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US politicians have expressed outrage about a Biden administration move to quietly tell American investors they can hold on to shares of Chinese companies on an investment blacklist for military links, as reported by Nikkei Asia. “What is the point of a required divestment period if it doesn’t actually require divestment?” Republican Senator Marco Rubio said to Nikkei. “Once again, the Biden administration has watered down and weakened critical national tools to take on the Chinese Communist Party.” From across the aisle, Michael Wessel, a Democratic member of the official US-China Economic and Security Review Commission, said: “Treasury simply got it wrong. … Investors should be required to divest their holdings, not continue to profit from the threats the actions of some of these companies pose to American interests.”
The US trade deficit shrunk in April by the most on record in dollar terms, reflecting a drop in the value of imports amid Covid lockdowns in China while exports climbed. The gap in goods and services trade narrowed $20.6 billion, or 19.1%, to $87.1 billion, Commerce Department data showed Tuesday. The median estimate in a Bloomberg survey of economists called for an $89.5 billion deficit. The figures aren’t adjusted for inflation. Imports dropped in April as factory activity in China fell to the lowest level since February 2020 amid strict lockdowns to curb the spread of Covid-19. While manufacturing in the country has improved somewhat since, the measures are still straining already-tenuous global supply chains, especially when coupled with Russia’s war in Ukraine.
Facing paralysis of the US solar industry, President Joe Biden has ordered that potential trade violations by Chinese solar panel manufacturers go unpunished for the next two years, sidestepping a law Congress passed to protect US workers. Biden’s move Monday to prohibit new tariffs on the solar panels also took the teeth out of an investigation by the Commerce Department that was required by law. The Biden administration had previously tried to avoid interference in what’s supposed to be an independent, quasi-judicial process. The investigation will go on uninterrupted, the Commerce Department said Monday. But nobody will be punished. Senior Biden administration officials described the move to suspend the tariffs as creating a “bridge” — temporarily allowing cheap foreign solar panels to flood into the US to speed the transition to clean energy, while using those two years to ramp up a fledgling US solar manufacturing industry.
Russia-China Relations
Russian officials have raised increasingly frustrated requests for greater support during discussions with Beijing in recent weeks, calling on China to live up to its affirmation of a “no limits” partnership made weeks before the war in Ukraine began. But China’s leadership wants to expand assistance for Russia without running afoul of Western sanctions and has set limits on what it will do, according to Chinese and US officials. Moscow has on at least two occasions pressed Beijing to offer new forms of economic support — exchanges that one Chinese official described as “tense.” The officials familiar with the talks spoke on the condition of anonymity because of the matter’s sensitivity. They declined to share specifics of Russia’s requests, but one official said it included maintaining “trade commitments” predating the Feb. 24 invasion of Ukraine, and financial and technological support now sanctioned by the United States and other countries.
Russia’s foreign minister, Sergey Lavrov, lauded the “inexhaustible potential” of his country’s strategic relationship with China on Wednesday. Moscow’s top diplomat called for more economic integration with its powerful neighbor as the war in Ukraine neared 100 days and the West’s wide-ranging sanctions continued to endanger Russia’s growth. In prepared remarks at the top of an academic conference hosted by state-backed think tanks from Moscow and Beijing, Lavrov said Russia’s cooperation with China continued to grow in “scale and intensity” despite punctuative measures and an “information war” led by the United States. Developing the “strategic partnership” between the two countries “remains among Russia’s foreign policy priorities,” he said. “The experience of working together in the new environment shows that our ties have a powerful, truly inexhaustible potential, and are confidently passing endurance tests.”
CCP Foreign Influence
China’s financing of overseas projects has disproportionately benefited the core political supporters of incumbent presidents or prime ministers of those countries that receive the funds, according to a new book. During the 20th century, China was mostly known as a recipient of international development finance. Its overseas development program was modest – roughly on a par with that of Denmark. But over the course of one generation, as Beijing emerged as the world’s second-largest economy, its footprint began to extend far beyond its borders – often in the form of infrastructure initiatives such as Belt and Road. Its use of debt rather than aid to bankroll big-ticket overseas projects created new opportunities for developing countries to achieve rapid socio-economic gains, but it also introduced major risks, such as corruption, “political capture” and conflict.
