• US House vote on TikTok ban suggests broader prism than just pro- or anti-China
• With ‘made-by-China’ under US pressure, Mexican trade probes spark concerns over curbs
• China has drawn its territorial line in the Gulf of Tonkin. Is the South China Sea next?
• China’s aspiring investors, eager for options, feeling lukewarm on cross-boundary offerings
• Chinese flying taxi maker EHang sells autonomous passenger drone for US$332,000 on Taobao as nation’s low-altitude economy takes off
• What is Xi Jinping’s vision for finance with Chinese characteristics? | News
• Evergrande: Chinese firm and founder fined over $78bn fraud claims
• India-friendly Bhutan walks tightrope as it seeks to end border row with ‘aggressive China’
• Stars and fish brains: how Chinese researchers are getting closer to mind-controlled computers
• Romance-seeking man in China cancels date after she sends him list of future expenses should they marry, have children
• Chinese tech giant Lenovo boosts AI efforts with new servers, professional computers powered by Nvidia GPUs and software
• Taiwan’s vice-president-elect Hsiao Bi-khim courts mainland China’s wrath with visit to Czech Republic
• Chinese academic’s disappearance sparks concerns among compatriots in Japan: ‘people are worried’
• Killing of teenager in China sparks debate about ‘left behind’ children
• China hits out at US ambassador Nicholas Burns for making negative comments ‘on multiple occasions’
• Blinken boosts U.S. ties to Philippines amid China maritime aggression
• Starship rival: Chinese scientists build prototype engine for nuclear-powered spaceship to Mars
• As pandemic, geopolitical tensions took their toll, China’s affluent families saw wealth and numbers decline, Hurun report says
• Nvidia expands ties with Chinese EV makers including BYD, Xpeng, as auto AI race heats up
• Blinken to underline ‘ironclad’ support for Philippines as it clashes with China in disputed sea
• White House to host first-ever US-Philippines-Japan summit to counter China
• Nvidia unveils new AI ‘superchip’ line-up Blackwell, succeeding dominant H100 chip banned from sale to China
• China to host global nuclear safety conference – but row over Fukushima nuclear waste water will not be on agenda
• Chinese envoy meets Hamas political leader in Qatar to discuss ‘Gaza conflict and other issues’
• What is the ‘blind box’ economy and why is retail phenomenon sweeping China? Consumption craze markets mystery
• Detention of 3 teens over gruesome killing of 13-year-old classmate sparks debate in China
• China’s steel sector could cut carbon emissions by more than 10% next year with faster shift to clean production: report
• What’s next for Hui Ka-yan after China slapped Evergrande with a 4.2 billion yuan fine and banned him from the markets for life?
• Chinese scientists create swarming drones that can rapidly multiply mid-air to create a tactical shock
• Singapore jails Chinese national for Taylor Swift concert chicanery
• In the busy waters between China and Taiwan, the de facto border is being tested
• Chinese navy teams up with coastguard in rare joint missile exercise
• About 40% of Americans see China as top US enemy in new poll
• China’s private firms, fed up with crippling payment delays and ‘red-tape excuses’, push back

US House vote on TikTok ban suggests broader prism than just pro- or anti-China

https://www.scmp.com/news/china/article/3256012/us-house-vote-tiktok-ban-suggests-broader-prism-just-pro-or-anti-china?utm_source=rss_feed

When TikTokers flooded US congressional offices with calls urging their representatives to vote against banning their beloved app, many were met with a mixture of indifference and polite clarifications that Congress was only trying to force a sale, not impose a ban.

But behind the scenes, much of Capitol Hill was furious. What TikTok said was “straight-up disinformation”, said a congressional staffer.

On March 6, a day after the House of Representatives introduced a bill that would ban TikTok’s operations in the US if its Chinese-based parent company ByteDance didn’t divest in about six months, TikTok sent a notification to its US users asking them to “speak up” to prevent a “total ban”.

The bill’s sponsor, Representative Mike Gallagher, a Republican from Wisconsin and chair of the House select committee on China, framed TikTok’s actions as “a campaign to manipulate and mobilise American citizens on behalf of the Chinese Communist Party”. Before the vote on the House floor – scheduled a mere eight days later – Representative Cathy McMorris Rodgers, a Republican from Washington, accused the company of forcing teenagers to call their representatives.

The lawmakers’ depiction of a top-down influence campaign by TikTok infuriated the platform’s users, many of whom made videos speaking about the positive impact the app has had on their education, mental health, community building and small-business ventures.

“I just called them of my own accord,” small-business owner Ben Stanley said angrily in a video, noting that he never even saw the notification. Stanley shared a recording of his call to his congresswoman, Mary Miller of Illinois, in which he vowed to spend the next two weeks actively campaigning against her and her party if she voted for the bill.

There are signs that their efforts may be paying off. In subsequent days, a growing contingent of lawmakers made it clear that they would vote against the bill. Last Wednesday on the House floor, 50 Democrats and 15 Republicans across the political spectrum voted “nay”. While still a minority compared to the 352 who voted for the bill, the diverse crew of dissenters suggests that TikTok could not be simply captured by a pro- versus anti-China framework as its critics desire.

The scale of the dissent against efforts to restrict the popular platform, much more visible than in previous years when the app faced similar pressures, also portends increased difficulties for the anti-TikTok movement should it persist. The latest effort to restrict TikTok faces its next battle in the Senate, where support appears mixed and a vote has not yet been scheduled.

Why is Trump now defending TikTok in the US after trying to ban it?

Founded in 2012, TikTok’s owner ByteDance is privately held and headquartered in Beijing. TikTok said last year that about 60 per cent of ByteDance is owned by global institutional investors like General Atlantic, 20 per cent is owned by ByteDance employees, and a final 20 per cent is owned by the company’s founder.

ByteDance’s base in China has caused concern that US user data could be subject to Chinese government control – though TikTok has repeatedly denied ever sending data to Beijing or being asked to do so.

Lawmakers are also worried about the potential for TikTok to manipulate its algorithm to influence users towards Beijing’s narratives. Though they have not presented evidence for this concern, it is one that has grown since the Israel-Gaza war when pro-Palestinian messaging spread on the app.

Critics of efforts to ban the app – which once included only a handful of libertarian and progressive lawmakers like Senator Rand Paul of Kentucky and Representative Jamaal Bowman of New York – note that the threats posed by TikTok are hypothetical rather than demonstrated.

It is “largely a potential threat”, said Representative Jim Himes of Connecticut, the lead Democrat on the House Permanent Select Committee on Intelligence, who voted against Gallagher’s bill last week.

In an interview with CNN, Himes said he cared about the constitutional protections for free speech, citing a decision by a Montana court to block a ban of TikTok in the state.

“Just because the Congress is falling all over itself for each member to demonstrate how hawkish they are on China, that doesn’t mean compromising the Bill of Rights, the First Amendment,” Himes said.

At least four House lawmakers from both sides of the aisle said that closed-door briefings on the matter did not convince them that the threat was substantial enough to sacrifice fundamental freedoms.

‘A great business’: ex-Trump Treasury chief Mnuchin seeks TikTok buyout bid

Protecting free speech was cited by 33 House members as a reason for not supporting Gallagher’s bill, with a handful of them cautioning against emulating China’s censorship system.

In justifying his “nay” vote on the House floor, Representative Robert Garcia, a Democrat from of California, cited free speech groups like the American Civil Liberties Union, which have consistently argued against banning TikTok ever since then president Donald Trump tried to curb the app’s influence in 2020.

Garcia, along with other progressive legislators, is also an advocate for the app’s educational, economic and community-building aspects. “As an openly gay person, it’s a place where I get so much gay information, where gay creators come to share news.”

Any ban on TikTok will cause “huge harm to our national economy,” he added, noting that some business owners rely solely on the app.

Gallagher’s bill, formally called the Protecting Americans From Foreign Adversary Controlled Applications Act, establishes a process for the president to designate apps controlled by “foreign adversary” countries to face restrictions on operations in the US, but singles out TikTok and ByteDance for immediate action.

In opposing Gallagher’s bill, at least 26 Democratic representatives pushed for comprehensive privacy legislation to address data security concerns, rather than targeting a single app or company. Echoing TikTok users, legislators noted that even if TikTok were banned, China could buy American user data from other apps, including US-based Facebook and Instagram.

Meanwhile, House Republicans were quick to emphasise that a vote against Gallagher’s bill was not an endorsement of Beijing, with eight of them citing concerns about overly broad expansions of government power. “It’s the libertarian in me,” said Representative Nancy Mace, a Republican from South Carolina.

As the most vocal antagonist to a TikTok ban in the Senate, Rand Paul has spoken consistently against giving “unprecedented authority to President Biden and the surveillance state”. In 2023, Paul blocked an effort by Senator Josh Hawley, a Missouri Republican, to fast track a TikTok ban bill through the Senate, and pledged last week to stop such attempts for Gallagher’s bill in the chamber.

TikTok told to break with China’s Communist Party or lose access to US users

Few Republicans appeared to be have been swayed by the change of heart by Trump, who came out against banning TikTok two weeks ago after meeting with ByteDance investor Jeff Yass. In a contrast to President Joe Biden, who said he would sign Gallagher’s bill if it passed both congressional chambers, Trump said a ban would only empower TikTok’s competitor Facebook.

Arguing that banning TikTok would open a “Pandora’s box” to speech restrictions, Representative Marjorie Taylor Greene, a Republican from Georgia, said she made her decision independently without consulting Trump. Supporting Trump “doesn’t mean we’re all robots”, she said.

Only two Republicans mentioned Trump explicitly when explaining their “no” votes, with one citing the need to protect Trump-founded social media platform Truth Social from claims of foreign influence.

Twenty lawmakers, including Representative Gregory Meeks, a New York Democrat and ranking member on the House Foreign Affairs Committee, noted the rushed nature of the bill as a reason to not support it. Meeks, as with some other members of the House Democratic leadership, urged Congress to focus on more pressing issues, such as funding for Ukraine.

Several lawmakers, including Meeks, also pointed to the difficulty of achieving the divestiture offered – an analysis that experts agree with.

“Divestiture would be difficult given any time frame, but likely almost impossible in six months,” said Caitlin Chin-Rothmann of the Centre for Strategic and International Studies, a Washington-based think tank.

“TikTok is significantly larger than it was back in 2020 when Trump first ordered a sale, and it is larger than Twitter was in 2022 when Elon Musk purchased it. Any buyer would need to have a significant amount of resources as well as a high level of risk tolerance.”

When Trump was trying to ban TikTok in 2020, the app had about 50 million users in the US. That number has grown to 170 million in 2024, according to TikTok.

Chin-Rothmann said other complicating factors included potential antitrust scrutiny due to the size of the acquisition. The Chinese government could also block the transaction under export control laws that allow it to prevent sales of sensitive technologies, such as TikTok’s recommendation algorithm, she added.

Australia won’t follow US on TikTok ban, PM Albanese says

Facing pressures to reduce the Chinese government’s potential interference in the app, TikTok began implementing a mitigation strategy in 2022 called Project Texas and entered into now-stalled negotiations with the Committee for Foreign Investment in the United States (CFIUS).

Project Texas would cede authority over TikTok’s American operations to a three-person board selected by CFIUS. That board would run a subsidiary called US Data Security, which would handle all of the app’s critical functions in the United States, including user data, engineering, security and content moderation.

But while TikTok’s efforts to address security concerns are something that TikTok users have picked up on, they have had little sway over lawmakers.

“Many members of Congress have already made up their minds about TikTok or see it as an easy messaging opportunity during an election year … there is probably little that TikTok can say to change their minds,” Chin-Rothmann said.

Still, some House members and senators have expressed openness to meeting with TikTok – indeed, some met with TikTok CEO Chew Shou Zi last week.

But for Representative Maxwell Frost, a Democrat and the youngest member of Congress at age 27, hearing from his Florida constituents was enough for him to vote no – a “hell no”.

For the majority of lawmakers, however, constituent engagement was one of many factors, or did not factor in much at all in their stance.

A staffer for a Democratic lawmaker who voted “nay” said the lawmaker’s decision was informed mostly by how important TikTok had become for small-business owners and believing that there were less restrictive means than banning an app. The staffer noted that the lawmaker did not receive a significant number of constituent calls.

Regardless of the political winds, most TikTok users remain firm against the ban. Many took to the app to express scepticism it was truly about the threat from China, alleging that the anti-TikTok movement has been “bought” by Big Tech and other forces.

“It’s all about control,” said one user with more than 12,000 followers. “They just want to control us and control where we get our information.”

US lawmakers push to put TikTok-parent ByteDance on export control list

Others expressed doubt about TikTok’s Chinese government ties and manipulation of information.

A day before the vote, dozens came to Washington from across the country to push against a potential ban.

Flanked by a small contingent of lawmakers, JT Laybourne of Farmington, Utah, spoke of his frustration at some members of Congress for dismissing the app as something for “dumb TikTok dances”.

“It’s changed our lives,” he said, highlighting how it helped him and his wife garner support when he went through open-heart surgery.

“So when I hear these elected officials literally mock and make fun of TikTok and its creators, I’m disgusted.”

With ‘made-by-China’ under US pressure, Mexican trade probes spark concerns over curbs

https://www.scmp.com/economy/global-economy/article/3255973/made-china-under-us-pressure-mexican-trade-probes-spark-concerns-over-curbs?utm_source=rss_feed

Mexican tariffs on Chinese steel products indicate a willingness to accommodate US demands, analysts said, with additional trade curbs in the run-up to November’s presidential election set to add to the concerns of Chinese producers and investors.

Mexico’s Ministry of Economy imposed a provisional compensatory duty of 31 per cent on Chinese steel nail producers on Friday, according to its Official Gazette of the Federation, after concluding an anti-dumping investigation that had started in September.

Chinese firms still have a chance to appeal, but the tariffs came less than two weeks after Mexico also imposed duties of between 3.68 and 12.35 per cent on steel balls imported from China after concluding another anti-dumping investigation.

And according to China Trade Remedies Information, a monitoring agency affiliated with the Ministry of Commerce, more than 240 similar cases were filed against Chinese companies in recent years, representing about one tenth of the cases filed by the US.

“Trade data continues to indicate the increasing participation of Chinese inputs in US-bound exports,” S&P Global Market Intelligence said on Monday.

“The US will likely increase measures aimed at curtailing the rise in Chinese exports and foreign direct investment flows to Mexico, such as those applied to electric vehicle software and port cranes.”

It added that Washington may also consider a trade review of China’s support for its shipbuilding industry after a petition from US unions.

Presumptive Republican candidate for November’s election and former US president Donald Trump said during a campaign rally in Ohio on Saturday that he would target cars made in Mexico by Chinese companies with a 100 per cent import tariff.

Trade by value between China and Mexico rose by 6 per cent year on year to US$100.2 billion last year, according to customs data.

China’s export to Mexico, meanwhile, increased by 5.1 per cent to US$81.5 billion, with major trading items including car parts and electronic components.

Exports of car components to Mexico, in particular, surged by 260 per cent in 2023 compared to the eve of the US-China trade war in 2017, the Chinese data showed.

Xu Shicheng, vice-president at the Latin American Society of China, said that “it’s nothing new” for Mexico to levy anti-dumping duties on Chinese products.

China’s investment in Mexico is up – but is dodging US tariffs the whole story?

However, the influence of the US would continue whether Trump or incumbent Joe Biden wins the presidential election later this year.

“The American government will still launch new restrictive measures towards the Mexican-made vehicles, especially those electric vehicle producers of China or Chinese-Mexican joint ventures that export cars to the US,” he said.

Container shipping imports from China to Mexico in January increased by 60 per cent year on year, according to ocean freight rate benchmarking and intelligence platform Xeneta.

Such a trade lane has been “further fuelling suspicions it has become a ‘back door into the US”, the firm added.

Annual growth in container shipping between China and Mexico increased by 34.8 per cent in 2023 compared to an increase of 3.5 per cent in 2022, according to Xeneta.

