This ‘Russian’ Woman Loves China. Too Bad She’s a Deepfake; Chinese Firms Face Authoritarianism at Home and Hostility Abroad
Beijing in no rush to respond to new Taiwanese leader’s ‘pro-independence’ speech; China launches its own anti-dumping probe following Biden’s monster tariffs
Welcome to this issue of The China Brief. Today is May 20, 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.
Beijing in no rush to respond to new Taiwanese leader’s ‘pro-independence’ speech
South China Morning Post
Beijing has not yet responded to Taiwanese President William Lai Ching-te's first speech in office, which mainland scholars have described as sending an "intense" pro-independence signal. In his speech, Lai called for peace and stability in the Taiwan Strait, and urged China to cease its political and military intimidation of Taiwan. Lai also described Taiwan as a "frontline guardian of world peace" due to its strategic location in the "first island chain", a US Cold War strategy to contain the Soviet Union and China.
South China Morning Post
Chinese President Xi Jinping's recent trip to Europe highlighted the divisions among European nations in their approach to China. While Xi faced tough questions in Paris from French President Emmanuel Macron and European Commission President Ursula von der Leyen about China's economic model and its relationship with Russia, he received a warmer reception in Hungary and Serbia. Xi signed 37 bilateral cooperation agreements with Macron in France, but in Hungary and Serbia, he was welcomed with open arms to visit critical infrastructure projects. However, while China may have brought Hungary and Serbia closer to its orbit, their influence should not be overstated, as both countries have moved away from the European centre of gravity in recent years.
China launches its own anti-dumping probe following Biden’s monster tariffs
CNN
China has initiated an anti-dumping probe into polyoxymethylene (POM) copolymers, a thermoplastic imported from the US, the European Union, Taiwan, and Japan. The investigation comes after the US announced tariffs on $18 billion worth of imports of Chinese electric vehicles (EVs) and other products. EVs imported from China will see their tariffs increase from 27.5% to 100%. The EU is also investigating state support for Chinese EV makers and may announce extra import duties by early July. China has vowed to take "all necessary actions to protect its legitimate rights" in response to the trade barriers.
Taiwan's new President Lai calls on China to cease intimidation
Yahoo US
Taiwan's new President, Lai Ching-te, has called on China to end its political and military intimidation against Taiwan. Lai urged China to choose dialogue over confrontation and to engage in cooperation with Taiwan's government. He also called on China to resume tourism on a reciprocal basis and to allow Taiwanese students to enrol in Chinese institutions. Lai stated that the future of cross-strait relations will have a decisive impact on the world.
Philippines calls on China to open Scarborough Shoal to scrutiny
Nikkei Asia
The Philippines has demanded that China open Scarborough Shoal to international scrutiny after the Philippine Coast Guard reported marine destruction within the lagoon. China effectively controls part of the shoal after putting up a barrier to prevent Filipino fishermen from entering the lagoon. The Philippines is considering filing a new case against China, this time for the destruction of coral reefs and harvesting of giant clams in the South China Sea. Despite the challenge, the Philippines wants to settle the issue diplomatically.
This ‘Russian’ Woman Loves China. Too Bad She’s a Deepfake.
NY Times
A new trend has emerged on Chinese social media platforms, where AI-manipulated videos featuring young Russian women are used to promote China-Russia ties, evoke nationalistic sentiments, and generate income. The videos are often targeted at nationalist Chinese men and feature women praising the accomplishments of Chinese men or appealing to be rescued from poverty or their own country. While it is unclear who is behind these videos, they often include links to products, suggesting that the primary goal is commercial.
Chinese Firms Face Authoritarianism at Home and Hostility Abroad
NY Times
Chinese companies like ByteDance, the owner of TikTok, are facing increasing challenges as distrust between the US and China deepens. Previously, Chinese companies operating abroad could appease the Chinese government while enjoying the protection of private ownership and the rule of law in other countries. However, as tensions rise, Chinese companies are finding themselves caught between their own authoritarian government and a suspicious US government. ByteDance is currently fighting against a US order to divest TikTok or face a ban. This shifting landscape poses significant challenges for Chinese companies operating globally.
South China Morning Post
Apple is offering discounts of up to 23% on its iPhone 15 models in an effort to boost sluggish sales in China. The discounts are being offered on online retail platforms JD.com and Alibaba's Tmall, with prices lowered by as much as CNY2,050 ($298). Apple's iPhone sales in Greater China fell 8% to $16.4bn in Q1 2019, and its share of the Chinese smartphone market decreased to 15.7% from 20.2% a year earlier. However, the discounting has helped foreign-branded smartphone shipments in China to grow 12% YoY.
