses would weaponize space.

Mr. Trump has employed some of the same nationalist grievance politics and disinformation strategies that Mr. Putin and Mr. Xi have used to cement their power at home, but has failed to reach a deal with either leader since returning to the White House.

Talks with Moscow over the war in Ukraine are continuing but have not curbed the fighting there. U.S. officials are set to begin trade negotiations in Switzerland this week with their Chinese counterparts, as the trade war threatens economic growth.

In Moscow, the summit took place as Mr. Putin began welcoming what the Kremlin expects to be more than 25 world leaders to the Red Square celebrations. The guests include a veritable “Who’s Who” of authoritarians, with the presidents of Venezuela, Cuba, Equatorial Guinea and Belarus expected to attend.

But none of the leaders is more important to Moscow than Mr. Xi.

10. Now ‘friends of steel’: Xi and Putin meet in Moscow

    Chen Zifei, Radio Free Asia, May 8, 2025

The leaders of China and Russia vowed to deepen their “strategic partnership” in a show of solidarity in Moscow on Thursday, casting themselves as defenders of the world order.

Russian President Vladimir Putin played host to Chinese President Xi Jinping on the eve of a military parade marking the 80th anniversary of the end of World War II in Europe.

The two sides signed a joint statement to “further deepen the comprehensive strategic partnership of cooperation in the new era between China and Russia.”

Their meeting comes three years after Putin ordered an invasion of Ukraine, triggering the deadliest conflict in Europe since the World War II.

It also came as Taiwan’s president, in Taipei, marked the World War II anniversary by making broad comparisons between threats to European peace and aggression from China.

President Lai Ching-te told diplomats: “Authoritarianism and aggression lead only to slaughter, tragedy, and greater inequality.” He added that Taiwan – a self-governing island that China claims as its own - and Europe were “now facing the threat of a new authoritarian bloc.”

11. “A Vicious Cycle”
    Rachel Cheung, The Wire China, May 2, 2025

Squeezed by commercial and political pressures, China’s book publishers face an existential crisis.

In 2020, one of China’s leading private sector book publishers, Beijing Motie Book, bought the Chinese-language rights to Invent and Wander, The Collected Writings of Jeff Bezos. Motie thought the book was perfectly timed for the Chinese market. The Amazon founder was then the world’s richest man and his Chinese technology billionaire peers were also riding high.

But it was also the final year of Donald Trump’s first term and Sino-U.S. relations were at a nadir. As a result, Motie was unable to get final clearance from the National Press and Publication Administration (NPPA), the Chinese agency that oversees print publications and sometimes steps in to halt potentially sensitive titles. “At that time, many American books could not get published,” says a former book editor at Motie, who asked not to be identified. “It was stupid. Whenever China does not get along with a country, it will ban its books or it will delay them for a long time.”

Invent and Wander, titled Longterm-ism in Chinese, was eventually published in 2022, but it had missed its moment. By then President Xi Jinping had launched his campaign to rein in Jack Ma and other influential technology moguls, and prominent Chinese entrepreneurs pulled their blurbs for the book. Then, weeks before publication, Amazon announced it was shutting down Kindle’s business in China. The book sold a fraction of the 500,000 copies Motie had expected. “A lot of this is beyond the control of an editor or a publisher,” adds the editor. “But it really wears you down.”

12. How a Pillar of New York’s Chinese Community Did Beijing’s Dirty Work
    James T. Areddy, Wall Street Journal, May 3, 2025

A prominent businessman is headed to prison after pressuring a suspected fugitive to surrender to China.

Liu Shenxiang spent years living in the U.S., defying Chinese authorities’ claims that he was a criminal fugitive who misappropriated money from his employer.

Then, after China stepped up the pressure by publishing his New York City address, an esteemed member of the city’s Chinese business community plunged in to help Beijing by pushing Liu to surrender.

Now the businessman, An Quanzhong, is headed to a federal penitentiary for acting as China’s agent in a harassment campaign and could face deportation. He has paid almost $1.3 million in restitution to Liu, who remains in the U.S.

What linked the two men, both from China’s Shandong province and permanent residents of the U.S., was the deep distrust between the U.S. and China: The U.S. mostly ignores China’s criminal allegations, for instance taking no position on Beijing’s claim that Liu is a criminal or a fugitive. In response, China has pursued unusual strategies to enforce its laws on American soil.

The clash between the two countries’ legal systems is evident in a separate case making its way through a federal court in New York, in which China is alleged to have managed what prosecutors called a police station in Manhattan’s Chinatown. China’s government says the outpost handled administrative matters like driver-license renewals.

In other prosecutions, China has been accused of deploying pressure tactics against its political opponents in the U.S. Recently, the Justice Department charged a Chinese national and a British national with orchestrating a scheme to use violence against a California activist critical of Chinese leader Xi Jinping around the time of his 2023 visit to the U.S. China has said it acts lawfully.