Mexico will also head to the ballot box in June to decide its next president, with ruling party candidate Claudia Sheinbaum leading against opponent Xochitl Galvez, according to the latest polls.

“The problem is that the trade deficit in Mexico against China is ballooning to nearly US$100 billion … for the size of Mexico, this is huge,” said Alicia Garcia-Herrero, chief economist for Asia-Pacific at Natixis.

Garcia-Herrero noted that Biden is “collaborative” to make deals on immigration in exchange for reducing foreign direct investment from China in Mexico.

“If Trump wins, [the situation] might be different … because Trump will not give anything to Mexico,” she added.

China has drawn its territorial line in the Gulf of Tonkin. Is the South China Sea next?

https://www.scmp.com/news/china/diplomacy/article/3255978/china-has-drawn-its-territorial-line-gulf-tonkin-south-china-sea-next?utm_source=rss_feed

China’s decision to draw a new territorial line in southern waters it shares with Vietnam has raised regional concerns that similar tactics could be used in the South China Sea.

Earlier this month, Beijing declared a set of seven base points along its southern coast to demarcate its territorial waters and sovereignty over airspace, seabed and subsoil in the Gulf of Tonkin, known in China as the Beibu Gulf.

Previously, China had not specified a baseline but, under the United Nations Convention on the Law of the Sea (Unclos), its maritime zone was measured from its low-water line along the coast and was curved.

Now China is defining its territorial waters extend seaward up to 12 nautical miles from the straight lines formed by the seven points, which some analysts say covers a bigger area.

Beijing said the new baseline was in line with Unclos – which allows for straight lines in some cases – as well as a demarcation agreement with Vietnam for the Gulf of Tonkin, which was signed in 2000.

It is also in line with China’s Law on the Territorial Sea and the Contiguous Zone adopted in 1992, which says the baseline should be straight.

On its WeChat account, the Chinese foreign ministry’s department of boundary and ocean affairs said the move was necessary to exercise China’s sovereignty and jurisdiction.

“The announcement of new baseline … is an important part of China’s efforts to improve the delineation of the baseline of the territorial sea, with a view to better serving the economic development of the provinces and regions along the Beibu Gulf, such as Guangxi, Guangdong and Hainan, and striving to realise the strategic goal of building a strong maritime power,” the department said.

Chinese foreign ministry spokesman Wang Wenbin said on Friday that China had a “legitimate and lawful right” to delineate the new baseline.

Under their agreement signed in 2000, China and Vietnam agreed on a delimitation line in the gulf, giving Vietnam 53.23 per cent of the gulf and China 46.77 per cent. The two sides also agreed to establish a joint fishing regime in that area.

Vietnam’s foreign ministry declined to say on Thursday whether the new base points would jeopardise the two-decade-old agreement, stating only that international law and the rights and interests of other countries must be respected.

Kentaro Nishimoto, an international law professor with Tohoku University in Sendai, Japan, said the new baseline would allow China to convert a large part of the northern South China Sea into its internal waters, where it could exercise more control.

“This leads to a fairly large area that was formerly China’s exclusive economic zone being converted into the territorial sea or internal waters, where it could exercise more powers under international law,” Nishimoto said.

There have also been concerns that Beijing could restrict ship movements in the area around Hainan Island.

“Under Unclos, the rights of innocent passage and transit passage remain even if a straight baseline is established,” Nishimoto said.

“If China adopts a different interpretation and seeks to restrict the navigation of ships in this area, this would have an impact on the navigational rights of all other states.”

Jay Batongbacal, director of the Institute for Maritime Affairs and Law of the Sea at the University of the Philippines Diliman, said the new baseline in the gulf was “clearly excessive”, with some places beyond the 24-nautical mile limits from shore.

“It is indicative of China’s overall attitude towards expanding its territorial claims into the sea, attempting to increase its internal waters as much as possible, and abusing its rights as a coastal state under Unclos,” Batongbacal said.

“This attitude of playing fast and loose with the baselines is likely going to be reflected in its future actions toward the islands in the South China Sea,” he said, referring to the future delineation of baselines elsewhere in the strategic waterway.

So far it has announced three sets of baselines for its maritime territory. These include points on the outer edge along and outer islands off the coast of China until on the eastern tip of the Shandong peninsula that faces the Korean peninsula across the Yellow Sea, as well as lines completely enclosing the Paracels.

In 2012, when territorial spat over the East China Sea escalated, Beijing also declared a set of base points near the Japanese-held Diaoyu Islands, also known as the Senkakus.

It has not set baselines for the Pratas Islands, also known as the Dongsha; the Spratly, or Nansha, Islands as well as the Zhongsha Islands in the South China Sea.

Hanoi’s low-key approach may be central to muted confrontations with Beijing

Nishimoto, from Tohoku University, said Chinese law assumed that straight baselines would be designated for all of China’s coastline but this had not been done in reality for some parts of China’s coast.

“[This has] raised questions about whether a further designation for the maritime features in the South China Sea will follow in the near future,” he said.

But Ding Duo, an associate research fellow at the National Institute for South China Sea Studies in Hainan, said Beijing was unlikely to rush to do this.

“There are more factors to take into account when it comes to the Spratly Islands, over which China admits there are disputes over the territorial sovereignty and maritime delimitation,” he said.

He said concerns over possible restrictions on navigation in the region were overstated.

“The only impact would be on foreign warships, which would be required to seek permission from China, but in reality, I don’t think any foreign warships would have to travel into the gulf.”

China’s aspiring investors, eager for options, feeling lukewarm on cross-boundary offerings

https://www.scmp.com/economy/china-economy/article/3255948/chinas-aspiring-investors-eager-options-feeling-lukewarm-cross-boundary-offerings?utm_source=rss_feed

Stella Lu, an interpreter in China’s southern metropolis of Guangzhou, has been on the hunt for safe investment products with a decent return.

She, like many of the country’s middle class, is left with limited onshore options, and Beijing’s capital controls make overseas investment a non-starter.

As real estate and A-share stocks have lost their appeal amid slowdowns, gold and termed deposits have become two popular alternatives – even with the rate offered by Chinese banks being less than half those available in the US.

The introduction of a new product has provided another option for budding investors – one which also presents a test for Beijing’s oversight of capital flows.

The cross-boundary Wealth Management Connect (WMC) scheme, recently updated, allows residents of the southern province of Guangdong to deposit money in Hong Kong-based banks at a high rate.

Lu’s interest was piqued. “This would be a new channel to invest in various financial products in Hong Kong,” she said.

However, when Lu approached a local bank to learn more, she was quickly disappointed.

A high entry threshold – at least 1 million yuan (US$138,979) in net assets, local household registration and ownership of local property – as well as other, more hidden restrictions dampened her enthusiasm.

Over the past decade, China has gradually launched several programmes allowing mainland residents to invest in stocks, bonds, insurance policies and other wealth management products in Hong Kong and vice versa.

The new version of the WMC scheme, updated in January, appears part of a larger effort to strengthen the integration of the Greater Bay Area – a regional connectivity plan tying together the southern powerhouse province of Guangdong with Hong Kong and Macau.

“Mainland households have much less global diversification in their investment portfolios due to capital restrictions … The economic slowdown should further enhance the attractiveness of WMC as an alternative,” said Wong Kin-ming, senior lecturer in accountancy, economics and finance at Hong Kong Baptist University.

“It is crucial for the Greater Bay Area to continue exploring new initiatives in capital account liberalisation, which may involve extending the WMC to more products or introducing liberalisation in new areas, as part of China’s efforts to liberalise its capital account.”

The scheme, with its relative flexibility, is also likely to complicate Beijing’s management of capital movement.

China had to fend off an exodus last year after a drop in investor confidence, and sentiments remain weak as the interest rate gap remains wide and concerns linger over the country’s economic prospects and business environment.

The Institute of International Finance, a US-based association for the global financial services industry, estimated in a December report that Chinese stocks and bonds could see an outflow of US$65 billion in 2024 from foreign investors.

Fund flows via the “ants moving home” approach – slang for carrying cash to Hong Kong or Macau in small amounts – have also been seen as a wide interest rate gap persists.

The one-year deposit rate for Chinese banks is far lower than the over 4 per cent offered in Hong Kong and over 5 per cent in the US.

Since last year, lenders in Hong Kong including HSBC, Standard Chartered, Bank of China (Hong Kong) and DBS recorded strong demand for new accounts from mainland clients.

Hundreds of thousands have flocked to the city to open a bank account, drawn by higher-yielding bank deposits, insurance and investment products and easier access to US currency.

The WMC is regarded as a mechanism to ease outflow pressures, as fund flows are watched closely under a closed-loop, quota-based management system.

‘Symbolic weight’: China’s Jiangsu opens to foreign firms in strategic sectors

Investors are required to open one bank account for cross-boundary remittance in their place of residence and another account for investment in the other market, and pair the two together.

Figures from the state-owned Economic Daily newspaper showed that there were 71,000 individual retail investors in the Greater Bay Area joining the scheme up to the end of January.

With 67 banks in Guangdong, Hong Kong and Macau taking part in the programme, southbound investment accounted for 94.3 per cent of the total fund that stood at 13.8 billion yuan.

Products currently offered under the WMC scheme are simple wealth management products with low to medium risk – insufficient to draw in masses of customers, despite the willingness of middle-class mainland residents to travel to Hong Kong in person to open a bank account.

“It sounded like a closed loop,” said He Huiying, a human resources manager in Guangzhou. “In fact, our funds cannot be substantially invested overseas.

“Whether [they] deposit or withdraw, citizens already are facing a lot of questioning from banks,” He added, predicting that controls over foreign currency withdrawal could become more stringent.

At present, the scheme seems of little interest to China’s wealthy. Dong Jinyue, senior economist at BBVA Research, said the per-person investment cap of 3 million yuan may not be enough to entice high net worth customers.

“People from other provinces cannot buy overseas financial products through this scheme,” Dong added. “Product varieties need to be further diversified.”

Lu, the Guangzhou-based interpreter, said she felt that even the country’s largest state-owned banks were not enthusiastic about promoting the programme.

“There are no brochures, and investors can’t find any information about it in the online banking app,” she said.

Lu was only able to find a three-month time deposit with an annualised rate of 4.9 per cent. However, investment is capped at 1 million yuan.

Another foreign-funded bank requires household financial assets of 2 million yuan or more from the past three months, as well as a personal average annual income of 400,000 yuan over the past three years.

Chinese flying taxi maker EHang sells autonomous passenger drone for US$332,000 on Taobao as nation’s low-altitude economy takes off

https://www.scmp.com/tech/big-tech/article/3255974/chinese-flying-taxi-maker-ehang-sells-autonomous-passenger-drone-us332000-taobao-nations-low?utm_source=rss_feed

Chinese flying taxi maker EHang is selling its EH216-S electric vertical take-off and landing (eVTOL) vehicle on Alibaba Group Holding’s Taobao marketplace, weeks before the Nasdaq-listed company makes the autonomous passenger-carrying aircraft available in overseas markets.

Based in Guangzhou, capital of southern Guangdong province, EHang has put its EH216-S for sale at a unit price of 2.39 million yuan (US$332,000) on e-commerce giant Alibaba’s primary domestic retail platform. Alibaba owns the South China Morning Post.

In February, EHang announced that the EH216-S would be sold at a suggested retail price of US$410,000 outside the mainland from April 1.

The ambitious domestic and international marketing campaigns show EHang’s confidence in generating strong market demand, months after its self-developed EH216-S became the world’s first recipient of a Type Certificate and Standard Airworthiness Certificate for pilotless eVTOLs. Those certifications were issued last October and December, respectively, by the Civil Aviation Administration of China (CAAC).

“This significant achievement has had a profound impact on our business, as it has sparked a surge in demand for our remarkable EH216-S,” EHang founder, chairman and chief executive Hu Huazhi said last Friday, when the company released its latest financial results.

“The market response has been overwhelmingly positive, leading to strong quarterly and yearly revenue growth.”

EHang reported fourth-quarter revenue of 56.6 million yuan, a 260.9 per cent jump from 15.7 million yuan in the same period in 2022, on the back of an increase in orders for its EH216-series products. Total 2023 revenue reached 117.4 million yuan, up 165 per cent from 44.3 million yuan the previous year.

Sales and deliveries of the company’s EH216-series products totalled 52 units last year, compared with 21 in 2022.

After completing aircraft certification, EHang conducted EH216-S production under the supervision of CAAC representatives at the company’s factory in Yunfu, a city in Guangdong. The firm began deliveries of certified aircraft to customers in the December quarter.

EHang did not immediately respond to a request for comment. The company’s shares were up 4.71 per cent to US$16.23 in pre-market trading on Tuesday.

The EH216-S, which was first announced in February 2018, has reportedly completed over 42,000 successful test flights in more than 14 countries.

The two-passenger aircraft has a top speed of 130-kilometres per hour, a cruising speed of 100km/h and a maximum altitude of 3,000 metres. It has a range of 30km and a flight time of 25 minutes.

It is built with 16 propellers, recharges its batteries in 120 minutes and provides a maximum payload of 220 kilograms. The luggage boot can accommodate an 18-inch suitcase to satisfy general commuting and short-distance travel requirements.

The autonomous flight capabilities, fully electric propulsion, comprehensive redundancy safety features, and intelligent command-and-control systems of the EH216-S make it an ideal solution for various urban air mobility (UAM) applications, including air taxi services, aerial tourism, airport shuttles and cross-island transport, according to EHang.

The company earlier this month forged a UAM cooperation pact with the municipal government of Wuxi, a city in eastern Jiangsu province, covering an order of 100 EH216-S units.

Last October, EHang entered into a strategic cooperation deal with the municipal government of Hefei, a city in eastern Anhui province, for joint development of a low-altitude economy ecosystem, with US$100 million in extended support that can be used to facilitate a minimum order of 100 EH216-series products.

The low-altitude economy, which is expected to be driven by the wide adoption of aircraft like eVTOLs and pilotless aerial vehicles, was identified as one of the national strategic emerging industries during the Central Economic Work Conference held in Beijing in December. About 20 provinces across the country have prioritised the development of the low-altitude economy this year, according to EHang.

That is expected to contribute between 3 trillion yuan and 5 trillion yuan to China’s economy by 2025, according to a white paper published last year by the International Digital Economy Academy in Shenzhen.

What is Xi Jinping’s vision for finance with Chinese characteristics? | News

https://www.economist.com/news/2024/03/12/what-is-xi-jinpings-vision-for-finance-with-chinese-characteristics

China’s markets are in trouble and the Communist Party is blaming the bankers. It has told them to abandon “hedonistic” lifestyles, and regulators have moved to curb transactions that they consider “ill-intended”. Now, China’s bankers face new orders: to develop a “financial culture with Chinese characteristics”.

David Rennie, The Economist’s Beijing bureau chief, and Alice Su, our senior China correspondent, examine these new directives and ask: what is Xi Jinping’s vision for finance with Chinese characteristics? And where does that idea come from?

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Podcast transcripts are available upon request at [email protected]. We are committed to improving accessibility even further and are exploring new ways to expand our podcast-transcript offering.

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Evergrande: Chinese firm and founder fined over $78bn fraud claims

https://www.theguardian.com/business/2024/mar/19/evergrande-chinese-firm-and-founder-hui-ka-yan-fined-over-78bn-claims

The troubled Chinese property developer Evergrande and its founder have been fined over allegations that they fraudulently inflated its revenues by $78bn (£61.6bn) in the two years before it defaulted on its debt.

Beijing’s stock watchdog fined the company about $580m for allegedly falsifying its revenue, among other violations, as it conducts a deep clean of the country’s embattled financial sector.

The company said in a release to mainland Chinese stock exchanges late on Monday that its chair, Hui Ka Yan, was fined $6.5m and banned from China’s markets for life. Hui, also known as Xu Jiayin, was detained by authorities in September for suspected “illegal crimes”.

