Matt Turpin's China Articles - March 12, 2023
Friends,
Recently, there has been a wave of commentary seeking to explain why an openly hostile rivalry between the United States and the PRC has emerged.
The explanation put forward by a number of these commentators is that U.S. policy has been hijacked by a tiny cabal of “China hawks” who are deeply nationalist and anti-Chinese, and that Washington has fallen victim to groupthink and moral panic.
Here are some examples from just this past week… I think I’m being fair to describe the overarching themes of these pieces as: America is hysterical, that groupthink within the Beltway has taken over, and that experts, like themselves, should be listened to:
Democrats and Republicans agree on China. That’s a problem.
Max Boot, Washington Post, March 6, 2023
Is America’s China Policy Too Hawkish?
Ravi Agrawal and Jessica Chen Weiss, Foreign Policy, March 8, 2023
VIDEO – Former U.S. Ambassador to China discusses deteriorating U.S.-China relations
Former U.S. Ambassador to the PRC Max Baucus, CNN, March 8, 2023
AUDIO – Jude Blanchette on the Select Committee and the American moral panic over China
Kaiser Kuo and Jude Blanchette, The China Project’s Sinica Podcast, March 9, 2023
Who Benefits from Confrontation with China?
Editorial Board, New York Times, March 11, 2023
Another plausible explanation, which doesn’t depend on some sort of conspiracy theory or that Democrats are just too scared of Republicans, is that elected leaders across the United States (and in other democracies) are responding to a dramatic shift in public opinion due to actions by the People’s Republic of China.
Mounting and sustained evidence over the last decade that Beijing poses a threat to their interests and security, transformed public opinion about the PRC in numerous countries. (See #3, #4, and #5 below)
This explanation, which posits that democracies actually respond to the will of voters, shouldn’t be as surprising (or disturbing) as the commentary above suggests.
It just means that citizens, over a period of years, have concluded that the policies of engagement have not worked and demand their elected leaders implement policies that are appropriate to the threat that they perceive. It is this democratic feedback loop, not some “inside the Beltway groupthink” or conspiracy of so-called “China hawks,” that drives these policy changes.
This dramatic transition from engagement to rivalry is quite jarring for the advocates of a more cooperative policy with the People’s Republic of China. After decades of effort to build a collaborative relationship with Beijing, which enjoyed broad public support across the political spectrum, public opinion has turned against these types of policies. Not because the public has been tricked to abandon them, but because the policies have not worked.
The advocates of these policies are profoundly disappointed, and it is entirely understandable that they want to vent their frustrations. They feel ignored and marginalized on a topic that, in most cases, is the center of their life’s work and they are deeply frustrated that their advice is now being ignored.
Thanks for reading!
Matt
MUST READ
1. China’s New Way to Control Its Biggest Companies: Golden Shares
Lingling Wei, Wall Street Journal, March 8, 2023
The state takes company stakes that are often small but give it a board seat and power to ensure that corporate behavior hews to the party agenda.
In its uneasy dance with China’s private sector, the Communist Party is moving away from a public battle with some of the country’s biggest companies. Instead, it is inching toward a quieter form of control.
At the center of the effort is a push by various levels of government to take stakes in the private companies that have long driven Chinese innovation and job creation.
The government stakes are sometimes very small, like the 1% holding that a fund of Beijing’s cyberspace watchdog recently took in the digital-media unit of e-commerce giant Alibaba Group Holding Ltd. But they tend to give the government board seats, voting power and sway over business decisions. Colloquially, they are known as golden shares.
For the companies, there is little choice: Selling such a stake to a government entity that seeks one is crucial for staying in business. For the state, the stakes mean more direct involvement in some of China’s most high-profile companies—digital cornerstones of Chinese life and, in some cases, darlings of global investors.
…
One result of the new normal of subtle influence is that the boundary between the party-state and the private sector is getting increasingly muddled. That reverses a trend dating to the late 1970s, when Chinese leader Deng Xiaoping had the party-state step back from business control and let entrepreneurs flourish.
“The blurring of the line is pushing policy makers in the U.S. and other countries to take a broadly restrictive position on Chinese companies,” said Scott Kennedy, a China expert at the Center for Strategic and International Studies, a Washington think tank focused on international relations. “The burden of proof is on the private companies to show they’re not agents of the state.”
COMMENT – Obviously, these companies remain distinct from a formal “State-owned Enterprise” (SOE) controlled by SASAC (State-owned Assets Supervision and Administration Commission). But when combined with Communist Party cells, which sit above the supposedly “independent” Board of Directors (here, here, here, here, here, and here), one must conclude that the categories of SOE and Publicly-listed Company are increasingly distinctions without difference. It is the Party-State that exercises decision-making of all these firms, not the shareholders through their board of directors.
The fact that this is still not fully grasped by foreign investors in these companies (the same foreign investors that plow more capital into these firms with opaque governance) simply proves the resiliency of wishful thinking and mirror-imaging.
A quote from Lingling’s piece: “One result of the new normal of subtle influence is that the boundary between the party-state and the private sector is getting increasingly muddled.” – that is certainly an understatement.
2. Chinese minister warns of conflict unless US changes course
Associated Press, March 7, 2023
Chinese Foreign Minister Qin Gang warned Tuesday that Beijing and Washington are headed for “conflict and confrontation” if the U.S. doesn’t change course, striking a combative tone at a moment when relations between the rivals are at a historic low.
In his first news conference since taking office late last year, Qin’s harsh language appeared to defy predictions that China might abandon its aggressive “wolf warrior” diplomacy in favor of more moderate rhetoric as the two countries face off over trade and technology, Taiwan, human rights and Russia’s invasion of Ukraine.
Washington’s China policy has “entirely deviated from the rational and sound track,” Qin told journalists on the sidelines of the annual meeting of China’s rubber-stamp legislature, when leaders lay out their economic and political priorities for the coming year.
3. Americans Continue to View China as the U.S.'s Greatest Enemy
Mohamed Younis, Gallup, March 6, 2023
For the third year in a row, Americans are most likely to mention China as the United States’ greatest enemy in the world today. When asked the open-ended question, 50% of Americans say China is their nation’s greatest enemy, with most of the rest, 32%, naming Russia. North Korea, which was viewed as the greatest enemy in 2018, is now a distant third at 7%.
The latest results are from Gallup’s Feb. 1-23 World Affairs survey, coinciding with widespread reporting of China’s balloon-carried surveillance device being shot down over U.S. waters. There has also been growing concern in the U.S. about China’s alleged backing of Russia in the Ukraine conflict and its association with the origin of the COVID-19 pandemic.
China’s position atop this year’s list is notable for extending the longest stretch of time such a large proportion of Americans have agreed on what country represents the United States’ greatest enemy. The highest level of consensus on this question since Gallup launched it in 2001 was for North Korea in 2018, with 51% naming it. But that tumbled to 14% the following year after former President Donald Trump worked to defuse U.S.-North Korea tensions.
While Iran topped Gallup’s greatest enemy list five times between 2006 and 2012, it did so with far fewer Americans naming it than name China today, topping out at 32%. That was also the percentage naming Russia when it topped the list in 2019. In addition to China, Russia, North Korea and Iran, Iraq has also led the list, in 2001 and 2005.
COMMENT - Gallup’s chart…
4. Record-Low 15% of Americans View China Favorably
Megan Brenan, Gallup, March 7, 2023
A record-low 15% of Americans view China favorably, marking a five-percentage-point, one-year decline in this rating, which Gallup has measured since 1979. China has been gradually falling in the U.S. public’s esteem in recent years and is down a total of 38 points since 2018. More than eight in 10 U.S. adults have a negative opinion of China, including 45% who view it very unfavorably and 39% mostly unfavorably.
Gallup has tracked China’s image in the U.S. at least once a year since 1996 and, prior to that, measured it six times between 1979 and 1994. Favorability of China was highest in early 1989, at 72%, but it fell to 34% later that year in the aftermath of the Tiananmen Square incident. From that point until 2017, China was viewed in a positive light by 33% to 50% of Americans. For just the third time in the trend, favorability rose to the majority level in 2018 (53%). However, it fell to 41% in 2019, 33% in 2020, and 20% in 2021 and 2022 during the height of the COVID-19 pandemic. Before this year’s 15% rating, 20% was the lowest on record.
The latest data are from Gallup’s Feb. 1-23 annual World Affairs poll, during which tensions between the U.S. and China rose when Secretary of State Antony Blinken canceled a diplomatic trip after a Chinese surveillance balloon was discovered flying over the U.S. Toward the end of the poll’s field period, Blinken spoke publicly about U.S. concerns that China is considering providing weapons to Russia in its war against Ukraine. The poll was completed before FBI Director Christopher Wray said his agency had concluded that COVID-19 likely came from a lab leak in Wuhan, China.
China’s favorable rating has fallen precipitously in recent years among Republicans, Democrats and independents alike and is now at its lowest point for each group. Republicans’ 6% rating is the lowest of the three, while Democrats’ and independents’ ratings are 17% and 18%, respectively.
Since 2007, Republicans’ views of China have remained lower than Democrats’, although favorable views have fallen steadily over the past five years among both parties.
COMMENT - Gallup’s chart…
5. How Global Public Opinion of China Has Shifted in the Xi Era
Laura Silver, Christine Huang, and Laura Clancy, Pew Research, September 28, 2022
Multiple factors have affected views of China over time. In the U.S., the sense that China has handled COVID-19 poorly and is at fault for the virus’s spread certainly is related to negative opinions of the superpower, but is not the only factor driving attitudes. Rather, negative views of China were already rising prior to the pandemic. The same is true in other countries, including some of China’s neighbors, like South Korea, Japan and Australia.
Unfavorable views of China in South Korea have increased dramatically since 2017. South Korea was heavily affected by Chinese economic retribution following the country’s 2017 decision to install an American missile interceptor (THAAD). Negative views of China went up substantially in 2017 alongside this turmoil; they increased again in 2020 when, in the wake of COVID-19, unfavorable opinion went up in nearly every country Pew Research Center surveyed. But views have continued to sour, and today unfavorable views of China are at a historic high of 80%.
Japanese views of China have been broadly negative for the past decade. Negative views of China skyrocketed in the early 2000s amid myriad bilateral tensions, and for the past 20 years, Japanese views of China have always been among the most negative in Center surveys, if not the most negative. Negative views peaked at 93% in 2013, following extreme tension in the East China Sea. Very unfavorable views of China have also been particularly elevated since 2020, with around half of Japanese adults saying this describes their views of China.
While COVID-19 and resulting trade frictions led to the most negative views of China on record in Australia, unfavorable views had been ticking up since 2017. In that year, the Australian Security Intelligence Organization issued warnings about Chinese attempts to influence Australian domestic politics, resulting in new Australian laws to curb foreign interference and strong responses from China. And while views went from broadly favorable to unfavorable between 2017 and 2019, the largest year-on-year increase in negative views took place between 2019 and 2020; at the time, negative views went up 24 percentage points as trade tensions spiraled following Australia’s calls to investigate the COVID-19 virus’s origins.
COMMENT - A fascinating chart from Pew Research…
Sara Fischer and Bethany Allen-Ebrahimian, Axios, March 7, 2023
Semafor, the 5-month-old news startup, is drawing criticism in the U.S. for partnering with a think tank in China that is known to have close ties to the Chinese Communist Party. The group has in the past obscured those ties to Western audiences.
Why it matters: The collaboration is notable because the organization Semafor is partnering with — and its leader — has a track record of misleading Western audiences about its affiliation with the CCP.
What's happening: Semafor last week announced a new initiative called “China and Global Business” to serve as a platform for business leaders to discuss U.S.-China relations.
The partnership has been developed with a group called the Center for China and Globalization (CCG). The center's founder and director, Wang Huiyao, sits on the board of Semafor's initiative.
COMMENT – It is ridiculous for Semafor to portray itself as some sort of “transparent” news outlet on issues related to the PRC. Of the 18 individuals on the advisory board of Semafor’s ‘China and Global Business’ platform, at least 11 are Chinese Communist Party members… we can be confident that there will be nothing “independent” or “transparent” about what Semafor does in this forum.
