‘Groundless’: China dismisses report of corruption probe into Defence Minister Dong Jun；Why some experts say China urgently needs a crisis system to stop ‘lone wolf’ killings
China investigates Shanghai free-trade-zone party chief for corruption
Welcome to this issue of The China Brief. Today is November 27, 2024. Here at The China Brief, we bring you the latest news on China's politics, economy, and society from global media sources, along with exclusive expert analysis. If you find our content helpful, please subscribe to our newsletter.
‘Groundless’: China dismisses report of corruption probe into Defence Minister Dong Jun
South China Morning Post
China's foreign ministry has dismissed reports claiming Defence Minister Dong Jun is under investigation for corruption as "groundless." The Financial Times cited U.S. officials stating that Dong is the third consecutive Chinese defense minister to face such scrutiny, following Li Shangfu and Wei Fenghe, both of whom were ousted over corruption allegations. Foreign ministry spokeswoman Mao Ning’s response to the recent report differed from her earlier comments regarding Li, indicating a more assertive denial this time. Dong, appointed in December 2022, lacks the influential titles held by his predecessors, serving primarily as the international representative of the People's Liberation Army rather than a key military figure. His last public appearance was on November 21, 2023, where he did not meet with U.S. Defence Secretary Lloyd Austin due to tensions over U.S. arms sales to Taiwan.
https://www.scmp.com/news/china/military/article/3288366/groundless-china-dismisses-report-about-corruption-probe-defence-chief-dong-jun?utm_source=rss_feed
China launches corruption probe against Defence Minister Dong Jun: Report
Al Jazeera
China is investigating Defence Minister Dong Jun for suspected corruption, marking him as the latest official caught in a military anti-corruption crackdown. Reports indicate that Dong, appointed in December 2023, is the third consecutive defence minister to face such scrutiny, following Li Shangfu and Wei Fenghe, both of whom were expelled from the Communist Party for corruption-related offenses. The Chinese military has seen significant purges, with many high-ranking officials and executives removed amid allegations of bribery. This ongoing investigation is seen as detrimental to the Communist Party's image and highlights the intense competition and potential for mutual accusations among military officers. The situation remains unconfirmed, with Chinese officials dismissing the report as unfounded.
https://www.aljazeera.com/news/2024/11/27/china-launches-corruption-probe-against-defence-minister-dong-jun-report
Why some experts say China urgently needs a crisis system to stop ‘lone wolf’ killings
South China Morning Post
Legal experts in China are calling for the establishment of a crisis intervention system to identify high-risk individuals and prevent “lone wolf” attacks, following recent violent incidents that resulted in over 40 deaths. In an article, they emphasized the need for improved mental health crisis intervention and conflict resolution mechanisms. The recent attacks included a vehicle ramming in Zhuhai that killed 35 people and a stabbing in Jiangsu that claimed eight lives. The suspects in both cases exhibited signs of distress and could have benefited from psychological support. The experts criticized the current security measures for lacking early intervention strategies and highlighted the ineffectiveness of existing counseling services. They suggested that China could learn from legal frameworks in the U.S. and Germany to develop a comprehensive prevention system and proposed regular visits by certified mental health workers to vulnerable populations. The authorities are still investigating the attacks, with promises of swift and severe action against similar crimes.
https://www.scmp.com/news/china/politics/article/3288319/why-some-experts-say-china-urgently-needs-crisis-system-stop-lone-wolf-killings?utm_source=rss_feed
Chinese woman makes US$42,000 in 3 months from ‘flash’ marriages and divorces
South China Morning Post
Matchmaking companies in southwestern China are under police investigation for defrauding single men by arranging fake marriages with women who later vanish or seek divorce. Some women reportedly made up to 300,000 yuan (US$42,000) in a few months through these scams, known as "flash weddings." Many male victims, like Liao, paid large bride prices and faced deceitful partners who concealed their pasts. Since March last year, authorities received 180 fraud reports and resolved 50 disputes, leading to a crackdown on these agencies, which have since begun relocating operations to evade scrutiny.
