‘We have survived!’: Huawei looks to local solutions following US sanctions;Exclusive Insight: Debt Dragons Unleashed: China's Local Governments Grappling with the Legacy of Zhu Rongji
US investor interest in China cools as political tensions grow; US Lawmakers Query Nike, Adidas Over Forced Labor in China
Welcome to this issue of The China Brief. Today is May 3, 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.
And here’s today’s exclusive insight:
Exclusive Insight: Debt Dragons Unleashed: China's Local Governments Grappling with the Legacy of Zhu Rongji's Fiscal Decentralization
From the establishment of the People's Republic of China in 1949 until the dawn of the reform and opening up era in 1978, China adhered to a planned economy, with the central government exerting vertical control over local finances. The central government largely dictated the revenues and expenditures of local governments, rendering local government debt a non-issue.
Following the 1978 reforms, the central government devolved numerous financial powers to local governments, endowing them with a measure of budgetary autonomy and expenditure decision-making authority. Local governments were required to submit a predetermined portion of their fiscal revenue to the central government annually, while retaining discretion over the allocation of the remaining funds.
One advantage of fiscal decentralization is that the more revenue local governments generate, the larger the surplus they can retain. The larger the surplus, the more resources they have for local economic development, leading to accelerated economic growth and even greater fiscal revenue in subsequent years. This creates a virtuous cycle of self-perpetuating growth.
Nevertheless, drawbacks are evident as well. The swift expansion of the economic scale resulted in accelerated growth rates, but the portion remitted to the central government did not keep pace. Conversely, central government expenditures surged due to the burgeoning economy, engendering severe deficits and eroding political authority. In some cases, the central government even had to resort to borrowing from local governments.
In 1994, to tackle the chronic fiscal deficit, then-Vice Premier Zhu Rongji championed the "fiscal decentralization" reform, reconfiguring the fiscal revenue and expenditure ratios between the central and local governments. Through this reform, the central government claimed the lion's share of tax revenue, while shouldering only a fraction of the fiscal expenditure. Local governments could close the substantial gap between their revenues and expenditures by applying for transfer payments from the central government, selling land (as land is owned by local governments in China), or taking on debt.
The skewed tax system instituted roughly two decades ago has laid the groundwork for the present-day massive local government debt.
("The Causes of China's Local Government Debt" series, Part 1, authored by Li Weijun, a special economist for The China Brief)
US investor interest in China cools as political tensions grow
Financial Times
US investor interest in Chinese stocks has declined as political tensions between the two countries heighten. Trading activity of the most liquid US-listed options that track the Chinese stock market has decreased by more than half since November 2021, marking a significant cooling of trading activity. Political tensions include doubts about whether China can sustain its economic flow and concerns over increased government oversight of companies and further sanctions. Many investors have become extra cautious due to the increased risk of regulation by the Chinese government combined with the risk of sanctions, all of which push investors away from China.
Taliban, China Envoys to Meet in Pakistan in Belt and Road Push
Bloomberg
Afghanistan's foreign minister, Amir Khan Muttaqi, is traveling to Pakistan to talk with his Chinese counterpart, Qin Gang, about possible participation in China's $60 billion China-Pakistan Economic Corridor. cash-strapped Afghanistan is keen to secure much needed infrastructure and Chinese businesses have been discussing the possibility of expanding the Economic Corridor into Afghanistan. The Taliban has also expressed hope China would invest in Afghanistan's natural resources as a way to fix the economy that has nearly collapsed since international aid was halted following the withdrawal of US troops last year.
Cautious Start Awaits China Stock Traders Returning From Holiday
Bloomberg
Chinese equity markets are expected to open lower on Thursday after the Golden Week holiday, and any gains in consumer stocks are anticipated to be short-lived, according to investors. The benchmark CSI 300 Index has dropped for three successive weeks, showing waning momentum since posting a 20% gain in Q1 2019. Uncertainties include the weakening manufacturing sector and geopolitical risks such as tensions between the US and China and emerging weaknesses in China’s property sector.