Evergrande is the world’s most indebted property developer, with more than $300bn in debts. It is among dozens of Chinese companies that have collapsed since 2020 under official pressure to rein in excessive borrowing that the ruling Communist party views as a threat to the economy.

The notice cited a preliminary ruling by the China Securities Regulatory Commission, which recently got a new chief, Wu Qing, an industry veteran with a reputation for being tough on market misbehaviour.

Evergrande said regulators found it had overstated its revenue in 2019 by nearly $30bn, or about half. In 2020, they allege its revenue was overstated by nearly 80%, or $48.6bn. The CSRC also suspects problems with bonds Evergrande issued, it said.

Hui, as chair, was “the person in charge who is directly responsible and at the same time serves as the actual controller of the organisation and guidance”, it said. “The means were particularly bad and the circumstances were particularly serious.”

It also named and fined other Evergrande executives who it said were responsible for the falsified reports and had “behaved badly”.

A Hong Kong court ordered Evergrande into liquidation in late January after efforts to restructure its foreign debt failed.

Real estate helped fuel China’s economic boom as families bought into one of the few potentially high-yielding assets available for investment. But developers borrowed heavily as they turned cities into forests of apartment and office towers, pushing total corporate, government and household debt to more than 300% of the country’s annual economic output, unusually high for a middle-income country.

The government has stepped up support for the real estate industry, listing thousands of projects eligible for loans from state banks that stepping up to help contain the damage. Party leaders have emphasised that they want to ensure that families are able to obtain housing they have paid for.

Regulators are striving to reassure investors after Chinese markets slumped in the past year, in tandem with the downturn in the property market. Even after regulators announced new policies to support the markets, promising to root out insider trading and other abuses, the Shanghai Composite index is still 5.8% below its level a year earlier, and Hong Kong’s Hang Seng has fallen 15.3%.

The fallout from the property crisis has also affected China’s shadow banking industry – institutions that provide financial services similar to banks but operate outside regulations.

A Chinese media report said police in Beijing had detained suspects, including senior executives, in a case related to asset management company Zhongzhi Enterprise Group. Caixing Global, a financial news outlet, said the investigation aims to recover investor losses.

Zhongzhi, a conglomerate that lent heavily to developers and operates trusts, insurance, leasing and other fund management businesses, declared it was insolvent and filed for liquidation in November.

Associated Press contributed to this report

India-friendly Bhutan walks tightrope as it seeks to end border row with ‘aggressive China’

https://www.scmp.com/week-asia/politics/article/3255953/india-friendly-bhutan-walks-tightrope-it-seeks-end-border-row-aggressive-china?utm_source=rss_feed

Bhutanese Prime Minister Tshering Tobgay’s recent visit to India, taking place amid ongoing border negotiations with China, underscores the kingdom’s careful diplomatic strategy aimed at strengthening its ties with New Delhi without provoking Beijing, analysts have said.

Bhutan and China have been engaged in long-running talks to resolve their border dispute, a matter of strategic interest to India given its implications for regional security.

According to Aditya Gowdara Shivamurthy, an associate fellow with Observer Research Foundation’s Strategic Studies Programme, Bhutan was currently at a “crossroads”.

“On one hand, Bhutan is trying to demarcate its borders with its aggressive northern neighbour China,” Shivamurthy said. “On the other hand, it is facing an economic crisis and mass migration, and needs India’s support and collaboration more than any other time in the past.”

In ‘big test’ for India, China and Bhutan push for official ties and border fix

India has two significant tri-junction points involving Bhutan and China. One is in the west, which includes Doklam, and the other is in the east, marking the eastern terminus of the McMahon Line that Delhi uses to define the Sino-Indian border.

China’s increasing presence and influence in Bhutan could pose a threat to India’s security interests.

India and China had a military stand-off at Doklam in 2017, when the Indian Army intervened to halt the construction of a road by the Chinese People’s Liberation Army (PLA) in the contested area.

Bhutan and China also have competing claims over the area, with the former asserting that Doklam is part of its territory and Beijing claiming it as part of its Donglang region. The stand-off lasted for some two months and ended in August 2017 after diplomatic talks between the three countries. China stopped road construction and India withdrew its troops. Satellite imagery, however, has revealed ongoing Chinese construction of military infrastructure in the region.

Shivamurthy, who focuses on broader strategic and security related-developments throughout the South Asian region, said Bhutan was keen to bring its dispute with China to an end.

“Bhutan has to close its disputes, there’s no option B and India knows it. In fact, India has been consistently informed about the progress made in the negotiations,” he said.

In 2021, Bhutan and China signed an agreement to expedite boundary talks with a “three-stage road map”. By October last year, after the 25th round of talks, they agreed on guidelines for a joint technical team to delimit and demarcate the boundary.

Shivamurthy said these talks had also been aimed at soothing India’s concerns. “The negotiations with China will go on. That won’t change. Bhutan cannot ignore there is a military and economic power to its north. But it is trying to assure that Indian interests are respected,” he said.

As a small state squeezed between two large powers, Bhutan has a geopolitically strategic role in the region.

Analyst Amit Ranjan noted that Modi’s first foreign visit after becoming prime minister in 2014 was to Bhutan.

“That was a master stroke. [Modi] began his foreign visits with a smaller South Asian country, which demonstrated India’s strategic priorities,” said Ranjan, a research fellow at the Institute of South Asian Studies, an autonomous research institute at the National University of Singapore.

On December 13, Bhutan officially left the least developed countries (LDCs) category established by the UN General Assembly in 1971.

As Bhutan transitions from a LDC and enters the World Trade Organization, it would require investment and capital to fuel further growth, making its relationship with India all the more significant, Ranjan said.

“So, it will be a test for the Bhutanese leadership, of how they are going to deal with India and how much they are ready to engage with China,” he said.

On March 13, the Indian cabinet approved two agreements with Bhutan on energy efficiency and conservation measures.

Bhutan and India have a strong economic partnership, especially when it comes to hydropower. India is Bhutan’s largest trading partner, largest source of foreign investment and largest importer of its surplus electricity, which makes up about 40 per cent of Bhutan’s revenue.

India contributed 45 billion rupees (US$542 million) to Bhutan’s 12th Five Year Plan, which ended in October 2023, and it has committed to stepping up its assistance in the next blueprint.

The kingdom is seeking to build the “Gelephu Mindfulness City”, 1,000 sq km green economic zone bordering India’s Assam state that is aimed at creating infrastructure and jobs.

Bhutan eyes surge in national happiness with US$15 billion hydropower push

Ranjan said India needed to maintain tight relations with Bhutan, considering its less-than-favourable relations with some of its immediate neighbours.

“[India doesn’t] have good ties with Afghanistan. With Pakistan, the relationship is at its lowest point in the past 75 years. In Bangladesh, there is a simmering anti-India campaign. So, India wants Bhutan to remain in its good books and not fall into China’s lap,” he said.

Bhutan is the only country in India’s neighbourhood that has not officially joined China’s Belt and Road Initiative.

According to Indian media reports, the government has proposed to build a motorable road connecting Arunachal Pradesh and Assam through Bhutan. But Thimphu is reportedly not enthusiastic about the proposal until its border with China is demarcated.

Ranjan said that while Bhutan might initially resist the plan due to its discussions with China, it would eventually need to prioritise ease of business with India.

As China and Bhutan wind down border feud, alarm bells ring in India

Meanwhile, Modi’s coming visit to Bhutan would be watched closely by China, Ranjan said.

“India is concerned about Doklam. They don’t want Chinese presence at the tri-junction border, which may cut the ‘chicken-neck’ corridor,” he said, referring to a stretch of land that connects India’s northeastern states to the rest of the country. “And I am sure that Modi on his visit to Bhutan will talk about it with the Bhutanese.”

In 1949, India and Bhutan signed the Indo-Bhutan Treaty of Peace and Friendship, which gave Delhi significant control over Thimphu’s foreign policy and defence in exchange for security guarantees and economic support. Though revised in 2007 to grant Bhutan more autonomy, India still plays a major role in Bhutan’s external affairs.

Nitasha Kaul, an international relations professor at the University of Westminster who specialises in Bhutan, said while the country faced limitations given its dealings with China on diplomatic and border issues, it was cautiously advancing its democratic consolidation and international engagement, given its strong economic ties with India.

“Bhutan’s relationship with China is not hostile but amicable, and it is rooted in the understanding of its long-term and multidimensional orientation towards India,” she said.

“Bhutan’s main aim has been to keep its own domestic politics coherent with its national interest, and avoid the splintering of its political sphere into pro-India and pro-China voices,” Kaul said, adding that during the Doklam dispute, Bhutan made strategic use of silence to avert confrontation with either power.

Kaul said the main threat to the Himalayan region in contemporary times was posed by India-China hostilities, and the Doklam incident very nearly escalated into war.

“Bhutan’s careful diplomatic navigation of the stand-off was a crucial contribution to averting it, thereby illustrating that small states can play a role in war not being a fait accompli on a volatile frontier.”

Pavan K Verma, a former Indian ambassador to Bhutan, said ties between the neighbours were deeply interwoven, and the kingdom consistently consulted India before entering any discussions with China.

“Talks with China on border issues have been going on for many years. China has unresolved border issues with Bhutan and India. And they (Bhutan and India) always consult with each other how to proceed with these negotiations with China, so that they are not only fair but of strategic relevance to both countries,” he said.

Stars and fish brains: how Chinese researchers are getting closer to mind-controlled computers

https://www.scmp.com/news/china/science/article/3255808/stars-and-fish-brains-how-chinese-researchers-are-getting-closer-mind-controlled-computers?utm_source=rss_feed

Scientists in China have harnessed the observation techniques of astronomers to scrutinise another object of mystery much closer to home – fish brains.

For the first time, researchers have scanned the neural pathways of zebrafish, a freshwater fish from the minnow family, to produce an imaging analysis of up to a hundred thousand neurons.

The real-time imagery of the neurons is a significant advance in brain-computer interface (BCI) technology, an emerging field in which machines and devices can be controlled with thoughts.

Chinese team captures fish’s ‘thoughts’ as it goes in for the kill

“It generates feedback signals by continuously monitoring the activities of the zebrafish brain’s entire network of neurons with a feedback delay of less than 70.5 milliseconds, and it can handle data streams up to 500 megabytes per second,” a statement on the Chinese Academy of Sciences (CAS) website said on Wednesday.

“This advancement may lead researchers to develop more efficient optical brain-computer interface technologies in the future,” the statement said, adding that the research method qualified for a patent called “Optical Brain-Computer Interface System and Methods”.

The study was published in Nature Neuroscience on March 11 by brain scientists Mu Yu and Du Jiulin, from the Centre for Excellence in Brain Science and Intelligence Technology at CAS, and algorithm specialist Hao Jie, from the Institute of Automation at CAS.

Zebrafish helps push the frontiers of research

The human brain is made up of hundreds of different types of neurons – nearly 100 billion in total – while the universe comprises about 200 billion known galaxies, interconnected in a network similar to the structure of the brain. The structural resemblance has prompted theoretical speculation that the universe is much like a vast human brain.

Scientists know that human perception, learning, memory and emotions involve the collaboration of multiple regions of the brain. Extracting information from neurons is akin to finding patterns in the vast expanse of the galaxy. But the ability to process such huge amounts of data remains a significant challenge.

China’s FAST telescope deepens mystery over cosmic blasts

Astronomers have faced similar challenges in the study of fast radio bursts (FRBs) – deep-space blasts of energy that are the subject of intense interest. FRBs have extremely short durations – often only a fraction of a second – and rarely repeat.

However, scientists have been able to speed up the research by pinpointing FRBs in vast amounts of astronomical data with the help of computer learning powered by graphics processing units.

Inspired by this technology, the Chinese researchers created a way to process neural signals in zebrafish. The system collects signals from optical sensors and sends them to a computer system in real-time. The system is fast – able to analyse complex signals, decode them and produce responses that allow the brain to act like a light-controlled switch that could theoretically control external devices.

Scientists consider the zebrafish a model vertebrate because of its relatively small and simple brain, which only contains about 100,000 neurons. By studying these creatures, researchers have unlocked principles of brain function at the whole-brain level.

“The system has been tested in three neuroscience research scenarios, including real-time optogenetic stimulation, real-time visual stimulation, and virtual reality control,” the report said.

Using this system, the researchers said they aim to identify characteristics of neural activity that could be suitable for optical BCI and reveal their mechanisms, which would eventually lead to more efficient optical BCI technologies.

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Romance-seeking man in China cancels date after she sends him list of future expenses should they marry, have children

https://www.scmp.com/news/people-culture/trending-china/article/3254915/romance-seeking-man-china-cancels-date-after-she-sends-him-list-future-expenses-should-they-marry?utm_source=rss_feed

The experience of a man in China who was astounded when a woman he had just met sent him a detailed list of future family expenses, has gone viral on mainland social media.

The 35-year-old man, surnamed Wang, lives in Hangzhou of Zhejiang province in eastern China, and works as an administrator at a state-owned enterprise, the news portal Toutiao News reported.

Wang is 1.8m tall, owns two flats in the city, and earns about 100,000 yuan (US$14,000) a year, according to the report. His profile ticks all the boxes for what is considered an eligible husband on the mainland.

At the beginning of this month, he was introduced to a woman a year younger than him via a matchmaking agency.

They met in person and chatted happily, which made Wang feel he might have found true love.

However, that evening the woman sent him a Word document with the title “Family’s Normal Daily Expenditure List”.

The checklist covered all the outgoings they could expect if they lived together, including utilities bills, groceries, transport, socialising, clothes and gadgets.

It estimated they would spend a combined 9,900 yuan (US$1,400) a month on “fixed expenses”.

In addition, there would be ad hoc expenses, such as paying for their parents’ medical bills and for raising a child if they have one, the woman said.

She said it was necessary to show the man a clear statement of potential outgoings because he currently lives with his parents and has no idea how much daily necessities cost.

“She said we will face plenty of challenges that need to be solved with money. She encouraged me to double my salary to 200,000 yuan per year,” Wang said.

He said he was astonished when he received the woman’s list and that reading it made him feel exhausted.

“I am yearning for a simple and pure love, instead of a life full of calculation and comparison,” Wang said.

He had another failed dating experience last year when a woman said she did not want to sleep in the same bed or have sex with him if they married.

Unusual dating news often captivates mainland social media.

In January, a woman in central Hubei province reported to police that she was raped by a man she had consented to share a hotel bed with for the night.

They met on a dating app and she agreed to go to the hotel to test the man’s powers of restraint.

Chinese tech giant Lenovo boosts AI efforts with new servers, professional computers powered by Nvidia GPUs and software

https://www.scmp.com/tech/big-tech/article/3255963/chinese-tech-giant-lenovo-boosts-ai-efforts-new-servers-professional-computers-powered-nvidia-gpus?utm_source=rss_feed

Lenovo Group has unveiled a series of servers and computers powered by technology from US chip designer Nvidia, in the Chinese computer giant’s latest push to bring artificial intelligence (AI) solutions to businesses and cloud service providers.

Lenovo said it has added two new Nvidia graphics-processing-unit (GPU) systems to its AI server series, ThinkSystem. The servers are designed to support professional users in developing generative AI and large language models – the technology underpinning ChatGPT and similar AI tools.

Under the two companies’ collaboration, Lenovo’s server clients can use Nvidia’s enterprise-facing generative AI software, the Beijing-based company said on Monday. Customers can also access “microservices”, a set of new Nvidia tools that let developers create and deploy custom generative AI applications, Nvidia announced on the same day.

Silicon-Valley-based Nvidia is the world’s leading supplier of GPUs used for processing massive amounts of data used in AI models. Nvidia processors are in high demand, as companies around the world, including those in China, race to build and deploy generative AI models and related applications.