https://www.scmp.com/news/people-culture/trending-china/article/3288086/chinese-woman-makes-us42000-3-months-flash-marriages-and-divorces?utm_source=rss_feed
The Limits of a Trump-Putin Deal on Ukraine
Foreign Policy
President-elect Donald Trump's promise to end Russia's war in Ukraine on his first day in office raises concerns about the potential implications of such a deal, particularly if it excludes Ukraine and European allies. While Trump may seek an agreement with Russian President Vladimir Putin, there is a significant risk that Putin could exploit Trump's eagerness for a deal to extract concessions from the U.S. This could lead to a weakened Western alliance, diminished support for Ukraine, and potentially pave the way for future Russian aggression against Europe.
The article outlines possible terms of a Trump-Putin deal, which could involve the U.S. dropping support for Ukraine's NATO membership, recognizing Russian annexations, and ending sanctions in exchange for a cease-fire. However, there are doubts about whether Putin would accept such terms, given his long-term objectives regarding Ukraine. Even if an agreement is reached, it may not bring an end to hostilities, as Ukraine views the conflict as existential and would likely continue to resist any concessions made without its input.
To counter the risks posed by potential negotiations between Trump and Putin, European countries must take proactive measures. This includes increasing defense spending, sending troops to Ukraine for training, reaffirming NATO's commitment to Ukraine's membership, and linking any U.S. security assurances to cooperation on issues like China. Strengthening European military capabilities and asserting a unified stance on Ukraine will provide a buffer against unfavorable deals and help maintain the integrity of the European security order amidst evolving geopolitical dynamics.
https://foreignpolicy.com/2024/11/27/trump-putin-deal-peace-ukraine-russia-war-europe/
China investigates Shanghai free-trade-zone party chief for corruption
South China Morning Post
Zhu Zhisong, the party chief of Shanghai’s Pudong New Area, is under investigation for suspected corruption, marking the first such probe since Pudong's establishment in 1992. The Central Commission for Discipline Inspection reported Zhu is accused of serious violations of discipline and law. His recent public activities included promoting economic reforms at the Hongqiao International Economic Forum. Zhu, who has a background in aerospace, was appointed party chief of Pudong in 2021 and oversees the China (Shanghai) Pilot Free Trade Zone. He follows other high-profile officials, like Dong Yunhu, in facing corruption investigations.
https://www.scmp.com/news/china/politics/article/3288357/china-investigates-shanghai-free-trade-zone-party-chief-corruption?utm_source=rss_feed
Trump’s trade chief pick, a Lighthizer protégé, set to push hard line, tariffs on China
South China Morning Post
Jamieson Greer's nomination as the next US trade representative signals a continuation of a hardline approach in US-China trade relations, as emphasized by President-elect Donald Trump. Greer, a protégé of former trade representative Robert Lighthizer, is expected to focus on reducing the US trade deficit and implementing aggressive tariffs on China, further straining the relationship between the two largest economies. Analysts predict Greer will mirror Lighthizer's protectionist policies, pushing for tariffs to combat what Trump describes as unfair trade practices. The potential revocation of China’s permanent normal trade relations status could also be a significant blow to bilateral ties. While American businesses are bracing for increased tariffs, many express skepticism about their efficacy in benefiting the US economy. European companies operating in China are particularly concerned about the geopolitical tensions and the complex regulatory landscape. The article highlights the ongoing challenges in achieving meaningful trade agreements, with experts doubting the likelihood of a "phase two" trade deal that would be advantageous for American stakeholders. Overall, the trade environment is poised for heightened tensions, with Greer’s appointment reinforcing the administration's protectionist stance.