China Falls Further Down World Press Freedom Index, US Slips
Bloomberg
China has fallen to 179th place on the annual World Press Freedom Index, joining North Korea at the bottom of the ratings which are compiled by Reporters Without Borders (RSF). The US has also slipped down three places to 45th position after the murders of two journalists. Meanwhile, Norway retained its position at the top with Ireland rising four places to take second place. Hong Kong rose eight spots to 140th while Singapore climbed ten places to 129th.
Financial Times
Apple's close relationship with China and its government means that the tech company faces risks and complications that investors should be aware of. Despite generating almost a fifth of its revenue from the Chinese market, the Communist Party of China (CCP) has been known to sanction companies operating in the country, as well as intermittently blocking online and digital content. Apple's compliance or teaming up with CCP objectives has seen the company's China image grow in credibility, despite occasionally censuring and monitoring local apps for political statements, Apple has also sold user data to Chinese officials. Investors facing incomplete information about Apple's dealings with Chinese forces are encouraged to pay attention to warning of such risks. Certain Apple investments can be seen as a geopolitical choice and an economic lever, one that can be used by China to target US interests in the future.
U.S.-China war would be ‘disastrous for us all,’ Singapore’s defense minister warns
Japan Times
Singapore's Defense Minister Ng Eng Hen has called on government and military leaders in the Indo-Pacific region to deepen mutual understanding, warning that a physical conflict between the US and China in Asia would be "existential for many countries". With a simultaneous war in Europe and Asia "disastrous for all of us", Ng called upon regional leaders to renew their commitment to a rules-based order, citing the crucial role of global trade links and the need to mitigate the risk of miscalculations in any domain.
Taiwan seeking US cooperation to make next generation fighters
Reuters
Taiwan is seeking US help to develop its next indigenous fighter aircraft as it seeks to raise its technical prowess to offset incursions by China into its airspace. Taiwanese Defense Contractor Aerospace Industrial Development's chairman Hu Kai-hung said the project included developing engines, avionics, control systems and environmental controls, and that the development of a domestically-made aircraft "is the road we have to travel." Taiwan's air force has relied on French and US aircraft, including F-16s and Mirages, but its domestic jet fleet dates to more than three decades ago.
Tesla raises car prices globally, with the biggest increase in China
CNN
Electric vehicle maker Tesla has raised the price of its Model 3 sedan and Model Y SUV in several key markets, including the US and China. Its Chinese-made vehicles saw a RMB2,000 ($289) increase, but remained lower-priced than they were at the beginning of 2021 due to earlier price cuts. The Model Y in the US now starts at $47,240, with the Model 3 at $40,240. Late last month, Tesla raised the price of its high-end Model S and Model X by $2,500. It is thought by some analysts that Tesla's strategy was to increase demand by testing elasticity and reversing customer expectations of further price cuts.
Love, ambition, no politics: Chinese women flock to read Eileen Chang
Washington Post
The work of Chinese writer Eileen Chang has become a source of respite for young Chinese women, largely due to her focus on the personal, such as love, sex and ambition. Chang has been celebrated for her defiance of patriarchal norms, her rejection of nationalism, and her delight in everyday matters. Her decision to be un-political resonates with modern-day readers, who are drawn to her defiant lifestyle and sardonic worldview as well as to the crispness of her prose. Cao Zhixin, a 20-something editor at a Beijing publishing house, took to the streets of Beijing last November to protest the Chinese government’s “zero covid” policies, and considered Chang one of her literary idols. Many readers are pursuing Chang-inspired tours of Shanghai, where fans can visit her birthplace or themed cafes. Her growing appeal has been attributed to her clarity of mind and the disillusionment of young Chinese people who are told they are living through this great moment in Chinese history but who feel dislocated and excluded.
No longer just ‘important’, Taiwan’s future becomes ‘indispensable’
The Sydney Morning Herald
Leaders from the United States and six other advanced economies have made statements affirming that stability across the Taiwan Strait is “an indispensable element of global security and prosperity”, marking a departure from the previously used phrase, “the importance of peace and stability”. Such a declaration is intended to deter China from attacking Taiwan and increase expectations of intervention from other nations if conflict does arise. This comes after China has been increasing military drills and warnings aimed at Taiwan, including the revision of its conscription laws to allow retired military personnel to be re-enlisted.