For Liu and An, the outcome was a flipped script, winning an alleged fugitive the protection of the Federal Bureau of Investigation and leaving a community stalwart in disgrace.

The Justice Department said as part of the effort to compel Liu to give himself up, An helped arrange a trip to New York by Liu’s nephew, who said he was forced to deliver threats face-to-face. An repeatedly contacted Liu’s son, once getting him on the telephone with a Chinese investigator.

COMMENT - Expect the PRC Government to take an American hostage on trumped up charges in a bid to get An released.

13. Russia and China turn space into a warzone
    London Loves Business, May 6, 2025

14. India vs. Pakistan Is Also U.S. vs. China When It Comes to Arms Sales
    Mujib Mashal, New York Times, May 7, 2025

15. Chinese graduates in UK face bleak prospects amid job crunch: ‘it’s devastating’
    Mia Nulimaimaiti, South China Morning Post, May 4, 2025

16. China’s C919 stuck on tarmac in Europe as certification timeline extended
    Ralph Jennings and Xiaofei Xu, South China Morning Post, May 1, 2025

As China continues to promote its home-grown C919 passenger plane to overseas markets – and builds a name for the jet in Southeast Asia – it could take longer than expected for the aircraft to receive a coveted endorsement from the European Union’s safety regulator.

In remarks published by French magazine L’Usine Nouvelle on Monday, Florian Guillermet, executive director of the European Union Aviation Safety Agency (EASA), said certification for the narrowbody C919 – essential for the sale of any aircraft to European carriers – will not be granted this year.

“As we informed them officially, the C919 cannot be certified in 2025 … We should be certifying the C919 within three to six years,” Guillermet said.

17. Chinese exporters ‘wash’ products in third countries to avoid Donald Trump’s tariffs
    William Langley, Rafe Uddin and Song Jung-a, Financial Times, May 4, 2025

18. Chinese exporters undervalue cargo to skirt Trump tariffs
    Joe Miller, Financial Times, May 5, 2025

19. China sees global turmoil as opportunity to be ‘business friendly’, says Novartis chief
    Mercedes Ruehl and Hannah Kuchler, Financial Times, May 6, 2025

20. China’s diplomatic charm offensive
    Joe Leahy, Financial Times, May 5, 2025

21. Despite Trump, Europe Should Not Flee into China’s Arms
    Alicia García-Herrero, The Wire China, May 4, 2025

The continent should rely more on developing its own internal markets rather than seek a rapprochement with Beijing.

One would think Europe had already learned its lesson about the huge costs of strategic dependencies. The continent’s first reality shock came with China during the pandemic, when Europe had to beg for ventilators and masks. Its second major dependency, which turned out to be extremely costly, was on Russian gas, as exposed after Russia’s invasion of Ukraine. Despite these experiences, the European Union might still respond to President Trump’s current trade and security pressure by drawing closer to China once again.

Trump’s measures on the European Union (EU) are for sure hurting European companies and more could come if the proposed 20 percent reciprocal tariffs, which have been paused for 90 days, are finally enacted against European products. The question, then, is whether a “rapprochement” with China can help European companies buffer this potentially huge shock.

The answer to this question is as simple as it is worrisome: No.

The main reason for such a negative answer might seem to be the potential retaliation Trump might enact against the EU if it gets closer to China. In fact, the most important factor is the EU’s own interests.

The EU’s “de-risking” strategy towards China, officially announced in March 2023, a few weeks before the Biden administration also switched to a similar approach, was based on European core interests, independent from those of the United States. Those core interests relate to the increasingly small benefits Europe gains from the Chinese market, with European exports there plummeting, resulting in a large annual trade deficit amounting to around 400 billion euros.

There is little scope for improving this situation, even if EU-China relations warm up. China already produces much of what it used to import from Europe, and it now has a clear interest in using even more local production, as its external sector will be hit hard by Trump’s trade war. The last thing China intends to do is increase its imports from Europe.

22. Operation Take Back America Strikes Chinese Money Launderers in Charlotte Cartel Case
    Sam Cooper, The Bureau, May 6, 2025

23. ‘Brazen’ suspected China surveillance sites in Cuba trigger US House hearing
    Igor Patrick and Zhao Ziwen, South China Morning Post, May 7, 2025

Lawmakers warn that Beijing may be expanding intelligence footprint near American soil and urge Trump administration to take firmer stance.

24. The Bubble Blasters and Other Chinese Goods That Are Paralyzed by Trade Chaos

    Rebecca Feng, Hannah Miao, and Natasha Khan, Wall Street Journal, May 7, 2025

Six thousand inflatable snowmen and holiday figurines are sitting in Alan Chau’s Guangdong factory with nowhere to go.