China is secretly building a naval facility in Cambodia for the exclusive use of its military, with both countries denying that is the case and taking extraordinary measures to conceal the operation, Western officials said. The military presence will be on the northern portion of Cambodia’s Ream Naval Base on the Gulf of Thailand, which is slated to be the site of a groundbreaking ceremony this week, according to the officials, who, like others, spoke on the condition of anonymity because of the matter’s sensitivity. The establishment of a Chinese naval base in Cambodia — only its second such overseas outpost and its first in the strategically significant Indo-Pacific region — is part of Beijing’s strategy to build a network of military facilities around the world in support of its aspirations to become a true global power, the officials said.
In every crisis, someone always benefits. In the case of Russia’s invasion of Ukraine, that someone is Indian Prime Minister Narendra Modi. By refusing to condemn Moscow and join Western-led sanctions, Modi has managed to elevate India’s global stature. Each of the other major powers—the United States, Russia, and China—are intensely courting India to deny a strategic advantage to their adversaries. Relishing the spotlight, Modi and his Hindu-nationalist government will surely look to keep the momentum going. Their likely goal is to carve out an independent superpower role for India, hasten the transition to a multipolar international system, and ultimately cement its new status with a permanent United Nations Security Council seat for India.
COVID-19
Chinese authorities have apparently eased restrictions on a commuter town near Beijing after the latest show of public anger against Covid-19 controls. Thousands of residents gathered in Yanjiao, Hebei province on Wednesday to protest over measures that have made it difficult for them to enter Beijing in the past two years. The town is located on the eastern outskirts of Beijing, about 35km from the city centre. Many people choose to live there because it is cheaper than Beijing, and about 100,000 residents need to make the daily commute into the capital. But since the pandemic began, towns like Yanjiao have been subject to some of the toughest controls in China. Yanjiao residents have been unable to enter the capital for months this year even though there have been few cases in the region.
China’s Premier Li Keqiang’s recent warning that the economy is facing serious challenges as a result of its Covid-19 controls has raised fears the country may be facing its biggest economic slowdown – or even recession – in decades. Chinese and international observers have suggested that Beijing may need to rethink its approach towards the West and scale down its global ambitions as it grapples with an increasingly hostile external environment. They warned that economic headwinds may compromise China’s ability to compete with the United States and put further strains on the Belt and Road Initiative, its transcontinental investment strategy. Senior Chinese officials, however, have put on a brave face over the past week, trying to play down such concerns while repeating their promises to developing nations.
A COVID-19 vaccine candidate from China’s Walvax Biotechnology using mRNA technology triggered a stronger antibody response against the Omicron variant of the coronavirus as a booster dose than Sinovac’s shot, clinical trial data showed. The result for Walvax’s ARCoV candidate, which is yet to be peer reviewed, comes as competition for the COVID booster market intensifies in China, where more than half of the 1.4 billion population have so far received a non-mRNA booster shot. Among 300 healthy adults vaccinated with two doses of either a Sinovac or Sinopharm vaccine around six months earlier, the neutralizing antibody level against Omicron in those given an ARCoV booster was 4.4-fold higher than in those who received a Sinovac third dose, researchers said in a paper published on Tuesday.
Hong Kong
Congress and the White House continue to fail Hongkongers. Most recently, as protesters have fled Hong Kong and sought refuge across the world, Congress has repeatedly failed to back their claimed support of the cause with action. Despite several efforts, no legislation to provide Hongkongers a pathway to residency has successfully become law. In the latest effort—a very modest bill to allow in a few thousand Hongkongers each year—a single senator blocked its passage, and now a legislative committee is close to rejecting its inclusion in a larger legislative package. These bills have been bipartisan efforts. Hongkongers are, on average, a relatively skilled and prosperous bunch, and the US is in the midst of a labor shortage. Logic suggests Hongkongers should be welcomed with open arms by those of all political stripes. So what has prevented the US Government from doing so?
The high-profile national security case involving a number of pro-democracy figures has largely been transferred to Hong Kong’s High Court, with 44 defendants committed to the Court of First Instance for trial or sentencing. Dozens of defendants have spent more than a year behind bars as committal proceedings were repeatedly adjourned. Principal Magistrate Peter Law on Monday moved 27 democrats to the High Court, where they could face up to life in prison over an alleged conspiracy to commit subversion in connection with an unofficial legislative primary election held in July 2020. Committal proceedings began last July and were adjourned numerous times in the months since. The accused included former law professor Benny Tai, prominent activist Joshua Wong, former lawmakers, ex-district councillors and other activists, who organized and participated in the primary with the aim of gaining a controlling majority in the legislature.