Myanmar to free more than 2,000 political dissidents
Al Jazeera
The military junta ruling Myanmar has announced that it is pardoning over 2,000 political prisoners on humanitarian grounds to commemorate the Buddhist holiday of Wesak, which falls on 26 May. The prisoners had been detained on charges of incitement and could face up to three years in jail. The junta has been involved in a violent crackdown upon opponents since seizing power from the elected government of Aung San Suu Kyi in February 2021. Since then, the military has detained thousands of people and asserted its control through lethal force. Although announcements of amnesties often occur during major holidays, the latest gesture came after Chinese Foreign Minister Qin Gang visited Myanmar and held talks with coup leader Min Aung Hlaing. The move has suggested bolstering ties between Myanmar and China and a prospect of increased Chinese support for the military junta. Meanwhile, violent resistance has taken root in several parts of the country, and the military has responded with air attacks that have caused civilian casualties, including children.
Alibaba founder Jack Ma returns to public life as a university professor
South China Morning Post
Jack Ma, founder of Alibaba Group, has taken up professorships at four schools outside China. Ma resumed his links with academia following a controversial speech in Shanghai, in which he criticized the banking sector, leading to Ant Group's planned IPO being canceled at the last minute. Universities in Hong Kong, Japan, Israel and Rwanda have appointed Ma as a visiting professor responsible for contributing to research into such areas as agriculture, finance and the environment.
China Sends Drones Circling Taiwan in New Surveillance Tactic
Bloomberg
China has flown a drone over Taiwan, the second time it has employed such a tactic in a week. This time, it is believed a BZK-005, made by the Chengdu Aircraft Industry, was flown over the island's sensitive air-defense zone. CNA reports the drone flew north before turning east and then south. It's not known exactly when the drone flew the mission. The incident came as Beijing announced it had deployed a submarine detection plane near the day an unidentified piece of US military hardware was found floating off the Chinese mainland.
In India, news of population growth reinvigorates viral Islamophobia
Japan Times
Despite the announcement that India has overtaken China to become the most populous nation, social media influencers of the majority Hindu faith have been spreading false demographic data claiming the country is being transformed into an Islamic state. The conspiracy theories suggest that Muslims are multiplying faster than their Hindu counterparts, despite a decline in birthrates across the board, and looking to create a Muslim-majority country. India’s last National Family Health Survey, in 2021, demonstrated an overall fertility rate of 2.0 children per woman, which rose marginally to 2.3 for Muslim women. The Pew Research Center predicted that India's Muslim community would grow to 311 million by 2050.
Paths to a ‘cold peace’ after Russia’s war in Ukraine
Financial Times
Two new books on Russia argue that to properly deal with the country and manage expectations in this era of conflict, it is vital to re-examine the dashed hopes of Russia's past. Cold Peace is the work of Michael Doyle, a professor at Columbia University, who looks back at the unfulfilled hopes of the 1990s. While Jade McGlynn, a postdoctoral researcher at King’s College London, explores the reasons for the current pro-war sentiment in Russia in Russia's War. Both suggest keeping expectations appropriately low with hopes of a cold peace in place of endless war with Russia.
Hong Kong holds edge over Singapore as business and finance hub: research
South China Morning Post
A new study has rated Hong Kong as the leading choice for businesses looking for their Asia-Pacific headquarters thanks to its financial prowess and talent levels. Meanwhile, Singapore performed well on environmental and social governance issues and technology industry size but fell short in other areas. Corporate occupiers in Hong Kong were advised to act soon to secure more favorable leasing terms while availability is high.
Refurbished iPhones boost Apple’s share of Indian market
Financial Times
India's refurbished-smartphone market has driven impressive demand for Apple's iPhone, with the company pinning its hopes for the future on the country as it ramps up its share in the world's third largest smartphone market. The iPhone accounted for 11% of secondary smartphone sales in India in 2022, up from 3% in the previous year, and was the “fastest-growing refurbished brand in India,” data from Counterpoint Research shows. Apple CEO Tim Cook met with Prime Minister Narendra Modi in April to open Apple's first stores in the country and is increasing operations to reduce the company's reliance on China.