Here’s the list of Advisory Board members from Semafor:
7. Taiwan suspects Chinese ships cut islands’ internet cables
Huizhong Wu and Johnson Lai, Associated Press, March 8, 2023
In the past month, bed and breakfast owner Chen Yu-lin had to tell his guests he couldn’t provide them with the internet.
Others living on Matsu, one of Taiwan’s outlying islands closer to neighboring China, had to struggle with paying electricity bills, making a doctor’s appointment or receiving a package.
For connecting to the outside world, Matsu’s 14,000 residents rely on two submarine internet cables leading to Taiwan’s main island. The National Communications Commission, citing the island’s telecom service, blamed two Chinese ships for cutting the cables. It said a Chinese fishing vessel is suspected of severing the first cable some 50 kilometers (31 miles) out at sea. Six days later, on Feb. 8, a Chinese cargo ship cut the second, NCC said.
Taiwan’s government stopped short of calling it a deliberate act on the part of Beijing, and there was no direct evidence to show the Chinese ships were responsible.
8. Clues to the U.S.-Dutch-Japanese Semiconductor Export Controls Deal Are Hiding in Plain Sight
Gregory Allen and Emily Benson, CSIS, March 1, 2023
On October 7, 2022, the Biden administration upended more than two decades of U.S. trade policy toward China when it issued sweeping new regulations on U.S. exports to China of advanced artificial intelligence (AI) and semiconductor technology. These export controls were designed after consultation with key U.S. allies, but the United States originally implemented them unilaterally.
This was a major diplomatic gamble.
In the face of rapidly advancing Chinese AI and semiconductor capabilities, the United States wanted to move fast, so it was willing to take the risk of moving first alone. The United States has the strongest overall position in the global semiconductor industry, and it was by itself strong enough to reshape the Chinese semiconductor industry in the short term. Over the medium to long term, however, this move could have backfired disastrously if other countries, particularly Japan and the Netherlands, moved to fill the gaps in the Chinese market that the partial U.S. exit left.
But that is not going to happen. In late January 2023, the Biden administration’s gamble paid off when the United States secured a deal with both the Netherlands and Japan to join in the new semiconductor export controls. Some officials suggested to the Center for Strategic and International Studies (CSIS) that the result of the dialogues is better characterized as an “understanding” rather than a formal deal, as some details have yet to be worked out. Regardless, the United States has secured the top three international partners needed to ensure the policy’s success. Taiwan had already made a public announcement that it would support enforcement of the October 7 regulation’s application of the U.S. Foreign Direct Product (FDP) rule.
However, the exact contours of the deal with the Netherlands and Japan are not yet publicly known. China has aggressively used trade restrictions in the past as a coercive and punitive tool of foreign policy, and all parties to the deal remain tight-lipped, likely in the hopes that this will diminish China’s appetite for retaliation. No doubt the White House would love to have had a big photo-op signing ceremony to show how its gamble on allied diplomacy paid off, but the Biden administration has remained remarkably leak-proof on the topic. The lack of leaks is happening for the same reason the administration was able to pull the deal off: they take allies’ concerns—including a desire for secrecy—seriously.
Thus, journalists and semiconductor companies have struggled in vain over the past few weeks to gain clarity on the elements of the deal. The full details are unlikely to be known until the Dutch and Japanese governments publish their updated export controls regulations, which will take months. In the case of Dutch export controls, some types of policy changes might never be published at all, such as changing the policy for reviewing certain types of export license applications from “case by case” to “presumption of denial.”
In the meantime, however, there are plenty of clues to the deal’s contents from a careful analysis of three elements: (1) the role that Dutch and Japanese companies play in the global semiconductor value chain, (2) the revealed policy preferences of the Biden administration based on the content of the October 7 regulations, and (3) the nature of the underlying legal authorities that constitute the Dutch export controls system. This paper addresses each in turn.
COMMENT – Congratulations to the Biden Administration for engineering this diplomatic and technological victory. Enforcement will be critical, but these first steps are likely determinative of success.
AUTHORITARIANISM
9. AUDIO – Was Li Keqiang a quiet reformer or a Communist Party apparatchik?
David Rennie and Alice Su, The Economist Podcast Drum Tower, March 7, 2023
This month China’s prime minister, Li Keqiang, will retire. He was once a rising star of the Communist Party and a contender to lead it, but under Xi Jinping he had little chance to shine.
The Economist’s Beijing bureau chief, David Rennie, and senior China correspondent, Alice Su, ask what Mr Li’s career and retirement reveals about power in China. They speak to two people who know Mr Li: Tao Jingzhou, a former university classmate, and Joerg Wuttke, the head of the European Union chamber of commerce in China, about his political and economic outlook. And The Economist’s James Miles decodes the choice of Mr Li’s successor.
10. China Premier Li Keqiang bows out as Xi loyalists take reins
Associated Press, March 5, 2023
After a decade in Chinese President Xi Jinping’s shadow, Li Keqiang is taking his final bow as the country’s premier, marking a shift away from the skilled technocrats who have helped steer the world’s second-biggest economy in favor of officials known mainly for their unquestioned loyalty to China’s most powerful leader in recent history.
After exiting the ruling Communist Party’s all-powerful Politburo Standing Committee in October — despite being below retirement age — Li’s last major task was delivering the state of the nation address to the rubber-stamp parliament on Monday. The report sought to reassure citizens of the resiliency of the Chinese economy, but contained little that was new.
Once seen as a potential top leader, Li was increasingly sidelined as Xi accumulated ever-greater powers and elevated the military and security services in aid of the “great rejuvenation of the Chinese nation.” Li’s lack of visibility sometimes made it difficult to remember he was technically ranked No. 2 in party.
COMMENT – The sidelining of Li Keqiang (before his retirement age) should be interpreted as a flashing red light for any investor or multinational operating in the PRC.
11. ‘Absolute loyalty’ top priority as China readies security for crucial legislative meetings
Phoebe Zhang, South China Morning Post, February 7, 2023
12. China Shakes Up Government as Xi Asserts More Control Over Policy
Keith Zhai and Chun Han Wong, Wall Street Journal, March 7, 2023
Beijing will create regulatory bodies to oversee financial sector and all data-related issues.
China is preparing sweeping changes to its vast government bureaucracy, as leader Xi Jinping further strengthens Communist Party control and seeks to boost his country’s technological and financial prowess at a time of heightened competition with the West.
Under a plan presented to lawmakers Tuesday, Beijing would create new regulatory bodies to oversee broad segments of China’s financial system, as well as the use of data and related digital technologies. Other state institutions, including the Ministry of Science and Technology, would be restructured or have some of their powers redistributed to other departments. Central-government agencies would cut their head count by 5% across the board.
The restructuring is aimed at advancing China’s ability to foster scientific advances, strengthen financial oversight and data management, improve rural development, among other goals, according to Xiao Jie, a senior member of the State Council, China’s cabinet.
Officials must “resolutely uphold the party center’s authority and centralized, unified leadership” as they implement the bureaucratic revamp, Mr. Xiao told lawmakers in a speech Tuesday that outlined the proposed changes.
China’s legislature is expected to rubber-stamp the plan Friday.
William Zheng, South China Morning Post, March 7, 2023
A pivotal reform plan for the State Council – China’s cabinet – and a new leadership line-up are expected to be officially unveiled later this week, as the country’s top legislative body holds its key annual session.
The changes were part of President Xi Jinping’s efforts to strengthen the ruling Communist Party’s role in top-level decision making, and tighten its control over the crucial finance and technology sectors, observers said.
14. Russia and China have been teaming up to reduce reliance on the dollar. Here’s how it’s going.
Maia Nikoladze and Mrugank Bhusari, Atlantic Council, February 22, 2023
Just days before Russia’s brutal invasion of Ukraine began in 2022, we warned that Russia and China’s collaboration on dedollarization—the process of reducing an economy’s reliance on the US dollar for international trade and finance—would not sanction-proof Russia’s economy. And it did not. As a result of unprecedented Western sanctions, Moscow overnight became unable to transact in dollars and euros—the world’s dominant currencies.
Russia has since pursued alternatives to manage its trade and reserves. Chinese yuan and gold became the stars of the show, but both introduced new vulnerabilities and inconveniences. Yuan makes Russia dependent on Beijing’s goodwill, while gold is not as sanctions-proof as Moscow expected, and Russia has had a hard time scaling up its illicit gold trade.
15. Fractured foundations: Assessing risks to Hong Kong’s business environment
Logan Wright, Atlantic Council, March 7, 2023
Hong Kong’s legal and institutional structure has changed fundamentally since the implementation of the National Security Law in 2020. When changes of this magnitude occur, it is difficult for anyone to know what shifts are transitory, and what adjustments will end up becoming permanent features of Hong Kong’s political and commercial environment.
Over the past three years in Hong Kong, a system based upon legal and institutional restrictions on government action founded on the Basic Law and British common law has shifted toward a system governed by political norms reinforced by the National Security Law. In that process, those dominant political norms have changed significantly from those that had governed the “one country, two systems” policy since the handover of sovereignty in 1997, and are increasingly driven by priorities in Beijing, rather than the previously dominant local leadership of Hong Kong. The National Security Law created a parallel system of authority operating both behind and above Hong Kong’s system of government established by the Basic Law and the Sino-British Joint Declaration of 1984. This new structure permits a broad interpretation of the definition of “national security,” leaving individuals and businesses with few options to challenge the law’s reach.
The National Security Law has been used to target multiple institutions seen as politically challenging to Beijing, including independent newspapers, media outlets, and pro-democracy politicians. It also has limited activities of the press, the publication and distribution of books and films, and the flow of information in other formats, including those essential to the operation of a modern commercial and financial system.
The bet for businesses operating in Hong Kong, and the financial industry in particular, is that they will continue to be viewed as essential for Hong Kong’s globally competitive position. Despite the widespread changes in the political and social landscape in Hong Kong, some argue that changes in the rest of Hong Kong’s operating environment will not influence their own businesses, because they will continue to enjoy some degree of special treatment.
This report attempts to provide an objective framework to assess the wager that business conditions for most firms operating in Hong Kong will remain unchanged, despite the dramatic changes that Hong Kong has seen within its legal and institutional infrastructure. The report analyzes in detail the risks to the commercial operating environment in Hong Kong that have emerged since the 2020 introduction of the National Security Law, including currency risks, compliance challenges, threats to judicial independence, access to accurate information, and data security.
16. China’s Ukraine Peace Plan Is Actually About Taiwan
Craig Singleton, Foreign Policy, March 6, 2023
After twelve grinding months, China appears no more capable of influencing the outcome of Russia’s war in Ukraine than it was at the conflict’s inception. Largely reduced to spectator status, Beijing’s primary role has been to provide Moscow with a financial lifeline by ramping up purchases of heavily discounted Russian crude oil and coal, while reaping an unexpected windfall from surging exports to Russia. But these and other Chinese half-measures appear aimed, for now, at ensuring Russia has what it needs to sustain its wartime economy—not actually win the war.
In a similar twist, China’s 12-point peace plan for Ukraine is not geared toward restoring peace in Europe. Indeed, China’s dead-on-arrival missive has little to do with ending the war in Ukraine and everything to do with setting the conditions to win a future war over Taiwan. Put differently, China recognizes the causes of Russia’s failure in Ukraine are the same that threaten its eventual reunification plans.
Read correctly, China’s phony peace proposal could also serve as the basis for a Western-led roadmap to prevent an Indo-Pacific war from breaking out in the first place.
Clearly, Beijing’s position paper, titled “The Political Settlement of the Ukraine Crisis,” reflects China’s concerns about current battlefield conditions in Europe. To date, transatlantic resolve to support Ukraine remains more or less resolute, even as Western democracies grapple with absorbing the costs associated with being cut off from Russian energy and other raw materials. Even though more Russian soldiers have perished in Ukraine than during all Russian wars combined since World War II, Russian President Vladimir Putin remains entirely too confident he can still defeat Ukraine and altogether too stubborn to change course. Meanwhile, China continues to vacillate in providing lethal assistance to Russia, a decision made more complicated now that Washington has leaked details on Beijing’s internal deliberations.