His customer, an American toy maker, planned to sell the holiday-themed products to QVC for the TV-shopping network’s “Christmas in July” programming. The TV-shopping network froze the shipment after President Trump raised tariffs on Chinese goods to 145%.

Now, Chau faces a cash crunch as new orders dry up and money to pay his workers runs low. The Hong Konger who has worked in China’s toy manufacturing industry for two decades said he’s only sleeping a few hours a night and stays glued to the news when awake, watching for any change in U.S. tariff policy. If a deal between the U.S. and China isn’t reached soon, he said, he might have to declare bankruptcy, affecting his Chinese workers and suppliers and his U.S. customers, as well as his wife and toddler son.

“This is the chain reaction,” he said. “Everyone is suffering.”

Trump’s tariffs are creating chaos for businesspeople on both sides of the Pacific who built their livelihoods on globalized supply chains for everything from toys to furniture to footwear.

COMMENT – Without bubble blasters and inflatable snowmen, how will America survive?!?

My advice: stop building your livelihood on supply chains that depend on the PRC.

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Environmental Harms

25. China’s emissions have now caused more global warming than EU

    Carbon Brief, November 19, 2024

China’s historical emissions within its borders have now caused more global warming than the 27 member states of the EU combined, according to new Carbon Brief analysis.

The findings come amid fraught negotiations at COP29 in Baku, Azerbaijan, where negotiators have been invoking the “principle of historical responsibility” in their discussions over who should pay money towards a new goal for climate finance – and how much.

Carbon Brief’s analysis shows that 94% of the global carbon budget for 1.5C has now been used up, as cumulative emissions since 1850 have reached 2,607bn tonnes of carbon dioxide (GtCO2).

While developed countries have used the majority of this budget, the analysis shows that China’s historical emissions reached 312GtCO2 in 2023, overtaking the EU’s 303GtCO2.

China is still far behind the 532GtCO2 emitted by the US, however, according to the analysis.

Indeed, China is unlikely to ever overtake the US contribution to global warming, based on current policies, committed plans and technology trends in both countries. This is even before accounting for the potential emissions-boosting policies of the incoming Trump presidency.

COMMENT – Carbon Brief’s analysis is misleading.

Large portions of CO2 emissions leave the atmosphere within 50-60 years, so it is irrelevant to count European (or American) emissions from before 1970. Picking the start date as 1850 is incredibly misleading and is only done to imply that the West is the worst offender and “responsible” for global warming we are experiencing today. US and European carbon emissions have largely leveled off over the past two decades while the PRC’s will continue to grow over the next five decades.

Today, the PRC is pumping out more GHG than any other country (and that will stay in the atmosphere for the next 50-60 years). Those emissions drive global warming… NOT carbon emitted in the 1920s that has already left the atmosphere.

26. China's solar panel makers plunge to first combined net loss
    Kohei Fujimura, Nikkei Asia, May 7, 2025

27. China’s smog may have contributed to more lung cancer deaths

    Lucie Lo, Radio Free Asia, February 13, 2025

The country tops the world for deaths caused by lung adenocarcinoma, a type of cancer usually seen in non-smokers.

28. Chinese Firm Behind NATO Ally's Windfarm Is Tied to Army
    Didi Kirsten Tatlow, Newsweek, May 5, 2025

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Foreign Interference and Coercion

29. INVESTIGATION: Uncovering Chinese Academic Espionage at Stanford

    Stanford Review, May 7, 2025

30. Letter to the Editor: How Universities Should Respond to Chinese Government Interference

    Larry Diamond, Matt Pottinger, and Matthew Turpin, Stanford Review, May 9, 2025

COMMENT - Larry Diamond, Matt Pottinger, and I felt that it was necessary to make the point that while we need to be vigilant about the Chinese Communist Party’s efforts to abuse our academic institutions and open society, that we must guard against unfairly accusing Chinese students and individuals of Chinese heritage of complicity.

The Chinese Communist Party purposefully targets individuals whom they can entice or coerce into aiding them.

29. California's Newsom offers 'open hand' to China amid Trump trade war
    Yifan Yu, Nikkei Asia, May 3, 2025

California remains open to Chinese trade as President Donald Trump's 145% tariff on Beijing threatens the largest state economy in the U.S, Gov. Gavin Newsom said in an online interview with Nikkei Asia on Friday.

Newsom said that while the California government has not had any direct high-level conversations with Beijing, the state is a "stable partner" and has "extended an open hand" to China and other trading partners.

"We established a memorandum of understanding both at the state level, and the regional and municipal level, as well as with President Xi's administration at the federal level in China," Newsom said, referring to his visit to the world's second-largest economy in 2023.

China is one of the top three trading partners of California, which has an economy about the same size as that of Japan.

Mexico, Canada and China combined bought over one-third of the state's $183 billion in exported goods last year, while over 40% of California imports came from those three countries.