AI regulation: controversial forecasts could mean strident oversight
Financial Times
The departure of AI pioneer Geoffrey Hinton from Google could push regulators into taking immediate action over the growing power of artificial intelligence (AI), according to an opinion piece in the Financial Times. Hinton believes that AI is advancing too quickly and will soon make it impossible for the public to differentiate between fact and fiction. Regulation of AI carries some risks, and could be more heavy-handed than that of previous technologies. However, China has already decided that generative AI services must pass security reviews. PitchBook shows this sector raised $1.7bn in Q1, dwarfed by a near $11bn in announced but uncompleted deals.
Chile’s move to control lithium risks scaring off investors
Financial Times
Chile's attempt to take state control of key lithium projects in an attempt to develop its extensive resources of the electric car battery metal could backfire, as mining executives and analysts fear it will erode the attractiveness of Chile as an investment destination. This could benefit several African countries, Australia and Argentina. The move brings Chile closer to countries Bolivia and Mexico in imposing greater state control, but Chinese groups may still be keen to fill the gap. The strategic challenge from greater state involvement is most acute for SQM, a controversial company whose contract expires in 2030. Its largest shareholder is Julio Ponce, former son-in-law of Chilean dictator Augusto Pinochet. Atacama extraction would face environmental pushback and, although there are opportunities for junior lithium miners, the effort to introduce fresh competition has faltered. Chile risks falling from the world’s second-largest lithium producer last year to fourth in 2030, with its share poised to shrink from almost a third to 12%.
China Restricts Overseas Access to Corporate Registry Databases
Bloomberg
Chinese data providers have ceased to supply sensitive corporate information to overseas clients. Wind Information stopped allowing non-mainland Chinese clients from accessing its corporate registry database, while Qichacha and TianYanCha databases have also been offline for some time. Overseas clients also face problems renewing subscriptions. The move reinforces the difficulties faced by foreign firms attempting to access sensitive data in China as investors become more cautious, despite improving economic fundamentals; the MSCI China Index is down about 17% from its January peak. The Cyberspace Administration of China, Wind, and TianYanCha declined to comment, while Qichacha did not respond.
‘It stinks’: India dumps 18,000 Olympic-sized pools of untreated sewage each day
South China Morning Post
India is treating less than one-third of urban sewage, equivalent to 18,000 Olympic-sized swimming pools of untreated sewage each day, according to government estimates. The system is also not well connected to homes, and many plants do not meet environmental regulations, causing waterways to become polluted and deadly. Waste disposal is a cultural issue in India with dirt regularly left in streets because of insufficient bins and cultural practices, which make the dirtiness of waste disposal a taboo topic for conversation. Mridula Ramesh has suggested installing decentralized treatment plants, which are partially funded by NGOs or private enterprises, and have the fully treated sewage reused or released into local lakes.
White House calls in tech firms to talk AI risks
South China Morning Post
Senior officials from the White House will meet with executives from Google, Microsoft, OpenAI and Anthropic on Thursday to discuss the potential and dangers of AI, according to an AFP report. Participants will discuss ways to ensure the public benefits from AI but is also protected from its risks. President Joe Biden expects tech firms to ensure that products are safe before being accessible to the public, the invitation said. US regulators have taken initial steps towards drafting regulations on AI that could slow new technology releases, including IBM's decision to pause hiring for roles AI can undertake.
Europe’s ‘Golden Visa’ Programs Are Dying Out as Housing Costs Rise
Bloomberg
Portugal has moved to abolish its 11-year-old "golden visa" scheme, a program offering residency and a path to citizenship to foreigners willing to invest in the country. Investors need to spend at least €350,000 ($383,000) in Portuguese property – seven days per year in the country included – to be eligible for the scheme. Portuguese officials have cited concerns about the soaring housing market as one reason behind the decision to close the program, with the Irish government doing the same in February. Spain and Greece are witnessing a surge of interest in their respective schemes as a direct result. While the visa schemes in many countries appear skewed towards wealthy Chinese citizens – giving them a means to live and travel freely in the EU – market data suggest golden visas have scant influence on property values, though there is concern the schemes are linked to gentrification and foreign investment viewed as "colonial" by critics.