On Monday, Lenovo also announced new computer workstations pre-installed with Nvidia GPUs and software that support industrial users, scientists and developers in generative AI tasks.

The products are part of a partnership struck between Nvidia and Lenovo in October.

Lenovo, the world’s largest personal computer (PC) maker, has doubled down on AI, with plans to roll out its first-generation AI PCs in the first half of this year and “dramatically expand” its portfolio of AI devices through 2025, the company said during its earnings announcement last month.

The Chinese company, which operates in more than 180 markets worldwide, has also vowed to put more financial and human resources into AI research and development (R&D).

Last August, Lenovo said it would invest US$1 billion over three years to accelerate AI deployment for businesses around the world. The firm’s R&D headcount increased by more than 25 per cent last year, with its full-year R&D expenses-to-revenue ratio projected to reach a record high, the company said last month.

Taiwan’s vice-president-elect Hsiao Bi-khim courts mainland China’s wrath with visit to Czech Republic

https://www.scmp.com/news/china/politics/article/3255965/taiwans-vice-president-elect-hsiao-bi-khim-courts-mainland-chinas-wrath-visit-czech-republic?utm_source=rss_feed

Taiwan’s vice-president-elect Hsiao Bi-khim is visiting the Czech Republic on a visit that further provoked Beijing in the wake of her visit to the United States last week.

The foreign ministry in Taipei confirmed on Tuesday that Hsiao, who will be inaugurated on May 20, is in the central European country, saying she was there to “meet friends” and “exchange views”.

Lin Jian, a spokesman for Beijing’s foreign ministry, reacted by saying “the Chinese side firmly opposes any form of official exchanges” between Taiwan and countries that have diplomatic relations with mainland China.

He told a scheduled press conference that the Czech government had recognised that “Taiwan is an inseparable part of China” in various official agreements.

He warned Prague to keep its promise by “severely restraining certain individual politicians” and “take effective measures to remove the negative influence of the incident”.

Hsiao was invited by Sinopsis, a Prague-based think tank, to “deliver a speech,” according to Jeff Liu, a spokesman for Taiwan’s foreign ministry.

Czech foreign minister calls for more united EU-US approach to China

“She is also there to meet friends, exchange views, and interact with them before officially assuming office,” he added.

Asked if Taiwan and the Czech Republic had any new cooperation plans, Liu said his ministry would “make public related information about the two sides at an appropriate time”.

Taiwan’s ruling Democratic Progressive Party has previously confirmed that Hsiao, the former de facto ambassador to Washington, visited the United States last week. Reuters and The Wall Street Journal both reported that unnamed American officials had said she visited the US “in her personal capacity”.

Liu did not disclose details of what Hsiao had done or who she visited in the US and did not say whether she would visit any other countries in Europe.

Last week Beijing said it opposed her visit to the US “in any name or under whatever pretext” and repeated its regular attacks on her as a “diehard Taiwan independence separatist”, adding that Washington should “not arrange any form of contact” between Hsiao and US government officials.

Beijing regards Taiwan as part of China and has never renounced the use of force to bring it under its control. The Czech Republic and US, in common with most countries, does not officially recognise Taiwan as independent but are opposed to a forcible change in the status quo.

It was initially thought that Hsiao’s visit to the Czech Republic was going to be a low-key affair – along the lines of the trip to the US – to avoid provoking Beijing. But the president of the Czech Senate Milos Vystrcil posted a picture of a meeting with Hsiao on X, previously Twitter, on Tuesday.

The Czech Republic’s relationship with China? It’s complicated

Vystrcil led a high-profile delegation to Taipei in 2020 and declared himself as “Taiwanese” during a speech, prompting Beijing to warn he would “pay a heavy price” for his trip.

The Prague city authorities had previously cancelled a twin city relationship with Beijing in 2019 – replacing it with Taipei – with then mayor Zdenek Hrib hitting out at mainland China as an “unreliable partner”.

Prague’s unofficial relations with Taiwan have warmed steadily in recent years, especially following the election of President Petr Pavel last year.

Weeks before his inauguration, Pavel accepted a phone call from Taiwanese President Tsai Ing-wen, becoming the first European Union head of state to directly communicate with a Taiwanese leader.

Chinese academic’s disappearance sparks concerns among compatriots in Japan: ‘people are worried’

https://www.scmp.com/week-asia/people/article/3255977/chinese-academics-disappearance-sparks-concerns-among-compatriots-japan-people-are-worried?utm_source=rss_feed

The disappearance of a Chinese academic based in Japan after a brief visit to his homeland has sparked fears among his peers at Japanese universities, with the incident marking the third such reported case of its kind in more than a decade.

Hu Shiyun, 63, a professor of Chinese literature and linguistics at Kobe Gakuin University, told his employer last August that he would be making a short trip to China and return to Kobe before the start of the autumn semester classes.

The university on Monday confirmed it had heard nothing from Hu since he left, and that his family in Japan first expressed their concern in September. Kobe Gakuin has contacted the Chinese consul-general in Osaka but received no reply, the Yomiuri newspaper reported.

The cause of Hu’s disappearance remains unknown, amid speculation the Jiangsu native has been detained on unknown charges, it added.

More Japanese expats in US, China returning home amid rising costs of living

Chinese foreign ministry spokesman Lin Jian said he had no information on the case when asked about it at a press conference this week.

Maya Hamada, a professor of Chinese literature at Kobe University, told This Week in Asia: “People are very worried about Hu and what might happen to any of us when we go to China.”

More of her Chinese academic colleagues are making the conscious decision not to go back to China and are instead seeking greater job security in Japan or another country, according to Hamada.

Hamada was in Beijing in September for work and said she planned to return “several times” again this year – but she admitted to also being concerned, given that China had also arrested a number of Japanese nationals on charges of espionage.

She added it was becoming increasingly difficult to travel to China to pursue academic studies, citing what she said were demanding visa application processes. She objected, for example, to being asked about her annual income and to provide a full transcript of her academic history stretching back to secondary school.

Beijing raises ‘serious concerns’ over Japan’s arrest of Chinese researcher

Hu is at least the third Chinese academic based in Japan to go missing after a brief visit to his homeland. Zhu Jianrong, a professor at Toyo Gakuen University in Tokyo, vanished in 2013 in Shanghai and was apparently suspected of espionage. He was released six months later and returned to Japan.

Six years later, Yuan Keqin was detained on espionage allegations during a visit to China for his mother’s funeral. Yuan, a professor of Asian politics for 25 years at Hokkaido University of Education, was subsequently formally indicted.

Chinese government officials later claimed Yuan had “confessed to the facts of the crime” and that the evidence against him was “conclusive”. Since May 2021, there has been no news about court hearings or a conviction.

A group of Yuan’s colleagues have published repeated requests for information on his well-being, adding in a statement: “We sincerely hope that the false accusations against Dr Yuan will be dropped and [he will be] released immediately, as well as the recovery of safe and sound exchanges between Japan and China.”

Killing of teenager in China sparks debate about ‘left behind’ children

https://www.theguardian.com/world/2024/mar/19/killing-of-teenager-in-china-sparks-debate-about-left-behind-children

The killing of a 13-year-old boy in northern China last week, for which three boys are in police custody, has triggered a heated discussion in the media on juvenile crime and the plight of children left at home by migrant workers.

Police arrested three boys and took them into custody after they allegedly bullied and killed the junior high school student in the small city of Handan, in Hebei province, on 10 March, and then buried him in a shallow pit, state media reported. So far, no charges have been laid.

Local police are investigating the case as a homicide and have set up a team of more than 60 people, state media broadcaster CCTV News reported. Police in Handan’s Feixiang District declined to comment, and district propaganda officials referred Reuters to CCTV reports on the case.

State media said the victim and the three boys were children of rural migrant workers who spend most of the year working in large cities, leaving childcare duties to grandparents and other relatives.

Relatives of the victim and their attorney said in interviews with Chinese media and in posts on social media that the boy had long been a victim of bullying.

There are nearly 67 million so-called “left behind” children, 2020 census data shows, and academic studies show that these children are at higher risk of mental health issues, becoming victims of bullying and criminal behaviour.

In the last recorded moments before the 13-year-old boy’s death, authorities said surveillance footage showed him sitting on a scooter, surrounded by the three boys. An hour later, his phone went dead, triggering a frantic search by relatives.

The following day, police in a village discovered the boy’s body buried underneath a tarpaulin in an abandoned greenhouse.

The case has gripped the nation, with many Chinese expressing their outrage on social media.

“Public Trial! National live broadcast,” wrote a user on the Chinese social media platform Weibo. Other users called for the perpetrators to be punished, while some said that bullies across the country were watching the outcome.

In 2021, China lowered the age of criminal responsibility from 14 to 12 for certain crimes. The Global Times, citing experts, said the case could be the first that goes to court under the new legislation.

David Zhang, a Beijing-based defence lawyer, told Reuters the crimes the law covered include intentional homicide, intentional injury causing death and injuring someone by cruel means resulting in disability.

With Associated Press and Reuters

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China hits out at US ambassador Nicholas Burns for making negative comments ‘on multiple occasions’

https://www.scmp.com/news/china/diplomacy/article/3255936/china-hits-out-us-ambassador-nicholas-burns-making-negative-comments-multiple-occasions?utm_source=rss_feed

China has attacked US ambassador Nicholas Burns for making “multiple” negative comments about the country and warned he risks undermining recent efforts to improve the relationship.

Burns has recently said the two countries will remain “systemic rivals” for the next decade, and called the deepening competition between the two countries “quite profound”. He has also expressed concern about Hong Kong’s new national security law.

China’s support for Russia ‘very troubling’, says US ambassador

“We oppose defining bilateral relations with competition, and smearing and attacking China. We stand against the US interfering in China’s internal affairs under the pretext of human rights and values, and restraining China’s legitimate right to development in the name of competition,” Lin Jian, a new spokesman for the Chinese foreign ministry, said on Tuesday.

Lin also told a regular press conference: “We noted that Ambassador Burns has recently made negative comments on China on multiple occasions.

“These statements deviate from the important common understandings reached by the two presidents of China and the US at the summit meeting in San Francisco. They go against the spirit of the summit meeting in San Francisco and do not serve the sound and steady growth of China-US relations.”

At their summit in November, Joe Biden and Xi Jinping agreed to cooperate on a number of issues such as drug trafficking, military communications and artificial intelligence, as well as working to improve exchanges between people from the two countries.

Last Friday, Burns told a virtual seminar organised by the East-West think tank that the summit in San Francisco had not resolved “many of the outstanding differences on major issues”, but confirmed both countries in their view that “we are competitors”.

He highlighted the military and technology as major competitive fronts between the two, saying the US had long been a Pacific power but now “there’s a competition under way for military power and military influence”.

He said technology was “at the heart of the battle”, with rivalries raging from AI to machine learning, adding that the White House has made an effort to restrict China’s access to US cutting-edge technology.

US and China ambassadors identify areas of cooperation as well as danger zones

He also said it was “supremely ironic” that Beijing had criticised proposed legislation that would force TikTok’s owner ByteDance to sell up, saying China had banned most Western social media platforms and the TikTok app itself.

The ambassador also made a rare visit to Hong Kong earlier this month as the city’s legislative body prepared to vote on a domestic national security bill, which the city is required to pass under Article 23 of the Basic Law, the city’s mini-constitution.

Burns told Bloomberg News after the visit, where most of his meetings were held behind closed doors, that Washington had “serious concerns” about the proposed legislation.

“The concerns are about the right of people to dissent, freedom of speech, freedom of assembly, and the [US] State Department’s been very clear about that concern that we have over the last several weeks,” he said.

After the visit, the commissioner’s office for China’s foreign ministry in Hong Kong accused him of making “irresponsible” comments regarding the Article 23 bill.

“The United States has ignored its own stringent network of national security laws and severe related penalties while defending it as a secret,” a spokesman for the office said.

“However, they were pointing fingers and spreading gossip on Hong Kong’s constitutional duty to enact its national security law.”

Blinken boosts U.S. ties to Philippines amid China maritime aggression

https://www.washingtonpost.com/national-security/2024/03/19/phillipines-blinken-china/2024-03-19T07:28:31.322Z

MANILA — U.S. Secretary of State Antony Blinken discussed Chinese security risks on Tuesday with senior Philippine leaders, as Washington and Manila seek to bolster ties in the face of increasingly aggressive Chinese action against Philippine targets in the South China Sea.

The visit was the latest effort by Philippine President Ferdinand Marcos Jr. to fortify his nation against Beijing, as he steers Manila toward a much more assertive stance toward China than his predecessor, Rodrigo Duterte.

Duterte once declared it was “time to say goodbye” to Washington and cultivated closer relations with China. Marcos, by contrast, has built up a network of global security allies to help defend against Chinese naval aggression in disputed waters and plans to visit Washington next month for the first joint summit with U.S. and Japanese leaders.

Blinken’s visit — coming in the middle of a longer swing through Europe, Asia and the Middle East — was the latest in an intense parade of high-level U.S. visits to Manila. Just last week, Commerce Secretary Gina Raimondo came to the Philippine capital to announce plans to invest $1 billion in the country’s tech sector, part of an ongoing U.S. effort to diversify the global supply of semiconductors and reduce reliance on Chinese manufacturing.

“The alliance has never been stronger,” Blinken told reporters in Manila, speaking alongside Philippine Foreign Secretary Enrique Manalo. “We have a shared concern about [China’s] actions to threaten our common vision for a free, open Indo-Pacific.”

Blinken declared that the United States has “an ironclad commitment” to a mutual defense treaty with the Philippines that extends to any armed attack on Philippine armed forces and public vessels. “We've been very clear about that,” he said.

He said that none of the U.S. efforts to build alliances in the region “are directed against anyone or anything, they’re in service of something. They’re there for trying to realize the positive vision that all of the countries involved share of a free and open Indo-Pacific.”

Manalo told reporters that the U.S.-Philippine relationship has “been on hyperdrive over the past year or so,” declaring that his country is a “formidable ally for the United States.”

China lays claim to most of the South China Sea, despite conflicting claims by various countries. The Philippine claim is bolstered by a ruling in its favor by the Permanent Court of Arbitration in The Hague, which China does not recognize. Beijing has claimed that Washington is behind the Philippine pushback, accusing the two of fueling tension at sea.

Over the last year, the island nation has extensively documented how its vessels have come under extreme harassment by China, such as facing collisions and water cannons. These gray-zone tactics fall just short of an armed attack, which could trigger Washington’s obligations to defend the Philippines under the mutual defense treaty.

Relations between the United States and Philippines were strained under Duterte, who publicly “realigned” himself with China. But Marcos has sought international support in the South China Sea, and expanded U.S. access to Philippine military bases.

Since 2022, the Philippines has embarked on a spree of new defense agreements, signing deals with the European Union, India and Britain. Japan, Canada and France are also looking at signing military agreements with the Philippines, according to their embassies.

Starship rival: Chinese scientists build prototype engine for nuclear-powered spaceship to Mars

https://www.scmp.com/news/china/science/article/3255889/starship-rival-chinese-scientists-build-prototype-engine-nuclear-powered-spaceship-mars?utm_source=rss_feed

A collaboration of more than 10 research institutes and universities across China has made significant strides towards interplanetary travel with the development of a nuclear fission technology that could power large-scale exploration of Mars.

In a paper published by the Chinese Academy of Sciences’ peer-reviewed journal Scientia Sinica Technologica, the research team said its prototype lithium-cooled nuclear reactor system has passed some initial ground tests.

The results confirmed some of the key technological solutions invented by Chinese scientists and engineers to shrink a megawatt-class reactor – seven times more powerful than a rival system being built by Nasa – to an unprecedented size, they said.

When fully deployed in space, the 1.5 megawatt reactor – including its heat sink – could tower as high as a 20-storey building. But on the ground, it will fold neatly into a container-sized volume, weighing less than eight tonnes, the paper said.