Despite rising geopolitical risks and competition with China, Newsom said global trade is not a zero-sum game and that he recognizes "our interdependence."

Soon after U.S. President Donald Trump announced his sweeping "reciprocal" tariffs, Newsom openly called for countries to discuss trade relations directly with California. The state also became the first to sue the Trump administration over the president's use of emergency powers to implement tariffs.

While Trump has paused most of the reciprocal tariffs for 90 days, Chinese imports have faced a levy of 145% since early April.

Newsom said the reason he has been so outspoken about Trump's trade policy was because the Golden State is "disproportionately impacted" by tariffs compared with other states because of its extensive trade with Asia and Silicon Valley tech companies' integrated supply chains and markets in the region.

"The direct and indirect economic costs to the state of California is in the billions and billions of dollars," said Newsom. "It has an outsized impact on tourism, on trade, small businesses, large businesses... and the reputation [damage] is incalculable."

Japan, for example, has been one of the leading sources of foreign direct investment in California for a decade, but the governor said he worries the policies coming out of Washington could lead to less investment from one of America's closest allies.

"That's why we're trying to step up and push back against them," said Newsom.

During the interview, Newsom repeatedly mentioned the distance -- both physical and metaphorical -- between California and the Trump administration in Washington.

"We're 2,000 miles away from Washington, D.C., but we're a world away in terms of our mindset. I represent the most un-Trump state in America," he said.

"California is not the United States of America. We're proud to be part of the United States of America, but our values are in contrast to those that are being expressed currently by the current occupant in the White House," he added.

Despite his outspoken criticism of Trump's policies, Newsom said tariffs should "play a role, but they have to be strategic, and they have to be combined with an industrial policy."

COMMENT – The Chinese Communist Party loves finding wedges to exploit between national and sub-national governments.

It would be great if Governors didn’t fall for the “climate cooperation” trap.

32. Somalia Bars Taiwanese Passport Holders from Entering the Country
    Abdi Latif Dahir, New York Times, April 30, 2025

33. Xi’s Visit to Russia Complicates China’s Courtship of Europe
    David Pierson and Paul Sonne, New York Times, May 7, 2025

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Human Rights and Religious Persecution

34. 71-Year-Old Falun Gong Practitioner Tortured to Death in Chongqing

    Yang Feng, Bitter Winter, May 8, 2025

Tang Fenghua’s case was not the first. It will not be the last. Another practitioner jailed in the same notorious prison died two days after him.

Tang Fenghua, a 71-year-old man from Chongqing, fell seriously ill while imprisoned at Yongchuan Prison, where he had been tortured due to his faith in Falun Gong. He was transferred to Chongqing Second Municipal Hospital for treatment but passed away there on April 17, 2025. His family was informed only recently.

Tang owned a successful furniture store near the old military subdistrict in Yongchuan. He has been repeatedly detained since 1999 and served two prison sentences totalling five years.

On April 10, 2013, he was detained for distributing Falun Gong materials. He was held at the Yongchuan District Detention Center and sentenced to three years of imprisonment. He served his sentence at Yongchuan Prison in Chongqing and was released in January 2016.

On December 6, 2016, Tang was arrested and detained for over ten days. Shortly after his release, he was re-arrested on January 10, 2017, for distributing Falun Gong materials. He was sentenced to two years and released on January 9, 2019.

Tang experienced several instances of police harassment from August 31, 2019, to March 2021.

35. How Images of the Dalai Lama’s Hands, Feet Landed a Tibetan Woman in China’s Dragnet
    Tripti Lahiri, Wall Street Journal, May 5, 2025

36. China’s Shadow Over the Conclave: Two Bishops Appointed Without Vatican’s Approval

    Massimo Introvigne, Bitter Winter, May 5, 2025

One of the most problematic aspects of Pope Francis’ legacy is the Vatican’s relationship with China, which I discussed in “Bitter Winter” after the Pontiff’s death. Different assessments of the Vatican-China deal of 2018 exist, but one fact is that Beijing keeps violating it.

The 2023 situation regarding the new bishop of Shanghai, the most significant diocese in China, illustrates this issue. The Holy See officially reported that it had discovered Bishop Shen Bin had been transferred to Shanghai “from the media.” To uphold the agreement, the Pope legitimized Bishop Shen Bin “ex post,” and the Vatican even invited him to a conference in Rome.

A similar situation arose with Bishop Ji Weizhong, who, according to a statement from Chinese authorities on July 19, 2024, was “elected” as the bishop of Lüliang. The diocese of Lüliang, whose creation Beijing had requested, did not even exist at that time. In this case, Francis’ Vatican “remedied” the situation by announcing its recognition of the new diocese and bishop on January 20, 2025, the date when he was publicly consecrated.