Foreign Affairs
The International Criminal Court’s (ICC) announcement that it has issued an arrest warrant for Russian President Vladimir Putin may have set a precedent that could implicate other Russian elites, with many within the government now nervously eyeing the exit. However, almost a decade of individual sanctions has failed to divide Russia’s leadership or weaken Putin; instead, his allies have rallied around him, and the regime has become more isolated, anti-Western, and more focused on personal relationships than on policy expertise. During this time, sanctions have unified the Russian leadership in their desire to keep relations with the West tense, and Western pressure has reinforced suspicions within Russia of any member of the elite who seeks to avoid sanctions.
Putin’s regime has always been a coalition between the security services, the armed forces, and various technocrat economists. The relationship between these military and civilian groups has changed over time, with the technocrats who viewed Russia as part of the global and Western economy finally realizing that they were, in fact, employees of those who believed in the opposite. The ICC’s announcement of its arrest warrant against Putin is viewed as an invitation for the elite to rally against the president rather than around him, with any future warrants against other members of the Russian government likely to cause some to take measures to protect themselves, whereas others will seek to become targets in the hope of raising their status within the regime.
Of course, Putin will only go on trial at the ICC if he is apprehended. But Russia does not recognize the court’s jurisdiction, meaning he cannot be arrested unless he travels to a nation that does. Even if he were to visit a non-Western country, he will be certain to ensure that he is not arrested.
China's expanded espionage law only hastens foreign capital drain
Nikkei Asia
China's new counterespionage law will take effect from July onwards, tightening restrictions on all foreign nongovernmental organizations, businesses and academic institutions by giving police the power to monitor their work, finances and personnel. Besides endangering the safety of foreign firms' staff and curbing cross-border economic activity, it is also widely predicted to further damage investor confidence in the country and hit capital outflows hard, a creeping trend over recent months which saw restricted cash outflows and billions of dollars of Chinese outbound investment suppressed.
Foreign Affairs
A new approach is needed to revitalize the center of politics in Western democracies, according to a Foreign Affairs op-ed by Andrew Moravcsik. The article argues that antiglobalism caused by the collapse of the Soviet Union and the breakdown of the postwar compromise between free-market capitalism and social democracy has transformed Western politics. Support for policies favoring trade liberalization and multilateral cooperation has fallen by nearly 50% since the early 1990s, with the UK’s Brexit vote in 2016 and the election of US President Donald Trump among the most prominent examples of this trend.
The article argues that such a shift has fuelled voter dissatisfaction, which in turn leads to political volatility and dysfunction, not only domestically but also internationally. As a result, support for Western priorities has weakened in multilateral institutions, while faith in liberal democracy has declined. To address this issue, Moravcsik argues that Western governments need to restore the balance between staying open to the world and safeguarding economic security at home. Attempting to turn back time and recreate the Cold War era or turn inwards will not work, it warns.
Throughout the Cold War, parties on both the left and right supported liberal internationalism, with Western leaders seeing political advantage in the ideology and globalization. However, as the Cold War ended, the agendas of politicians in France, Germany, the UK and the US became more neoliberal, focusing more on market-driven globalization to gain support for the internationally competitive sectors of business and middle-class voters.
Cambodia poised for SEA Games with Chinese flavor
Japan Times
The 32nd edition of Cambodia's first Southeast Asian Games welcomed more than 11,000 athletes, coaches, and delegates from 10 other countries on May 14, with the athletic event set to run until May 17. This year’s SEA Games were held in Cambodia’s capital city of Phnom Penh, at the new Morodok Techo National Stadium, built by Chinese firms, with China footing the $160m bill. Regional glory is up for grabs, but competitors will also have one eye on the Asian Games in China in September-October and next year’s Paris Olympics.
China’s foreign minister touts ‘friendship’ on Myanmar visit
Al Jazeera
China’s foreign minister has met with Senior General Min Aung Hlaing, Myanmar’s top general, in Naypyidaw. Qin Gang’s trip makes him the highest-ranking Chinese official to meet the coup leader since he took over from the country’s elected government in February 2021. The visit comes as violence in Myanmar continues to escalate two years after an outrageous military coup. China is one of very few major allies to Myanmar’s military and is one of the country’s biggest arms suppliers and trading partners. Hoping to deepen the relationship, Qin pledged to promote a further “comprehensive strategic partnership between the two countries” during his meeting with the general.
