How ‘Decoupling’ From China Became ‘De-risking'; Exclusive Insight: The unexpected shift in the G7's stance towards China reflects a broader unwillingness to incur greater risks
What you need to know about Temu, the online shopping app dominating download charts; Modi promises ‘whatever is possible’ to help Ukraine to Zelensky
Welcome to this issue of The China Brief. Today is May 21, 2023 . 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.
Exclusive Insight: The unexpected shift in the G7's stance towards China reflects a broader unwillingness to incur greater risks
At the Hiroshima summit, the absence of harsh rhetoric against China was not a surprising outcome. It was instead an awakening from a state of somnambulism, acknowledging the pressing issues that each country must address. A renewed emphasis on honesty and rationality has emerged, prioritizing this over attacks, interference, or coercion of other nations.
Importantly, reliance on war and the formation of ideological blocs are ineffective in resolving the differences in our current world. In this era, there is a greater need than ever for cooperation, interdependence, and joint problem-solving.
However, we must scrutinize the perceived misguided attitudes of recent years, such as casting blame from a moral high ground and the inability to accept the rise of the global south. The original industrial giants of the G7, which constituted 70% of global GDP three decades ago, have now dwindled to 40%. This is not a decline of the West, but rather an inevitable result of global development. The eradication of poverty and attainment of prosperity are, after all, the ideals that the West has always aspired to. Instead of anxiety or desolation, Western countries should take comfort in this. A balanced global structure not only contributes to world peace but also aids in addressing global issues.
The global South is still developing and grapples with considerable challenges and historical contradictions. We cannot overlook, for instance, Russia, a country that once rivalled the West, now emerging from the ruins of the Soviet Union. Russia's persistent engagement in brutal war games, its failure to fully integrate into Europe, while much blame lies with Putin, the West must question its own responsibility for the isolation Russia faces.
Now consider China. With a GDP that accounts for 20% of the world's total—almost half of that of the G7 countries—this is a result of learning from the West, not antagonism. China's impressive high-speed rail system and its successful elimination of extreme poverty merit Western acknowledgement. Its formidable industrial productivity plays a pivotal role in addressing global inflation and post-pandemic economic recovery. Decoupling would not mitigate risks for the West; it would increase them immediately.
Admittedly, China has severe issues concerning human rights and rule of law. The West should offer constructive assistance rather than treat China as an adversary, thereby pushing it into opposition. Regarding the Western seven's desire to establish a small-scale G20, we must remember that the original intent of the G20 was to aid Asia in overcoming the financial crisis. A truncated G20 that excludes China and Russia might breed larger crises.
The G7's relatively restrained approach towards China is not a weak form of appeasement but a realistic, honest representation of our ideals. It offers a more compelling impetus for China's progression towards civility.
(Ho Pin, analysis expert for The China Brief, is the author of this article.)
Modi promises ‘whatever is possible’ to help Ukraine to Zelensky
The Independent
Indian Prime Minister Narendra Modi has pledged his support to Ukraine's President Volodymyr Zelensky in bringing peace to his nation amid Russia's full-scale invasion. The two leaders met in Hiroshima along the sidelines of the G7 summit, where Modi promised to do everything he can to help find a solution to the conflict. Over 17,000 Indian students had to be evacuated from Ukraine in February last year and Indian medical students had to transfer to universities in other countries to resume higher studies. India has come under criticism for its lack of support of Ukraine during the war. The G7 summit has provided an opportunity for fence-sitting nations, such as India and Brazil, to offer their support to Ukraine.
Inside the Barbecue City That Is China’s Hottest Tourist Destination
NY Times
Zibo, a previously obscure city in China, has become a major tourist destination for its barbecue offerings. The city offers diners the chance to cook their own skewers on tabletop charcoal stoves, which is a popular option among young people looking for a D.I.Y. feel. The affordability of the skewers — starting at just 15 cents — has also driven the craze, which started with college students sharing their experiences on social media. However, locals have done all they can to keep the frenzy alive, including offering homes to tourists who can't find accommodation and organising “180 groups” — men taller than 5 feet 11 inches wearing suits — to greet arrivals at the train station. Zibo has become so popular that other city officials have sent research teams there to try to replicate its success. Despite the influx of visitors, some locals have said they would like to see their town's sudden fame ebb at least a little.