The design makes the reactor system “easy to load and launch by rocket,” wrote the researchers, led by the academy’s Wu Yican. It will also be able to maintain stable operations in the harsh environments of space for extended periods, they said.

According to the paper, the powerful energy source will make high-mass, round-trip transport possible for both crewed and cargo space flights – opening the way for China’s large-scale exploration of the moon and Mars.

Some scientists estimate that a nuclear-powered spacecraft could complete a round trip between the Earth and Mars in just three months. The current scientific mainstream consensus is that the technology will be vital for interplanetary missions.

In contrast, spacecraft that rely on fossil fuels – like the Starship under development by US company SpaceX – could take at least seven months to reach Mars, according to some calculations.

The Starship rocket is central to Nasa’s plans for landing astronauts on the moon later this decade, as well as SpaceX CEO Elon Musk’s hopes of colonising Mars, but even a one-way trip to the red planet would need an enormous life support system.

“Innovate or perish. No excuses,” reads a slogan hanging above the Chinese prototype reactor – an indication of China’s determination to lead the race for nuclear-powered space travel that is now under way.

Nasa’s Artemis programme plans to send a nuclear reactor to the moon and use similar technology to build a fleet of Mars-colonising spacecraft. The European Union has initiated three ambitious projects to develop nuclear-related space technologies.

And Russia has restarted its Cold War-era nuclear-powered spacecraft project. The US government raised concerns last month over Russia’s attempts to launch a nuclear-powered weapons platform into low Earth orbit.

Both the Soviet Union and the United States sent low-power reactors into space during the Cold War. The US reactors were capable of reaching a maximum in the hundred-watt range, while the Soviet Union’s devices achieved kilowatt-level power.

Design work for Nasa’s 20 kilowatt nuclear reactor – which is being built by Lockheed Martin, Westinghouse, and private start-up company IX – is expected to be completed by 2025. The US space agency hopes to send this device to the moon in the early 2030s.

China and its lunar exploration partner Russia are discussing the possibility of building a nuclear power plant on the moon, the Russian space agency Roscosmos said earlier this month.

US-China space race fuelled by lunar landings and orbital ‘parking spots’

If the plans proceed smoothly, a China-Russia nuclear reactor could be launched between 2033 and 2035, according to Roscosmos.

The Chinese Yutu-2 lunar rover, powered by a Russian radioactive isotope nuclear battery, has been operating on the far side of the moon for more than four years, making it the longest lasting man-made machine on the lunar surface.

Wu and his team said Russia is making the fastest research and development progress in some of the field’s key technologies, including space nuclear fuel.

The researchers said the Chinese reactor will generate up to 1,276 degrees Celsius (2,328.8 Fahrenheit) through the fission of uranium fuel, far exceeding the operating temperature of most commercial nuclear plants.

The intense heat will expand liquid forms of the inert elements helium and xenon into gases, driving a generator. The chain reaction produces fast neutrons that will enable an efficient and continuous power supply for at least 10 years, the paper said.

The scientists said that by using liquid lithium they can make the reactor smaller, thanks to the element’s high thermal conductivity and low weight.

Traditionally, a heat exchanger and radiation shield occupy a significant amount of space in reactor designs, but Wu and his colleagues said they have developed a technology that combines these two components into one.

According to the paper, the reactor’s heat exchanger is made of tungsten alloy, which can achieve efficient heat exchange in the loop while blocking harmful radiation. Other new technologies include high-temperature corrosion-resistant materials.

At this stage, the prototype’s heat source is an external power supply, with plans to add nuclear fuel rods to achieve full operation in coming steps of the testing programme, the researchers said.

“Currently, integrated system operation tests have been carried out, including lithium-cooled loop circulation, coupling heat exchange between the primary and secondary loops, and [a] closed Brayton power generation system,” they said.

The tests provided a preliminary demonstration of the feasibility of coupling a lithium-based cooling system with a Brayton generator – developed in the 19th century as a piston engine and widely used in powered space flight.

“Corrosion tests of molybdenum alloy materials have also been conducted in high-temperature environments,” the researchers said.

World’s largest space environment simulator launched in northeast China

Wu and his team said China’s demand for nuclear fission power is likely to grow significantly around 2035 and there is still much to do, including practical flight verification of the technologies and hardware on board the Tiangong space station and other spacecraft.

A key focus of further research and development for the scientists will be the safety of the nuclear reactors during launch and operations, with an imperative requirement that there will be no danger of a nuclear explosion, even if a reactor falls back to Earth.

The project team also plans to apply artificial intelligence to the long-term uncrewed operation of space reactors, using the technology to automatically diagnose and deal with any faults.

The institutes and universities involved in the ambitious project plan to strengthen their coordination and cooperation even further in coming years. The researchers said China’s largest and most complete industrial chain will also help to realise the project.

Nuclear reactors could also support China’s other space activities, including its planned crewed mission to the moon and ambitions to play a leading role in interplanetary exploration.

“Our country is in a new era,” Wu and his team said. “We plan to embark on deep space exploration missions such as manned lunar exploration, asteroid exploration, flying by Jupiter, and exploring the edges of the solar system. [Space reactors] will be crucial in these endeavours.”

While there is still a gap in the research and development foundation of space reactors between China, the US and Russia, the researchers said they believe they will be able to demonstrate applications of the technology at an earlier stage than their rivals, because of their coordinated approach.

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As pandemic, geopolitical tensions took their toll, China’s affluent families saw wealth and numbers decline, Hurun report says

https://www.scmp.com/economy/china-economy/article/3255925/pandemic-geopolitical-tensions-took-their-toll-chinas-affluent-families-saw-wealth-and-numbers?utm_source=rss_feed

The number of rich families in China declined for the second time in 15 years as the world’s second-largest economy tackles a slew of economic challenges, ranging from a property crisis to dampened business confidence and mounting local government debt.

As of January last year, the number of affluent Chinese families with 6 million yuan (US$833,484) in assets had dropped to 5.14 million, a 0.8 per cent decline from the previous year, according to a report published by the Hurun Research Institute on Tuesday.

The report also showed that the number of high-net-worth (HNW) families – with assets worth more than 10 million yuan – dropped 1.3 per cent to 2.08 million in 2023, while the number of ultra-high-net-worth (UHNW) families – with assets worth more than 100 million yuan – fell 3.8 per cent to 133,000.

The number of international UHNW families, defined as families with assets worth more than US$30 million, also declined by 4.5 per cent to 88,000.

“In 2022, the pandemic and a shifting geopolitical landscape posed uncertainties to global economic development, impacting private wealth in major countries by varying degrees,” said Rupert Hoogewerf, the chairman and chief researcher of Hurun Report who is also known as Hu Run.

The report comes amid a push by President Xi Jinping to address inequality through his “common prosperity” initiative, which is intended to bolster social and economic equality, as wealth disparity has increased significantly in China in tandem with an economic boom from the late 1970s onwards.

China’s top 100 storied brands fall in value as weak economy dents demand

It also came weeks after Beijing unveiled its annual gross domestic product (GDP) target of around 5 per cent for 2024, amid deflationary risks, low business confidence and a prolonged downturn in the property sector.

The total amount of assets held by China’s rich families declined by 3.6 per cent year on year to 158 trillion yuan, Hoogewerf said, adding that these assets still accounted for 1.3 per cent of the entire country’s GDP.

The bulk of China’s rich families came from first-tier cities and economically developed regions in the southern and eastern parts of the country, according to the report. Beijing topped the charts for affluent, HNW and UHNW families, while Shanghai and Hong Kong were in second and third place, respectively.

China’s billionaire population drops: 229 knocked off Hurun rich list

Among China’s rich families, UHNW families held 8.9 billion yuan in assets, accounting for 67 per cent of the total wealth held by this group. That number also went down by 1 per cent compared with the previous year.

Premier Li Qiang said during the two sessions that the government was “keenly aware” of the challenges it faced ahead, but questions remain as to how Beijing will address these problems.

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Nvidia expands ties with Chinese EV makers including BYD, Xpeng, as auto AI race heats up

https://www.scmp.com/business/china-business/article/3255916/nvidia-expands-ties-chinese-ev-makers-including-byd-xpeng-auto-ai-race-heats?utm_source=rss_feed

Nvidia said on Monday it is expanding its collaborations with BYD and other Chinese carmakers that are racing to build self-driving vehicles and AI-augmented infotainment technology to compete in global markets.

BYD, which overtook Tesla last year as the world’s top electric vehicle manufacturer, will use Nvidia’s next generation of in-vehicle chips, called Drive Thor, to enable increased levels of autonomous driving and other digital functions, Nvidia said.

BYD will also use Nvidia technology to streamline factories and its supply chain, as well as to develop virtual showrooms, Danny Shapiro, Nvidia’s vice-president for automotive, said during a conference call.

“Drive Thor is going into BYD [vehicles] next year,” Shapiro said.

Chinese carmakers BYD, Xpeng and GAC Aion’s Hyper brand are among several carmakers and autonomous truck developers that announced expanded collaborations with Nvidia on Monday as part of the chipmaker’s GTC developer conference in San Jose, California. Chinese carmakers Zeekr, a unit of Geely, and Li Auto had previously said they would use Nvidia’s Drive Thor technology.

Chinese car companies are turning to Nvidia as they use advanced technology to compensate for what they currently lack in global brand recognition. BYD and its rivals are driving to expand sales in Europe, Southeast Asia and other markets outside China, while competing with Tesla and other established Western vehicle brands in their home market.

“There’s a massive number of Chinese carmakers,” Shapiro said. “They have a lot of incentives in place to innovate, a lot of regulation that’s favourable” to developing increasing levels of automated driving.

Xpeng eyes slice of mass-market segment with launch of cheaper models

Among other new automotive and industrial partnerships announced by Nvidia on Monday is a collaboration with US software company Cerence to adapt large language model (LLM) artificial-intelligence systems for in-car computing, Shapiro said.

Chinese computer maker Lenovo is also collaborating with Nvidia on LLM deployment, Nvidia said.

Soundhound will use Nvidia technology to develop an in-vehicle voice command system that could allow a vehicle owner to obtain information from a virtual owners manual using speech commands.

Nvidia did not refer to OpenAI or other LLM developers by name.

Blinken to underline ‘ironclad’ support for Philippines as it clashes with China in disputed sea

https://apnews.com/article/us-philippines-blinken-marcos-south-china-sea-0c39aa94e32469f3d608561c2c0f167cU.S. Secretary of State Antony Blinken, right, shakes hands with Philippines' Secretary of Foreign Affairs Enrique Manalo at the Sofitel Hotel in Manila, Philippines Tuesday, March 19, 2024. (Evelyn Hockstein/Pool Photo via AP)

2024-03-19T05:03:39Z

MANILA, Philippines (AP) — Secretary of State Antony Blinken will underscore Washington’s “ironclad commitment” to its alliance with the Philippines on Tuesday, as clashes between Chinese and Filipino forces in the disputed South China Sea turn more hostile, the U.S. State Department said.

Blinken, the latest high-level official to visit the U.S. treaty ally, met his Philippine counterpart, Enrique Manalo Tuesday, before planned meetings with Philippine President Ferdinand Marcos Jr. and other top officials in Manila.

Next month, President Joe Biden will host Marcos and Japanese Prime Minister Fumio Kishida in a White House summit amid growing concerns over increasingly aggressive Chinese actions in the South China Sea and North Korea’s nuclear program.

The Chinese coast guard blocked and used water cannons against Philippine vessels in a confrontation two weeks ago that slightly injured a Filipino admiral and four of his sailors near the disputed Second Thomas Shoal.

The March 5 faceoff in the high seas also caused two minor collisions between Chinese and Philippine vessels and prompted Manila’s Department of Foreign Affairs to summon China’s deputy ambassador to convey a protest against the Chinese coast guard’s actions, which the Philippines said were unacceptable.

Washington renewed a warning after the hostilities that it is obligated to defend the Philippines if Filipino forces, ships or aircraft come under an armed attack anywhere in the South China Sea.

The Chinese coast guard said that “it took control measures in accordance with the law against Philippine ships that illegally intruded into the waters adjacent to Ren’ai Reef,” the name Beijing uses for Second Thomas Shoal.

The Second Thomas Shoal, which is occupied by a small Philippine navy contingent but surrounded by Chinese coast guard ships and other allied vessels, was the site of several tense skirmishes between Chinese and Philippine coast guard ships last year. But Filipino officials said the confrontation earlier this month was particularly serious because of the injuries sustained by its navy personnel and damage to their vessel.

In his meetings with Marcos and Manalo, Blinken will “advance shared economic priorities and underscore the United States’ ironclad commitment to the U.S.-Philippine alliance,” the State Department said.

They will “discuss areas to deepen U.S.-Philippine cooperation on a range of bilateral and global issues, including on regional peace and stability, human rights and democracy, economic prosperity” among others, the State Department said.

Outside the presidential palace, dozens of left-wing activists tore a mock U.S. flag in a noisy rally Tuesday to oppose Blinken’s visit and U.S. involvement in the long-simmering territorial disputes.

Aside from China and the Philippines, Vietnam, Malaysia, Taiwan and Brunei also have overlapping claims in the resource-rich and busy waterway, a key global trade route.

Beijing claims almost the entire South China Sea. In the last decade, China has turned barren reefs into seven islands that now serve as missile-protected island bases, including three with runways, that have bolstered its capability to fortify its territorial claims and patrols.

In response, Washington has been strengthening an arc of military alliances and security relationships in the Indo-Pacific, including with the Philippines, Vietnam and other countries at odds with China in the disputed sea.

After China effectively seized another disputed atoll, the Scarborough Shoal off the northwestern Philippines, in 2012, Manila brought its disputes with Beijing to international arbitration and largely won. China, however, rejected the 2016 ruling of the U.N.-backed tribunal that invalidated its expansive claims on historical grounds and continues to defy the decision.

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Associated Press journalists Joeal Calupitan and Aaron Favila in Manila contributed to this report.

JIM GOMEZ Gomez is The AP Chief Correspondent in the Philippines. twitter mailto

White House to host first-ever US-Philippines-Japan summit to counter China

https://www.scmp.com/news/asia/article/3255887/white-house-host-first-ever-us-philippines-japan-summit-counter-china?utm_source=rss_feed

US President Joe Biden will hold the first three-way summit with the leaders of the Philippines and Japan next month, as the United States boosts alliances against China.

Biden’s meeting with Philippines President Ferdinand Marcos Jnr and Japanese Prime Minister Fumio Kishida at the White House on April 11 is the latest in a series of meeting with Asia-Pacific allies.

It also comes against a backdrop of clashes between Philippines and Chinese vessels in the South China Sea, where the countries have contested maritime claims.

“The leaders will advance a trilateral partnership built on deep historical ties of friendship” including a “shared vision for a free and open Indo-Pacific,” White House Press Secretary Karine Jean-Pierre said on Monday local time.

Biden will later hold a separate bilateral meeting with Marcos to “reaffirm the ironclad alliance” with the Philippines, she said.

Kishida will be at the White House for a state visit the day before, which had already been announced.

Japan believes the talks will boost a “free and open international order based on the rules of law,” chief government spokesman Yoshimasa Hayashi said.

“With the Japan-US alliance as the linchpin, we believe that deepening cooperation with like-minded countries like the Philippines in a wide range of areas will be essential to maintaining the peace and prosperity of this region,” he told reporters.

The US is redoubling efforts to improve long-standing ties with regional allies such as Tokyo and Manila, in an effort to counterbalance an increasingly aggressive China.

The announcement of the three-way summit came as US Secretary of State Antony Blinken was heading to Manila, a trip that the State Department said would reaffirm America’s “unwavering commitment” to the Philippines.

Beijing recently accused Washington of using the Philippines as a “pawn” in the dispute over the South China Sea.

Japan and the Philippines meanwhile said during a visit by Kishida in November that they would begin negotiations for a defence pact that would allow them to deploy troops on each other’s territory.