Six people have been arrested in Hong Kong as authorities moved to restrict public commemoration of the Tiananmen Square massacre. Saturday was the 33rd anniversary of the highly sensitive incident in which China’s rulers crushed peaceful protests with tanks and troops. Until recently, Hong Kong was one of the few Chinese territories which commemorated the event. But Beijing has effectively banned the city’s annual public vigil. Hong Kong Police confirmed five men and one woman had been arrested in the vicinity of Victoria Park, where a candlelight vigil marking the 1989 crackdown in Beijing would have been held. The six are now in police custody.
Taiwan
Although China’s threat to seize Taiwan by force has been in place ever since the Chinese Nationalist government and army fled to Taiwan in 1949 after losing the civil war on the mainland, Beijing had long focused on pulling the island into its fold with economic lure and political pressure. But many Taiwanese policymakers now believe that as the Chinese Communist party loses hope these measures will ever work and with its armed forces modernizing rapidly, Xi might opt for war soon. Taiwan came into renewed focus as an increasingly dangerous flashpoint just days after Biden’s inauguration last year when Chinese warplanes simulated missile attacks on a US aircraft carrier sailing in the vicinity of the country. Over the following months, China then boosted the tempo and size of fighter jet and bomber sorties near Taiwan.
It is wrong to label Taiwan’s main opposition party the Kuomintang (KMT) as being pro-China as it has always been pro-US and is dedicated to defending the island though also to talking to Beijing, its chairman said in Washington. The KMT ruled China until fleeing to Taiwan in 1949 after losing a civil war to the Communists. It has traditionally favored close ties with Beijing, which has increasingly set it at odds with most Taiwanese, who feel little in common with autocratic China. The KMT badly lost presidential and parliamentary elections in 2020, having failed to shake accusations from the governing Democratic Progressive Party it would sell out Taiwan to Beijing.
A civic group in Taiwan unveiled a replica of the “Pillar of Shame” statue honoring the victims of the 1989 Tiananmen Square incident on its 33rd anniversary on Saturday. The original sculpture created by a Danish artist had been on the University of Hong Kong’s campus since 1998. Memorial services were held in front of the statue every year. However, the university removed the statue last December following a series of arrests under the territory’s national security law that is designed to clamp down on anti-government activities. With permission from the Danish creator, the civic group in Taiwan has reproduced the statue using a 3-D printer. About 500 participants, including Hong Kong people living in Taiwan, observed a silent prayer for 64 seconds from 8:09 p.m. that represented June 4, 1989.
Xinjiang
Several European lawmakers are pushing to designate human rights abuses against Uygurs and other ethnic Muslims in Xinjiang by China as “genocide.” The resolution will be presented to the European Parliament this week. The parties entred negotiations on Tuesday to finalize the text of the resolution, which will be reviewed on Wednesday and hopefully put to a vote on Thursday. Four of the biggest parties in the European Parliament, the center-right European People’s Party (EPP), the center-left Renew Group, the Socialist and Democrats (S&Ds) and the right-wing European Conservatives and Reformists, are likely to back the motion, giving a high chance of it passing, according to the South China Morning Post.
Some time ago in a major city in eastern China, a letter was hand-delivered by a Uyghur young man. The young man addressed the letter to the world outside China. The recipient of the letter, a non-Chinese citizen in eastern China, in turn shared it with me at the author’s request. At the risk of great personal harm, the author insisted that the letter be translated, edited, and published in English. After independently confirming the identity of the letter-writer, I agreed to do this. In the letter, the author describes how his life has been shattered by the mass internment campaign that has swept up Uyghurs from across the country, trapping them “in the darker world of Xinjiang.”
It’s been over five years since I’ve seen my mother. At a banquet for my cousin in the village of Karasu, in the Yining district, they arrested her and took her away for questioning. My younger brother waited outside for her for seven hours, but nobody told him his mom wouldn’t be able to come home that day. After that, she disappeared for several months. We searched and searched, and finally we learned through some friends and coworkers that she was in a camp.
The China Debrief is a resource of the Victims of Communism Memorial Foundation.
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