Time to get serious

In less than a decade, great power war has gone from unlikely to the new normal

Friends,

Apologies for not getting an issue out last week. I was traveling and ran out of time, plus so many things are happening that I felt that I needed a bit of distance before writing some commentary.

There’s lots to be concerned about, but I don’t want to be all doom and gloom.

Noah Smith’s latest post (“Feeling cautiously optimistic about American democracy”) provides a bit of perspective that I think is needed right now.

The first five months of the Trump Administration was an experiment on pursuing an audacious set of policies on a very narrow political mandate… and it appears that Americans are not convinced that it will work and the President is being forced to moderate his policies (I doubt he will moderate his rhetoric, but it appears he understands he has real limits on what he can and can’t do).

If Trump’s domestic opposition can avoid slogans like “defund the police,” “abolish ICE,” “Free Palestine,” and “open borders,” I think they have a reasonable chance of continuing to erode the Administration’s popularity and shift U.S. policy.

The President has already lost significant ground on what had seemed like his strongest policy areas (immigration and the economy). Noah included this chart from Nate Silver which helps to show these trends:

From Nate Silver via Noah Smith

How is President Trump’s approval rating compared with his predecessors over the last 75 years?

Well, he is beating only one… himself from 2017.

From Strength in Numbers

And compared to President Biden, it wasn’t until the disastrous withdrawal from Afghanistan in August 2021, that his numbers dipped into negative territory, never to recover.

All presidencies suffer from the loss of approval over time, but very few have started with so little or lost it so fast.

As Noah Smith points out, these negative approval ratings seem to be constraining President Trump. He has walked back several policies like the recent decision to conduct immigration raids on businesses and farms, the perpetual extensions on imposing his April 2 tariffs, and the hiring back of certain federal employees. The grand experiment with DOGE did not result in any measurable savings and likely made the Federal Government less efficient.

The President’s very public spat with Elon Musk over the BBB (Big, Beautiful Bill) only illuminated how the Administration has NOT been able to get Federal spending under control.

Unfortunately, the President’s efforts to portray strength and confidence (like the Army Birthday Parade on Saturday) has only made him look weak to outside observers. I fear that this cycle will only become self-reinforcing as the President deflects criticism by blaming others for what he has been unable to achieve with his own style of leadership.

Most of the President’s domestic political opponents will rejoice at this development, but I think that creates real dangers. It is a bad thing for Americans and the rest of the world to perceive the U.S. Administration as being weak and ineffective. There are plenty of bad actors in the world who have been deterred for decades because they perceive the United States as capable of stopping them.

The world has become much more dangerous and the ‘good guys’ are not prepared.

This situation wouldn’t be so dangerous if other liberal democracies had acted responsibly over the past two decades and built out hard power capabilities that could be deployed globally. But they failed to do that and are now scrambling to make up for lost time. The Japanese Prime Minister, the new Canadian Prime Minister, the UK Prime Minister, and the new German Chancellor have all recently announced increases in military spending. But these relatively modest increases must be put into the context of decades of underinvestment in military capabilities by these countries, as their adversaries have been making multi-decade investments in theirs.

So, what does this have to do with Sino-American relations?

Well, for starters, Chinese leaders can perform this kind of tasseography as well as we can. They understand that President Trump is negotiating from a position of domestic political weakness, which will likely only get weaker over time. The entire ordeal since the poorly thought-out announcement of the Global Reciprocal Tariffs on April 2 has simply reinforced this perception in Beijing.

Beijing likely thinks it’s rare earth and magnet export controls work really well… which means they will employ it more often.

Chinese leaders understand that given President Trump’s negotiating tactics, even reasonable requests by the United States to its allies will be difficult for democratic leaders to comply with given the optics of being coerced by President Trump. This creates the perception that America’s adversaries can divide and conquer, making the cost of negotiations much higher. This also makes Chinese leaders confident that Trump will be forced to change course in the face of economic headwinds before they will be forced to do so. This emboldens the voices in Zhongnanhai who say the United States is a ‘paper tiger’ and that American decline is inevitable.

If the United States can’t compel Beijing to make structural changes in its economic and trade practices because America isn’t prepared for drawn-out economic costs, and can’t get its allies onboard with imposing costs on the PRC’s harmful economic policies, then Beijing is more likely to conclude that they have an opportunity to achieve more ambitious objectives, like annexing Taiwan.

Right now, the United States is broadcasting a message to the world:

• Washington thinks the old geopolitical order is no longer fit for purpose, but is unwilling to pay the costs of creating a new geopolitical order itself.

As the old saying goes, nature abhors a vacuum. If the United States isn’t going to bear the costs to maintain the old geopolitical order (an open market to enable free trade internationally and collective security to reduce interstate conflict) and the United States isn’t going to bear the costs to build a new geopolitical order, then someone else is going to try to impose their preferred geopolitical order.

The most likely candidate to do that is the PRC, along with some fellow travelers who view the old liberal, rules-based international order as a threat.

The 64 trillion-dollar question is: Does Xi Jinping move aggressively with blatant military force to impose that new geopolitical order now with the expectation that he has a fleeting opportunity, or does he exercise patience with the expectation that trends are moving in his direction already?