No new bishop is appointed in the Catholic Church between a Pope’s death and his successor’s election. Only the Pope can do this, and there is no Pope.

China, however, decided to appoint two new bishops during this period, called “sede vacante” in the Vatican’s jargon. As reported by “Asia News” and confirmed to “Bitter Winter” by local sources, both in Shanghai and Xinxiang, Henan, the authorities informed Catholics that new bishops had been appointed. The process likely started before Pope Francis’ death, but it could and should have been paused due to the situation of “sede vacante.”

37. 87 Groups Condemn Arrests of Activist’s Relatives

    Human Rights watch, May 7, 2025

Hong Kong authorities’ unjust arrests of the father and brother of the prominent US-based activist Anna Kwok is an escalation of the Chinese government’s use of cross-border repression, 87 international and diaspora rights groups, including Human Rights Watch, said today in two joint statements.

Anna Kwok’s father, Kwok Yin-sang, 68, was arrested and formally charged under a national security law that carries a punishment of up to seven years in prison. Her brother was also arrested and later released on bail.

“The Hong Kong authorities took an unprecedented action by charging the family member of an exiled activist with a national security crime to try to silence her,” said Yalkun Uluyol, China researcher at Human Rights Watch. “Foreign governments should respond to this assault on basic liberties by speaking up about the case and taking concrete actions to protect their citizens and residents from the Chinese government’s long arm.”

The groups said that foreign governments should put in place effective measures to protect exiled activists and other critics of the Chinese government from Beijing’s transnational repression.

38. Article 23 law used to ‘normalize’ repression one year since enactment

    Amnesty International, March 19, 2025

Just one year after its passage, Hong Kong’s Article 23 law has further squeezed people’s freedoms and enabled authorities to intensify their crackdown on peaceful activism in the city and beyond, Amnesty International said.

“Over the past year, Article 23 has been used to entrench a ‘new normal’ of systematic repression of dissent, criminalizing peaceful acts in increasingly absurd ways,” said Amnesty International’s China Director Sarah Brooks.

“People have been targeted and harshly punished for the clothes they wear as well as the things they say and write, or for minor acts of protest, intensifying the climate of fear that already pervaded Hong Kong. Freedom of expression has never been under greater attack.”

39. How China Hijacks the International Human Rights System

    Rana Siu Inboden, The Diplomat, April 28, 2025

U.N. systems have played a crucial role in highlighting Beijing’s human rights abuses. Now China’s government is stacking these very bodies with its own mouthpieces.

The People’s Republic of China (PRC) is using money, collaboration with authoritarian allies, and manipulation of rules to shift the international human rights system’s priorities and discussions to advance narratives and issues that are friendly to China. For example, Beijing has secured the inclusion of independent experts in the United Nations Special Procedures system who work on issues that align with Beijing’s interests and is populating the U.N. with Government Organized NGOs (GONGOs) that act as mouthpieces for the Chinese government.

In the past, the experts in the Special Procedures system and civil society organizations have played a crucial role in spotlighting China’s human rights abuses. But now Beijing is utilizing them to promote issues and narratives that align with China’s interests.

China and the U.N. Special Procedures

Among Beijing’s targets are the U.N. Special Procedures, which comprises roughly 60 independent experts who focus on a theme or country. The Special Procedures have spoken out about the worsening repression in China, issuing over two dozen joint statements expressing alarm about the PRC’s crackdown on Hong Kong, human rights defenders, and ethnic groups, particularly the Uyghur community, with some of the statements attracting over 40 signatures.

While the majority of Special Procedures focus on crucial human rights issues, such as torture or freedom of expression, and demonstrate integrity, China and other authoritarian countries have begun creating Special Procedures with mandates that favor their views, such as the Special Rapporteur on “Unilateral Coercive Measures,” a term intended to give sanctions a negative gloss, and the Special Rapporteur on the Right to Development, to name a few.

Even though sanctions have long been a human rights tool, including to resist apartheid in South Africa, China and other countries that have been the target of sanctions managed to secure passage of a 2014 Human Rights Council (HRC) resolution that created a Special Rapporteur on Unilateral Coercive Measures.

Despite opposition from a number of liberal democracies, including the U.S., the resolution, which was introduced by Iran, created in the United Nations an independent expert to examine “the negative impact of unilateral coercive measures.” It passed following a contentious vote with support from nations such as China, Russia, and Venezuela.

After securing the creation of this position, Beijing and other authoritarian countries have cooperated with the mandate holder and provided funding. For example, since 2015, Russia, China, and Qatar – which are categorized as “not free” by Freedom House – have donated $1,325,000 (with roughly $800,000 coming from China) to the mandate on unilateral coercive measures. Although rapporteurs do not receive a salary from the U.N., states can use donations to a specific Special Procedure to help support the mandate holder’s work by funding travel, staff, and research assistance. Most Special Procedures receive only enough funding to cover two trips per year and one staff position to support the independent expert. Therefore, additional funding can elevate and amplify a particular Special Procedure mandate.