Nearly 300 arrested in US and Europe during international dark web drug bust
South China Morning Post
A global law enforcement operation has resulted in the arrest of nearly 300 people and the seizure of over $53 million, as well as the closure of a dark web marketplace specialising in drug sales and other illegal goods. The majority of the arrests (153) were made in the US, where a synthetic opioid crisis has led to more annual fatalities than the number of American deaths across Vietnam, Iraq, and Afghanistan combined. The worldwide operation, known as SpecTor, was the biggest of its kind to target drug trafficking as well as the dark web.
TikTok’s US trust and safety head departs role as pressure mounts
South China Morning Post
Eric Han, who has led TikTok's US trust and safety operations for years, is leaving the company amid increasing pressure for the US government to ban the video-sharing app. Han had been promoted to lead trust and safety at the company's newly walled-off US data operations in December. TikTok is facing a national security review in connection with its ownership by Chinese tech giant ByteDance, and multiple bills in Congress that could limit access to the app.
US Lawmakers Query Nike, Adidas Over Forced Labor in China
Bloomberg
The US House Select Committee on the Chinese Communist Party (CCC) has written to Nike, Adidas and Chinese-owned shopping platforms Shein and Temu to enquire about the possible import of products that have been produced in China with the use of forced labor from the Xinjiang region. China subjects Uyghurs to use forced labor in the region. The US has accused China of human rights abuses against the Muslim Uyghurs in Xinjiang as part of a wider campaign of genocide. Congress passed the Uyghur Forced Labor Prevention Act in 2021, which prevents goods from the region from entering the US.
As US-China rivalry deepens, India gets a ‘free pass’ on rights concerns
South China Morning Post
The Biden administration has opted not to publicly criticize Indian Prime Minister Narendra Modi's increasingly autocratic approach, as the US strives to keep India on its side in the struggle against China. Despite concerns about Modi's tendency to clamp down on religious minorities and the media, and to target opposition lawmakers, the administration believes India is increasingly vital to its geopolitical and economic aims in the Indo-Pacific. The situation is a reminder of how the US focus on human rights has clashed with the strategic reality of its need for allies in the face of rivals like China and Russia. India's huge population makes it impossible to tackle global issues such as climate change without Delhi's participation. An official said India remains an integral part of the US's Indo-Pacific strategy.
NATO to open Japan office, deepening Indo-Pacific engagement
Nikkei Asia
NATO is reportedly preparing to establish a liaison office in Tokyo, Japan, marking the first time the defense alliance has established a presence in Asia, according to Nikkei Asia. The new office will enable NATO to hold regular consultations with Japan and key regional partners including South Korea, Australia and New Zealand on a periodic basis amid growing concern around China's rising military assertiveness.
Qin Gang warns against Myanmar violence ‘spillover’, calls for ‘stable’ border
South China Morning Post
China's foreign minister has warned about the potential for a "spillover" of violence in Myanmar as he called for the maintenance of stable borders and crackdown on cross-border crime. Qin Gang spoke out over his concerns during a recent visit to the southwestern frontier province of Yunnan. He called on the government, military, police and civilians to strengthen the defense system around the region's borders. He then continued to Myanmar for a two-day visit before heading on to a Shanghai Cooperation Organisation meeting in India. There have been increasing tensions between Myanmar since a military coup in February.
Nepal police searching for five missing people after avalanche
Reuters
Five villagers in northwest Nepal went missing after an avalanche hit their camp near Byas village while they were searching for the "Himalayan Viagra". Four women and one man were missing since Tuesday while seven others escaped; hundreds of villagers go to the foothills of the Himalayas during the summer to pick up the fungus-like herb. Sixteen villagers collecting the expensive herb were killed in a heavy snow storm in the remote Dolpa region bordering China in 2007.