The answer is uncertain to us and may be uncertain for Xi Jinping at this point.

Given what we know today and the experience we have from a dozen years of Xi Jinping rule, I put a 68% probability on Xi exercising patience and a 32% probability on him using military force to impose a new geopolitical order by annexing Taiwan.

This may sound like I’m dismissing the danger to Taiwan and the danger of a wider conflict, but it shouldn’t be interpreted that way.

I’m saying that there is essentially a zero percent chance that Xi and his cadres give up on annexing Taiwan… that is a long-term goal of the Chinese Communist Party and as long as the Party remains in power, its leaders will devote considerable time and resources to achieve that objective.

There is a better than 1 in 4 chance that in the next few months/years that the PRC will initiate a war in the Western Pacific that would likely devastate the global economy and could plunge much of the world into a long, drawn-out conflict involving multiple nuclear powers and could conceivably result in the use of nuclear weapons on the battlefield. Under this scenario, the on-going conflict in Europe and the Middle East would merge with Beijing’s offensive and become what any objective observer would see as a Third World War.

I suspect that Xi would only make this decision to initiate a war IF he felt confident, that his forces would seize and control Taiwan rapidly and prevent the military intervention of the United States and Japan. I disagree with several of my colleagues that Xi would initiate a war if we “backed him into a corner” and I think that fixating on “reassuring” Beijing only persuades Xi that we are unwilling to fight. If the conditions aren’t “right” for military success, Xi will wait and play for more time.

So, better than 1 in 4 chance of a Third World War is not good and we should be doing much more to prevent it from happening.

But I am also saying that there is a better than 2 in 3 chance that Xi Jinping decides that, for whatever reason, it is in his interest to be patience and wait. It could be that Xi believes that trends are moving in a direction that he will achieve his objectives without the use of force (clearly his preferred approach). It might be that he does not yet feel confident that the use of military force could achieve his objectives at an acceptable cost. He might be persuaded that the combined preparedness of the United States and Japan, along with the resilience of Taiwan might be sufficient to stymie an untested PLA. Or it could be a combination of these factors.

My advice is that we should be doing things that undermine Xi’s confidence that his military can achieve a rapid victory. That means making U.S. (and Japanese) military intervention in a Taiwan scenario less ambiguous and posturing the kinds of forces in the region that the PLA must account for. It also means that other countries who want to deter a conflict must do much more to persuade Xi Jinping that they are economically and militarily prepared to protect their own national security interests.

A decade ago, we were negotiating the Paris Climate Agreement as the leaders of the world’s advanced democracies were fixated on the dangers of climate change. The world has changed considerably since that time.

For the most part, those leaders dismissed the likelihood of great power conflict and reoriented their policies and spending to address the threat they perceived from CO2 emissions. It is time for a serious reorientation again. Some will say that we can walk and chew gum at the same time, addressing both the threat of global war and climate change simultaneously… I think that is a serious mistake. We have finite resources and each of these problems requires more than what we are currently devoting to them.

The threat of a global great power war is self-evident, and those immediate dangers vastly outweigh the dangers of climate change in the immediate and medium term. Failing to deter a global, great power war would not only lead to enormous devastation and death, but would make mitigating climate change all but impossible. By focusing on deterring a war through significant military preparedness, we at least buy ourselves time to also make some progress on reducing CO2 emissions, albeit slower than some would prefer.

Political leaders need to make some hard choices.

Thanks for reading!

Matt

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MUST READ

1. Japan Flexes Its Military Muscle at China, and Trump
   Martin Fackler, New York Times, June 8, 2025

A highly visible missile base on Okinawa is part of a Japanese defense buildup made amid fears of Beijing’s growing power and questions about U.S. commitment.

The ship-slaying missiles of the Japanese army’s Seventh Regiment are mounted aboard dark green trucks that are easy to move and conceal, but for now, the soldiers are making no effort to hide them. Created a year ago, the fledgling regiment and its roving missile batteries occupy a hilltop base on the island of Okinawa that can be seen for miles.

The visibility is intentional. The Seventh is one of two new missile regiments that the army, called the Ground Self-Defense Force, has placed along the islands on Japan’s southwestern flank in response to an increasingly robust Chinese navy that frequently sails through waters near Japan.

“Our armaments are a show of force to deter an enemy from coming,” said Col. Yohei Ito, the regiment’s commander.

China is not their only target. The display is also for the United States, and particularly President Trump, who has criticized Japan for relying too heavily on the presence of American military bases for its security.

COMMENT – This is exactly what Japan should be doing.

2. Two Chinese aircraft carriers conduct simultaneous drills in Pacific for first time

   Jesse Johnson, Japan Times, June 10, 2025

China’s two operating aircraft carriers have been spotted conducting simultaneous operations in the Pacific for the first time, according to Japan’s Defense Ministry, as Beijing continues to highlight its growing military prowess ever farther from its shores.

Beijing confirmed late Tuesday that the two carriers, the Shandong and Liaoning, had conducted the training "to test the forces' capabilities in far seas defense and joint operations," Chinese Navy spokesperson Senior Capt. Wang Xuemeng said Tuesday, calling the exercises "routine training" that did not target at any specific country.