The U.S. Needs Minerals for Electric Cars. Everyone Else Wants Them Too.
NY Times
China dominates global processing of the critical minerals needed to make batteries for electric vehicles and renewable energy storage, however, control over the materials needed to power that transition is still up for grabs. After years of development and intense efforts to boost the market share of lithium-ion batteries, OEMs and battery suppliers have turned their attention to the supply chain challenges of raw materials. US officials have begun negotiating a series of agreements with other countries to expand America’s access to important minerals like lithium, cobalt, nickel and graphite. But it’s unclear, which of these partnerships will succeed.
Leaders of Japan, Europe and other advanced nations, who are meeting in Hiroshima, agree that the world’s reliance on China for more than 80% of processing of minerals leaves their nations vulnerable to political pressure from Beijing, which has a history of weaponizing supply chains in times of conflict. On Saturday, the leaders of the Group of 7 countries reaffirmed the need to manage the risks caused by vulnerable mineral supply chains and build more resilient sources. Ministerial meetings have been taking place in Tokyo over the last week aimed at addressing supply chain vulnerabilities in critical technology sectors. Most notably, the US and Japan's joint statement "core technologies can be provided through multivendor solution or disaggregated systems that combine different vendors’ products and services to achieve resilience and security of a network. In this context, the ministers affirmed the importance of the US-Japan cooperation on 5G and beyond 5G."
The global demand for these materials is triggering a wave of resource nationalism that could intensify. Outside of the United States, the European Union, Canada and other governments have also introduced subsidy programs to better compete for new mines and battery factories and Chinese companies are still investing heavily in acquiring mines and refinery capacity globally. The G7 nations, together with the countries with which the United States has free trade agreements, produce 30% of the world’s lithium chemicals and about 20% of its refined cobalt and nickel, but only 1% of its natural flake graphite.
What you need to know about Temu, the online shopping app dominating download charts
CBC
Experts have raised concerns about Temu, a discount e-commerce platform that has become hugely popular due to its referral scheme, gamification techniques, and aggressive social media marketing. The platform, which launched in the US in 2022, aims to be the “cheapest online supermarket in America,” according to a Super Bowl advertisement. Among the concerns raised about the Boston-based, Chinese-owned app is its “growth-at-all-costs” approach, its promotion of low-quality, disposable goods, and the environmental impact of its free shipping and returns policies. Experts also warn that using Temu encourages consumers to “buy stuff you don't need and inexpensive stuff that's likely to break.” There have also been accusations that the platform enables the sale of counterfeit goods and data leaks. However, the platform’s consumer-to-manufacturing model has been praised by some for potentially reducing waste.
The revolutionary electric car battery technology that you’ve never heard of
Telegraph
Battery technology is advancing with silicon anode materials potentially transforming the EV market within a few years. Silicon anodes have been experimented with since the 1970s but lithium-silicon batteries have made huge leaps in the last few years, becoming known for their high performance and energy density. Silicon anodes are known for their high volume expansion when heated during charging but a 3D carbon structure in the battery can contain the expansion. Israel-based company StoreDot is at the pinnacle of silicon anode development and is expected to bring this new silicon battery technology to the premium EV market within the next couple of years.
Hostages no more: G7 takes stand against China
BBC
The G7 summit concluded with a clear message to China, stating that the nation's rise pose the "the greatest challenge of our age". Via two statements, the leaders of the G7 democracies took exception with Beijing's interference in the Indo-Pacific and Taiwan, warned that China could undermine foreign and domestic policies and positions of the group's members, and claimed China was "increasingly authoritarian at home and abroad". They also voiced concern over the "weaponization" of economic vulnerabilities, but did not propose any specific changes, instead seeking to "de-risk" policy. Beijing lodged a complaint with summit organizer Japan.