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Industrial Policies and Economic Espionage

40. China’s wait-and-see approach exposes policy limit
    Ka Sing Chan, Reuters, May 7, 2025

China is biding its time ahead of planned trade talks with the United States. On Wednesday, the country's top three regulators announced a raft of new measures but held off on major spending. The reluctance partly stems from the government's limited room to expand its fiscal deficit too quickly.

In a rare joint meeting, the heads of the People’s Bank of China, the China Securities Regulatory Commission and the National Financial Regulatory Administration detailed steps to prop up the tariff-hit economy. Those included lowering bank reserve requirements to inject 1 trillion yuan ($138 billion) into the system, rate cuts and other monetary easing, as well as stock market support tools and other moves.

41. Trump’s Tariffs Are Lifting Some U.S. Manufacturers
    Jeanne Whalen and Bob Tita, Wall Street Journal, May 4, 2025

42. What a $15,000 Electric SUV Says About U.S.-China Car Rivalry
    Peter Landers, Wall Street Journal, May 3, 2025

43. As China Looks for Way Out of U.S. Trade Deadlock, Fentanyl Could Be Key
    David Pierson and Joy Dong, New York Times, May 3, 2025

44. China’s Garment Factories Face a Tipping Point After New Tariffs
    Meaghan Tobin, New York Times, May 5, 2025

45. Wealthy Chinese turn away from US real estate as Trump amps up trade war with Beijing
    Cheryl Arcibal, South China Morning Post, May 4, 2025

46. US lawmakers urge SEC to delist Alibaba and Chinese companies
    Demetri Sevastopulo and Stefania Palma, Financial Times, May 2, 2025

47. Rare-earth prices triple to new records on China export curbs
    Shugo Yamada, Nikkei Asia, May 3, 2025

48. China's price wars come for its baijiu liquor makers
    Wataru Suzuki, Nikkei Asia, May 3, 2025

49. Demise of 'de minimis' sparks China-to-US airfreight cancellations
    Pak Yiu, Nikkei Asia, May 3, 2025

50. China’s secret weapon in the trade war
    The Economist, May 4, 2025

51. Chinese Companies Moving to Texas, Nevada to Avoid Trump’s Tariffs
    Floyd Buford, Daily Caller, May 5, 2025

52. ‘Made in China’ airliner faces trade turbulence
    Chan Ho-him and Sylvia Pfeifer, Financial Times, May 6, 2025

53. Ford warns of industry vulnerability to China rare-earth restrictions
    Kenji Kawase, Nikkei Asia, May 6, 2025

54. Under China's shadow, Germany aims to build EU lithium supply chain
    Jens Kastner, Nikkei Asia, May 6, 2025

55. Shein Bet Big on Donald Trump. It Lost Big, Too
    Timothy McLaughlin, Wired, May 5, 2025

56. U.S. and Chinese Officials to Meet for Trade Talks
    Wall Street Journal, May 7, 2025

57. Trump Officials to Meet with Chinese Counterparts Amid Trade Standoff
    New York Times, May 6, 2025

58. Chinese Imports Hit 2-Decade Low as Trump Tariffs Begin to Bite
    Karl Russell and Ana Swanson, New York Times, May 6, 2025

59. Significant, but not systemic: The challenge of China's efforts to rival Western financial predominance
    Martin Chorzempa and Lukas Spielberger, PIIE, May 6, 2025

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Cyber and Information Technology

60. White House Warns China of Cyber Retaliation Over Infrastructure Hacks
    James Coker, InfoSecurity Magazine, May 2, 2025

61. US lawmaker targets Nvidia chip smuggling to China with new bill
    Max A. Cherney, Reuters, May 5, 2025

62. How China is gaining ground in the Middle East cloud computing race
    Andrea Benito, Rest of World, May 5, 2025

63. Is It Too Late to Slow China’s AI Development?
    Rishi Iyengar, Foreign Policy, May 5, 2025

64. Alibaba's Qwen is foundation for more and more Japanese AI models
    Nikkei Asia, May 6, 2025

65. How China is still getting its hands on Nvidia’s gear
    The Economist, May 5, 2025

66. China’s Blockchain Playbook: Infrastructure, Influence, and the New Digital Order
    Anoosh Kumar, CSIS, May 5, 2025

67. China urges state-backed tech players overseas to counter Trump tariffs
    Cheng Ting-fang, Lauly Li, Cissy Zhou and Shunsuke Tabeta, Nikkei Asia, May 7, 2025

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Military and Security Threats

68. China deploys 200-ton boats to take on 10,000-ton US warships in South China Sea
    Kapil Kajal, Interesting Engineering, April 28, 2025