Defense Minister Gen Nakatani said earlier in the day that the Shandong had been spotted along with four other Chinese warships in Japan’s exclusive economic zone about 550 kilometers southeast of Miyako Island in Okinawa Prefecture on Saturday. The fleet was then spotted Monday in the EEZ north of Okinotorishima, Japan’s southernmost island some 1,700 km south of Tokyo, where it conducted flight operations with fighter jets and helicopters.

3. Chinese Jets Tail Japanese Air Patrol in Close Encounter

   Jason Douglas, Wall Street Journal, June 12, 2025

Fighters from China aircraft carrier followed aircraft at close range, risking accident, Japan says

Chinese jet fighters tailed Japanese patrol aircraft in separate incidents, with the gap narrowing to just 150 feet at one point, officials from Japan said Thursday, disclosing new details about China’s unprecedented naval activity over the weekend.

China’s show of force was a sign of Beijing’s ambitions to broaden its maritime reach, and a willingness to test the boundaries with even the U.S.’s most powerful allies in Asia.

The fighters took off from the Shandong, one of two Chinese aircraft carriers spotted in Western Pacific waters close to Japan over the weekend, Japan’s Defense Ministry said. A second aircraft carrier, the Liaoning, and seven other Chinese warships ventured east of the Japanese island of Iwo Jima, some 725 miles from Tokyo, for the first time Saturday.

On Saturday morning, a Chinese J-15 jet fighter chased a Japanese military patrol plane for approximately 40 minutes, the ministry said, at one point flying as close as 45 meters, or about 150 feet.

In a second incident on Sunday, a Chinese J-15 again followed a Japanese patrol for more than an hour, crossing in front of the aircraft’s flight path at a distance of around 900 meters, a little over half a mile.

“Such abnormal approaches by Chinese military aircraft have the potential to induce accidental collisions. We expressed serious concern and demanded the prevention of recurrence,” the Japanese Ministry of Defense said Thursday in a statement describing the two incidents. No damage was reported.

4. New China Trade ‘Deal’ Takes U.S. Back to Where It Started

   Ana Swanson, New York Times, June 11, 2025

After two days of tense negotiations, the United States and China appear to have walked back from the brink of a devastating economic conflict — maybe.

Officials from the two countries reached a handshake agreement in the early hours of Wednesday in London to remove some of the harmful measures they had used to target each others’ economies as part of a clash that rapidly intensified in recent months.

It remains unclear whether the truce will hold — or crumble like one struck in May did. Even if the agreement does prove durable, its big accomplishment appears to be merely returning the countries to a status quo from several months ago, before Mr. Trump provoked tensions with China in early April by ramping up tariffs on goods it produces.

“It seems like we’re negotiating in circles,” said Myron Brilliant, a senior counselor at DGA-Albright Stonebridge Group and former executive vice president of the U.S. Chamber of Commerce.

COMMENT – I suspect that Beijing feels that its coercive levers (export controls over rare earths and advanced magnets) are powerful and insulate the PRC from having to accept demands from Washington.

We should have planned for this better before kicking off this latest round of trade hostilities. We knew this was a vulnerability, we had ways to mitigate, but we failed to prepare before acting and then certain leaders got surprised by entirely predictable countermeasures by Beijing.

5. China Puts Six-Month Limit on Its Ease of Rare-Earth Export Licenses

   Lingling Wei, Brian Schwartz, and Gavin Bade, Wall Street Journal, June 11, 2025

Tentative deal reached in London gives Beijing leverage in trade talks.

China is putting a six-month limit on rare-earth export licenses for U.S. automakers and manufacturers, according to people familiar with the matter, giving Beijing leverage if trade tensions flare up again while adding to uncertainty for American industry.

Beijing’s agreement to temporarily restore rare-earth licenses was one of the key breakthroughs in the latest round of intense trade talks in London, but the six-month limit illustrated how each side is retaining the tools to easily escalate tensions again.

In exchange for the Chinese easing rare-earth curbs for now, the people said, U.S. negotiators agreed to relax some recent restrictions on the sale to China of products such as jet engines and related parts, as well as ethane, a byproduct of natural gas and oil drilling important in manufacturing plastics.

6. Trump’s tariff threat exposes China’s tight grip on the global pharmaceuticals industry

   John Liu and Yong Xiong, CNN, June 3, 2025

It’s the most prescribed antibiotic in the United States, used by tens of millions of people every year to treat bacterial infections including pneumonia, stomach ulcers, and strep throat.

Yet, it isn’t exactly common knowledge that amoxicillin, a relative of penicillin that has been in chronic short supply, has only one manufacturer in the US, or that China controls 80% of the raw materials required for its production.

That’s a major concern as US President Donald Trump threatens to impose tariffs on pharmaceutical imports, throwing a spotlight on America’s dependence on critical drug supplies from abroad.

“Increasing trade hostilities or more protracted conflicts could devastate our access to amoxicillin or the ingredients used to make it should Beijing weaponize its supply chain dominance,” Rick Jackson, founder and CEO of Jackson Healthcare, which owns America’s sole amoxicillin manufacturer, told CNN.

Last year, 96% of US imports of hydrocortisone (the active ingredient in the anti-itch cream), 90% of imports of ibuprofen (found in common over-the-counter pain relievers), and 73% of imports of acetaminophen (in other kinds of pain relievers) all came from China, according to CNN calculations based on trade data from the Census Bureau.