No doubt, Chinese leader Xi Jinping appears powerless to pull Putin back from the brink—not that Xi has demonstrated any inclination to do so. At the same time, China’s refusal to condemn Russia’s invasion has ravaged its credibility across Europe, including in countries such as Austria, Poland, and Croatia, where Beijing has historically enjoyed positive relations. And China’s sunk costs are not purely reputational but increasingly economic. With the war weighing on global growth, debt defaults in the developing world loom, with Beijing holding many of those loans. Economic uncertainty also threatens to depress worldwide demand for Chinese exports just as Beijing’s attempts to stimulate domestic consumer spending—the key to re-igniting China’s recovery and revamping the country’s broken growth model—have fallen flat.
Cue Beijing’s peace plan, both a masterstroke at misdirection as well as a not-so-subtle admission that Western unity, sanctions, supply chain instability, and potential grain disruption could derail China’s Indo-Pacific revisionism.
17. Hong Kong citizens not interested in digital yuan: Reports
David Attlee, CoinTelegraph, March 2, 2023
Despite the 20% discount, the e-CNY hard wallets don’t attract much attention from Hong Kong residents.
The Chinese government’s central bank digital currency (CBDC) project has not sparked much enthusiasm among the citizens of Hong Kong. In the first four days since the “digital yuan” (also known as “e-CNY”) hard wallets became accessible to residents, only 625 Hongkongers had obtained them.
As reported by a local newspaper on Feb. 28, Shenzhen installed the machines, dispensing the hard wallets for digital yuan, the first of a kind in the country. Due to the city’s unique location as a gateway from Hong Kong to mainland China, the machines were programmed to serve the citizens of Hong Kong exclusively.
The goal of the initiative, launched by the Bank of China and smart card provider Octopus Card, was to issue 50,000 hard wallets by March 31. However, in the first four days after the machines’ installation, only 625 wallets were demanded by the customers.
Even the 20% discount on purchases from 1,400 local vendors — subsidized for the CBDC owners by the government — hasn’t been a decisive factor for adoption.
Peter Lee, Hong Kong Free Press, March 7, 2023
The lead prosecutor in the sedition trial against the defunct online media outlet Stand News has said calls to end China’s one-party dictatorship were “obviously” unlawful after the country amended its constitution five years ago.
During Monday’s hearing, lead prosecutor Laura Ng questioned the former chief editor of Stand News, Chung Pui-kuen, in front of District Judge Kwok Wai-kin about an opinion piece written by veteran journalist Allan Au and published by Stand News on June 1, 2021.
Chung, the outlet’s former acting chief editor Patrick Lam and its parent company stand accused of conspiring to publish 17 “seditious” articles between July 2020 and December 2021.
19. China says Ukraine crisis driven by 'invisible hand'
Ryan Woo, Reuters, March 7, 2023
The Ukraine crisis seems to be driven by an invisible hand pushing for the protraction and escalation of the conflict, China's foreign minister Qin Gang said on Tuesday.
The "invisible hand" is "using the Ukraine crisis to serve certain geopolitical agendas", Qin said on the sidelines of an annual parliament meeting in Beijing, calling for dialogue to begin as soon as possible.
"Conflict, sanctions, and pressure will not solve the problem...The process of peace talks should begin as soon as possible, and the legitimate security concerns of all parties should be respected," Qin said.
ENVIRONMENTAL HARMS
20. Pollution returns to northern China as industrial activities rise
Albee Zhang and David Stanway, Reuters, March 6, 2023
Thirteen northern Chinese cities surrounding the capital Beijing have issued pollution alerts over the last few days, raising concerns that an industrial recovery in the region is increasing smog levels.
All 13 cities, including Tianjin and Tangshan, China's biggest steelmaking centre, had issued "orange" heavy pollution alerts by Sunday, the second-highest alert, the National Joint Research Center for Tackling Key Problems in Air Pollution Control (NJRC) said.
21. China-funded bridge threatens Paradise Reef in southern Philippines
Bong S. Sarmiento, Mongabay, March 7, 2023
22. Chinese investment continues to hurt Latin American ecosystems, report says
Maxwell Radwin, Mongabay, February 28, 2023
China has taken a special interest in deepening ties with Latin America over the last twenty years, providing billion in loans for mines, electric grids, trains and roads. But many of the country’s projects ignore regulations protecting the environment and local and Indigenous peoples.
A report delivered this month to the U.N. Committee on Economic, Social and Cultural Rights explores 14 cases from nine Latin American countries in which there was some example of an environmental or human rights violation.
The cases include mines, hydroelectric dams, oil fields, trains and animal processing plants across Argentina, Bolivia, Brazil, Chile, Colombia, Ecuador, Mexico, Peru and Venezuela.
FOREIGN INTERFERENCE AND COERCION
23. US sees China propaganda efforts becoming more like Russia’s
Nomaan Merchant and Matthew Lee, Associated Press, March 8, 2023
China has long been seen by the U.S. as a prolific source of anti-American propaganda but less aggressive in its influence operations than Russia, which has used cyberattacks and covert operations to disrupt U.S. elections and denigrate rivals.
But many in Washington now think China is increasingly adopting tactics associated with Russia — and there’s growing concern the U.S. isn’t doing enough to respond.
U.S. officials and outside experts cite recent examples of China-linked actors generating false news reports with artificial intelligence and posting large volumes of denigrating social media posts. While many of the discovered efforts are amateurish, experts think they signal an apparent willingness from Beijing to try more influence campaigns as part of a broader embrace of covert operations, according to two people familiar with the matter who spoke on condition of anonymity to discuss sensitive intelligence.
“To us, the attempt is what stands out,” one U.S. intelligence official said.
An increasingly pessimistic mood in Washington about Beijing’s expansive political and economic goals and the possibility of war over Taiwan is driving calls for the U.S. to make a stronger effort to counter Chinese influence abroad.
Lawmakers and officials are particularly concerned about countries that comprise the “Global South” in Africa, Asia and Latin America, where both the U.S. and China have huge economic and political interests. Many of those countries have populations that support both sides — what an official called “swing states” in the narrative battle.
“This should be a whole of government effort,” said Rep. Raja Krishnamoorthi of Illinois, who is the top Democrat on a newly formed House committee focusing on the Chinese Communist Party.
“The CCP is going around the world bad-mouthing the U.S., bad-mouthing our institutions, bad-mouthing our form of government,” Krishnamoorthi said in an interview. “We have to counter this because ultimately it’s not in the best interests of the United States.”
China’s embassy in Washington said in a statement that Beijing “opposes the fabrication and dissemination of false information” and blamed the U.S. in turn for making social media “into its tool to manipulate international public opinion and its weapon to stigmatize and demonize other countries.”
“On this issue, it is for the U.S. side to reflect on itself and stop shouting ‘catch a thief,’” said embassy spokesman Liu Pengyu.
Chinese state media and affiliated channels, as well as social media influencers with vast followings, routinely spread ideas the U.S. labels exaggerated, false or misleading. In recent weeks, China’s foreign ministry has called attention to the train derailment that released toxic chemicals in Ohio as well as allegations the U.S. may have sabotaged pipelines used to transport Russian gas.
The Biden administration has strongly rejected the allegations about the Nord Stream pipelines and defended its response in Ohio.
China has long been seen as less willing than Russia to take provocative steps that could be exposed and more concerned about being publicly blamed. U.S. intelligence judged that Russia tried to support Donald Trump in the last two presidential elections, while China in 2020 considered but did not try to influence the election.
But some U.S. officials believe China is now undertaking or considering operations it would not have in the past, according to the two people familiar with the matter. That’s partly due to fears in Beijing that they are losing a battle of narratives in many countries, one of the people said.
Officials noted public examples identified in recent weeks by groups that track disinformation and influence.
The research firm Graphika recently identified AI-generated videos that it linked to a pro-Chinese influence operation. One video attacked the U.S. approach to stopping gun violence; another “stressed the importance of China-U.S. cooperation for the recovery of the global economy,” according to Graphika. And threat analysts at Google said they disrupted more than 50,000 instances of posts and other activity last year linked to a pro-China influence operation known as “Dragonbridge.”
COMMENT – Of course, if the Administration were concerned about these threats, one obvious step would be to take action against ByteDance and its wholly-owned subsidiary, TikTok.
24. Trudeau orders two probes into Chinese election interference
Robert Fife and Steven Chase, The Globe and Mail, March 7, 2023
Prime Minister Justin Trudeau has initiated two closed-door probes into Chinese election interference that will be reviewed by a special rapporteur after facing growing calls to investigate Beijing’s influence activities.
Mr. Trudeau called a late afternoon news conference to announce that the National Security and Intelligence Committee of Parliamentarians (NSICOP), which reports directly to his office, will study China’s interference in the 2019 and 2021 elections.
He also said the National Security and Intelligence Review Agency (NSIRA), which oversees the RCMP and federal spy agencies, will examine how investigations into Chinese election meddling have been handled.
Opposition parties were highly critical of the Prime Minister’s announcement, saying the probes would be secretive and fall far short of a much-needed public inquiry.
25. Chinese interference in Canada? Chinese Canadians say they reported it for years — and were ignored
Joanna Chiu, Toronto Star, March 6, 2023
With PM Trudeau reportedly set to ask for a new investigation of foreign interference in Canada, advocates recall all the incidents and evidence that has gotten little apparent action over the years.
The first time Cheuk Kwan and Sheng Xue testified to a parliamentary Foreign Affairs Committee was in 2006. They warned of Beijing’s desire to “control everything” including activities of Canadians, and urged Ottawa to adopt a stronger stance in order to “earn (China’s) respect and not wrath.”
“But every time we spoke to the government, it felt like we were putting on a show and helping them tick off a box that they were hearing from critics. Nothing was done,” Kwan said.
Nearly 20 years later, he said they are part of a group of veteran Chinese-Canadian advocates and experts on China who are still struggling to be heard.
On Monday, Prime Minister Justin Trudeau apparently relented. He is set to ask MPs and senators on Parliament’s national security committee to launch a new investigation of foreign interference in Canada.
None of the recent leaks of Canadian Security and Intelligence Service (CSIS) warnings about Beijing’s foreign interference have surprised people in the country’s Chinese diaspora who have directly experienced Beijing’s intimidation and harassment, they say.
“These are not even open secrets. It’s common knowledge,” said Kwan, an author and filmmaker who co-founded the Chinese Canadian National Council in 1980. “It’s just the tip of the iceberg.”
Kwan’s group supported those who fled to Canada from China following the 1989 Tiananmen massacre, and he has since witnessed Beijing’s mobilization of resources to influence other societies, particularly in places such as Canada, the U.S. and Australia where many Chinese diaspora settled.
These days most of the blame is attributed to the increasingly infamous United Front Work Department. Since 1979, the United Front has been an official bureau in China that employs thousands of agents to pursue the Chinese Communist Party’s political strategy to use international networks to advance its global interests. According to official documents, the bureau takes special interest in people of Chinese descent living abroad, viewing them as powerful external threats as well as potential allies.
Kwan alleges that his organization was targeted by United Front astroturfing: a new group arose with a very similar name, and it started issuing press statements and interviews that regularly opposed his own group’s messages, while boasting of connections to the Chinese consulate in Toronto.
He and others also became suspicious when they saw buses of people arrive at federal political nomination meetings to support candidates who were known to shy away from critical messages about China, or when buses of international students in Toronto arrived to participate in counterprotests defending China’s position.
Sources in the Chinese-Canadian community tell the Star that they have sent many tips, including copies of email correspondence, to RCMP and CSIS. In 2018, Mounties in Metro Vancouver probed allegations that the Chinese-state-linked Canada Wenzhou Friendship Society sent out messages on the social-media app WeChat urging chat group members to vote for certain candidates in mayoral elections — and offering a $20 transportation subsidy. But police later said they found no evidence of voter manipulation.