69. America’s New Pacific Army Commander Lays Out His China Strategy
    Niharika Mandhana and Timothy W. Martin, Wall Street Journal, May 4, 2025

70. A Tale of Two Reams: Questions Remain at Cambodia’s Growing Naval Base
    CSIS, May 5, 2025

71. Xi Jinping’s Moscow visit highlights China’s strategic vulnerabilities
    Patricia M. Kim, Brookings, May 5, 2025

72. U.S. Advances Toward China in Hypersonic Weapons Race
    Heather Somerville, Wall Street Journal, May 6, 2025

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One Belt, One Road Strategy

73. Trump has cut global climate finance. China is more than happy to step in.
    Christian Shepherd, Washington Post, May 6, 2025

Even U.S. allies locked in national security disputes with Beijing, like the Philippines, are finding it impossible to resist China’s green energy infrastructure.

The Philippines, among the countries in Southeast Asia, has the most contentious relationship with China: It is embroiled in a protracted and high-stakes territorial dispute with Beijing in the South China Sea, and has accused Chinese state-sponsored groups of trying to interfere in this month’s midterm elections.

But these tensions, and associated national security concerns, have not stopped the Philippines from turning to China for the renewable energy infrastructure it needs for its development — not least because Chinese-made green tech is much cheaper than American and European offerings.

“The Chinese offer was so much lower than their European counterparts, so for us that was an awakening,” said Gerry P. Magbanua, president of Manila-based renewable power company Alternergy, recounting the bids he received to build two wind farms in the Philippines.

This was true even before Donald Trump took office. But Beijing’s effort to dominate Southeast Asia — both in green tech and as the regional superpower — has received a welcome boost from Trump’s decision to slash climate financing intended to propel the transition to renewable energy at the same time that he threatens the region with tariffs.

74. China’s Coming Diplomatic Blitz in the Americas
    R. Evan Ellis, The Diplomat, May 2, 2025

75. China on African charm offensive to rally opposition to ‘bullying’ US
    Jevans Nyabiage, South China Morning Post, May 6, 2025

76. Ecuador’s Incoming Government Faces Difficult Choices Regarding China

    R. Evan Ellis, The Diplomat, May 5, 2025

The event itself showcased China’s advance in Ecuador, not only in commerce, but also in other domains, and in the aggressiveness with which Beijing asserts its interests in the country. Unlike many China-financed platforms, the Quito forum included a range of both positive and critical perspectives about China’s relationship with the region.

Because the forum was not limited solely to pro-China speakers and talking points, in the weeks leading up to the event, the Chinese embassy in Quito reached out to both of the Ecuadorian institutional hosts, trying to convince them to cancel it. To their credit, both institutions defended their right to academic freedom and integrity in holding the event. China then went further, working through social media to convince some invited presenters not to participate.

The timing of the Quito forum was propitious, occurring at an inflection point in the Ecuador-China relationship. Just 10 days before the event, Ecuadorian President Daniel Noboa won an 11-point victory over Luisa Gonzalez in the second round of national elections. Chinese President Xi Jinping was reportedly among the first international leaders to congratulate Noboa on his victory.

As the forum took place, Noboa’s National Democratic Party, which had won 66 seats in the first round of the election in February, and its rival, the Citizen Revolution (RC) party, which had won 67 seats, were negotiating with the parties who had won the other 18 seats over who would control the 151-seat expanded National Assembly.

With the seating of the new parliament on May 14 and the formal beginning of Noboa’s new term will come committee assignments for the legislative body, as well as the new membership of the China Friendship Caucus, the principal vehicle for China’s influence within the National Assembly, headed during the outgoing Congress by RC activist Silvia Nunez Ramos.

Meanwhile, on the Chinese side, Ambassador Chen Guoyou is finishing his assignment to Ecuador. His actions in his final weeks were notably more aggressive than during the rest of his five years in the post. This included not only the previously noted attempt to intimidate Ecuadorian institutions and academics over the conference, but also reproaches of Ecuadorian officials for how they characterized members of the Taiwan Commercial Representative Office who were providing important services for communities in need. It is unclear whether such aggression is a harbinger for the posture of whoever will replace Chen as China’s emissary in Ecuador.

The Noboa government has strongly allied itself with the United States, including a March 2025 visit by Noboa and his wife to Mar-a-Lago for a meeting with U.S. President Donald Trump. Nonetheless, although Noboa has restrained some aspects of Ecuador’s engagement with China as part of that alignment, Beijing’s activity in the economic, military, and other domains in Ecuador is strong and continues to grow.