With the US already facing shortages of many essential medications, experts warn that Beijing could potentially exploit this reliance as leverage in an escalating trade war. Tensions between the two sides have soared since Trump unleashed his trade assault on the world’s second-largest economy.

While the two countries have announced a temporary truce that rolled back the three-digit tariffs for 90 days, relations remain tense with ongoing feuding over chip restrictions imposed by the US.

Leland Miller, a commissioner at the US-China Economic and Security Review Commission, said the “chokepoints” that China holds over the US pharmaceutical supply are “detrimental to American security.”

“Simply by having this leverage … whether or not they ever pull the trigger, causes us to change our policy positions on a lot of things, and that’s not good,” he said.

COMMENT – Our vulnerability to PRC dominance over small molecule pharmaceutics is far worse than rare earth elements and advanced magnets. Again, this is a vulnerability that everyone knew about, but we have failed to mitigate.

7. Chinese migrate to Japan for education
   Nikkei Asia, June 8, 2025

More Chinese are migrating to Japan than ever before, with many driven by a “search for freedom.” The easing of requirements for obtaining visas has made it possible for wealthy and middle-income Chinese to more easily move to Japan, and the number of Chinese residents in the country is expected to exceed 1 million in 2026. But what does "search for freedom" mean, exactly? For many, it's better educational opportunities.

In interviews by Nikkei, Chinese people said they were unhappy with the stifling atmosphere and anxiety they found in China, noting how fierce the competition is for entering universities there.  “We want to bring up our children in a better educational environment,” one person said. “In China, graduating from a university does not lead to finding employment,” noted another. 

Takadanobaba, a neighborhood in Tokyo, has become a hub for preparatory schools specializing in university entrance exams for Chinese people who dream of finding employment and living in Japan after graduation.

Chinese students already make up large percentages of foreign students at leading universities in Japan, representing as much as 70% at the University of Tokyo.

Song Jiaying, 19, is one of them. This spring, she gained admission to the prestigious Hitotsubashi University. “I like Japan’s atmosphere of freedom" she said. "I’m no longer thinking of returning to China.”  Song is no exception.

COMMENT – Tokyo, what ever you are doing, keep it up!

8. How China and Pakistan Work Against India
   Harsh V. Pant, and Rahul Rawat, National Interest, June 4, 2025

Pakistan and China’s militaries are highly integrated and poised to continue threatening New Delhi’s position in multiple domains.

The China-Pakistan military partnership, driven primarily by shared competition with India, has found renewed geostrategic logic since August 2019. India’s recent Operation Sindoor and Pakistan’s military response reflect the depth and quality of its bilateral exchanges with China. These ties are maturing and could soon prove decisive. New Delhi’s window to escape from this trap is closing.

Following the logic of legendary Indian strategist Kautilya and his Mandala theory, China and Pakistan have emerged as natural strategic partners, seeking to counterbalance India. This alignment was visibly reinforced during Operation Sindoor. On May 6–7, 2025, the Indian military targeted terrorist infrastructure in response to a likely Pakistan-backed terrorist attack in the Pahalgam region of Jammu and Kashmir.

In retaliation, the Pakistani military launched Operation Bunyan-un-Marsoos to target India. During the crisis episode, the employment of Chinese-origin fighter jets, Chinese PL-15 missiles, and drones highlighted a significant level of convergence in operational capabilities.

COMMENT – Expect to see the PRC use Pakistan more often as a proxy against India.

9. Countering AI Chip Smuggling Has Become a National Security Priority

   Erich Grunewald and Tim Fist, CNAS, June 11, 2025

An Updated Playbook for Preventing AI Chip Smuggling to the PRC

Based on the available evidence, artificial intelligence (AI) chip smuggling has likely been occurring at a scale that significantly undermines U.S. attempts to restrict the People’s Republic of China’s (PRC’s) access to advanced AI. This is indicated by four lines of argument:

Smuggling should be expected based on historical precedent. The PRC has a long history of smuggling U.S. technology despite export restrictions, which has rarely resulted in criminal or civil penalties.

Smuggling of U.S. AI chips is highly incentivized by their superior performance, higher supply, and more mature software ecosystem relative to chips legally available to Chinese AI labs. Based on publicly available data, of the 22 notable models that had been developed exclusively in the PRC by 2025, only two were trained with Chinese chips.

Six news outlets have independently reported evidence of large-scale AI chip smuggling, totaling tens to hundreds of thousands of chips smuggled in 2024. One smuggler reportedly handled an order of for servers containing 2,400 NVIDIA H100s—worth $120 million—to a customer in the PRC. Another facilitated an order worth $103 million. Singapore authorities arrested three individuals suspected of diverting AI servers worth $390 million. Within this reporting, multiple chip resellers and start-ups in the PRC have claimed that gaining access to export-controlled AI chips is straightforward, with one Chinese start-up founder estimating in 2024 that there were more than 100,000 NVIDIA H100s in the PRC. Most of the Chinese chip sellers interviewed in these reports confirm that they work with multiple distributors, use shell companies based overseas, and employ simple tactics to avoid detection, such as relabeling shipments as tea or toys.