“Even if there was proof the Chinese consulate or its proxies paid for transportation or paid people directly to support certain candidates or to protest, it’s hard to explain to Canadians the nefarious ways the Chinese state uses its tools and resources to try to influence our democracy,” Kwan said. While media had published the leaked WeChat screenshots offering the $20 subsidy, it is unclear why RCMP found that this was insufficient evidence of voter manipulation.
And these are relatively subtle forms of influence, Kwan said: Beijing’s blunt tactic of coercion on Canadians is to threaten their friends, family members or business connections in China.
He and others collected testimony and documentation, and published a report in 2017 with Amnesty International on a “sustained campaign of intimidation and harassment aimed at activists working on China-related human rights issues in Canada, in circumstances suggesting the involvement or backing of Chinese government officials.”
“We sent copies to the RCMP and to the Prime Minister’s Office, but it was ignored,” Kwan said.
Numerous reports emerge over years
The report detailed threatening phone calls and physical confrontations of Canadians, improper detention of Canadians at Chinese airports, threats of retaliation against relatives living in China and online smear and disinformation campaigns.
This was followed by a cascade of research from academics and advocacy groups, including Alliance Canada Hong Kong, journalist Jonathan Manthorpe’s book “Claws of the Panda,” and Australian researcher Alex Joske warning that Beijing’s foreign interference is “likely widespread” in Canada.
Canada does not have laws or protocols in place for police and CSIS to work together with different levels of government to counter foreign interference. Following reports of intimidation of Canadians of Sikh heritage by Indian authorities, Canada’s Ministry of Public Safety told the Star that “anyone who feels threatened online or in person should report these incidents to their local police.”
But many Canadians have told the Star that their reports of threats from foreign actors to police have gone largely unheeded. A Chinese student in Quebec only had two followers on Twitter, but he still didn’t escape Beijing’s tactics, which he alleged included tracking his IP address and threatening his father living in China.
Chinese-Canadian reporters and others would whisper to each other the names of Canadian politicians of various backgrounds who they saw having meetings or attending events with Chinese consulate staff. But without support from Canadian law enforcement, they didn’t dare air those observations publicly, Kwan said.
Last year Victor Ho — the former editor of Sing Tao Daily, Canada’s largest Chinese-Canadian newspaper, who has been outspoken on pressures from the Chinese government on Canadian media — was placed on a “wanted list” by security officials in Hong Kong. He was accused of violating the territory’s National Security Law, which applies to anyone in the world regardless of nationality.
In the wake of recent reporting from the Globe and Mail and Global TV on leaked CSIS warnings, spy chief David Vigneault told a parliamentary committee that a registry of foreign officials or agents would make it easier to track activities of people intent on influencing or interfering in Canadian elections on behalf of foreign governments.
“CSIS has been talking about foreign influence for the last few years — foreign interference — and I think that tool would be useful,” Vigneault said last Thursday. “It wouldn’t solve all our problems, but it would increase transparency.”
The most aggressive actors trying to influence Canadian lawmakers and voters are China, Russia and Iran, which try to coerce or pressure people within expat communities abroad — or leverage sympathizers in Canada — to exert influence on elections, nomination contests or public debate, the committee heard.
Trudeau is facing increasing pressure from the public and opposition parties to launch a public inquiry into allegations of foreign interference. Until Monday he had rejected calls for a probe.
On Tuesday, the prime minister was asked at a press conference whether his initial response to reports concerning Liberal MP Han Dong, in which he stated that the allegations stemmed from racism, were dismissive of Chinese-Canadian concerns. He did not directly address the question, but stated that he has regularly heard from Chinese Canadians on the issue.
“I think it’s extremely important for us to (stand up) for Canadians that can trace their roots to different countries around the world, whether it’s China, Iran, or Russia, who are themselves targets of interference and I think that often gets overlooked in discussion of foreign interference,” Trudeau said.
The RCMP told Parliament last week they are not investigating any allegations related to foreign interference from the 2021 federal election.
The Globe and Mail and Global TV have separately reported several specific details about what happened in both the 2019 and 2021 campaigns. Among them: China being behind the nomination of Liberal candidate Han Dong ahead of the 2019 election; undeclared cash donations to candidates; schemes to have some of that money paid back to donors; having businesses hire Chinese students who were then lent out to volunteer and intimidation campaigns.
China has disputed all of the allegations.
The Star has not verified the reports independently, and security officials at the committee repeatedly declined to do the same, saying they couldn’t “validate” or “speak to” the allegations.
Sheng Xue was among those who fled to Canada from Beijing following the Tiananmen Square massacre of pro-reform demonstrators in 1989. Here, she continued to work as a journalist and became vice-president of the Canadian chapter of the Federation for a Democratic China.
“The Canadian chapter has been quite active for the past 33 years. We’ve had yearly closed-door meetings with Global Affairs Canada,” Sheng told the Star.
Advocacy in Canada for human rights in China used to be a popular and mainstream activity among immigrants from China, she said. But Beijing soon turned to threatening their family members back in China to try to stifle their activities.
“It was very effective. We lost a lot of members. When your parents or relatives are being harassed and threatened, most people won’t be able to stand it. Especially those who still wanted to go back to China to visit their families.”
Sheng did not bow to this pressure, and in September 1996, she was arrested by Chinese police when she tried to visit her mother in Beijing. She was interrogated by more than a dozen officers for 24 hours, and then deported back to Canada.
“My Canadian passport saved me. I have never been able to go back to China and my dad passed away in 1992 and I couldn’t see him. Luckily, my mom was able to come to Canada and she lived with me for many years,” said Sheng, who is now in her early sixties.
Smear campaign includes fake nude photos
She thought she would be safe living with her mother in Greater Toronto, But since 2014, the award-winning writer has faced a relentless online smear campaign, including fake nude photos and a photo that seemed to show her kissing a man who is not her husband.
“This started in 2014, the 25th anniversary of the Tiananmen massacre. In addition to the online posts and images, thousands of emails were sent to my contacts with the material and if you Google my name in Chinese, there are still a lot of fake nude photos as well as my phone number listed in fake online ads offering sex services,” she said. The Star has viewed copies of the emails and photographs.
Sheng went to police all over North America to plead for help.
“I remember going to a police station in Mississauga to report, and the officer just advised me to change my phone number. I told him, ‘Whatever new number I choose, they will find it out right away.’”
“This is how the Chinese regime makes people feel isolated and hopeless.”
A spokesperson for CSIS confirmed that foreign states target Canadian communities with “harassment, manipulation or intimidation.” United Front is active in Canada and around the world to stifle criticism and manipulate Canadian communities, while the fear of state-backed retribution targeting them and their loved ones can force individuals to submit to foreign interference, the spokesperson said.
“When individuals in Canada are subjected to such tactics by foreign states seeking to gather support for or mute criticism of their policies, these activities constitute a threat to Canada’s sovereignty and to the safety of Canadians.”
“Of course, the CSIS leaks aren’t surprising. We’ve spent years sharing information to Parliament,” said Uyghur Canadian human-rights advocate Mehmet Tohti, echoing Kwan and Sheng’s frustrations.
In the early 1990s, when the Chinese government was already targeting Uyghurs and other Muslim minorities in Xinjiang, the biology teacher left China for Turkey and then Canada. For over a decade, as China interned an estimated over a million people in Xinjiang in “re-education camps,” Tohti has been a prominent advocate, co-founding the World Uyghur Congress and working as the executive director of the Uyghur Rights Advocacy Project based in Ottawa.
For this work, he alleges, Chinese police threatened his mother at gunpoint and ordered her to not speak to her son again. The last time he spoke with her was on the phone in 2016 — to say goodbye.
‘It’s time for my cousin to pay the price’
More recently, ahead of an unanimous House of Commons vote last month to accept 10,000 Uyghur refugees, a move that Tohti lobbied for, he said he received a menacing call from Chinese police.
“They told me that my mother died and my two sisters are dead and it’s time for my cousin to pay the price. The message was basically that my family paid a heavy price and if I don’t stop, my cousin will be in danger. It’s a direct threat and it’s still ongoing,” Tohti told the Star. He said his mother had passed away from a stroke, but he believes his sisters are still alive.
Canada, along with other Western nations, imposed sanctions on high-ranking officials in China in 2021 over what it said were “gross and systematic human rights violations” against Uyghurs.
Tohti said he has spoken to the Canadian government at least 30 times, and while he is appreciative of existing support for Uyghurs, he thinks it is time for Ottawa to do more to protect them once they’re living in Canada, where they remain vulnerable to persecution.
Advocates tell the Star that any new approach to countering foreign interference in Canada should involve a whole-of-government approach and apply to all countries and not just China, since local-level politicians and grassroots community groups are as vulnerable to intimidation and meddling as federal politicians.
“What’s happening is the hijacking of families back home to push Canadian citizens in Canada to live under the norms of the Chinese Communist Party and not as free citizens of Canada,” Tohti said.
Kwan said with a sigh: “We have been talking about the same things in the (leaked) CSIS reports for years but getting much less attention.”
“If it takes secret spy documents to finally get people’s attention, that is fine.”
26. Ottawa needs to do more to address foreign interference, government adviser says
Marieke Walsh, The Globe and Mail, March 5, 2023
27. Take political interference claims seriously, Chinese community leaders say
Jeremy Nuttall, Toronto Star, February 28, 2023
It isn’t racist to raise concerns about foreign interference in Canadian elections, say Chinese community leaders, adding Prime Minister Justin Trudeau should investigate concerns openly.
When Trudeau said recent media attention to foreign interference in elections was racist, he was using a deflection technique also employed by the Chinese Communist Party (CCP), said Bill Chu of the Chinese-Canadian Concerned Group on the Chinese Communist Party’s Human Rights Violations.
“He should be more concerned about national security, he should be more concerned about sovereignty,” Chu said.
Chu, a longtime anti-racism advocate in British Columbia, said the comments also ultimately conflate Chinese people with the CCP, a tactic China’s government often uses to try to silence criticism by trying to spin it into an instance of racism.
On Monday, after more than a week of political pressure over explosive news reports about China’s attempts to influence Canadian elections, Trudeau said the most recent attention on Toronto Liberal MP, Han Dong, stems from racism.
“One of the things we’ve seen unfortunately over the past years is a rise in anti-Asian racism linked to the pandemic, and concerns being arisen around people’s loyalties,” Trudeau said Monday in Mississauga.
“I want to make everyone understand fully: Han Dong is an outstanding member of our team, and suggestions that he is somehow not loyal to Canada should not be entertained.”
Last week, Global News reported Dong was a “witting affiliate” in Beijing’s attempts to help him become the Liberal candidate and run for the party in North York.
The report cited unnamed sources who said that Canada’s spy agency — the Canadian Security Intelligence Service (CSIS) — started tracking Dong in 2019. Officials also suggested to Trudeau’s office that the Liberals should drop Han as a candidate due to the concerns.
Trudeau has said CSIS cannot direct political parties on what candidates they can run in elections.
“Instead of allowing the CSIS input to stand he’s actually allowing the input of the People’s Republic of China (PRC) to stand.
“The PRC has been using the racism card for the longest time,” Chu said.
Meanwhile, Fenella Sung of Canadian Friends of Hong Kong said she doesn’t think the news stories come from racism.
“I would encourage people to no longer pull the racist card out every time those kind of legitimate questions are asked about our politicians,” Sung said. “You need to look at the facts.”
Sung said Chinese Canadians are more vulnerable to infiltration by CCP officials because of the shared language, culture and communities, making it more important for Ottawa to address the issue head-on rather than allow a cloud of suspicion to hang over them.
She said the government is throwing Chinese Canadians under the bus by trying to subdue the conversation with allegations of racism when it should be getting everything out in the open.
A full independent inquiry with subpoena power to investigate the allegations is in order, adding such an inquiry would be beneficial to Canada’s Chinese communities, Sung said.
Audrey Champoux, press secretary for the office of the Minister of Public Safety, said in a statement the federal government is “soberly aware of incidents in which hostile foreign actors have attempted to monitor, intimidate or threaten Canadians and those living here.”