Japanese fighter jets land in Philippines for first time since World War II

Japan invaded and occupied the Philippines during World War II, but the two countries have since grown closer due to trade and investment, and more recently, to counter China’s assertiveness in the region.

Biden has also increasingly turned to the three-way summit format to build US alliances.

In August he hosted Japan’s Kishida and South Korea’s President Yoon Suk-yeol at his Camp David presidential retreat, in a bid to bring the two US allies closer after years of tensions.

Biden held a landmark summit with Chinese President Xi Jinping in California in November in a bid to prevent conflict between the two superpowers, but relations remain tense.

Nvidia unveils new AI ‘superchip’ line-up Blackwell, succeeding dominant H100 chip banned from sale to China

https://www.scmp.com/tech/big-tech/article/3255895/nvidia-unveils-new-ai-superchip-line-blackwell-succeeding-dominant-h100-chip-banned-sale-china?utm_source=rss_feed

Nvidia chief executive officer Jensen Huang showed off new chips aimed at extending his company’s dominance of artificial intelligence computing, a position that’s already made it the world’s third-most-valuable business.

A new processor design called Blackwell is multiple times faster at handling the models that underpin AI, the company said at its GTC conference in San Jose, California. That includes the process of developing the technology – a stage known as training – and the running of it, which is called inference.

The Blackwell chips, which are made up of 208 billion transistors, will be the basis of new computers and other products being deployed by the world’s largest data centre operators – a roster that includes Amazon.com, Microsoft, Alphabet’s Google and Oracle Blackwell-based products will be available later this year, Nvidia said.

China said to fall short of matching US advances in AI amid major challenges

Blackwell – named after David Blackwell, the first Black scholar inducted into the National Academy of Science – has a tough act to follow. Its predecessor, Hopper, fuelled explosive sales at Nvidia by building up the field of AI accelerator chips. The flagship product from that line-up, the H100, has become one of the most prized commodities in the tech world – fetching tens of thousands of dollars per chip.

The growth has sent Nvidia’s valuation soaring as well. It is the first chip maker to have a market capitalisation of more than US$2 trillion and trails only Microsoft and Apple overall.

The announcement of new chips was widely anticipated, and Nvidia’s stock is up 79 per cent this year through Monday’s close. That made it hard for the presentation’s details to impress investors, who sent the shares down about 1 per cent in extended trading.

Huang, Nvidia’s co-founder, said AI is the driving force in a fundamental change in the economy and that Blackwell chips are “the engine to power this new industrial revolution”.

Nvidia is “working with the most dynamic companies in the world, we will realise the promise of AI for every industry”, he said at Monday’s conference, the company’s first in-person event since the pandemic.

The new design has so many transistors – the tiny switches that give semiconductors their ability to store and process information – that it’s too big for conventional production techniques. It’s actually two chips married to each other through a connection that ensures they act seamlessly as one, the company said. Nvidia’s manufacturing partner, Taiwan Semiconductor Manufacturing Company, will use its 4NP technique to produce the product.

Blackwell will also have an improved ability to link with other chips and a new way of crunching AI-related data that speeds up the process. It’s part of the next version of the company’s “superchip” line-up, meaning it’s combined with Nvidia’s central processing unit called Grace. Users will have the choice to pair those products with new networking chips – one that uses a proprietary InfiniBand standard and another that relies on the more common Ethernet protocol. Nvidia is also updating its HGX server machines with the new chip.

The Santa Clara, California-based company got its start selling graphics cards that became popular among computer gamers. Nvidia’s graphics processing units, or GPUs, ultimately proved successful in other areas because of their ability to divide up calculations into many simpler tasks and handle them in parallel. That technology is now graduating to more complex, multistage tasks, based on ever-growing sets of data.

Blackwell will help drive the transition beyond relatively simple AI jobs, such as recognising speech or creating images, the company said. That might mean generating a three-dimensional video by simply speaking to a computer, relying on models that are have as many as 1 trillion parameters.

For all its success, Nvidia’s revenue has become highly dependent on a handful of cloud computing giants: Amazon, Microsoft, Google and Meta Platforms. Those companies are pouring cash into data centres, aiming to outdo their rivals with new AI-related services.

The challenge for Nvidia is broadening its technology to more customers. Huang aims to accomplish this by making it easier for corporations and governments to implement AI systems with their own software, hardware and services.

Huang’s speech kicks off a four-day GTC event that’s been called a “Woodstock” for AI developers. Here are some of the highlights from the presentation:

Huang concluded the event by having two robots join him on stage, saying they were trained with Nvidia’s simulation tools.

“Everything that moves in the future will be robotic,” he said.

China to host global nuclear safety conference – but row over Fukushima nuclear waste water will not be on agenda

https://www.scmp.com/news/china/science/article/3255894/china-host-global-nuclear-safety-conference-row-over-fukushima-nuclear-waste-water-will-not-be?utm_source=rss_feed

China will host an international nuclear safety conference next month but the release of waste water from the Fukushima nuclear plant in Japan will not be on the agenda.

The fifth International Conference on Enhancing the Operational Safety of Nuclear Power Plants will be held in Beijing between April 15 and 19, the first time the event has been held outside Vienna, the headquarters of the International Atomic Energy Agency (IAEA).

“China, which operates and builds many nuclear power plants, offered to host this event,” the IAEA said, adding that it “holds conferences in various member states”.

It had previously said the main focus will be on how nuclear plant operators and owners can improve safety at their plants.

While the conference will “highlight enhancements in operational safety management at all stages of nuclear power plant operations,” it added: “The specific topic of the release of treated water from Fukushima Daiichi nuclear power plant is not within the scope of this conference.”

The Chinese Ministry of Foreign Affairs did not respond to queries about why the topic will not be addressed.

China has been vocal in its criticisms of Japan’s plan to release batches of treated contaminated waste water, which accumulated after a meltdown at the plant when it was struck by a devastating tsunami in 2011. It has also banned all Japanese seafood imports citing safety concerns.

However, the IAEA has approved the plan, saying it is consistent with scientific standards. Last week its director general Rafael Grossi posted on X, formerly Twitter, that the agency would maintain a presence at the plant until the last drop of water is released.

The IAEA said that the director general and deputy director general for nuclear safety and security “may participate in the conference”.

Grossi has been subjected to repeated attacks by nationalistic commentators on Chinese social media, many of whom pointed out that the Argentinian career diplomat does not have a scientific background.

However, the IAEA has traditionally been headed by diplomats and politicians, including high-profile figures such as former United Nations weapons inspector Hans Blix and Mohamed ElBaradei, who later served as Egypt’s interim vice-president.

The agency was also accused on Chinese social media of accepting “hush money” or “bribes” from Japan following South Korean media reports last year that staff from the IAEA had accepted a €1 million (US$1.1 million) “political donation” from Japan.

Those reports also said the IAEA’s report on the plan to release the waste water had been edited by the Japanese side before its release in July.

The Japanese foreign ministry said it was “absolutely untrue” that a political donation had been made or that the results of the IAEA’s report were “fixed.” The IAEA, which has not commented on the reports, relies on contributions from member nations, including Japan and China, to operate.

When Grossi visited Japan last week the government said it would provide the IAEA with a further €18.5 million to support its activities.

UN nuclear chief visits Japan to examine Fukushima waste water release

The China Nuclear Energy Association, which is hosting next month’s conference, said it will “contribute China’s strength to the development of global nuclear power safety”.

Around 200 participants from over 30 countries are expected to attend the conference. Following the conference, some participants will visit the China Institute of Atomic Energy in Beijing – home to the China Experimental Fast Reactor, a major research facility.

Anna Bradford, director of the IAEA’s Division of Nuclear Installation Safety, said: “It is indispensable that operational safety at nuclear installations is maintained at a high level, to protect people and the environment. This conference will help enable all of us to do that.”

Chinese envoy meets Hamas political leader in Qatar to discuss ‘Gaza conflict and other issues’

https://www.scmp.com/news/china/diplomacy/article/3255898/chinese-envoy-meets-hamas-political-leader-qatar-discuss-gaza-conflict-and-other-issues?utm_source=rss_feed

China’s foreign ministry envoy Wang Kejian has met the head of Hamas’ political bureau, according to a Chinese readout on Tuesday, in the first known meeting between a Chinese official and the militant group since the Gaza conflict broke out last year.

The brief statement said Wang met Ismail Haniyeh in Qatar on Sunday and “exchanged views on the Gaza conflict and other issues”, without further elaboration.

The Jerusalem Post, citing Hamas, reported that Haniyeh told the Chinese envoy that the war needed to end quickly. He also said Israel must withdraw its forces from Gaza and an independent Palestinian state should be established.

According to the report, Wang said China was “keen on relations” with Hamas, which he called a “part of the Palestinian national fabric”.

Wang is the first diplomat China has sent to Palestine and Israel since the war erupted in October. Last week, he visited the West Bank and met the Palestinian Authority’s foreign minister Riyad al-Maliki. There, he said China was renewing its call for an immediate ceasefire and a “two-state” solution as a political settlement.

Wang also held talks with Hagai Shagrir, head of the Israeli foreign ministry’s Asia and Pacific bureau, and Rachel Feinmesser, the head of the ministry’s policy research centre.

In Gaza at Ramadan, starvation adds to deaths amid Israel-Hamas truce impasse

Since the conflict began, China has sought to play a role by releasing its own five-point position paper on the crisis, which urged the UN Security Council to draw up a “concrete” timeline and road map for a two-state solution.

Its foreign minister Wang Yi last year held separate calls with his Israeli and Palestinian counterparts while other Chinese officials have discussed the situation with various countries in the Middle East.

But China has not condemned Hamas or referred to the group as a terrorist organisation, which analysts earlier suggested might prompt countries, including Israel, to view Beijing’s efforts as unbalanced.

What is the ‘blind box’ economy and why is retail phenomenon sweeping China? Consumption craze markets mystery

https://www.scmp.com/news/people-culture/trending-china/article/3254906/what-blind-box-economy-and-why-retail-phenomenon-sweeping-china-consumption-craze-markets-mystery?utm_source=rss_feed

The iconic 1994 Hollywood film Forrest Gump, starring Tom Hanks, features the famous quote: “Life is like a box of chocolates. You never know what you’re gonna get.”

For young people in China, the quote has been tweaked and has morphed into: “Life is like a blind box, you never know what you’ll uncover next.”

This new phenomenon, dubbed the “blind box economy”, is sweeping the mainland.

It features mostly young, enthusiastic adults who revel in the mystery and excitement of the unknown, whether in retail, food services or socialising.

What is it?

The blind box economy flourishes through the sale of products in opaque packaging, hiding the item’s appearance or specific design, creating a sense of intrigue for the buyer that is only revealed on opening.

This anticipation of the unknown can be addictive, turning every opening into a moment of surprise and excitement, some customers even make multiple purchases to acquire a desired item from a collection.

The thrill mirrors the allure of lottery tickets, mixing possibility with the hope of acquiring a sought-after piece.

Pop Mart, a leading company in China’s blind box industry, has successfully captured consumers’ interest with its stylishly designed cartoon toys across various product lines.

By cleverly incorporating rare models into its offerings, Pop Mart appeals to both dedicated collectors and casual buyers.

Veteran customers can invest a small amount of money to discover a valuable item that can fetch significant sums on the secondary market.

Morphing into the social sphere

The fascination with unpredictability and the thrill of surprise has led to blind box concept to expand into various aspects of life.

Businesses with surplus unsold food have capitalised on the trend to clear inventory by selling blind box leftovers, offering customers the chance to buy items at a steep discount.

Customers have expressed their delight with the buying experience.

One person said: “I absolutely love the thrill of opening these leftover food blind boxes. Occasionally, when I discover a super valuable cake, it feels like I have hit the jackpot.”

As for blind box socials, the new trend involves meeting up with strangers who share common interests, whether dining out or engaging in various group activities, helping them foster new friendships and expand their social circles.

Why has the trend taken China by storm?

The blind box phenomenon is popular because it taps into consumer curiosity by creating an air of mystery.

Successful companies have mastered the art of creating a special reward mechanism, usually by selling rare or hidden models that can turn casual buyers into avid collectors.

Reflecting on this trend, one online observer said: “People have always been drawn to the unknown, seeking to unravel mysteries.

“Just as we once looked to the stars in wonder, now we find ourselves drawn to the surprise and mystery of what lies within each blind box. It’s a modern way of exploring new worlds, one box at a time.”

Detention of 3 teens over gruesome killing of 13-year-old classmate sparks debate in China

https://apnews.com/article/murder-teen-juvenile-china-classmate-bullying-d697fe277133af51537eca80cad21a72FILE - A man walks along the road in the city of Handan in northern China's Hebei province on Feb. 28, 2024. Chinese authorities in the Feixiang district near Handan city announced three suspects have been detained over the March 10, 2024 gruesome murder of a thirteen-year-old boy, riveting users on Chinese social media and sparking debate over bullying and mental health in China's countryside. (AP Photo/Emily Wang Fujiyama, File)

2024-03-18T14:42:13Z

BEIJING (AP) — In the last recorded moments before the 13-year-old boy’s death, surveillance cameras showed him sitting on a scooter, surrounded by three classmates. An hour later, his phone went dead, kicking off a frantic search by relatives.

The following day, police in a village in central China made a sickening discovery: the boy’s body, buried underneath a tarp in an abandoned vegetable greenhouse.

His three teenage classmates have been detained on suspicion of murdering the boy in a case that has riveted China, setting off outrage and frenzied debate over the young age of the suspects and soul-searching about bullying and social responsibility in the Chinese countryside.

Police in Feixiang district of Handan city identified the boy only by his last name, Wang. In a statement Sunday they said the boy had been killed on March 10 and that the suspects were detained the following day. A police investigator told state broadcaster CCTV on Monday that the crime had been premeditated, with the suspects digging out the pit twice, once the day before and again the day of the killing.

Wang’s relatives and their attorney said in interviews with Chinese media and in posts on social media that the boy had long been a victim of bullying, and was forced to give money to one of his classmates before he was killed. They said police identified the suspected killers after reviewing the surveillance footage and questioning the classmates.

“He was beaten alive and his body was disfigured beyond recognition,” Wang’s father wrote on Douyin, a Chinese social media platform. “I hope the government will be fair, open and just, punish them severely, and that the killers will pay with their lives!”

The case will be a test of a change in the law in 2021 that lowered the age at which children could be charged with a crime from 14 to 12 years old.

Wang’s father, aunt, and grandmother did not respond to requests for comment. A person answering a phone number listed for their attorney’s law firm told The AP to wait for comment, saying they were swamped with interview requests. A number for the principal of the boy’s school rang unanswered, as did numbers for relatives of two of the suspects.

The victim and the suspects are all under the age of 14. Media reports said they were “left-behind” children, a phrase used to describe kids in the countryside often cared for by grandparents because their parents work in faraway cities.

As details of the tragedy emerged last weekend, it renewed concern over the social and psychological welfare of such children, their exposure to violent content online and the ability of the country’s social services to care for them. Posts and videos from Wang’s relatives garnered millions of views and thousands of comments.

“The attention paid to the mental health of minors in the countryside is too little,” said one commenter on Weibo, a Chinese social media platform. “I think this sort of thing could happen again.”

Zhang Dongshuo, a defense attorney in Beijing unaffiliated with the case, said that Wang’s death is the latest in a series of juvenile murder cases in China that have sparked debate on how old a child should be before being held responsible for a crime.

“Generally speaking, these kinds of cases involving minors are rare,” Zhang said. “But recently more and more of these cases have been reported by the media, and it’s been triggering discussion in Chinese society over revising the age of criminal responsibility.”

In 2019, a 13-year-old boy who confessed to sexually assaulting and murdering a 10-year-old girl avoided criminal charges because Chinese law at the time stipulated that only those over the age of 14 could be held criminally liable. Two years later, the the age of criminal responsibility was lowered to 12, but the government mandated that prosecution only take place if approved by the Supreme People’s Procuratorate, China’s highest prosecuting authority.