Zelenskiy seeks G7 support for Kyiv's 'peace formula'
Reuters
Ukrainian President, Volodymyr Zelenskiy, has sought global support for his administration's "peace formula" to end Russia's war in Ukraine, which he called "an obvious expression of rationality". He presented the plan to G7 leaders at the Hiroshima summit, saying it was developed in a way that ensured each point was backed by UN resolutions. Zelenskiy has previously called on Western allies to increase economic and military measures to support Kyiv as Russia's invasion goes on.
Hong Kong Chief to Visit Singapore, Asean Members in July: SCMP
Bloomberg
John Lee, the Chief Executive of Hong Kong, is reportedly planning a week-long trip to Singapore, Malaysia, and Indonesia to deepen ties with ASEAN nations. The delegation is set to include representatives from the financial, technology, and professional service sectors. During the trip, Lee is expected to meet with influential leaders in these countries and promote Hong Kong's bid to enter the Regional Comprehensive Economic Partnership Agreement, a free trade agreement backed by China. Hong Kong recently emerged from its pandemic-induced recession in Q1 2023.
Ukraine's Zelenskyy rallies support during G7 Japan talks
Deutsche Welle
Ukrainian President Volodomyr Zelenskyy has appealed for diplomatic and military assistance in Hiroshima to his fellow G7 leaders amid ongoing aggression from Russia. The group has already announced new sanctions and other measures against Moscow, with Zelenskyy expected to deliver a speech to rally support for a ten-point peace plan which canters around Russia’s withdrawal from Ukrainian territory. Despite initial skepticism regarding the Ukrainian leader’s trip, there is guarded optimism that it will lead to a constructive end. India’s prime minister, Narendra Modi, said: “I can assure you that India, and personally, I will do whatever we can to resolve this” while French President Emmanuel Macron referred to the trip as “a pathway to peace”, as Russia condemned attempts to contain it made by the G7. Although the US has been critical of its own delayed response, allied nations are now allowed to provide F-16 fighter jets to Kyiv in an attempt to help prevent further escalation.
Microsoft: China approves plan to buy game maker Activision Blizzard
South China Morning Post
Microsoft has said that China has approved its $69bn purchase of Activision Blizzard. This is significant as Activision Blizzard had stopped offering many of its games in mainland China earlier this year following a dispute with its local publishing partner, NetEase. Both the China and the European Union are set to give their consents to the deal, in contrast to the United Kingdom and US where authorities are attempting to block it. The EU conditionally cleared the purchase earlier this week, while British regulators rejected Microsoft's promises to try to prevent the destruction of competition.
Why Is China Suddenly Shutting Down Concerts and Events?
Bloomberg
The Chinese government has cancelled and postponed notable events in the past week, ranging from a folk festival to a convention for female tech entrepreneurs. Some individuals relate these sudden cancellations to a $2m fine and suspension of performances of production company Xiaoguo after a comedian made a joke about a military slogan. However, the cancellations are not solely based on assumed criticism of the government. Xiaoguo’s scandal and subsequent measures could be a reason for the heightened amount of event cancellations, but this has yet to be confirmed by the Chinese Government. Beijing musicians have also stated they believe cultural shows are given more focus during a crackdown and that international performers are typically the first to be targeted during such times of law enforcement. Event organizers issued apologies citing 'force majeure', however, this is perceived a euphemism for higher powers such as government agencies that can halt events.
Russia and China hit back at a G7 that saw them as a threat
CNN
Russia and China have reacted angrily to the Group of Seven (G7) summit in Hiroshima, which pledged new measures designed to target Russia and spoke out about concerns over China. The Moscow government condemned the G7’s agenda for seeking to “deter” both countries whilst the Chinese Foreign Ministry accused the G7 of “hindering international peace”. Both Russia’s aggression towards Ukraine and how to confront a more assertive China have dominated the three-day gathering of the world’s big democracies taking place in Japan, which counts both amongst its neighbors.
South Korea wants domestic workers to support families. But are they welcome?