It said it uses all tools to respond to such threats.
Former Canadian ambassador to China Guy Saint-Jacques said Trudeau’s reaction to the unfolding concerns suggests he’s “getting desperate” and the racism allegations would be welcomed by the Chinese embassy as it echoes their own lines of deflection.
Saint-Jacques said Canada is risking its international partnerships by not acting fast and taking the allegations seriously.
“Once your security services tell you ‘watch out this candidate has close links with the Chinese government,’ and probably that comes with some details to buttress the allegations, then you have to take this seriously,” he said.
28. Canada roiled by leaked intelligence reports of Chinese election ‘meddling’
Leyland Cecco, The Guardian, March 7, 2023
A flurry of leaked intelligence reports has reignited allegations that China interfered in Canada’s recent federal elections, kicking off a fierce debate over possible responses to Beijing’s meddling.
But the leaks also run the risk of harming Canada’s reputation among its allies, experts warn, as the country’s spy agency struggles to respond to mounting public concern.
Opposition leaders have pushed the prime minister, Justin Trudeau, for a public inquiry into how China attempted to sway the result of two federal elections in its favour.
On Monday evening, Trudeau announced he would appoint a special rapporteur to investigate foreign interference allegations, as well as the creation of a foreign agent registry.
“We believe deeply in the values of freedom, openness, and dialogue. These values are not universally shared by every government around the world,” Trudeau said. “Indeed, I don’t know if in our lifetime, we’ve seen democracy in a more precarious place. Many state actors and non-state actors want to foster instability here and elsewhere, to advance their own interests.”
29. Philippines launches strategy of publicizing Chinese actions
Jim Gomez, Associated Press, March 8, 2023
The Philippine coast guard has launched a strategy of publicizing aggressive actions by China in the disputed South China Sea, which has countered Chinese propaganda and sparked international condemnation that has put Beijing under the spotlight, a Philippine official said Wednesday.
Manila’s coast guard has intensified patrols in the disputed waters and taken extra efforts to document and publicize assertive Chinese behavior in the strategic waterway, including a Feb. 6 incident in which a Chinese coast guard ship aimed a military-grade laser that briefly blinded some crew members on a Philippine patrol boat off a disputed reef.
The coast guard protested and released a video of the incident, which sparked alarm in the Philippines, the United States and some other Western countries. President Ferdinand Marcos Jr. summoned China’s ambassador to Manila and later said the Philippine military has shifted its focus from fighting Muslim and communist insurgents and other internal threats to external defense amid long-seething South China Sea territorial disputes.
“I’d like to emphasize that the best way to address Chinese ‘gray zone’ activities in the West Philippine Sea is to expose it,” coast guard Commodore Jay Tarriela said, referring to China’s use of ostensibly civilian fishing and research vessels to perform military tasks to avoid a military response from rival claimant states.
COMMENT – The other nine ASEAN member states (Brunei, Cambodia, Indonesia, Laos, Malaysia, Myanmar, Singapore, Thailand, and Vietnam) have been largely silent about the PRC’s aggression against the Philippines.
Given the need for consensus in ASEAN, martime disputes between members, and the near complete control Beijing maintains over two ASEAN members (Laos and Cambodia), this probably shouldn’t be surprising.
30. WAY BACK MACHINE – China and California: The Anatomy of a PRC Subnational Lobbying Campaign
Flora Yan, The Diplomat, August 23, 2022
One of the earliest cases of PRC diplomats directly lobbying state legislators was the defeat of a pro-Tibet resolution in 2009 in California. Here’s how it happened.
31. Chinese police target U.S.-based woman who signed a critical Change.org petition
Mia Ping-Chieh Chen, Radio Free Asia, March 6, 2023
Change.org says it hasn’t detected any leaks, so how did state security police know a user’s email address?
Chinese state security police recently targeted a U.S.-based Chinese national after she signed a petition critical of Communist Party leader Xi Jinping on Change.org, raising questions over how they managed to get hold of her personal details, Radio Free Asia has learned.
A U.S.-based Chinese woman who gave only the nickname Ning Ning said she had recently received a late-night phone call from her father back in China, asking her to confirm whether a signature on a Change.org petition was hers.
“The state security police had come visiting, and my dad was repeating the [text on the petition] website back to me, asking me if it was me who signed,” Ning Ning said.
“They knew it was me because I had to fill out some personal details [for the petition],” she said.
Ning Ning’s revelations come as governments around the world scramble to assess the degree to which Beijing has managed to infiltrate and exert influence on foreign soil, particularly through the use of overseas police “service stations,” which have been shut down in a number of locations worldwide in recent months.
Video call from state security – State security police also wanted Ning Ning to provide all of the registration details she gave to Change.org, and to accept a video call from them, so they could see her logging onto the website, she said.
The state security police appeared to know the email address she had used to sign the petition already, as well as other email addresses she had previously used there, Ning Ning said.
“They knew my account details and asked me to share my screen with them, and they also searched for my accounts on other social media,” she said. “They then asked me if the accounts were mine or not, and what sort of things I had posted there.”
Repeated calls to the local police department in the district where Ning Ning’s family lives rang unanswered during office hours on March 3.
Change.org currently hosts more than 9,000 petitions containing the keyword “China” in English, the majority of which have to do with animal protection issues, according to a brief search of the site.
It is entirely possible to withhold a person's real name on the site, and only have a nickname displayed publicly, raising questions about how Chinese state security police were able to access private information on users of Change.org.
“It’s pretty scary, as if the state security police can see in real time who is logging onto that website with what email address,” Ning Ning said. “How can they know about these email addresses?”
A spokesperson for Change.org, which is blocked by China's Great Firewall of internet censorship, said the company’s cybersecurity team had recently reviewed the data privacy and information security agreements relating to people who sign international petitions and found no signs of leaks or system vulnerabilities.
Former Sina Weibo censor Liu Lipeng said China-based hackers could have targeted Change.org, or police could have somehow gotten their hands on leaked data from the site, however.
“The fact that the Chinese authorities were able to go straight to her family and ask them to get her to take something down tells us clearly that they saw her email address,” Liu said. “The police have already made it totally clear that this was a leak from Change.org.”
“But how did they then link her email to her real name?” he said. “That is still an open question.”
“But the fact that they knew the email address shows that this is definitely something leaked from that website.”
32. How China controls its top students in Germany
Esther Felden, Deutsche Welle, March 7, 2023
Chinese students with scholarships are bound by contracts with gagging clauses, but that contravenes the academic freedom guaranteed by Germany's constitution. An investigation by DW and CORRECTIV.
Studying abroad offers a certain kind of freedom. It's something young people all over the world dream of doing. Yet, for many students, it is often only possible with the help of a state-sponsored scholarship.
But what if that scholarship didn't offer you any kind of freedom at all?
An investigation conducted jointly by DW and the German platform CORRECTIV shows that Chinese students in Germany are placed under repressive rules by the Chinese state. This is particularly true of young scientists and academics who come to Germany on scholarships from the China Scholarship Council (CSC).
CSC scholars must sign in advance a declaration that they will not take part in any activities that "harm" China's security. The restrictive scholarship contract requires them to report back to the Chinese embassy on a regular basis, and anyone who violates these conditions is subject to disciplinary action.
At least 30 German universities have welcomed CSC scholars from China. Some institutions have even entered into official partnerships with the council, which answers directly to China's Ministry of Education.
33. WAY BACK MACHINE – VIDEO – Is Europe helping modernize China's
Deutsche Welle, May 19, 2022
“Don’t feed the hand that bites you.”
DW and its partners in the China Science Investigation have been probing the nature of collaborations between Chinese and European scientists. The team has now revealed that a lot of the joint research has direct links to the Chinese military.
HUMAN RIGHTS AND RELIGIOUS PERSECUTION
34. Publisher behind Xi biography released from China prison
Associated Press, March 2, 2023
A Hong Kong-based publisher who was arrested while preparing to release an unauthorized biography of Chinese leader Xi Jinping has been freed after serving a 10-year sentence in a south China prison.
The respected San Francisco-based rights monitoring group Dui Hua reported Thursday that Yao Wentian, 83, was released Feb. 26 and returned to his family in Hong Kong the next day.
Yao was arrested in October 2013 and served his entire sentence apart from an eight-month term reduction in Dongguan prison near the border with the semi-autonomous Chinese city. He had repeatedly been denied appeals for medical release filed by Dui Hua, but had been moved to the prison’s medical facility and was allowed monthly visits from his wife, the group said in a news release.
Yao had been sentenced to 10 years and fined for “smuggling common goods” after he brought construction materials into China to help a friend who was refurbishing his apartment, Dui Hua said. He was accused of failing to declare the value of the goods at customs, not normally a crime punished with such a harsh sentence.
Yao’s publishing of sensitive books was “almost certainly the reason for his imprisonment,” Dui Hua said. Reports at the time said police and customs agents appeared to have been laying in wait for Yao as he crossed the border into China with several cans of paint for a longtime friend.
COMMENT – Let this sink in… Yao Wentian, 83, spent the last 10 years in prison because in 2013, as a citizen of Hong Kong, he was about to publish an unauthorized biography of Xi Jinping (officially, he was sentenced to 10 years in prison for bringing a few cans of house paint across border between Hong Kong and the Mainland for a friend painting an apartment).
35. UN rights chief cites ‘communication’ about issues in China
Jamey Keaten, Associated Press, March 7, 2023
The new U.N. human rights chief said Tuesday that his office has opened “channels of communication” to help follow up on concerns about the rights of minorities in China, including Uyghur Muslims and Tibetans. But this fell short of activists’ hopes for a stronger message to Beijing.
High Commissioner for Human Rights Volker Türk, in an address highly anticipated by rights advocates, didn’t detail how his office plans to follow up on a critical report on China’s western Xinjiang region published in August by his predecessor, Michelle Bachelet. That report cited possible “crimes against humanity” against Uyghurs and others in Xinjiang.
Türk noted that the U.N. rights office “documented grave concerns” like arbitrary detentions and family separations in China, and called for “concrete follow-up.” He also voiced concerns about the impact of the national security law in Hong Kong that has suppressed its pro-democracy movement.
“Regarding China, we have opened up channels of communication with a range of actors to follow up on a variety of human rights issues, including the protection of minorities, such as for Tibetans, Uyghurs, and other groups,” Türk told the Human Rights Council’s latest session.
…
The former head of Human Rights Watch, Ken Roth, said that Türk had “mouthed not a word of criticism of China.”
“He offers only quiet diplomacy – ‘we have opened up channels of communication’ — as if he has any leverage besides the public reporting/condemnation that he abandons,” Roth tweeted.
COMMENT – The Office of the UN High Commissioner for Human Rights remains just as terrified of angering the PRC as under the leadership of the former Chilean President, Michelle Bachelet.
36. China’s Head of Ethnic Affairs Is Keen to End Minority Culture
Aaron Glasserman, Foreign Policy, March 2, 2023
Pan Yue is doubling down on the party’s hard-line policies.
Last October, China’s top officials convened the once-every-five-year 20th National Congress of the Chinese Communist Party (CCP) to determine the leadership and political trajectory of the country for the next half decade. Xi Jinping secured a precedent-breaking third term as paramount leader of the party, confirming expectations that the congress would cement his authority and concentrate power in a single person to a degree not seen since the era of former leader Mao Zedong. Several high-profile promotions and demotions signaled that officials’ political survival depends on personal loyalty to Xi and that aggressive implementation of his policies is key to career advancement. Among the officials garnering Xi’s support is Pan Yue, who was elected as a full member of the CCP’s Central Committee.
Since last June, Pan has been head of the State Council’s National Ethnic Affairs Commission, which is responsible for policy concerning China’s “minority nationalities,” the 55 officially recognized ethnic groups who collectively represent around 8.9 percent of the total population. For decades, the CCP’s ethnic policies have oscillated between multiculturalism—recognizing and even celebrating distinct ethnic identities—and assimilationism—denying and destroying them—with significant variation at the local level. The Chinese term minzu captures this policy range: It refers both to individual “nationalities” or ethnic groups—like Han, Uyghurs, and Tibetans—and to the overarching “Chinese nation” or zhonghua minzu, which comprises all 56 (55 minorities plus the Han majority) groups.