https://www.scmp.com/economy/global-economy/article/3288351/trumps-trade-chief-pick-lighthizer-protege-set-push-hard-line-tariffs-china?utm_source=rss_feed
Crypto mogul Justin Sun invests US$30 million in Trump tokens after banana artwork deal
South China Morning Post
Justin Sun, the founder of the Tron blockchain, has invested $30 million in Donald Trump's cryptocurrency project, World Liberty Financial (WLFI), making him the largest holder of its crypto token. Sun expressed his support for Trump's vision for the U.S. as a blockchain hub and has joined WLFI as an adviser. His investment comes amidst a surge in cryptocurrency prices and follows his recent purchase of a controversial artwork by Maurizio Cattelan for $6.2 million. Sun plans to live stream himself eating the banana from the artwork. Despite his successes, he is facing regulatory challenges in both the U.S. and Hong Kong, where his cryptocurrency exchange has struggled to gain licensing approval.
https://www.scmp.com/tech/blockchain/article/3288350/crypto-mogul-justin-sun-invests-us30-million-trump-tokens-after-banana-artwork-deal?utm_source=rss_feed
Ikea warns Trump’s tariffs could push up prices
CNN
Jesper Brodin, CEO of Ingka Group, which operates Ikea, expressed concerns that Donald Trump's proposed tariffs could raise prices for consumers and hinder the company's ability to maintain affordability. He noted that high tariffs have historically been detrimental to both Ikea and the global economy. Brodin emphasized the importance of long-term supplier relationships and mentioned that Ikea recently reduced prices on thousands of products. Meanwhile, Ikea is launching a pop-up store on London’s Oxford Street, with a permanent store set to open next spring, aimed at providing a more accessible shopping experience.
https://edition.cnn.com/2024/11/27/business/ikea-prices-trump-tariffs-intl/index.html
China extends reach into Latin American as crane exports, trade diversification picks up
South China Morning Post
Chinese crane exports to Latin America are surging, particularly to Peru and Mexico, as part of Beijing's Belt and Road Initiative and amid a trade war with the U.S. Exports to Peru increased by 132% in October, while shipments to Mexico rose by 193% from January to October. Analysts suggest this indicates China's efforts to expand port capacity in these countries for exporting goods to the U.S. Additionally, China's state-owned Shanghai Zhenhua Heavy Industries dominates the crane market. However, potential risks exist, such as U.S. tariffs and bans on products from Chinese-invested ports.
https://www.scmp.com/economy/global-economy/article/3288381/china-extends-reach-latin-american-crane-exports-trade-diversification-picks?utm_source=rss_feed
Volkswagen unloads controversial Xinjiang plant for 'economic reasons'
Nikkei Asia
Volkswagen has sold its factory and test track in Xinjiang, China, citing economic reasons, while extending its joint venture with SAIC Motor until 2040. The move comes amid criticism over alleged forced labor in the region. VW plans to introduce 18 new models by 2030, emphasizing the importance of the Chinese market, which contributes 30% of its sales. Despite recent revenue growth, SAIC-VW has faced declining vehicle sales and profits compared to pre-pandemic levels. VW is also struggling in Europe and plans to cut costs, including a potential 10% salary reduction for German workers.
https://asia.nikkei.com/Business/Automobiles/Volkswagen-unloads-controversial-Xinjiang-plant-for-economic-reasons
China reclaims No 1 physics research spot from US as scientists fight it out: report
South China Morning Post
China has regained its position as the world's top nation in physics research, as reported in the 2024 "Research Fronts" report released by the Chinese Academy of Sciences, the National Science Library of China, and Clarivate. This follows a year where the United States held the top spot. The report evaluates scientific activities globally, highlighting China's strengths in various fields, including agricultural sciences, chemistry, and information sciences. The findings are based on data from Essential Science Indicators, which tracks influential academic papers and identifies emerging research trends. Despite China's success in physics, the U.S. has maintained a lead in basic research overall for the past five years, with a competitive landscape emerging in multiple research fields, including ecology and environmental sciences. The report aims to help China enhance its scientific and technological advancements amid global competition.