South China Morning Post
South Korea's latest plan to address population decline and support dual-income families is a pilot programme to allow them to hire domestic service workers from Southeast Asia. Families in Seoul will be able to take on overseas domestic workers through certified service providers this year, and the program will begin the process of introducing foreign domestic workers to the domestic work market more broadly. The hope is that this will ease the burden of household and childcare tasks and offer an affordable solution. Still, there are debates over the program's effectiveness, potential cultural barriers and discrimination, and fewer people may trust outsiders to take care of their children. The country has backing from Nobel laureate and economist Michael Kremer, who argued that an immigration policy should be made to help include foreign domestic workers.
Biden invited Kishida, Yoon to meet in Washington -U.S. official
Reuters
US President Joe Biden has invited his Japanese and South Korean counterparts to another meeting in Washington, following their trilateral meeting on the sidelines of the G7 summit in Hiroshima. The leaders discussed how to create new coordination in the face of North Korea's "illicit nuclear and missile threats." One scheme that was discussed was sharing information on missile launches among the three countries. Biden commended the Japanese Prime Minister and South Korean President on their work to improve bilateral ties, stating the trilateral partnership is stronger due to their efforts.
G7 signals long-term Ukraine support to Russia, woos 'Global South'
Reuters
The G7 group of wealthy nations has indicated to Russia that it is prepared to support Ukraine in the long term, whilst President Volodymyr Zelenskiy used the final day of the summit to try to win over countries such as India and Brazil. Ukraine's potential training programmes for its pilots on F-16 warplanes were interpreted by German Chancellor Olaf Scholz as a message to Russia that it should not rely on winning an extended conflict. The UK has also published plans to ban imports of Russian diamonds, copper, aluminum and nickel, and to impose a new wave of sanctions against Russia.
How ‘Decoupling’ From China Became ‘De-risking’
NY Times
The phrase "de-risking" has become popular among officials trying to loosen China's grip on global supply chains, according to a New York Times report. “I think we derive a huge amount of economic, social and safety value when systems are interoperable,” said David Koh, Singapore’s cybersecurity commissioner. “I want my plane to take off from Singapore and land safely in Beijing,” he added. Germany and France later pressed for the term in international settings, while Singapore and India's foreign ministers have also used the phrase. The state-run Global Times, however, has said de-risking “might be ‘decoupling’ in disguise”.
Why China wasn’t mentioned once by Quad in its 3000-world statement
The Sydney Morning Herald
Leaders from the Quad - the US, Japan, India, and Australia - caused the flagship dinner at the G7 summit to be delayed due to an important meeting among the leaders in Hiroshima. The Quad aims to contain China's ambitions, however, the strongest lines on Beijing of this year’s tandem summits did not come from the group, but from the G7. The Quad did not mention China once in its 3000-word statement, while the G7 devoted an entire section to Beijing and mentioned China 20 times, accusing China of distorting the global economy, human rights abuses, and enabling Russia’s war in Ukraine by not condemning it.
Just over half in mainland China back full-scale war to take Taiwan: poll
South China Morning Post
Over 55% of the Chinese public would support a full-scale war to regain control of Taiwan, according to a survey conducted by researchers from the National University of Singapore and NYU Shanghai. The poll canvassed 1,824 people and found that respondents were in favour of offensive options, including the use of limited military campaigns, economic sanctions, and a continued status quo until unification was achieved. Concerns about the economic, reputational, and human costs of a forceful takeover cooled support. It previously been thought that younger Chinese citizens are more nationalistic than older people. However, the poll appears to refute that claim and found that older citizens appear to be more impatient to resolve Taiwan’s status. The report noted that public opinion could shape China’s policy on Taiwan. However, the Communist Party controls the policymaking process, meaning that public opinion can only influence policy to a limited extent.
When You're in a Cold War, Play for Time
Bloomberg
Detente seems to be in the air between China and America according to an opinion piece in Bloomberg. It describes several significant breakthroughs in meetings between Chinese and American officials, a far cry from the frosty silence of recent times. Perhaps most poignantly, President Joe Biden’s National Security Adviser Jake Sullivan recently gave a speech at The Brookings Institute where he appeared to be intent on making Cold War II less chilly. Moreover, the opinion piece argues that the Chinese economy may not live up to its great expectations, showing some signs of headwinds with China’s dire demographic prospects and over-leveraged and depressed real estate sector.
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