What is going on at Ivanka Trump’s Chinese shoe factory?

Chinese police detain three investigating Ivanka Trump’s shoe factory

China Labor Watch, a New York–based NGO that works to defend the rights of Chinese workers, says that three of its investigators have been detained by local police while researching conditions at a Chinese factory that makes shoes for Ivanka Trump’s brand. The founder of China Labor Watch told the Washington Post, “This never happened before in my 17 years’ experience. This is the first time… The only reason we think this case is different is that this is Ivanka Trump’s factory.”

Ivanka Trump’s sister-in-law was recently found to have been using her White House connections to peddle a Kushner family real estate and residence visa scheme to Chinese investors. Meanwhile, the U.S. president recently became the owner of several trademarks that were approved in China at a speed that can be charitably described as “curious.”

Cybersecurity law: Minor concessions for foreigners

In November last year, China adopted a set of cybersecurity laws that Beijing says will counter threats from hacking, terrorism, and data theft. Foreign tech companies and chambers of commerce have complained that the new laws are protectionist, and place unreasonable burdens on companies such as security reviews and requirements to store data on China-based servers. There are also concerns that the laws will provide further legal cover for censorship, monitoring, and prosecution of people whom the government sees as troublemakers. The laws go into effect on June 1.

The government has made some modifications to the law, perhaps in response to concerns of foreign tech companies and governments. Yet the changes appear to be cosmetic: Caixin dismissively headlined its story on the amendments “Foreigners get minor concessions in cybersecurity law.” The New York Times used an equally pithy headline: “China’s new cybersecurity law leaves foreign firms guessing” (paywall), which quotes the vice president of the European Union Chamber of Commerce in China, who says that “officials had conveyed ‘less than half’ of the specifics of how the law would be implemented.”

There is a very different angle in Chinese media reports on the new laws. For example, the headline of this article on Sohu.com (in Chinese) focuses on provisions that make it a crime to sell people’s personal information, and a requirement that operators register drones that weigh more than 250 grams.

For more on China’s cybersecurity strategy, see Graham Webster’s The China Project article: “China and the Eight Guardian Warriors of American tech — What does China mean by ‘secure and controllable’ and who stands to lose?”

Guo Wengui just won’t go away

Guo Wengui 郭文贵 is an exiled Chinese billionaire engaged in a war of words on the internet with his former business partners, Chinese state media, and Caixin magazine. Last week’s main development in the Guo saga was a report in Caixin that alleges Guo paid for a private jet and accompanied former British prime minister Tony Blair on a trip to Abu Dhabi in order to raise investment from Abu Dhabi’s royal family.

This week, the New York Times has published a profile (paywall) of Guo that calls him “the biggest political story in China” for hurling “political grenades at the Chinese Communist Party for months, accusing senior leaders of graft using Twitter as his loudspeaker.” The Times says that the Chinese government has “eased up on its attacks against Mr. Guo,” and that “the about-face suggested that the Communist Party’s top leadership may not agree on how to deal with him, according to Victor Shih,” a well-regarded scholar of Chinese politics, finance, and economics. The Times also says that “there’s no sign that Mr. Guo is letting up,” and that he plans “a live event, perhaps from Lincoln Center, that will focus on Chinese corruption” to coincide with the upcoming 19th Communist Party Congress this fall. “I want it to be carnival-style with a big screen,” he said.

Xi Jinping vocabulary: The nail-driving spirit

Xi Jinping’s government has devoted considerable propaganda resources to promoting various political catchphrases, from the relatively comprehensible “Belt and Road” and “China Dream” to the utterly nebulous, such as the “four comprehensives strategy” — see The China Project’s translation of the “25 key phrases of Xi Jinping” for an explanation of some of Xi’s favorites.

On May 31, the People’s Daily highlighted (in Chinese) a Xi slogan that is not in the “25 key phrases,” but which the president first mentioned in a speech (in Chinese) in 2013: the “nail-driving spirit” (钉钉子精神 dìng dīngzi jīngshén). The phrase describes determination — just as you need to keep hammering a nail to drive it into a piece of wood, Party cadres need to exert themselves continuously to achieve results.