https://www.scmp.com/news/china/science/article/3288400/china-reclaims-no-1-physics-research-spot-us-scientists-fight-it-out-report?utm_source=rss_feed
China’s industrial profits drop in October as property slump flows downstream
South China Morning Post
China's industrial firms experienced a 10% profit decline in October, particularly in property and retail sectors, with total profits from January to October dropping 4.3% to 5.87 trillion yuan. Steel and fuel sectors reported significant losses, while state-owned firms saw an 8.2% decrease in profits. Analysts attribute the downturn to weak construction demand stemming from a struggling property market, compounded by potential tariff hikes under President-elect Trump. However, some sectors, like utilities and electronics, reported profit increases, reflecting a shift towards newer industries. Overall, China's manufacturing faces pressure from weak domestic demand and a looming trade war.
https://www.scmp.com/economy/economic-indicators/article/3288387/chinas-industrial-profits-drop-october-property-slump-flows-downstream?utm_source=rss_feed
Guangzhou court restricts China Evergrande founder Hui Ka-yan’s spending
South China Morning Post
A court in Guangzhou has imposed spending restrictions on Hui Ka-yan, the founder of China Evergrande, and his company due to their failure to meet payment obligations. This ruling comes as Evergrande, once China's largest property developer, has struggled since defaulting on its debts nearly three years ago, contributing to a significant property crisis in the country. The restrictions prevent Hui and his executives from engaging in non-essential spending, including traveling by plane or purchasing property. Despite government efforts to encourage property purchases, new home sales have dramatically declined. Evergrande's total liabilities are around 2.4 trillion yuan, and the company has been subject to liquidation proceedings and ongoing legal challenges. The prospects for restructuring and resuming trading remain uncertain as financial difficulties persist.
https://www.scmp.com/business/article/3288323/guangzhou-court-restricts-china-evergrande-founder-hui-ka-yans-spending?utm_source=rss_feed
Nvidia and Intel suppliers reassess Mexico plans amid Trump tariff threat
Nikkei Asia
Server manufacturers are preparing for potential 25% tariffs on imports from Mexico, announced by Donald Trump, as Mexico is a key manufacturing hub for tech giants like Nvidia and Intel. Companies like Foxconn are expanding U.S. production while pausing projects in Mexico due to uncertain trade policies. Foxconn plans to invest $33 million in Texas for AI server production but continues to invest in Mexico, believing in regional manufacturing trends. Analysts warn these tariff threats could hinder Mexico's growth as an AI server hub, prompting suppliers to consider diversifying production to other countries like Vietnam and Thailand.
https://asia.nikkei.com/Spotlight/Supply-Chain/Nvidia-and-Intel-suppliers-reassess-Mexico-plans-amid-Trump-tariff-threat
China's exports boom as companies race against Trump tariffs
Nikkei Asia
China's exports are predicted to hit a record high this year, fueled by U.S. companies rushing to stockpile goods amid looming tariffs from President-elect Donald Trump. Many American importers have increased orders to mitigate potential costs from new tariffs, leading to a nearly 6% rise in U.S. imports from China during the peak season. While China's exports surged by 12.7% in October, experts warn that this boost may be temporary due to potential future tariffs that could significantly impact China's trade and economic growth. China plans to implement policies to stabilize exports while seeking constructive dialogue with the U.S.
https://asia.nikkei.com/Economy/Trade-war/China-s-exports-boom-as-companies-race-against-Trump-tariffs
Foreign tech startups compete to help Vietnam go green
Nikkei Asia
The second-annual Net Zero Challenge, organized by the Temasek Foundation and partners, attracted around 500 startups from 55 countries to address Vietnam's environmental challenges. The competition, which offers a total of 15 billion dong ($590,000) in prizes, focuses on attracting innovative technology to Ho Chi Minh City, especially from businesses that may not typically consider Vietnam.
Three winners were announced, including Canada's CO2L Tech, which converts carbon dioxide into useful chemicals, Singapore's N&E Innovations, which repurposes organic waste into packaging, and Australia's Bygen, which produces a filtration product from waste. Additionally, other startups received $50,000 investments or grants. All recipients are required to pilot their technologies in Vietnam.