China commerce ministry bans trading by some U.S. companies
Nikkei Asia
China's Commerce Ministry has announced that it will prohibit certain US firms from importing and exporting activities related to China, as well as forbid them from making new investments in the country. General Atomics Aeronautical Systems, which is accused of selling arms to Taiwan, and General Dynamics Land Systems have been put on the unreliable entities list. Boeing Defense, Space & Security has also been placed on the list, according to state media. Senior executives of these companies will be prohibited from entering China and their work permits will be revoked.
Lai Ching-te: From coal miner's son to Taiwan president
Japan Times
Taiwan's new president, Lai Ching-te, is facing the challenge of dealing with a growing divide with China and a difficult domestic parliament. Lai, a former coal miner who graduated from Harvard, was elected in January on a promise to protect Taiwan's democracy and resist China's claims on the island. In his inaugural speech, Lai called on Taiwanese citizens to come together to defend the nation against China's threats.
Who died alongside Iran’s President Raisi in the helicopter crash?
Al Jazeera
Iranian President Ebrahim Raisi and several other senior officials have been confirmed dead after a helicopter crash in East Azerbaijan province. Raisi, a hardline religious conservative, had faced controversy over the years, including being part of a committee overseeing executions of political prisoners in 1988. He also led Iran during the 2022 protests over the death of Mahsa Amini and through a standoff with Israel over its war in Gaza. The top Iranian diplomat, Hossein Amirabdollahian, who was with Raisi in the helicopter, played a significant role in shifting Iran’s foreign policy towards improving relations with regional neighbours.
Chinese EV makers delay payments to vendors as they feel the heat from slowing sales, price cuts
South China Morning Post
Chinese electric vehicle (EV) makers, including BYD, Nio, and Xpeng, are taking longer to settle payments with suppliers, indicating financial stress in the industry due to slowing sales and increased discounts. BYD, the world's largest EV maker, took 275 days to pay supply-chain vendors in 2023, compared with 219 days in 2022. Longer payment delays may also affect production as component manufacturers may struggle to secure sufficient raw materials. The findings underline the slowdown in the Chinese EV market, which grew by just 37% in 2023, compared with a 90% increase in 2022.
South China Morning Post
Chinese auction house Cuppar began Beijing’s spring auction season with CNY 89.7m ($12.4m) in sales from its combined 20th-century and contemporary art evening auctions. According to Stacie Xie Yang, Cuppar’s co-founder and managing director, the auction results exceeded expectations in a depressed market. The Chinese capital’s art market shift is revealed with new, young collectors emerging and judicious use of social media paying off for art sellers. The market is seeing a growing emphasis on personal connection, especially in the CNY 500,000 to CNY 5m price range.
G7 leaders to discuss €30bn loan using Russian assets
Guardian
The US has been canvassing support for a plan to use €270bn of seized Russian state assets to give Ukraine an extra €30bn loan, which would help with the country's reconstruction or pay for arms. The US and UK argue that instead of handing relatively small sums to Ukraine annually, a €30bn loan could be given with the interest paid from the profits generated from the larger frozen assets. This has already caused divisions between the US and Germany, and the issue is likely to be debated at a meeting of G7 finance ministers this week.
Hong Kong stocks at 10-month highs after China’s property rescue measures
South China Morning Post
Hong Kong stocks reached a 10-month high on Monday, as Beijing's latest efforts to revive the struggling property sector lifted sentiment. The Hang Seng Index rose 0.1% to 19,581.13, the highest level since July 31 last year. The Tech Index also gained 0.2%, while the Shanghai Composite Index jumped 0.5%. The People's Bank of China announced aggressive measures to stimulate the property sector, including a CNY 300bn ($46bn) funding to clear excess housing. Analysts commented that Beijing was headed in the right direction to end the housing crisis, but that it would be a challenging process.
China sanctions Boeing, two U.S. defense contractors for Taiwan arms sales
Associated Press
China's Ministry of Commerce has placed Boeing, General Atomics Aeronautical Systems, and General Dynamics Land Systems on an "unreliable entities" list, imposing sanctions for arms sales to Taiwan. The sanctions will ban further investment in China and place travel bans on senior management for the companies. Taiwan's new president, Lai Ching-te, has vowed to strengthen Taiwan's security through imports of advanced fighters and other technology.
South China Morning Post
China has left its benchmark lending rates unchanged at its monthly fixing, in line with market expectations. The steady rates come after China announced steps last week to stabilise its crisis-hit property sector, including facilitating 1 trillion yuan ($138 billion) in extra funding and easing mortgage rules. The property rescue plan effectively reduced the need for further rate cuts, as aggressive monetary easing could put additional pressure on the weakening currency. The one-year loan prime rate (LPR) was kept at 3.45%, while the five-year rate remained unchanged at 3.95%.
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