Pan’s election to the Central Committee suggests that the Xi administration’s hard turn toward assimilationism will likely continue and perhaps intensify. Pan is the second Han official in a row to head the National Ethnic Affairs Commission, which for nearly 70 years had been led by a party member from a non-Han nationality. Since the beginning of Xi’s second term in 2017, measures related to “managing” ethnic minorities have run the gamut, from destruction of what officials deem “foreign” architectural elements such as mosque domes and the removal of Arabic signage on restaurant awnings and storefronts to the imposition of Mandarin as the sole language of instruction for certain subjects in some schools. Repression has been most severe in Tibet and Xinjiang, where local populations have been subjected to extreme restrictions on movement, constant surveillance, mass internment, and—as has been reported of Uyghur women—forced sterilization.
Pan did not initiate these policies, but he is poised to extend and expand them. Over a winding path to the center of Chinese political power—in a career spanning official media, economic restructuring, and environmental policy as well as a stint at the United Front Work Department—he has repeatedly staked out bold policy positions. He is a talented politician and an effective communicator who has long espoused assimilationist views, even before it was politically fashionable to do so. If Xi were looking for a lieutenant with the vision and policy entrepreneurship needed to guide and accelerate assimilation in his third term, then he has found one in Pan.
37. Hong Kong police stop activists from joining women’s march
Kanis Leung, Associated Press, March 5, 2023
A Hong Kong pro-democracy group on Sunday said the national security police stopped activists from joining a highly-anticipated protest that was canceled last minute by the organizer.
The League of Social Democrats said police questioned four of its members on Friday and warned them not to participate in the march that was planned by the Hong Kong Women Workers’ Association.
“The League of Social Democrats is very angry about being threatened and hindered by the national security police over joining a legal protest. But it has decided to be absent under such pressure,” the group said
Police said in an email response to The Associated Press that when they take any action, they handle it “in accordance to the actual situation and the law.”
The planned event would have been the first major civil rights protest in three years approved by police and the first after the lifting of major COVID-19 restrictions, including the mask mandate.
38. Lawmaker blasts China on human rights in front of embassy
Kevin Freking, Associated Press, March 10, 2023
The Republican chairman of a special House committee targeting China called Beijing’s government “bloodthirsty” and “power hungry” on Friday at a rally outside the Chinese embassy in Washington.
Rep. Mike Gallagher, R-Wis. attended a rally to commemorate the failed 1959 Tibetan uprising against China’s rule. The gathering took place on what is known as Tibetan National Uprising Day and comes as tensions between the U.S. and China continue to escalate.
Speaking to members of the Tibetan community, Gallagher said he wanted to recognize their courage in fighting for their freedom and culture. He described Tibetans as victims of a “cultural genocide” by the Chinese Communist Party.
“They’ve not changed one bit,” Gallagher said. “The CCP is still a threat, still duplicitous, still power hungry, still bloodthirsty.”
Tibet is governed as an autonomous region in western China, with authorities maintaining tight control over Tibetan Buddhist monasteries, and harassing and punishing Tibetans suspected of being followers of Tibet’s exiled spiritual leader, the Dalai Lama, who after the failed uprising would flee across the Himalayas to India.
INDUSTRIAL POLICIES AND ECONOMIC ESPIONAGE
39. China’s Cities Struggle Under Trillions of Dollars of Debt
Stella Yifan Xie, Yoko Kubota, and Cao Li, Wall Street Journal, March 6, 2023
As China tries to turn the page on one of its worst stretches of growth since the 1970s, its economy is being weighed down by the colossal debts of its local governments, which swelled during the pandemic and are starting to come to a head.
Xi Jinping’s zero-Covid campaign saddled cities with billions of dollars in unplanned expenditures for mass testing and lockdowns. The Chinese leader’s crackdown on excessive property-market leverage led to a sharp drop in land sales, depriving cities of one of their biggest revenue sources.
Two-thirds of local governments are now in danger of breaching unofficial debt thresholds set by Beijing to signify severe funding stress, with their outstanding debt exceeding 120% of income last year, S&P Global calculations show.
About a third of China’s major cities are struggling to pay just the interest on debt they owe, according to a survey by Rhodium Group, a New York-based research firm. In one extreme case, in Lanzhou, the capital city of Gansu province, interest payments were the equivalent of 74% of fiscal revenue in 2021.
40. Sino Biopharm Wins CFIUS Approval for $161 Million F-Star Deal
Dinesh Nair, Michelle F Davis, and Aaron Kirchfeld, Bloomberg, March 7, 2023
Sino Biopharmaceutical Ltd.’s invoX Pharma unit has won approval from the Committee on Foreign. Investment in the United States to proceed with its $161 million takeover of F-star Therapeutics Inc.
The companies announced the agreement in a statement on Tuesday that confirmed an earlier Bloomberg News report. The CFIUS clearance is the final regulatory approval required to complete the deal, which the companies now expect will happen promptly, they said.
COMMENT – This decision by CFIUS (Committee on Foreign Investment in the United States, led by the Treasury Department) is mind-boggling, considering that the Biden Administration has been signally strongly that Quantum Information Science and Biotech are the next two areas of critical emerging technologies that the US should protect.
I suspect that we will regret this decision as new cancer treatments get pulled out of the U.S.
It also strikes me as yet another example of how the entire CFIUS process is broken under the “leadership” of the Treasury Department. Treasury takes pride in being oblivious to national security concerns (perhaps that’s too harsh) and it has spent years trying NOT to use the authorities granted to it by Congress… of course, we will likely never know the full extent of these problems because the CFIUS process is a black box that cannot be audited.
41. Nvidia, AMD grapple with latest U.S. curbs on China's Inspur
Karen Freifeld and Stephen, Reuters, March 7, 2023
Nvidia Corp, Advanced Micro Devices Inc and other tech firms are scrambling to assess whether they must halt sales to units of China's Inspur Group Ltd after its addition to a U.S. export blacklist last week.
The United States last week added Inspur to its trade blacklist for allegedly acquiring U.S.-origin items in support of the China's military modernization efforts. The listing means that companies cannot sell Inspur items like semiconductors, which are made with U.S. tools, unless they apply for and get licenses, which are likely to be denied.
42. Chinese Exports Pull Back Again, Hampering Post-Covid Recovery
Stella Yifan Xie, Wall Street Journal, March 7, 2023
Outbound shipments have suffered string of declines since reversing in October.
Exports from the world’s second largest economy fell 6.8% during the first two months of 2023 from a year earlier, extending a string of year-over-year declines stretching back to October, data from China’s customs bureau showed Tuesday.
That trend is likely to continue as central bankers in the U.S. and other developed economies signal they may keep interest rates higher for longer to battle inflation, which could dampen Western demand for Chinese-made furniture, electronics and other goods, economists say.
CYBER AND INFORMATION TECHNOLOGY
43. U.S. National Cybersecurity Strategy
U.S. Executive Office of the President, March 2, 2023
44. How China Is Attempting to Control the ‘Information Pipes’
Joshua Kurlantzick, The Diplomat, March 3, 2023
In addition to beaming out its perspectives via Chinese state media, Beijing is aspiring to control both the structure and norms of global information networks.
45. White House Said to Consider Pushing Congress on Dealing with TikTok
David McCabe, New York Times, March 6, 2023
The Biden administration is considering pushing Congress to give it more legal power to deal with TikTok and other technology that could expose sensitive data to China, five people with knowledge of the matter said, as it comes under growing pressure to resolve security concerns about the Chinese-owned video app.
46. White House backs Senate bill to boost US ability to ban TikTok
David Shepardson, Reuters, March 8, 2023
The White House backed legislation introduced on Tuesday by a dozen senators to give the administration new powers to ban Chinese-owned video app TikTok and other foreign-based technologies if they pose national security threats.
The endorsement boosts efforts by a number of lawmakers to ban the popular app, which is owned by Chinese company ByteDance and used by more than 100 million Americans.
The bill would give the Commerce Department the ability impose restrictions up to and including banning TikTok and other technologies that pose national security risks, said Democratic Senator Mark Warner, who chairs the Intelligence Committee.
47. TikTok data collection, influence operations potential draw U.S. NSA concern
Suzanne Smalley, Reuters, March 7, 2023
U.S. National Security Agency Director Paul Nakasone on Tuesday expressed concern during congressional testimony about Chinese-owned video app TikTok's data collection and potential to facilitate broad influence operations.
Asked by Republican Senator Tommy Tuberville about any concerns he has about TikTok's influence on American children, Nakasone told a Senate Armed Services Committee hearing, "TikTok concerns me for a number of different reasons."
Nakasone said his concerns include "the data that they have."
"Secondly is the algorithm and the control of who has the algorithm," Nakasone added.
Nakasone ended his comments by asserting that the TikTok platform could enable sweeping influence operations. Nakasone said his concern is not only the fact that TikTok can proactively influence users but also its ability to "turn off the message," and noted its large number of users.
48. FBI chief says TikTok 'screams' of US national security concerns
Michael Martina and Patricia Zengerle, Reuters, March 8, 2023
China's government could use TikTok to control data on millions of American users, FBI Director Christopher Wray told a U.S. Senate hearing on Wednesday, saying the Chinese-owned video app "screams" of security concerns.
Wray told a Senate Intelligence Committee hearing on worldwide threats to U.S. security that the Chinese government could also use TikTok to control software on millions of devices and drive narratives to divide Americans over Taiwan or other issues.
49. Czech cyber watchdog warns against using TikTok
Jan Lopatka, Reuters, March 8, 2023
The Czech cyber security watchdog warned on Wednesday against using TikTok, joining a growing number of Western agencies alleging the Chinese-owned social media app poses a security risk.
The NUKIB agency recommended that TikTok should not be installed on phones whose users access critical and other significant infrastructure.
"The Agency is concerned about potential security threat stemming from the use of TikTok primarily due to the amount of user data that is collected by the app as well as the way the data is handled." NUKIB said.
50. Belgium bans TikTok from government phones after U.S. and E.U.
NBC News, March 11, 2023
The Chinese-owned video sharing app will be temporarily prohibited from devices owned or paid for by the Belgium’s federal government for at least six months.
51. Germany could ban China's Huawei, ZTE from parts of 5G networks
Sarah Marsh and Andreas Rinke, Reuters, March 7, 2023
Germany is considering banning certain components from Chinese companies Huawei and ZTE in its telecoms networks, a government source said, in a potentially significant move to address security concerns.
An interior ministry spokesperson on Tuesday confirmed that the German government was carrying out a general review of telecoms tech suppliers, but said that this was not directed at specific manufacturers.
COMMENT – Better late than never.
52. How the Dutch turned on Chinese tech
Pieter Haeck, Politico.eu, March 9, 2023
“I can’t see how this will be the century of China.”
In a recent op-ed, Dutch Prime Minister Mark Rutte made no secret that, in the new global order of dueling blocs, he had chosen Washington's side — not that of Beijing. The Netherlands, the rich European country he’s led for over a decade, has closely mirrored the U.S. and turned increasingly hawkish against China, especially in the race for tech supremacy.
In the past months, the Dutch have overhauled their ties with China in a number of areas involving sensitive technology. The biggest shift came Wednesday, when, in a bombshell announcement, the government said it would impose new export controls on China on advanced microchips technology sold by Dutch tech champion ASML. The Dutch decision implements a political deal struck in January with the U.S. and Japan to choke off the supply of cutting-edge chips to China.
MILITARY AND SECURITY THREATS
53. Australia faces the threat of war with China within three years – and we’re not ready
Peter Hartcher and Matthew Knott, Sydney Morning Herald, March 7, 2023
Are we prepared for full-scale conflict? Our panel of national security experts says no.
54. China’s foreign minister predicts impending clash with United States
Christian Shepherd, Washington Post, March 7, 2023
China and the United States are careering toward an inevitable collision, Foreign Minister Qin Gang said Tuesday, a day after Chinese leader Xi Jinping made a rare direct accusation that Washington was trying to contain China.