Zhang added that the lack of parental guidance for “left behind” children has been a longstanding social issue, but that the question of how they should be raised has not been fully resolved.

“Many people think schools and the government should take responsibility for children’s education, but that means if the relevant government departments and schools don’t educate them effectively, then it’s highly likely this minor is left in an educational vacuum,” he said.

State media have given Wang’s death widespread coverage, though there are signs that Chinese authorities are keeping a close eye on public sentiment. On Sunday, the family’s attorney, Zang Fanqing, was abruptly cut off on a live broadcast after saying he and Wang’s father were barred from seeing the boy’s body. The next day, Zang said on social media that they were allowed to see the body.

A public statement from police Sunday asked the public not to spread rumors to protect the victim’s privacy and avoid further harm to the boy’s family.

His family has signaled they intend to pursue criminal charges. In a video Wang’s father posted Monday, he said the sight of his son’s body was “crueler than I imagined.”

“Your father isn’t scared, he is only upset and furious,” Wang’s father wrote, addressing his son. “Wait for your father to avenge you!”

___

AP researcher Wanqing Chen contributed to this report.

DAKE KANG Kang covers Chinese politics, technology and society from Beijing for The Associated Press. He’s reported across Central, South, and East Asia, and was a Pulitzer finalist for investigative reporting in China. twitter mailto

China’s steel sector could cut carbon emissions by more than 10% next year with faster shift to clean production: report

https://www.scmp.com/business/article/3255870/chinas-steel-sector-could-cut-carbon-emissions-more-10-next-year-faster-shift-clean-production?utm_source=rss_feed

China’s steel sector could cut its greenhouse-gas emissions by over a tenth from current levels by next year if the country gets more ambitious about adopting cleaner production technology, according to US think tank Global Energy Monitor (GEM).

The emissions reduction – roughly the same as taking 47 million petrol-powered passenger vehicles off the road – would be possible if Beijing were to set a more ambitious target for the use of electric arc furnaces (EAFs) and accelerate its shift away from the dominant, coal-based process, known as blast furnace-basic oxygen furnace (BF-BOF), the organisation said in a report published on Tuesday.

Pushing EAF to 20 per cent of total production next year, rather than the current target of 15 per cent, could reduce the sector’s emissions by 11 per cent, versus 8.7 per cent with the lower target, GEM estimated.

“Given its outsized impact on carbon emissions, even incremental changes to the steel industry could significantly reduce China’s carbon footprint,” said Jessie Zhi, researcher at GEM and one of the authors of the report.

As of January, China had 1,064 million tonnes per annum (Mtpa) of steelmaking capacity, 86 per cent based on BF-BOF and 14 per cent using EAF, GEM’s data showed. That puts China just one percentage point away from the 2025 EAF target of 15 per cent, set by the Ministry of Industry and Information Technology (MIIT) in 2020.

While the 15 per cent target would reduce emissions by 179 Mtpa, raising the target to 20 per cent would eliminate 217 Mpta, or 21 per cent more emissions, according to Zhi.

The report comes as China, the world’s largest steel producing country, continues to invest in new coal-based iron and steel capacity despite overcapacity, low profitability among steel firms and China’s dual decarbonisation goals of peaking national emissions by the end of this decade and reaching net-zero emissions by 2060.

China will miss its climate goals unless it reins in coal power: report

The steel industry is China’s second biggest emitter of carbon dioxide after the power industry, accounting for between 15 and 20 per cent of the country’s overall emissions. The sector has long relied on the coal-based BF-BOF process, which emits about 2.1 tonnes of carbon dioxide per tonne of steel produced, compared with about 1.3 tonnes per tonne with EAF, according to GEM.

In a draft plan released by the MIIT in 2020, China originally called for EAF to account for from 15 to 20 per cent of steel production by 2025, but it removed mention of the 20 per cent level from guidance issued in 2022.

The country may aim to increase EAF’s share to more than 20 per cent by 2030, according to a proposal introduced this month by seven Chinese government apartments including the MIIT, the National Development and Reform Commission and the Ministry of Ecology and Environmental Protection.

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“If China made modest adjustments to its current capacity development and closure plans to add more EAF capacity and less BF-BOF capacity, or retire more BF-BOF capacity and less EAF capacity, the country could install enough EAF capacity to make its initial ambition of reaching 20 per cent EAF production by 2025 possible, provided utilisation rates are raised,” said Caitlin Swalec, GEM’s programme director of heavy industry and one of the authors of the report.

This would require China to add around 39 Mtpa of new EAF capacity by 2025, GEM said, given that EAF is now on track to account for 15.9 per cent of China’s total crude steel production in 2025, or 151 Mtpa out of 950 Mpta.

While the common inputs for BF-BOF steelmaking are iron ore and coal, EAFs use scrap steel. Experts say raw materials make up 50 per cent of BOF cost and 75 per cent of EAF cost, with the difference between the costs of these inputs determining which is more expensive.

What’s next for Hui Ka-yan after China slapped Evergrande with a 4.2 billion yuan fine and banned him from the markets for life?

https://www.scmp.com/business/banking-finance/article/3255877/china-bans-evergrandes-founder-hui-ka-yan-capital-markets-life-after-fining-developer-42-billion?utm_source=rss_feed

China’s securities regulator slapped a fine on one of the country’s largest property developers and barred its founder from accessing the capital markets for life, after accusing China Evergrande Group of fraud.

Evergrande must pay a fine of almost 4.2 billion yuan (US$583.4 million), according to a statement by the China Securities Regulatory Commission (CSRC).

Hui Ka-yan, the founder and former chairman of the Guangzhou-based company, was fined 47 million yuan and barred from taking part in China’s securities market for life, the statement said. Six other current and former Evergrande executives were slapped with penalties of between 200,000 yuan and 15 million yuan.

Evergrande, which has the dubious honour as the world’s most indebted developer with more than US$300 billion of liabilities, stands accused of inflating its revenue in the years leading up to its collapse. Its Hengda Real Estate unit issued bonds based on forged financial data, according to a stock exchange filing.

Is Evergrande too big to fail?

The harsh penalty reflects the irregularities and rule violations that have emerged in China’s property sector over the past decades as a result of rapid expansion, said Yan Yuejin, director of the Shanghai-based E-house China Research and Development Institute.

Hengda inflated its 2019 income by around 214 billion yuan, making up over half of its operating income and 63.3 per cent of its profit during the period. A year later, the company inflated its income by over 450 billion yuan, or 78.5 per cent of its operating income and 86.9 per cent of its profit during the period.

“Hengda is not an individual case in this situation, and companies should proactively self-regulate as the CSRC is expected to ramp up its crackdown in the future,” Yan said.

Evergrande, which was once China’s largest property developer by sales, has been ordered to wind up after a group of creditors took it to court in Hong Kong. Eddie Middleton and Tiffany Wong Wing-sze, managing directors of the consulting firm Alvarez & Marsal, were appointed as liquidators for the developer on January 29.

“The depth of the alleged fraud is shocking, but should not significantly impact the company or its creditors,” said Kaiyuan Capital’s managing director Brock Silvers in Hong Kong.

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The biggest-ever liquidation order on a Hong Kong-listed company came at a time when markets were expecting a stimulus package from Chinese authorities to calm sluggish stocks and stabilise home sales performance.

The decision triggered an implosion in the shares and bonds of the company and its associates. The rest of the sector saw buying, which analysts say reflected optimism that the court’s order would remove the most problematic entity in the sector, allowing authorities to introduce easing measures for the remaining players.

Still, the liquidation order comes at a tricky time when China’s capital flows through direct and portfolio investment face more pressure, according to a Citi report. “Such risk-averse sentiment can be amplified with the lower repayment priority for offshore bondholders, confirming our prediction in October 2021, and the potential losses for shareholders.”

Evergrande loses projects as Chinese firms pick away at its assets

Evergrande has more than 1,200 projects at different stages of progress, ranging from near completion to under construction, according to its 2022 annual report.

It would be difficult for offshore creditors to take control of Evergrande’s mainland assets, especially considering the priority to deliver 1.6 million pre-sold homes, according to the report.

Chinese scientists create swarming drones that can rapidly multiply mid-air to create a tactical shock

https://www.scmp.com/news/china/science/article/3255809/chinese-scientists-create-swarming-drones-can-rapidly-multiply-mid-air-create-tactical-shock?utm_source=rss_feed

Chinese scientists say they have developed a new type of war drone unlike any ever seen on the battlefield.

At first glance, it resembles a consumer-grade Chinese DJI multirotor. However, once it reaches the target airspace it can split in the blink of an eye into two, three or even six smaller drones, depending on what is needed in battle.

Each of these drones has only one blade but can hover and move freely like a regular drone. They can communicate with each other and each could play a specific role – such as command, reconnaissance, tracking and even launching an attack – while collaborating to complete a mission.

The research, led by Professor Shi Zhiwei from Nanjing University of Aeronautics and Astronautics, is a breakthrough in air separation technology.

For years, teams around the world have attempted to devise a practical and efficient method for the controlled separation of drones mid-air.

The technology could change the battlefield. When a drone swarm appears on enemy radar screens, air-defence systems allocate anti-drone weapon resources and means based on the number of drones.

However, if the drone swarm suddenly increases in size, not only will the defence system be overwhelmed, but it poses a psychological shock that could hamper effective resistance from enemy commanders and soldiers.

Progress in this technology has been slow because flight efficiency is significantly decreased when traditional drones are combined.

In a peer-reviewed paper published in Acta Aeronautica et Astronautica Sinica journal last month, Shi’s team said it had overcome this challenge. The drone combination, it said, boasted a flight efficiency nearly twice that of a similar sized multirotor drone.

When these small drones were united, they could fly faster and further than they could alone. Even after separation, their flight efficiency remained more than 40 per cent higher than that of traditional small drones – the first demonstration that combined drones could outperform single drones in any flight state.

China is the world’s leading designer and producer of drones, showing excellent price and energy efficiency. However, “combined design and air-separation technology provide the possibility to further enhance the effectiveness of drone use”, Shi and his colleagues wrote in the paper.

The inspiration for Shi’s team came from an unlikely source: the maple seed. Long admired by botanists for its ability to be carried vast distances by the wind, the maple seed’s unique structure – a wing-like cotyledon that rotates around the seed – provides lift and allows it to hover or even ascend in windy conditions.

China’s new hypersonic drone beats F-22 in aerodynamic efficiency: study

In 2012, researchers at Lockheed Martin, a leading US arms manufacturer, drew inspiration from the maple seed to develop a drone with a constantly rotating lens capable of stable target tracking and high-definition imaging.

However, limited by its energy and payload capacity, it could not fly for extended periods or tackle complex tasks alone. The US team envisioned large aircraft delivering these drones, but the cost and risk of being shot down proved prohibitive.

While other Western teams have since developed similar machines, none have reported large-scale practical applications.

Shi’s team says maple seed-inspired drones could be taken from the laboratory to production lines in China to revolutionise future warfare. However, the key is to assemble them to achieve efficient long-distance flight.

To this end and after numerous failures, they conducted extensive and detailed wind tunnel tests and finally found a blade shape that supported both combined flight and single flight efficiency.

The amalgamation of several single-blade drones introduces a distinct set of physical characteristics and flight control logic, departing radically from the familiar multi-rotor designs. Therefore, the team needed to build a physical model almost from scratch and design unique flight control software.

High-speed communication between the small drones is also a challenge, according to Shi.

In flight tests, both the combined body and individual drones were stable. Although the maximum flight speed of the combined body could not match that of some high-performance military drones, it could launch small drones so rapidly once it reached the target airspace the opponent might not even have time to determine what was happening.

The scientists said a soldier could carry several such modules and assemble different functions and quantities of drones on-site to complete missions as needed, affording China’s People’s Liberation Army a greater tactical advantage over its opponents.

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Since the Russia-Ukraine war began, China has doubled down on its drone research and production efforts, striving for technological breakthroughs and unparalleled cost-effectiveness to be ready for future conflicts.

Nonetheless, some military pundits caution that China’s drone systems remain untested in large-scale wars, casting a shadow over the efficacy of the strategy.

Singapore jails Chinese national for Taylor Swift concert chicanery

https://www.scmp.com/news/asia/southeast-asia/article/3255878/singapore-jails-chinese-national-taylor-swift-concert-chicanery?utm_source=rss_feed

A man who helped another man illegally enter Taylor Swift’s concert in Singapore was jailed for two weeks on Monday.

Wu Zhihong, 54, tried to trick security officers into believing that 20-year-old Yan Shuqing had a valid concert ticket.

He then helped distract a security officer while Yan followed a concertgoer passing through a turnstile gate in front of him at the National Stadium on March 7.

However, Yan was caught and promptly escorted out.

Wu, a Chinese national, pleaded guilty to one count of intending to cheat security officers into believing that Yan had a valid concert ticket, so that the officers would allow the younger man to enter.

American pop star Taylor Swift performed six concerts at the National Stadium within the Singapore Sports Hub as part of her The Eras Tour in early March.

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The highly sought-after concert tickets were sold out within eight hours of their release, and more than 368,000 people went to the Singapore Sports Hub between March 2 and March 9, mostly to attend the concerts.

Concertgoers were required to undergo two security checks before entering the National Stadium. These were a person check and a turnstile gate where they would have to scan their tickets.

The court heard that Yan searched for re-sold Singapore Eras Tour tickets and came across an offer to purchase a ticket for 3,000 yuan (US$417). Yan was told to arrive at the National Stadium before that start of the concert on March 7 and that someone would help him through the gates.

Yan transferred the money. As part of the arrangement, he met Wu at about 3.50pm on March 7 around the Singapore Sports Hub. There, Wu handed Yan a lanyard and a Taylor Swift poster.

They later passed through the person check, and Wu handed Yan a lanyard with “VIP” and “Taylor Swift The Eras Tour” attached to a card.

“The lanyard was genuine official event merchandise which was given out to VIP Singapore Eras Tour ticket-holders. The accused had obtained the lanyard before meeting with Yan, despite not being the holder of a VIP Singapore Eras Tour ticket,” the prosecution said. Wu also handed Yan a wristband.

“The accused informed Yan that, when Yan reached the turnstile gates, he would not be required to scan a valid Singapore Eras Tour ticket,” said Deputy Public Prosecutor Darren Ang.

“Instead, Yan could tailgate any of the other concertgoers while they were passing through the turnstile gate, and if he was stopped by the security officers, Yan could still enter the National Stadium by presenting the lanyard and wristband to the officers and informing the officers that he had friends inside the National Stadium.”

With Wu close behind, Yan queued up to enter a turnstile gate which was manned by at least three security officers.

As the concertgoer in front of him was entering the turnstile, Wu pushed Yan forward. At the same time, Wu showed the security officer at the turnstile gate his phone and spoke to him in an attempt to distract him from Yan’s antics.

Yan entered the area but was spotted by another security officer who escorted him out. The incident was captured by closed-circuit television cameras.

After Yan was escorted out, Wu still assured Yan that nothing was wrong. To hide his wrongdoings, he transferred 3,000 yuan to Yan and told him not to reveal the transactions to the police.

Ang said that the gate was crowded then, with many people waiting to enter through the turnstiles.

“The accused’s actions caused disquiet to the other concertgoers,” he said.

Wu is not the only man to have been charged with helping others illegally enter the concert venue. Two others, Yang Chenguang and Li Xiao Wei, were the first to be charged with abetting concertgoers in cheating the event organiser.

Ang told the court that Yan has not been prosecuted but did not specify why.

What is Taylor Swift’s connection to Singapore? From her mum to her grandma

He sought two to four weeks’ jail for Wu.

“Fundamentally, this concerned a hugely popular event, generating significant local and regional attention. Safety and security is a paramount consideration in the premises. Consequently, actions which disrupt, or undermine these efforts, must be uncompromisingly dealt with,” he said.