The event, supported by the Ho Chi Minh City Institute for Development Studies, serves as a platform for connecting officials, investors, and foreign startups, emphasizing the importance of climate innovations beyond the Western context. The competition highlights the need for collective effort in addressing global environmental challenges and aims to support early-stage startups towards profitability.
https://asia.nikkei.com/Business/Startups/Foreign-tech-startups-compete-to-help-Vietnam-go-green
China declares space milestone in launch of ‘self-driving’ radar satellites
South China Morning Post
China has successfully launched the world's first "self-driving" satellites, the Siwei Gaojing-2 03 and Gaojing-2 04, which can autonomously maintain or change their flight paths without ground assistance. Launched from the Jiuquan Satellite Launch Centre, these satellites represent a significant advancement in China's commercial space surveying and mapping capabilities. They are designed to provide high-resolution radar imagery and enhance data accuracy for various applications, including natural resource management, urban safety, and disaster response. Equipped with advanced technologies, these synthetic aperture radar (SAR) satellites can operate day and night, regardless of weather conditions. This launch is part of China's Siwei commercial remote sensing constellation project, which aims to deploy at least 28 satellites by next year to meet diverse industry needs.
https://www.scmp.com/news/china/science/article/3288158/china-declares-space-milestone-launch-self-driving-radar-satellites?utm_source=rss_feed
China investigating defense minister for corruption, FT reports
Nikkei Asia
China's defense minister, Dong Jun, is reportedly under investigation for corruption, according to a Financial Times report citing U.S. officials. Appointed in December by President Xi Jinping, Dong would be the third consecutive defense minister to face such scrutiny. The investigation is part of a broader campaign against corruption within the People's Liberation Army, though specific allegations against Dong have not been disclosed. Recently, Dong attended a defense ministers meeting in Laos but declined a meeting with U.S. Defense Secretary Lloyd Austin, which the Chinese defense ministry attributed to U.S. arms sales to Taiwan. Dong's predecessor, Li Shangfu, was removed from his position in October after a short tenure, following his predecessor Wei Fenghe, who also faced corruption allegations.
https://asia.nikkei.com/Politics/China-investigating-defense-minister-for-corruption-FT-reports
China’s central bank to cut reserve ratio again to add liquidity, aid growth: analysts
South China Morning Post
China's central bank is anticipated to reduce the reserve requirement ratio (RRR) for commercial banks by another half a percentage point in December, aiming to increase market liquidity and bolster economic growth. Analysts from Citic Securities noted that the timing is favorable due to increased government bond issuance and seasonal liquidity changes. This would be the third RRR cut of the year, following similar reductions in February and September, each injecting 1 trillion yuan into the economy. People's Bank of China governor Pan Gongsheng hinted at a potential cut, dependent on market conditions. Currently, the average RRR is 6.6%, with larger banks required to hold 8% of deposits. The expectation for an RRR cut comes as China's economy shows signs of recovery, supported by a recent stimulus package that included monetary easing measures and interest rate cuts. Retail sales and fixed-asset investment have improved, raising hopes for meeting the annual GDP target of around 5%. However, HSBC analysts warned of external challenges that could impede this recovery and called for stronger policy support.
https://www.scmp.com/economy/policy/article/3288189/chinas-central-bank-cut-reserve-ratio-again-add-liquidity-aid-growth-analysts?utm_source=rss_feed
Taiwan’s military uses Taipei university for urban warfare training, sparking outcry
South China Morning Post
Taiwan's military is conducting reservist training on the National Chengchi University (NCCU) campus, focusing on urban warfare in response to potential threats from the People's Liberation Army (PLA). This unprecedented move has raised safety concerns and criticism from opposition lawmakers, who argue it compromises campus security and disrupts academic life. While Taiwan's Defence Minister defends the training as necessary for combat readiness, critics question the decision's implications for the university's autonomy and the potential for it becoming a target in conflict. The Education Ministry reported no prior consultation on the matter.
https://www.scmp.com/news/china/politics/article/3288239/taiwans-military-uses-taipei-university-urban-warfare-training-sparking-outcry?utm_source=rss_feed
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