Together, the statements underscore the dire state of bilateral ties between the world’s two biggest economies, a month since a rogue balloon brought a sudden and surprising end to efforts to “put a floor” under the relationship.
In a news conference on the sidelines of the National People’s Congress, Qin, who was previously Beijing’s ambassador in Washington but became foreign minister in December, deployed a range of often colorful — and occasionally off-color — metaphors to describe the severity of tensions.
He took a number of swipes at the Biden administration’s stated desire to build “guardrails” to prevent simmering disagreements spiraling into crises, an effort he cast as being merely a way of preventing China from retaliating against criticism.
55. Scholz warns of ‘consequences’ if China sends arms to Russia
Associated Press, March 5, 2023
German Chancellor Olaf Scholz says there would be “consequences” if China sent weapons to Russia for Moscow’s war in Ukraine, but he’s fairly optimistic that Beijing will refrain from doing so.
56. Remote Corner of Taiwan Confronts Wartime Scenario: Life with No Internet
Joyu Wang, Wall Street Journal, March 7, 2023
For decades, residents of the tiny island of Dongyin, roughly 30 miles off the coast of China, have lived at the edge of tensions between Taipei and Beijing. For the past month, they’ve had a taste of what could come in the event of a conflict between the two sides.
On Feb. 2, Taiwanese authorities say, a Chinese fishing boat damaged an undersea communications cable linking Dongyin, part of the outlying Taiwanese archipelago of Matsu, to Taiwan’s main island. Six days later, they said another such cable between Matsu and Taiwan was severed by a Chinese cargo vessel.
The breaks cut off many Matsu residents from the internet. Online banking was disrupted and point-of-sale machines went dark, forcing some businesses to revert to rely on cash. Anxiety rippled through the tourism industry, a pillar of the local economy.
57. CIA future will be defined by US technology race with China, director says
Suzanne Smalley, Reuters, March 8, 2023
The U.S. Central Intelligence Agency’s future will be defined by America's ongoing technology race with China, agency director William Burns said on Wednesday during a Senate hearing.
Burns’ remarks followed the release of the Annual Threat Assessment of the U.S. Intelligence Community, which pointed to China as the biggest national security threat facing America. The report cited China’s robust use of cyber tactics to surveille Americans, its success at stealing intellectual property, and ability to acquire foreign technologies.
58. Annual Threat Assessment of the U.S. Intelligence Community
Office of the Director of national Intelligence, March 8, 2023
Below is the China portion of the unclassified threat assessment:
China’s Communist Party (CCP) will continue efforts to achieve President Xi Jinping’s vision of making China the preeminent power in East Asia and a major power on the world stage. As Xi begins his third term as China’s leader, the CCP will work to press Taiwan on unification, undercut U.S. influence, drive wedges between Washington and its partners, and foster some norms that favor its authoritarian system. At the same time, China’s leaders probably will seek opportunities to reduce tensions with Washington when they believe it suits their interests. China’s leaders probably will maintain their statist economic policies because they see state direction as necessary to reduce dependence on foreign technologies, enable military modernization, and sustain growth—ensuring CCP rule and the realization of its vision for national rejuvenation—even as the same policies risk undermining China’s private sector and inhibiting greater growth in household incomes.
Beijing sees increasingly competitive U.S.–China relations as part of an epochal geopolitical shift and views Washington’s diplomatic, economic, military, and technological measures against Beijing as part of a broader U.S. effort to prevent China’s rise and undermine CCP rule.
Beijing is increasingly combining growing military power with its economic, technological, and diplomatic influence to strengthen CCP rule, secure what it views as its sovereign territory and regional preeminence, and pursue global influence. The Government of China is capable of leveraging its dominant positions in key global supply chains in an attempt to accomplish its goals, although probably not without significant cost to itself.
However, China faces myriad—and in some cases growing—domestic and international challenges that probably will hinder CCP leaders’ ambitions. These include an aging population, high levels of corporate debt, economic inequality, and growing resistance to the People’s Republic of China’s (PRC) heavyhanded tactics in Taiwan and other countries.
The PRC uses coordinated, whole-of-government tools to demonstrate strength and compel neighbors to acquiesce to its preferences, including its land, sea, and air claims in the region and its assertions of sovereignty over Taiwan.
In 2023, Beijing will continue to apply pressure and possibly offer inducements for Taiwan to move toward unification and will react to what it views as increased U.S.–Taiwan engagement. Beijing claims that the United States is using Taiwan as a “pawn” to undermine China’s rise, and will continue to take stronger measures to push back against perceived increases in support to Taiwan. Beijing may build on its actions from 2022, which could include more Taiwan Strait centerline crossings or missile overflights of Taiwan.
Beijing’s control over Taiwan, if it succeeded in accomplishing its goal, probably would have wideranging effects, including disruption to global supply chains for semiconductor chips because Taiwan dominates production of cutting-edge chips.
In the South China Sea, Beijing will continue to use growing numbers of air, naval, coast guard, and militia forces to intimidate rival claimants and to attempt to signal that China has effective control over contested areas. Similarly, China is pressuring Japan over contested areas in the East China Sea.
Beijing will try to expand its influence abroad and its efforts to be viewed as a champion of global development via several initiatives––including the Belt and Road Initiative (BRI) and Xi’s new flagship policies—the Global Development Initiative and the Global Security Initiative. Beijing has attempted to use these programs and initiatives to promote a China-led alternative to often U.S. and Western-dominated international development and security forums and frameworks. The IC assesses that the Government of China will use these programs and initiatives to promote modifications to international norms to favor state sovereignty and political stability over individual rights.
Beijing will continue to promote the BRI while adjusting its response to public criticism and sustainability challenges by pledging deeper cooperation on clean energy, electric vehicles, and climate change. It will diversify project selection in an attempt to improve the initiative’s brand and minimize international criticism.
Despite global backlash over Russia’s invasion of Ukraine, China will maintain its diplomatic, defense, economic, and technology cooperation with Russia to continue trying to challenge the United States, even as it will limit public support.
MILITARY CAPABILITIES – The Government of China will continue pursuing its goal of building a world-class military that will enable it to try to secure what it views as its sovereign territory, attempt to establish its preeminence in regional affairs, and project power globally while offsetting perceived U.S. military superiority.
WMD – China is reorienting its nuclear posture for strategic rivalry with the United States because its leaders have concluded that their current capabilities are insufficient. Beijing worries that bilateral tension, U.S. nuclear modernization, and the PLA’s advancing conventional capabilities have increased the likelihood of a U.S. first strike. Beijing is not interested in agreements that restrict its plans and will not agree to negotiations that lock in U.S. or Russian advantages. Beijing’s heightened confidence in its nuclear deterrent is likely to bolster its resolve and intensify conventional conflicts. China is building hundreds of new ICBM silos.
SPACE – China is steadily progressing toward its goal of becoming a world-class space leader, with the intent to match or surpass the United States by 2045. Even by 2030, China probably will achieve world-class status in all but a few space technology areas. China’s space activities are designed to advance its global standing and strengthen its attempts to erode U.S. influence across military, technological, economic, and diplomatic spheres.
TECHNOLOGY AND ECONOMICS – China will remain the top threat to U.S. technological competitiveness, as Beijing targets key sectors and proprietary commercial and military technology from U.S. and allied companies and institutions. The Government of China is doubling down on efforts to boost indigenous innovation and to become self-sufficient. China uses access to its vast market and control over critical supply chains as tools to force foreign companies and to coerce foreign countries to allow the transfer of technologies and intellectual property.
Beijing uses a variety of tools, from public investment to espionage to try to advance its technological capabilities, protect domestic firms from foreign competition, and facilitate these firms’ global expansion. Beijing’s willingness to use espionage, subsidies, and trade policy to try to give its firms a competitive advantage represents not just an ongoing challenge for the U.S. economy and its workers, but also advances Beijing's attempts to assume leadership of the world’s technological advancement and standards.
China will persist with efforts to acquire foreign science and technology information and expertise, making extensive use of foreign scientific collaborations and partnerships, investments and acquisitions, talent recruitment, economic espionage, and cyber theft to acquire and transfer technologies and technical knowledge.
A slowing economy probably will begin to force Beijing to start making “guns versus butter” choices in allocating resources to technology development and industrial policy. These choices mostly will be on the margins of its priorities because the size and scope of the economy means Beijing still has the ability to marshal considerable state resources toward any specific priority. While we have yet to see Beijing forced to make such trade-offs in technology, it appears to be making some similar calculations with the BRI. New BRI lending commitments have declined for the past five years, but new loans and project financing remain available for China’s priorities and priority partners.
China is central to global supply chains in a range of technology sectors, including semiconductors, critical minerals, batteries, solar panels, and pharmaceuticals. In a speech in April 2020, Xi noted his intentions to increase global supply chain dependencies on China, with an aim of controlling key supply chains and being able to use those supply chain dependencies to threaten and cut off foreign countries during a crisis. China’s dominance in these markets could pose a significant risk to U.S. and Western manufacturing and consumer sectors if the Government of China was able to adeptly leverage its dominance for political or economic gain.
China is leading the world in building new chip factories, with plans to build dozens of semiconductor factories by 2024, most of which will be dedicated to producing older, more mature technologies. While China only accounted for 11 percent of worldwide semiconductor fabrication capacity in 2019, it is forecasted to reach 18 percent in 2025. Because of the difficulties China is facing from export controls by Western nations, it is focusing on lower-capability, commodity chip technology, and China could become a powerhouse in that segment, which could eventually make some buyers more reliant on China.
China’s dominance in the mining and processing of several strategic materials, including rare-earth elements, presents a major vulnerability to the United States. China could use its control of these critical minerals markets to restrict quantities for commercial advantage or as a tool in a political or trade dispute. A prolonged disruption in supplies controlled by China would result in shortages that could affect output in civilian and defense manufacturing in the United States and the West. However, restrictions on critical minerals exports probably would accelerate efforts and coordination worldwide to develop non-China-based alternative sources or substitutes.
Some other areas of concern are the battery, pharmaceutical, and solar panel manufacturing sectors. For example, PRC-based firms are on track to control 65 percent of the lithium-ion battery market by 2025, with the PRC dominant in all parts of the supply chain; China produces 40 percent of the world’s active pharmaceutical ingredients (APIs), the key ingredients in medicinal drugs; and China’s global share across all the manufacturing stages of solar panels now exceeds 80 percent and is set to rise to more than 95 percent during the coming years.
CYBER – China probably currently represents the broadest, most active, and persistent cyber espionage threat to U.S. Government and private-sector networks. China’s cyber pursuits and its industry’s export of related technologies increase the threats of aggressive cyber operations against the U.S. homeland, suppression of the free flow of information in cyberspace—such as U.S. web content—that Beijing views as threatening to the CCP’s hold on power, and the expansion of technology-driven authoritarianism globally.
If Beijing feared that a major conflict with the United States were imminent, it almost certainly would consider undertaking aggressive cyber operations against U.S. homeland critical infrastructure and military assets worldwide. Such a strike would be designed to deter U.S. military action by impeding U.S. decision-making, inducing societal panic, and interfering with the deployment of U.S. forces.
China almost certainly is capable of launching cyber-attacks that could disrupt critical infrastructure services within the United States, including against oil and gas pipelines, and rail systems.
China leads the world in applying surveillance and censorship to monitor its population and repress dissent. Beijing conducts cyber intrusions that are targeted to affect U.S. and non-U.S. citizens beyond its borders— including journalists, dissidents, and individuals it views as threats—to counter views it considers critical of CCP narratives, policies, and actions. China’s cyber espionage operations have included compromising telecommunications firms, providers of managed services and broadly used software, and other targets potentially rich in follow-on opportunities for intelligence collection, attack, or influence operations.