There are many online listings for export-controlled AI chips available for purchase in the PRC. The authors conducted a non-exhaustive search of three Chinese online marketplaces and found 132 domestic listings for export-controlled chips, along with many photos of supposedly smuggled goods. Where sellers provided information on stock, the average quantity of export-controlled graphics processing units (GPUs) per listing was around 1,200 for GPU server listings and 400 for GPU card listings. Though this data is patchy and likely unreliable, the total stock implied is around 100,000 H100 GPUs, as of December 2024.

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Authoritarianism

10. Japan Says Chinese Fighter Jet Flew Too Close to Its Military Plane

    Hisako Ueno and John Yoon, New York Times, June 12, 2025

Japanese defense officials said on Thursday that a Chinese fighter jet had flown abnormally close to a Japanese military plane over international waters in the Pacific Ocean last weekend, raising concerns about China’s growing military actions in the region.

Japan’s Defense Ministry said in a statement on Thursday that a Chinese J-15 fighter jet had made a peculiar approach to a Japanese P-3C patrol aircraft conducting surveillance over the Pacific.

The Chinese jet flew as close as 150 feet next to the Japanese plane on Saturday, and cut in front within 3,000 feet of the nose on Sunday, introducing the likelihood of a crash, the Defense Ministry said.

The Chinese fighter jet had originated from the Shandong, one of the two aircraft carriers that China had sent into the Pacific Ocean last weekend to conduct exercises, the first the carriers had done together so far from the Chinese coast. The exercises displayed Beijing’s growing military reach.

11. Strait talking: What’s behind China’s military drills around Taiwan
    Estelle Huang, European Council on Foreign Relations, June 6, 2025

12. Russian Intelligence Says It Collects WeChat Data. What Does That Mean?
    Aaron Krolik and Paul Sonne, New York Times, June 7, 2025

13. Xi Jinping's generals face a treacherous political battlefield

    Katsuji Nakazawa, Nikkei Asia, June 12, 2025

The fate of one missing officer was confirmed at his predecessor's funeral.

14. Xi Tightens Leash on Officials’ Boozing and Lavish Living
    Chun Han Wong, Wall Street Journal, June 9, 2025

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Environmental Harms

15. China backs probe into Mekong pollution after reports point finger at mining operations

    Xinyi Wu, South China Morning Post, June 9, 2025

Media reports and activists have said Chinese firms operating in Myanmar are responsible for pollution downriver in Thailand.

16. China-Linked Mines in Myanmar Blamed for Toxic Pollution Flowing into Thailand

    Chayanit Itthipongmaetee and Sally Jensen, China Global South Project, June 11, 2025

17. BYD Unleashes an EV Industry Reckoning That Alarms Beijing
    Bloomberg, June 8, 2025

18. China increases scrutiny over rare earth magnets with new tracking system
    Reuters, June 4, 2025

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Foreign Interference and Coercion

19. Two Are Charged with Stalking an Artist Who Criticized Xi Jinping
    Mark Walker, New York Times, June 9, 2025

20. More European, More Resilient: ECCT Chairman Calls for Deeper EU-Taiwan Partnership
    H Henry Chang, Commonwealth Magazine, June 2, 2025

21. Xi Jinping urges South Korea’s new president to set relations with China on ‘right course’
    Shi Jiangtao, South China Morning Post, June 10, 2025

22. Taiwan Tries to Purge Its Ranks of China Sympathizers
    Joyu Wang, South China Morning Post, June 9, 2025

23. Taiwan indicts four suspected spies for China in case reaching presidential office
    Reuters, June 10, 2025

24. Buyer With Ties to Chinese Communist Party Got V.I.P. Treatment at Trump Crypto Dinner
    Eric Lipton, et al., New York Times, June 6, 2025

25. Beijing Woos US Influencers with Free Trip to Show ‘Real China’
    Bloomberg, June 10, 2025

26. India's largest dam project on China border opposed by locals
    Quratulain Rehbar, Nikkei Asia, June 10, 2025

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Human Rights and Religious Persecution

27. New report details Beijing’s targeting of protestors abroad

    Carmen Molina Acosta, ICIJ, June 13, 2025

ARTICLE 19, a freedom of expression advocacy organization, documented heightened transnational repression during state visits, echoing the findings of ICIJ’s China Targets investigation.

28. Critical mineral industries in China’s far west using Uyghur forced labor: report

    Tenzin Pema, Radio Free Asia, June 12, 2025

A new report says major Chinese producers of critical minerals are using state-imposed forced labor programs in the Uyghur region to meet rising global demand, putting international brands they export to at risk of complicity in human rights violations.

According to the report by Hague-based rights group Global Rights Compliance, 77 companies and downstream manufacturers of critical minerals-based products operate in the Xinjiang Uyghur Autonomous Region (XUAR), placing them at risk of participation in the labor transfer programs in the lithium, titanium, beryllium, and magnesium industries.

The findings are likely to add to the due diligence concerns of foreign and multinational companies that source those products. Forced labor is on a long list of serious human rights problems that have been documented in Xinjiang, where the U.S. government determined in 2021 that China was committing genocide against the Uyghurs.