77. Bulldozed: Identifying Risk of Exposure to Illicit BRI Activity
    D.J. Bobbs, c4ads, May 6, 2025

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Opinion

78. DeepSeek. Temu. TikTok. China Tech Is Starting to Pull Ahead.
    Eric Schmidt and Selina Xu, New York Times, May 5, 2025

79. China, Russia and the remaking of the Eurasian supercontinent
    James Crabtree, Financial Times, May 3, 2025

80. America Has Lost Its Lead in 5G
    Ajit Pai, Wall Street Journal, May 4, 2025

81. How the trade war endangers national security
    Washington Post, May 5, 2025

When China stops exporting rare earths and magnets, American military readiness suffers.

Each F-35 Lightning II aircraft contains more than 900 pounds of rare earth elements. Each Virginia-class submarine has 9,200 pounds. Permanent magnets made from these materials are used to make Tomahawk missiles, Predator drones and the Joint Direct Attack Munition series of smart bombs.

Almost all of this material comes from China. The country accounts for nearly all of the world’s processing of heavy rare earths — whose critical magnetic and optical properties are vital for defense systems. It also produces about 90 percent of rare earth magnets, used in everything from electric motors to turbines and electronics, for civilian and military use.

After President Donald Trump raised a wall of tariffs against Chinese imports on April 2, China used this formidable source of leverage to retaliate: It suspended exports of six heavy rare earth elements as well as rare earth magnets. Thus, Trump’s trade war against China has come to endanger America’s national security.

Trump seems to have miscalculated the balance of forces in his trade war. When China is America’s only source for so many things — iPhones and minerals are only two examples — it can retaliate against tariffs in ways that hurt. This is probably why Xi Jinping, the Chinese leader, has not petitioned Trump for relief. Xi apparently would prefer that the U.S. president came to him.

But the miscalculation over rare earths is particularly problematic because it puts America’s military’s edge at risk. The White House must either ratchet down its hostility toward Beijing or quickly find an alternative supply. Given China’s control over the industry and the Trump administration’s evident distaste for stepping back when it comes to China, both options look to be long shots.

This quandary is not entirely of Trump’s making. The supply risk became obvious nearly 15 years ago, when Beijing imposed a seven-week embargo on exports of rare earth elements to Japan in a dispute over a Chinese fishing trawler caught in contested waters. Since 2023, China has restricted exports of strategic materials such as gallium, germanium and graphite to the United States.

Despite official warnings about the danger of depending on China for such critical materials and the need to diversify supplies, there has been limited U.S. government support for the rare earths industry.

Market forces alone won’t solve this problem. Investments in domestic mining and refining have made little sense because rare earths and magnets were always available from China at low cost. After China’s 2010 embargo on exports to Japan, the Obama administration encouraged Hitachi Metals to build a rare earths magnet factory in North Carolina. But the plant closed in 2015, after less than two years in operation.

Domestic capacity to produce rare earths is extremely limited. One mine in California is active. And the company that runs it, MP Materials, plans to ramp up domestic refining and has a magnet production facility coming online in Texas. But the trade war with China has put it in a bind, as it shipped most of its concentrates to China for processing. Another firm, Australia’s Lynas Rare Earths, is building a refinery for heavy rare earths in Texas, but it is struggling under high costs. USA Rare Earth has big plans but still nothing in production.

It’s hard to predict how China will play its hand. Its shipments of rare earths and magnets have been suspended while it puts in place an export licensing system for the materials. It is unclear how long this will take or how the licensing will operate.

The United States has few options. The Trump administration is investigating the risks of relying on imported minerals and their derivatives. But what Trump might do about the problem is unknown.

Tactics he has tried to obtain other critical minerals — shaking down Ukraine, threatening to take over Canada and Greenland, and inviting companies to mine the deep seabed in breach of international law — will not build the kind of goodwill needed to put together an international effort to find alternatives to China’s supply.

Tariffs seem especially counterproductive in this situation. Beijing’s retaliatory tariffs against the United States have already stopped exports of rare earths for processing in China.

Then there is the question of time. Various countries, including Australia, Brazil, South Africa and Vietnam, are looking into mining and refining rare earths and producing magnets. But capacity outside China remains small. In the best of cases, it will take years, perhaps more than a decade, to build out an alternative rare earths supply chain.

The urgent question is how to manage until then. Given the circumstances, maybe launching a trade war against China, foreclosing on the possibility of cooperation and coexistence, was not such a good idea. Rare earths and magnets alone should motivate the president to reduce hostilities with China and start talking.

82. Princeton’s Rory Truex unwraps Trump’s gifts to China, from tariffs to tech wars
    Dewey Sim, South China Morning Post, May 5, 2025

83. Why Didn’t Tariffs Push up the U.S. Dollar?
    Brad W. Setser, Council on Foreign Relations, May 5, 2025

84. China will not be a big winner from Trump’s policies in Latin America
    Michael Stott, Financial Times, May 5, 2025

85. Xi Can’t Trust His Own Military
    Phillip C. Saunders and Joel Wuthnow, New York Times, May 6, 2025