MALIGN INFLUENCE OPERATIONS – Beijing will continue expanding its global intelligence and covert influence posture to better support the CCP’s political, economic, and security goals. China is attempting to sow doubts about U.S. leadership, undermine democracy, and extend Beijing’s influence, particularly in East Asia and the western Pacific, which Beijing views as its sphere of influence. Beijing largely concentrates its U.S.-focused influence efforts on shaping U.S. policy and the U.S. public’s perception of China in a positive direction, but has shown a willingness to meddle in select election races that involved perceived anti-China politicians.
59. Kevin McCarthy to Meet with Taiwan’s President When She Visits U.S
Natalie Andrews, Wall Street Journal, March 7, 2023
60. How Beijing Boxed America Out of the South China Sea
Niharika Mandhana, Wall Street Journal, March 11, 2023
China incrementally built up military outposts, with little pushback from the U.S., and has emerged as a power in the strategic waters through which trillions of dollars in trade passes.
ONE BELT, ONE ROAD STRATEGY
61. China’s Checkbook Diplomacy Has Bounced
Christina Lu, Foreign Policy, February 21, 2023
China can make friends or break legs. It can’t do both.
In the span of a decade, China has emerged as the developing world’s bank of choice, pouring hundreds of billions of dollars in loans into global infrastructure projects as part of its sprawling Belt and Road Initiative (BRI).
But as its borrowers fail to pay up, China is finding that its newfound authority is coming at a price. Eager to recoup its money, Beijing is transitioning from generous investor to tough enforcer—and jeopardizing the very goodwill that it tried to build with initiatives such as the BRI. China has broken a few bones in Sri Lanka, whose financial turmoil allowed Beijing to seize control of a strategic port, and is hassling Pakistan, Zambia, and Suriname for repayment.
For two decades, countries “were getting to know China as the kind of benevolent financier of big-ticket infrastructure,” said Bradley Parks, the executive director of the AidData research group at William & Mary. Now, he said, “the developing world is getting to know China in a very new role—and that new role is as the world’s largest official debt collector.”
OPINION PIECES
62. China’s Censors Are Afraid of What Chatbots Might Say
Nicholas Welch and Jordan Schneider, Foreign Policy, March 3, 2023
Artificial intelligence development may get held up for political reasons.
63. China is right about US containment
Edward Luce, Financial Times, March 8, 2023
64. Has Xi doomed America’s ‘one China’ policy?
Ian Easton, Taipei Times, March 6, 2023
65. Behind Enemy Lines: The CIA’s Cold War in China
Jane Perlez, Foreign Affairs, February 28, 2023
66. It’s not xenophobic to call time on TikTok, it’s vital
Fergus Ryan, Sydney Morning Herald, March 8, 2023
67. The U.S. Needs to Talk About the Risk of War with China
Doug Bandow, Foreign Policy, March 2, 2023
Washington’s commitment to Taiwan hasn’t been sold to the American public.
The risk of war between China and the United States is rising. Bilateral relations were inflamed by then-House Speaker Nancy Pelosi’s highly publicized trip to Taiwan last August. The prospect of current Speaker Kevin McCarthy doing the same has Chinese diplomats warning U.S. officials that Beijing would respond aggressively.
68. Why China Is Not a Superpower
Jo Inge Bekkevold, Foreign Policy, March 2, 2023
China’s growing power is the single most influential driver of geopolitical change today. Notwithstanding Russia’s ongoing war in Ukraine, the United States has clearly identified China as its number one challenge. In June 2022, for the first time ever, NATO included China in its Strategic Concept, signaling a radical shift in the bloc’s security outlook.
But how mighty is China really? Measuring and comparing power between nations and across time is an imprecise exercise at best. Nonetheless, we can gain valuable information about China’s current power position if we compare it to the contemporary United States and Cold War-era Soviet Union—and consider three important concepts: polarity, hegemony, and the original definition of a superpower.
Such a comparison reveals that the United States is a pole, regional hegemon, and superpower. The Soviet Union was a pole and a superpower—but did not have regional hegemony. And although China is a pole in what is now a bipolar U.S.-China system, it is neither a regional hegemon nor a superpower. While these categorizations might read like abstract nuances in a scholarly debate, they actually have major, concrete implications for strategy and policy in the 21st century.
69. Cognitive warfare is no joke
Taipei Times, March 1, 2023
Quoting a US radio host’s Twitter post, a former Chinese Nationalist Party (KMT) legislator has been peddling the idea that the “US plans to destroy Taiwan.” While the tweet was a satirical post made up by the host, it is precisely this kind of misinterpretation and dissemination of disinformation that could lead to the “destruction” of Taiwan.
The “US plans to destroy Taiwan” tweet was posted on Feb. 16 by Garland Nixon, a radio talk show host based in Washington and identified to be a journalist working for Russian state-run media Radio Sputnik. The post says: “Breaking News: White House insiders leak that, when asked if there could be any greater disaster than the neocon Ukraine project, President Biden responded, ‘wait until you see our plan for the destruction of Taiwan.’”
Former KMT legislator Alex Tsai (蔡正元) translated Nixon’s satirical tweet into Chinese and posted it on Facebook. Tsai also appeared on pro-China TV shows saying he thinks Biden let slip the plan during a White House meeting.
Sensing an opportunity, Chinese Ministry of Foreign Affairs spokesman Wang Wenbin (汪文斌) said: “I also want to know what ‘the destruction of Taiwan’ plan is. The US should give a definitive explanation.” Meanwhile, Chinese state tabloid the Global Times wrote: “The US was reported to have been considering plans to destroy the island in the event of a military conflict between the island and the Chinese mainland.”
Nixon has been interviewed by an online influencer and confirmed that the Twitter post was meant to be satirical. The influencer said it was likely an example of something “lost in translation” and wondered why some Taiwanese did not check the accuracy of Twitter posts.
This case is a classic example of “cognitive warfare” aimed at intimidating Taiwan.
Nixon’s past tweets include one that says: “Breaking News: Taiwan government insider leaks that they have betrayed their citizens so dramatically that they may have to pay royalty right to the government of Norway for the use of the term ‘quisling.’” Tweets such as this are clearly jokes. However, for people who want to believe in disinformation, the truth is the last thing they would seek. In this case, individuals spreading and embellishing the quotes aim to promote “skepticism about the US” or propagate the conspiracy theory that the “US wants to destroy Taiwan.”
Disinformation has long been used as a tool by China, pro-China politicians and media to undermine Taiwan’s democracy and international relations. As US Representative Mike Gallagher, chair of the House of Representatives Select Committee on the Strategic Competition Between the US and the Chinese Communist Party, said: “The invasion has already begun in the cognitive space.”
A maxim often quoted in reference to Nazi propaganda states that: “If you tell a lie big enough and keep repeating it, people will eventually come to believe it.” Today, China deploys the same tactic, with its repeated propaganda that Taiwan — which the People’s Republic of China has never governed — is “part of China.”
A more recent example is China’s 12-point peace plan for Ukraine. It lists respect for the sovereignty of all countries as the first priority, but Beijing also trumpets its “rock solid” relations with Russia, Ukraine’s invader. China itself has long been the major saboteur and intimidator of Taiwanese sovereignty.
Unlike Nixon’s tweet, the cognitive warfare against Taiwan and the international community is no joke.
70. A scrambling Trudeau’s half turn on interference
Campbell Clark, The Globe and Mail, March 6, 2023
71. The Trudeau Liberals don’t own our elections
The Globe and Mail, March 8, 2023
Andrew Coyne, The Globe and Mail, March 7, 2023
That was a neat trick the Prime Minister pulled off Monday evening.
I don’t mean just the breathtaking change in communications strategy, on the issue that threatens to devour his government: foreign (specifically Chinese) interference in our elections. The sullen stonewalling of the last several weeks was instantly transformed into a dazzling pinwheel of apparent activity: multiple investigations, a pledge to consult on implementing a foreign agent registry, a promise to appoint a National Counter Foreign Interference Co-ordinator, a vow to start implementing some of the recommendations it had received from previous investigations, etc.
Such a strategy has obvious political benefits, from buying time to muddying the waters. But that, too, is not what I mean. The really artful part of this performance, rather, was to pose the Prime Minister as the solution to the problem, rather than the problem itself. It was as if, the Prime Minister having launched all of those multiple overlapping investigations, we were all supposed to forget that, in a serious country, he and his government would be the subject of them.
The issue, again, is not “foreign interference,” as such. We may take it as a given that our adversaries will seek to intervene in Canadian elections, as they have in other countries. The issue is not that China, according to intelligence sources, wanted the Liberals to win – though the implications are disturbing, can anyone claim to be surprised? – nor that it apparently went to some lengths to assure this, albeit with seemingly limited impact. The issue is whether it had help.
The allegations in the leaked CSIS documents are quite specific. They do not allege only that China interfered on behalf of the Liberals, but that it had domestic accomplices: not just that China was funnelling cash and manpower to favoured candidates, most of them Liberal, but that the candidates in at least some cases were knowing recipients; indeed, some campaigns were allegedly reimbursing donors for the part of their donation not covered by the federal tax credit.
Other alleged acts of interference, such as tipping the nomination in the safe Liberal riding of Don Valley North to an allegedly Beijing-favoured candidate, could not credibly have been carried out without at least somebody in the party knowing. And the whole thing was documented in report after official report, memo after urgent memo, from CSIS, from the Privy Council, from the Prime Minister’s own national security and intelligence adviser.
It is impossible – or let us say highly unlikely – that this information would not have reached cabinet, or the Prime Minister’s Office, or the Prime Minister himself. Yet nothing was done. Which is why so much is having to be done now.
But, with one possible exception, none of what the Prime Minister announced is likely to get at the question of Liberal involvement or government inactivity, in the way that, say, an independent public inquiry might.
It is all very well to ask the National Security and Intelligence Committee of Parliamentarians to investigate, but it is neither independent nor public: appointed by the Prime Minister, reporting to the Prime Minister, its reports are subject to redaction by the Prime Minister’s Office and its members are sworn to secrecy. Given that four of its nine members are Liberal MPs, plus a New Democrat pledged to sustain the government in office, it is unlikely to rock too many boats, and if it were, the Prime Minister has had no difficulty in ignoring its recommendations in the past.
As for asking the National Security and Intelligence Review Agency (NSIRA) to conduct a review of “how Canada’s national security agencies handled the threat of foreign interference … specifically around the flow of information from national security agencies to decision makers”: that seems to suggest the problem was with the agencies, and not the decision makers – as if it were the former’s increasingly frantic efforts to warn the latter that was the issue, and not the latter’s apparent deafness to the former.
The possible exception to this dispiriting pattern: the appointment of an “Independent Special Rapporteur” to advise the government on how to proceed further, notably on the question of whether to hold a public inquiry. Much will depend on the identity of the “eminent Canadian” the Prime Minister chooses for the job, and whether that person enjoys the trust and confidence of the opposition, and of Canadians generally. Much, too, will depend on the office’s precise mandate.
But in principle, the idea of leaving the decision on such an inquiry to an arms’-length expert, rather than the Prime Minister himself, has some merit. Tentative as it is, it’s the first win for accountability since this whole mess began.
73. No one believed the Covid Wuhan lab leak theory – then the world changed its tune
Sarah Knapton, Telegraph, March 8, 2023
Idea that the virus escaped from Chinese city used to be widely dismissed, but is now becoming ever more plausible.
74. Argentina’s Failed China Policy
Patricio Giusto and Juan Manuel Harán, The Diplomat, February 28, 2023
As President Alberto Fernandez’s term comes to an end, his flawed approach toward China is among his government’s greatest shortcomings.
75. Xi’s Chinese dream is in danger of being hijacked by ultra-left nationalism
Wang Xiangwei, South China Morning Post, March 6, 2023
The ultra-leftist revival threatens Xi’s plans to revive the economy and turn China into a dominant world power by 2049.
It’s time to curb these ultra-nationalistic tendencies and return to pragmatic reform and development.
COMMENT – The author seems to ignore that this isn’t some external hijacking, this is a deliberate policy shift initiated by the senior leadership of the Chinese Communist Party. Deng Xiaoping’s efforts to create collective rule and Jiang Zemin’s efforts to put distance between Party and State apparatuses seems to have been just a passing phase.