The Uyghur region is a major source of four critical minerals. It is the top source of beryllium, crucial for nuclear applications and advanced electronics, and one of the five province-level jurisdictions that produces raw magnesium. The region is also seeing a surge in lithium exploration, mining, and battery production to feed the electric vehicle industry, and accounts for 11.6% of the world’s titanium sponge, a key input in titanium metal that is used in aerospace and defense.

Over the past decade, Beijing has expanded exploration, mining, processing and manufacturing of critical minerals in the XUAR, transforming the region into a major “extractive hub,” Global Rights Compliance said in its report titled “Risk at the Source: Critical Mineral Supply Chains and State-Imposed Forced Labor in the Uyghur Region.”

China dominates global mineral production. The country leads production of 30 out of the 44 minerals that the U.S. government has designated as critical.

COMMENT – Hmmm… maybe we shouldn’t make ourselves dependent on these commodities.

29. Risk at the Source: Critical Mineral Supply Chains and State-Imposed Forced Labour in the Uyghur Region

    Global Rights Compliance, June 10, 2025

30. Harvard’s China Ties Become New Front in Battle with Trump
    James T. Areddy, Wall Street Journal, June 9, 2025

31. American students in China face a barrage of questions about Trump
    Katrina Northrop, Washington Post, June 8, 2025

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Industrial Policies and Economic Espionage

32. Supply Chains Become New Battleground in the Global Trade War

    Jason Douglas, Wall Street Journal, June 11, 2025

U.S.-China talks on trade resemble arms-control negotiations, with export controls the key weapons in each side’s arsenal.

33. U.S. and China Meet at Precarious Moment in Trade War
    Alan Rappeport and Keith Bradsher, New York Times, June 9, 2025

34. US Treasury chief slams ‘unreliable’ China at House hearing on Trump trade policy

    Mark Magnier, South China Morning Post, June 12, 2025

His claim Beijing has ‘most unbalanced economy in the history of the world’ fails to sway Democrats’ scepticism over administration’s ‘whims’

US Treasury Secretary Scott Bessent slammed Beijing on Wednesday for its aggressive export policies, urged it to be a more dependable partner and depicted China’s disjointed economic structure as hurting not only the US but the entire globe.

“China currently has the most unbalanced economy in the history of the world,” Bessent, a former hedge fund manager, told the powerful House Ways and Means Committee.

“They cannot be allowed to export their way back to prosperity, not only for working Americans but for working citizens around the world.”

Noting his return hours earlier from two days of negotiating with China in London, Bessent said this week’s bilateral agreement offered Beijing a chance to become a more balanced economic player.

The deal could also help China boost its domestic consumption rather than extend a long-standing pattern of excessive production distorting the global economy, according to the Treasury secretary.

But Bessent urged vigilance. “China has proven an unreliable partner,” he testified before adding that “we will see” if it is more reliable this time.

35. How BYD and Chinese peers are transforming Europe’s small EV market
    Yujie Xue, South China Morning Post, June 9, 2025

36. China to remove tariffs on nearly all goods from Africa as both criticise US trade moves

    Jevans Nyabiage, South China Morning Post, June 12, 2025

Plan expands on policy announced last year granting 33 least-developed African countries zero-tariff treatment.

37. China’s Rare Earth Exports Recover Ahead of US Trade Talks
    Bloomberg, June 8, 2025

38. China Consumer Deflation Streak Persists as Price Wars Rage
    Bloomberg, June 8, 2025

39. Trump’s China Gambit Belies Rocky Road Ahead on Tariff Deals
    Josh Wingrove, Bloomberg, June 7, 2025

40. Export Controls to Take Center Stage at U.S.-China Trade Talks
    Lingling Wei and Gavin Bade, Wall Street Journal, June 8, 2025

41. China’s Exports to U.S. Suffer Biggest Decline Since 2020
    Hannah Miao, Wall Street Journal, June 9, 2025

42. China Is Putting Aside Its Self-Sufficiency Push for American Medicine
    Stu Woo, Wall Street Journal, June 7, 2025

43. China arms itself for more export control battles
    Edward White and Joe Leahy, Financial Times, June 7, 2025

44. China fast tracks rare earth export licences for European companies
    Edward White and Andy Bounds, Financial Times, June 7, 2025

45. Auto companies 'in full panic' over rare-earths bottleneck
    Kalea Hall, Reuters, June 9, 2025

46. China Extends Probe into EU Pork Imports
    Wall Street Journal, June 10, 2025

47. Huawei Founder Dismisses U.S. Export Control Concerns
    Sherry Qin, Wall Street Journal, June 10, 2025

48. EU investigates alleged Chinese tariff dodging as it hikes plywood duties
    Andy Bounds, Financial Times, June 10, 2025

49. China’s $1.1tn asset manager becomes star player on ‘national team’
    Cheng Leng, Haohsiang Ko, and Thomas Hale, Financial Times, June 9, 2025

50. Smelters pay to process copper as China expands capacity
    Camilla Hodgson, Financial Times, June 9, 2025

51. Trump eyes easing US chip export restrictions to secure Chinese rare earths
    Demetri Sevastopulo and Thomas Hale, Financial Times, June 9, 2025