‘We have survived!’: Huawei looks to local solutions following US sanctions
Financial Times
A report from the Financial Times has described how Huawei, supported by Chinese government grants and funding from Beijing, has attempted to lead the way for Chinese firms seeking to reduce reliance on Western technology. The report suggests that Huawei's progress has been despite an ongoing and difficult struggle to replicate sophisticated chipmaking tools, such as lithography technology, which is dominated by the Dutch company ASML, and increasingly blocked for trade by US export controls. Huawei has built software to replace US systems it no longer had access to and has looked to find domestic alternatives to more than 13,000 components after suffering the impact of US sanctions, including a halting of 5G smartphone manufacturing. Meanwhile, local governments in over 20 cities in China have deployed Huawei's AI chips to build artificial intelligence computing centers. Huawei's success at replacing Western technology is expected to provide it with greater access to China's $2.38tn market in digital transformation between 2022 and 2026.
Award-winning Chinese mathematician returns to Peking University from US
South China Morning Post
Chinese mathematician, Sun Xin, an assistant professor at the University of Pennsylvania, will return to Peking University, where he previously studied, as an appointment at the Beijing International Centre for Mathematical Research. Recently awarded the Rollo Davidson Prize, which recognizes work on two models for random surfaces, including random planar maps and the Liouville Quantum Gravity, Xin specializes in research on probability theory and mathematical physics.
Thailand in talks with CATL, others on potential battery plants, govt official says
Reuters
Thailand expects to attract battery firms to establish plants in the country in a bid to become a regional EV production center outside China. The country will offer tax breaks and subsidies to aid its ambitions, seeking battery production plants in the industry along with local production of vital components like electricity chargers. The secretary-general of the Thailand Board of Investment said the government hoped to direct support and subsidies toward larger battery facilities with a capacity of 8 GWh or more. CATL, which has a 37% global market share, is among the companies reportedly in discussions with Thailand.
India gears up for Kashmir G-20 talks opposed by Pakistan, China
Nikkei Asia
Jammu and Kashmir is set to host a G-20 tourism meeting on May 22-24, marking the first time the region has hosted a significant international event since India revoked its special status in 2019. Dignitaries from around the world are expected to attend, and visitors driving into Srinagar from the Sheikh-ul Alam International Airport will be greeted by rows of lamp posts illuminated in the colors of the Indian national flag and billboards featuring India's Group of 20 lotus logo.
Iran's president lands in Syria for rare meeting with Assad
Independent
Iranian President Ebrahim Raisi visited Syria, marking the first time an Iranian head of state has done so in more than a decade. Iran has backed President Bashar Assad's government since the start of the conflict in 2011 by sending advisers and fighters from across the region. Russia has also supported the Syrian regime, helping it regain control over large parts of the country. Iran seeks to promote rebuilding efforts and the return of refugees fleeing Syria. Over recent weeks, other Arab countries, including Saudi Arabia and Egypt, have also moved closer to the Syrian regime. In March, Iran and Saudi Arabia agreed to re-establish diplomatic ties after seven years of tension. The conflict in Syria has resulted in almost half a million deaths and displaced half the country's pre-war population of 23 million.
Worth the Read: The Hell of Good Intentions: America's Foreign Policy Elite and the Decline of U.S. Primacy -by Stephen M. Walt
Stephen M. Walt argues that the United States should adopt a grand strategy of "offshore balancing" to maintain its primacy and protect its interests. Offshore balancing involves focusing on preserving U.S. dominance in the Western Hemisphere and countering potential hegemons in Europe, Northeast Asia, and the Persian Gulf. The United States would encourage other countries to take the lead in checking rising powers and intervene militarily only when necessary. This approach would enable the U.S. to reduce defense spending, minimize military commitments, and decrease the risk of terrorism.
Walt asserts that offshore balancing is not a new concept, as it guided U.S. foreign policy for many decades, preventing the emergence of dangerous regional hegemons and preserving a global balance of power that enhanced American security. However, deviating from this strategy has led to costly failures, such as Vietnam, the expansion of NATO, and the wars in Afghanistan and Iraq. Walt contends that returning to an offshore balancing strategy would better serve U.S. interests and security in the long run. Watch the Wall St TV for a discussion of the book (in Chinese):
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