“Shortly after committing his … offence, the accused committed a further similar offence by tailgating another concertgoer into the National Stadium himself. This reflected persistent offending.”

In Singapore, a person convicted of criminal trespass can be jailed for three months, fined up to S$1,500 (US$1,120), or both.

This article was first published by

In the busy waters between China and Taiwan, the de facto border is being tested

https://www.theguardian.com/world/2024/mar/19/in-the-busy-waters-between-china-and-taiwan-the-de-facto-border-is-being-tested

Motoring across the calm waters of the South China Sea, Taiwanese captain Lu Wen-shiung recalls the old days, when Chinese and Taiwanese fishers used to meet behind rocky headlands, anchoring their boats out of the authorities’ sight, to share a meal. There was less surveillance then, and the two sides were more friendly, fishing the same waters, occasionally selling to each other on the sly.

“We were like brothers, we had a good relationship, they would even cook for us,” he says. “But … now the control has become more strict, the [Chinese] coast guard will call me if the boats are too close.”

Now a tour boat captain, Lu says if he even gets close to the prohibited water line – a de facto sea border with China – he’ll get a swift warning over the radio from the coast guard.

Lu and his boat are travelling through the busy waters surrounding Kinmen County, an archipelago controlled by Taiwan but sitting just kilometres away from China.

The Chinese Communist party government claims Taiwan (including Kinmen) as a Chinese province, and has become increasingly hostile in its pursuit of annexation, as Taiwan’s government and people only grow more opposed.

Despite the political tensions that exist, Kinmen-Xiamen is one area where official cooperation has actually managed to continue, with joint efforts to crack down on illegal fishing and smuggling, and on search and rescue missions. But a fatal maritime incident last month has threatened to derail it and raised serious questions about the strength of the border.

A new normal

Lu’s boat passes within throwing distance of Kinmen’s outer islands, some of which are open to tourists, while others are restricted for the military. Not far away is the gleaming skyline of China’s Xiamen city, and the surrounding seas heave with fishing boats, civilian ferries and foreign cargo ships. Among them are probably some Chinese vessels known to both sides as “three noes” – no name, no registration, no flag – which often engage in illegal fishing and smuggling. A few hundred metres away, on the other side of a narrow international shipping lane, a Chinese coast guard ship is on patrol.

In February these patrols increased after the fatal capsize of a three-noes boat in Kinmen waters. The boat had fled a Taiwan coast guard vessel which had ordered it to stop for inspection. Two of the four Chinese passengers died, for which China blamed Taiwan. The fury grew when it became clear the two boats had collided – a fact Taiwan’s authorities had initially omitted. Fifteen rounds of closed-door negotiations over responsibility and compensation have so far come to nought. China accuses Taiwan of evasion and Taiwan accuses China of “absurd” demands like wanting the Taiwanese officers to go to the mainland for questioning.

Chinese officials have publicly rejected the existence of the prohibited waters line. Such a statement is consistent with Beijing’s claim over Taiwan, but the line had been tacitly respected since its demarcation in the 1990s. In the days after the collision, China’s coast guard launched extra patrols, one stopping and boarding a Taiwanese tour boat for inspection and scaring the passengers, and some others crossing into Kinmen’s waters.

Experts say both sides are clearly trying to avoid seriously escalating the incident, but the Chinese reaction also fits a pattern of using an incident to establish new norms and encroach on Taiwan’s borders.

The starkest example of this tactic came in August 2020, when the US speaker Nancy Pelosi visited Taiwan. In response, Chinese military incursions into Taiwan’s air defence identification zone increased and crossings of the median line – Taiwan Strait’s de facto border – have become a regular occurrence.

Around Kinmen, “Beijing has been careful to avoid looking excessively provocative even while using the incident to try to undermine Taiwan’s authority,” says Amanda Hsiao, a Taiwan-based senior China analyst at the International Crisis Group.

“The use of law enforcement patrols as a means of signalling displeasure is likely to continue, but Beijing may also choose to dial the frequency and intensity of those patrols up or down in response to events”.

Last week the director-general of Taiwan’s National Security Bureau, Tsai Ming-ye, told parliament that China was running “joint combat readiness patrols” on average every seven to 10 days in an effort to normalise the activity.

The end of the ‘silent agreement’

On Kinmen, residents are relaxed, and dismiss the recent furore as bad faith parties “internationalising” a tragic accident. Attitudes towards cross-strait relations and national identity are different to those on Taiwan’s main island. “The geographical economy and culture mean these two areas are always close,” says independent local councillor Tung Sen-po.

The primary worries among Kinmen people are about the tourism economy, and the ongoing restrictions on bilateral travel and trade privileges between their island and Xiamen, which were suspended during the pandemic and only partially restored.

Still, there are some concerns that tensions after the capsize will deter tourists. A taxi driver and hotelier both thought fewer domestic visitors have come since the capsize incident. A couple from Taiwan’s main island, surnamed Qiu and Li, say they were worried while planning their visit, but felt reassured once they arrived.

Some residents are concerned about maritime enforcement. At a fish market in Jincheng township, vendors say some fishing crew and tour boats are nervous to head offshore since Chinese patrols ramped up.

“They are worried about safety, and we are also afraid of conflict,” says Zhang, a seafood seller.

“We don’t think there is any hostility because [fishing crews] sometimes trade at sea, [but] the problem of smuggling is very serious, and sometimes the marine patrols will take care of it, but there are few of us and a lot of them.”

In the past, China and Taiwan have cooperated on illegal activity in the strait but the future is now complicated.

Raymond Kuo, a political scientist at the Rand Corporation, says the standoff increases the risk of misunderstandings and accidents.

“Not just between Chinese and Taiwanese enforcement agencies, but also between those agencies and civilians in the area,” he says.

“Whose rules and orders should they follow? What if they receive contradictory instructions? This disagreement in enforcement jurisdictions also creates opportunities for illegal activity.”

Chinese negotiators left Kinmen weeks ago without an agreement on compensation. Taiwan’s Ocean Affairs Council minister, Kuan Bi-ling, has apologised for poor evidence-collecting by Taiwan’s coast guard, and expressed regret and condolences over the deaths. But Taiwan’s investigation is ongoing, and further information would not be released until it was completed, she said.

On Wednesday, Chen Binhua, spokesperson for China’s Taiwan Affairs Office, accused Taipei of stalling, and threatened further countermeasures.

Less than 24 hours later, at least two Chinese fishers were killed in another capsize, this time a registered fishing vessel near Dongding, Kinmen’s southernmost island. It was inside the prohibited waters, but the cause wasn’t clear. Chinese and Taiwanese authorities conducted the search and rescue, suggesting that at least for now, some cooperation is continuing.

But so are the increased patrols. Over the weekend, four Chinese coastguard vessels entered Kinmen’s waters on consecutive days, causing confusion among Taiwanese officials who had just sent help to the capsize.

Tung says the “silent agreement” on the border is gone now, but hopes the two sides can formalise it during negotiations.

Lu too is hopeful that the two sides can move on, and Kinmen’s unique position between the two can return to friendlier times.

“The incident could have been minimised in the first place, but now it has become an international issue,” he says.

Chinese navy teams up with coastguard in rare joint missile exercise

https://www.scmp.com/news/china/diplomacy/article/3255847/chinese-navy-teams-coastguard-rare-joint-missile-exercise?utm_source=rss_feed

The PLA naval division in charge of the Taiwan Strait and the East China Sea conducted a rare joint exercise with a regional coastguard unit, the navy said on Monday, without saying when or where it took place.

The exercise simulated a joint air and sea response to an enemy missile attack on a frigate flotilla from the Eastern Theatre Command. The participants also practised countering “violent resistance” to law enforcement activities.

The “interdisciplinary and overnight” drill was aimed at improving their “coordination and combat capacity”, according to a post on the navy’s WeChat social media account.

The Eastern Theatre Command – one of the People’s Liberation Army’s five divisions – oversees the security of Shanghai and five eastern Chinese provinces, the East China Sea, and the Taiwan Strait.

It conducts regular drills in the strait, but the exercises do not usually involve the coastguard, a paramilitary force that is part of the People’s Armed Police Force.

The post said the joint exercise involved the navy’s Ezhou and Yiwu corvettes. Pictures in the post also showed coastguard vessel 11506, based in Jiangsu province.

The navy-coastguard drill came three months after President Xi Jinping visited the coastguard command office for the East China Sea and called on its officers to safeguard the country’s maritime rights.

The coastguard should “effectively” enforce China’s laws and “resolutely defend” its territorial sovereignty, he told the paramilitary force.

The force, which is used mainly for search and rescue and other maritime policing functions, has been on the front line of tensions in the East and South China seas, particularly with repeated face-offs occurred between China and Japan near the Diaoyu Islands, known as the Senkaku Islands in Japan.

Beijing has also vowed to make regular coastguard patrols in the Taiwan Strait following fatalities in the waters in recent months.

They include the deaths of two mainland Chinese fishermen whose boat capsized during a chase by Taiwanese patrol vessels near Quemoy, also known as Kinmen.

Beijing accused the Taiwanese coastguard of using “violent and dangerous methods” in the pursuit while Taipei insisted its coastguard followed legitimate procedures and the speedboat had entered its “prohibited waters”.

The mainland considers Taiwan to be part of its territory which must be reunited, by force if necessary. Most countries – including the United States, Taipei’s informal ally and top arms supplier – do not recognise Taiwan as an independent state.

About 40% of Americans see China as top US enemy in new poll

https://www.scmp.com/news/world/united-states-canada/article/3255865/about-40-americans-see-china-top-us-enemy-new-poll?utm_source=rss_feed

Americans continue to perceive China as the biggest adversary of the United States, followed by Russia, while Canada and Japan share the highest favourable rating of 83 per cent, a Gallup poll released on Monday showed.

In the telephone survey conducted in February, 41 per cent of respondents said China when asked to name one country they considered to be their nation’s “greatest enemy today.” It is the fourth straight year for China to top the perceived enemies list, though the number declined from 50 per cent in 2023.

Russia and Iran followed at 26 per cent and 9 per cent, respectively. While the figure for Russia also dwindled from 32 per cent in 2023, that of Iran jumped from 2 per cent a year earlier.

The poll found that 67 per cent of Republicans and 40 per cent of independents recognise China as the country’s biggest foe, but only 18 per cent of Democrats feel the same way, with 48 per cent of them naming Russia as the primary adversary instead.

US defence turns up heat on China as it increases budget in Indo-Pacific

Gallup said 5 per cent of the roughly 1,000 adults taking part in the survey called the United States its own worst enemy, the highest level recorded by the Washington-based advisory firm since it started asking the question in 2001.

North Korea followed the United States at 4 per cent, which fell from 7 per cent in 2023 – having already declined from 51 per cent in 2018.

Of those named as favourable, Canada and Japan were followed by Britain, Germany, France and Taiwan, coming in at 82 per cent, 79 per cent, 78 per cent and 77 per cent, respectively.

China’s private firms, fed up with crippling payment delays and ‘red-tape excuses’, push back

https://www.scmp.com/economy/economic-indicators/article/3255829/chinas-private-firms-fed-crippling-payment-delays-and-red-tape-excuses-push-back?utm_source=rss_feed

China’s embattled private firms are changing the way they do business in the face of crippling payment delays, a more challenging demand slowdown and overcapacity complications, according to new findings.

Leon Jin is among those who learned his lesson the hard way. And it’s made him more cautious and risk-averse in his dealings, including with state-owned clients that can no longer be blindly trusted to make payments on time.

“It’s become increasingly tough to get the delayed payments,” lamented Jin, a materials supplier for the state-run power grid in northeast China.

His situation appears to have become more of the norm than an outlier when conducting business in China, according to the 2024 China Corporate Payment Survey recently conducted by Coface, which specialises in credit insurance and risk management.

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“Before the pandemic, overdue payments were not so common, usually lasting no more than six months,” Jin said, emphasising that there has been a surge in payment arrears since the pandemic, with some even persisting for more than two years.

Jin recently said his state-owned enterprise client still owed him 120,000 yuan (US$16,700) for a project completed three years ago. Despite his efforts to reach out to the company for payment, he had received no response and was also not allowed to access their office premises.

“The cash flow hit is huge. For small and micro-sized enterprises like us, our projects simply can’t proceed without sufficient funding,” he said. “I’ll insist on full payment upfront in the future. I know I’ll inevitably have to take on fewer projects, but it’s better to turn down those that are only going to lead to more losses.”

Last month, Chinese social media was inundated with angry posts following the arrest of a businesswoman in southwest China after she had tried to collect 220 million yuan worth of back payments from the government.

To strike at the heart of these types of delayed payments that were exacerbated by China’s pandemic-induced slowdown, Beijing has been ramping up the pressure on provincial authorities and state-owned enterprises to pay off debts owed to private companies.

But Coface said that, among 1,020 respondents, 62 per cent had reported overdue payments, up from 40 per cent a year prior. And increased competition was deemed the biggest cause of financial difficulties among customers, due in part to excessive capacity in some industries.

“Slowing demand ranked as the second-biggest risk to business operations, and our respondents believed it would become more severe compared with 2023,” Coface said in its survey analysis.

The pain of arrears has persisted despite Beijing’s repeated push to address the country’s long-standing affliction of “triangular debt”, which occurs when a series of delayed or partial payments leave companies indebted to each other or the banks.

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Having first troubled China more than three decades ago, triangular debt has made its unwelcome return to the country amid an economic slowdown and an extended property market downturn.

Although the average payment delay fell from 83 days in 2022 to 64 days in 2023, which Coface said might be a sign of improved cash-flow conditions, growing caution was seen among Chinese enterprises.

Its findings said this was “evidenced by greater use of risk-management tools and more restrictive payment terms”, as well as a shrinking percentage of companies expressing more confidence in their customers in 2023, dropping from 33 to 16 per cent.

For some private businesses like Jin’s, the payment arrears’ impact on cash flow has dampened their willingness to expand, stalling an important engine for a post-pandemic rebound in the world’s second-largest economy.

China’s leadership has set an ambitious goal of growing the economy by 5 per cent this year, but doing so will require a big boost in momentum, considering the relatively high base of comparison from 2023 and a spattering of economic headwinds. These include persistent deflationary risks, an ongoing real estate crisis, and escalating pressure from the West.

“[Overdue payments] are too common in the construction industry,” said Bruce Lu, a private subcontractor for a major state-owned construction company in central China. “I won’t be taking on those big real estate projects. I’ll probably shift my focus to the smaller ones supported by the government and with solid financial backing.”

According to the Coface survey, the construction sector continued to be most affected by arrears in 2023, with payment delays averaging 84 days, as property developers still remained under financial pressure.

Lu said his state-owned enterprise client owed him 11 million yuan for three projects completed in 2019, and this has left him unable to pay downstream suppliers while putting his company “on the brink of collapse”.

“At first, we made some progress in chasing payments, but now it’s at a standstill. They keep stalling with red-tape excuses,” said Lu, who has turned to the courts to collect money from his state-owned debtor, but still laments how difficult it’s been.

Taiwan firms in mainland China turn ‘more cautious’ as moves intensify: survey

Wang Qichang, a committee member with the Private Economy Research Centre in Zhejiang province, pointed out that solving China’s debt problem largely revolves around the need to “create a better business environment”.

“The government’s money to repay debts comes mainly from tax revenue,” Wang said. “Only when enterprises dare to invest and innovate – providing goods that consumers willingly pay for – will the government be able to generate more value-added tax, income tax and sales tax.”

The authorities need to take concrete actions to revive the confidence of businesses rather than “just chant slogans and issue documents”, he stressed.

He proposed implementing property-right protections in the judicial system to bolster enterprise confidence in safeguarding private property.

“It’s also important to eliminate excessive nationalism from the business sector,” Wang said, citing the recent online attacks against China’s largest bottled-water producer Nongfu Spring and noting that events like these “hurt business sentiment and hinder commercial development”.