52. Clock Ticks as U.S. and China Try to Undo Devastating Trade Curbs
    Ana Swanson, New York Times, June 10, 2025

53. China’s solar PV makers seek antidote to market ills as glut, price war, Trump tariffs sting
    Yujie Xue, South China Morning Post, June 10, 2025

54. As trade talks continue, China thinks it has leverage over U.S.
    Katrina Northrop, Washington Post, June 10, 2025

55. Price wars grip China as deflation deepens, $30 for a luxury Coach bag?
    Casey Hall, Reuters, June 10, 2025

56. From Visas to Jets, US and China Are Finding New Trade Leverage
    Bloomberg, June 10, 2025

Cyber and Information Technology

57. Synopsys restarts some China services, sales of core tools still blocked, source says

    Liam Mo and Brenda Goh, Reuters, June 12, 2025

Synopsys has resumed offering some services in China, relaxing a suspension it implemented earlier this month to comply with new U.S. export curbs, a source with direct knowledge of the matter told Reuters.

As tensions flared between the world's two largest economies last month, Washington ordered a broad range of companies to stop shipping goods to China.

The decision led Synopsys, a California-based provider of semiconductor design software, to halt sales and services in China and shut down access to its SolvNet customer support site.

58. Chinese Managers Take Reins at TikTok Shop in US as Sales Miss Goal
    Bloomberg, June 7, 2025

59. The Silicon State
    Noah Berman, The Wire China, June 8, 2025

60. China’s Huawei plays down its chipmaking capabilities
    Eleanor Olcott, Financial Times, June 9, 2025

61. Chinese premier urges faster tech applications amid US export controls
    Sylvia Ma, South China Morning Post, June 10, 2025

62. Tesla’s self-driving future under threat from China's auto, tech giants
    Norihiko Shirouzu, Reuters, June 10, 2025

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Military and Security Threats

63. A Smuggled Pathogen Raises Specter of Chinese Agroterrorism

    Sofia Triana and Daniel Byman, Foreign Policy, June 11, 2025

The FBI says Chinese scientists may have targeted the U.S. food supply.

64. China’s sixth-gen fighters: fresh photos hint at cruising capacity and drone control
    Enoch Wong, South China Morning Post, June 8, 2025

65. Beijing’s 4 core principles held up as route to peace in disputed waters
    Alyssa Chen, South China Morning Post, June 8, 2025

66. US raises concern over plan for Chinese embassy in London
    Demetri Sevastopulo and Jim Pickard, Financial Times, June 8, 2025

67. China’s Chokehold on This Obscure Mineral Threatens the West’s Militaries
    Keith Bradsher, New York Times, June 9, 2025

68. China’s Navy Expands Its Reach with Aircraft Carrier Drills
    Austin Ramzy Follow and Joyu Wang, Wall Street Journal, June 9, 2025

69. Chinese drone parts prices double as export controls bite
    William Langley, Financial Times, June 10, 2025

70. How Defense Reconciliation Could Fund Indo-Pacific Deterrence
    Kimberly Lehn, Real Clear Defense, June 10, 2025

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One Belt, One Road Strategy

71. China-backed militia secures control of new rare earth mines in Myanmar

    Naw Betty Han, Shoon Naing, Devjyot Ghoshal, Eleanor Whalley, and Napat Wesshasartar, Reuters, June 12, 2025

A Chinese-backed militia is protecting new rare earth mines in eastern Myanmar, according to four people familiar with the matter, as Beijing moves to secure control of the minerals it is wielding as a bargaining chip in its trade war with Washington.

China has a near-monopoly over the processing of heavy rare earths into magnets that power critical goods like wind turbines, medical devices and electric vehicles. But Beijing is heavily reliant on Myanmar for the rare earth metals and oxides needed to produce them: the war-torn country was the source of nearly half those imports in the first four months of this year, Chinese customs data show.

72. Brazil plans panda bond as Lula looks to bolster ties with China
    Michael Pooler and Michael Stott, Financial Times, June 8, 2025

73. Transsion wheels into Africa’s EV market with same playbook that conquered mobile phones
    Damilare Dosunmu, Rest of World, June 10, 2025

74. AIIB stresses 'inclusive' approach as lender downplays China's sway
    Kenji Kawase, Nikkei Asia, June 10, 2025

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Opinion

75. How the United States Can Win the Global Tech Race
    Vivek Chilukuri, Foreign Policy, June 9, 2025

The Trump administration has scrapped its predecessor’s sweeping export controls for advanced artificial intelligence chips, known as the AI diffusion rule.

“To win the AI race, the Biden AI diffusion rule must go,” posted David Sacks, U.S. President Donald Trump’s top AI advisor, on May 8. Sacks continued his criticism at the Saudi-U.S. Investment Forum a few days later, arguing that the rule “restricted the diffusion or proliferation of American technology all over the world.”

As the administration decides what comes next, it should raise its sights from merely proposing a “simpler” rule to manage the diffusion of AI chips. Instead, it should seize the opportunity to offer an ambitious vision to promote the broader diffusion of U.S. technology.

After all, the world not only wants the United States’ AI chips, but also its AI applications, data centers, cloud services, satellites, and advanced technology offerings generally. But even as Beijing extends its digital offerings in key emerging markets, U.S. foreign policy has failed to adapt for a global technology competition with era-defining stakes. Whether you agree with the Trump administration or not, its disruption is an opportunity to forge a new model of technology statecraft to help the United States win the race to shape strategic digital infrastructure and technology diffusion across the globe.

To start, Washington must finally learn from its failure in the transition to 4G and 5G telecommunications networks, where Beijing’s state-backed model—and the absence of a compelling U.S.-led alternative—enabled Huawei and ZTE to all but corner emerging markets. Huawei now operates in more than 170 countries worldwide and is the top global provider of telecommunications equipment. But if there is broad consensus among U.S. policymakers that Beijing won that global technology transition, there is little agreement about how to win the next.

76. Trump Has No China Trade Strategy

    Wall Street Journal, June 11, 2025

Washington and Beijing stage a tactical retreat that shows China’s leverage.

77. The China Trade Deal Can't Go Soft on Chips

    Hal Brands, Bloomberg, June 11, 2025

Ending the tariff war may be important, but Trump shouldn’t negotiate away one of America’s most important controls.

The Donald Trump administration’s most recent round of trade talks with China has ended, but the great export-control debate is just getting underway.

Export controls were at the center of the negotiations in London this week; for years, they have anchored America's strategy for economic warfare with Beijing. China wants few things more than a relaxation of curbs on its access to high-end semiconductors; so do corporate players and analysts who argue that they do more harm than good.

Although the details are hazy, the Trump administration reportedly agreed to lift some recent controls as part of a deal to deescalate the trade war. Let's hope the administration doesn't go much further than that. Ditching or dramatically rolling back the measures that preserve American's technological advantage — and that have been imposed, with bipartisan backing, over the past several years — would be strategic self-sabotage of the highest form.

The export controls at issue pertain to the most advanced computer chips and the inputs, both hardware and software, required to make them. During Trump’s first term, the US hit specific Chinese firms, namely Huawei, with targeted bans. Under President Joe Biden, Washington went big: It intensified the tech war by expanding their application to cover China as a whole. Since then, Washington and Beijing have been playing cat-and-mouse, as China has sought to evade tech controls while the US gradually tightens them.

Export controls can seem arcane, but their purpose is strategically profound. The goal, as then-National Security Adviser Jake Sullivan said in 2022, was to maintain “as large a lead as possible” in key sectors like AI and advanced computing, because those sectors will shape the future economic and military balance.

Leaps in AI will affect everything from the lethality of warfare in the Western Pacific to the productivity of US and Chinese workers. Export controls, designed to keep China from accessing the crown jewels of US and allied innovation — and to exploit Washington’s unique position in key nodes of the semiconductor supply chain — are vital to staying ahead in this fateful race.

Not everyone agrees. The debut of DeepSeek’s R1 reasoning model in late 2024 raised questions about the dominance of US AI companies, just as the unveiling of a next-generation Huawei smartphone in 2023 sparked speculation that the company was shrugging off US bans.

Last month, Jensen Huang, the CEO of Nvidia — which makes top-of-the-line chips and would surely love to sell them in China — claimed that US controls have backfired by causing Beijing to push harder for self-sufficiency. But that position ignores a great deal of evidence.

Any honest evaluation starts with a realistic standard for success. The goal of US policy was never to comprehensively halt Chinese innovation. It was to slow Beijing in key areas that matter most to the future distribution of technological advantage and global power. If you want to know whether US controls have had that effect, just ask Beijing.

DeepSeek’s CEO has admitted that the chip ban is his company’s number one obstacle. Chinese leader Xi Jinping and his country’s Politburo have acknowledged the pressures US restrictions create. Xi repeatedly pushed for the easing of export controls in his interactions with Biden.

China wants those restrictions gutted because its leaders understand their power all too well. This is why Beijing is has been wielding its own limits on the sale of critical minerals: Imitation is the surest sign China appreciates the leverage export controls convey.

Other critiques falter under scrutiny. US tech restrictions can’t have spurred China’s drive for self-reliance: “Made in China 2025,” Xi’s bid to dominate key areas of innovation, was unveiled years before the US got serious about export controls. To suggest that a Leninist party-state needs US encouragement to seek technological primacy is to misunderstand how determined, how power-minded, Chinese leaders are.

The major problem with US export controls is the degree to which they have been evaded and undermined. Nvidia has built chips for export that just barely skirt performance thresholds the US government has established. Huawei has used shell companies and other illicit measures for getting prohibited chips. US policy has also been imperfect: The Biden administration’s deliberate approach to building bureaucratic and allied consensus around new controls often gave Beijing time to stockpile and blunt their impact.

And if Trump's deal with Xi entails an agreement not to impose new export controls in the future, it will — thanks to the cat-and-mouse dynamic — severely erode America's ability to keep even its existing restrictions effective and up to date.

78. Thanks to Trump, US threat of a ‘peaceful evolution’ recedes for China
    Wang Xiangwei, South China Morning Post, June 8, 2025

79. Tell Me How This Trade War Ends
    Emily Kilcrease and Geoffrey Gertz, Foreign Affairs, June 6, 2025

80. China's solar panel dumping into the US via Southeast Asia comes to an end
    Tim Daiss, Nikkei Asia, June 10, 2025