—Jeremy Goldkorn, Editor-in-Chief

Your weekly WeiWatch

Jiayun Feng rounds up the buzz on the Chinese internet for May 24–31. Please send feedback on this new feature to jiayun@thechinaproject.com or to editors@thechinaproject.com.

This issue of the The China Project newsletter was produced by Sky Canaves, Lucas Niewenhuis, Jia Guo, and Jiayun Feng. More China stories worth your time are curated below, with the most important ones at the top of each section.

BUSINESS AND TECHNOLOGY:

Changan Auto joins industry price war

Caixin reports that Changan, one of China’s largest domestic car manufacturers, has “joined an ongoing industry-wide price war to clear inventory,” making price cuts ranging from 4,000 to 18,000 yuan ($585 to $2,600) across its fleet. The company’s flatlined year-to-year sales growth for January through March, and startling 58 percent plunge in sales in April, illustrate its struggles to compete with the price cuts of carmakers such as Great Wall Motors and Audi AG.

Caixin notes one company that has remained above the fray and enjoyed striking success without price cuts: Geely Automotive. The company, known for its wildly popular sport utility vehicles (SUVs) and its high-profile takeover of Volvo Cars in 2010, enjoyed “total car sales surging 98% in the first quarter” of 2017. Read more about Geely’s remarkable rise in this The China Project feature.

• Private medical firms seek $1.5 billion tonic in new IPOs / Caixin
  Shenzhen Mindray Bio-Medical Electronic, which delisted from New York last year, aims to raise “up to 6.63 billion yuan ($975 million)” through a new offering on the Shenzhen stock exchange, while WuXi Biologics is “one of China’s top biotech firms,” and aims to raise up to HK$4 billion ($514 million) through an IPO on the Hong Kong stock exchange.
• China’s big Airbnb rival is taking the battle overseas / CNN
  “Tujia is chasing the rapidly growing number of Chinese people traveling abroad to popular destinations in Southeast Asia, Japan and South Korea. The company is currently seeking a fresh round of funds, in part to help expand products and properties abroad.”
• The hammer and sickle are making their way into some Hong Kong public companies / SCMP
  “As many as 19 Chinese state companies listed on the Hong Kong Stock Exchange have established Communist Party committees. Whose rules do they hew to?”
• Trade deal whets China’s appetite for U.S. beef / Financial Times (paywall)
• China is rapidly closing the innovation gap, European firms say / CNBC
• China factory PMI growth holds up in May, steel sector activity speeds up / Reuters
• Triumphs, and trials ahead, for China’s first large passenger jet / Caixin
• China’s Go masters and researchers are optimistic about the country’s AI future / MIT Technology Review

POLITICS AND CURRENT AFFAIRS:

‘Xi’an does not welcome LGBT events’

Authorities shut down an LGBT conference in Xi’an that would have featured Li Tingting 李婷婷, one of the Feminist Five arrested in 2015, the Hong Kong Free Press reports. The organizers of the event, called Speak Out 2017, were detained for eight hours and “forced to turn over their mobile phones, administrator access to their systems, their passwords, and a list of speakers to authorities,” according to a statement posted (in Chinese) by the organization on the social media platform Weibo. The authorities also reportedly told organizers that “Xi’an does not welcome gay activities” and that “LGBT activities can no longer be held in Xi’an.” Previously, four venues had already refused to host the event.

The new message of intolerance contrasts with previous years, when Speak Out successfully held gatherings to raise LGBT awareness in Chongqing, Chengdu, and even Xi’an in 2015. Reuters notes that the clampdown comes after last week’s court ruling in favor of gay marriage in Taiwan, which brought a wave of optimism to LGBT rights supporters in the mainland.

• A peek into a toppled Chinese official’s US$62 million worth of ill-gotten gains / SCMP
  “Worth a combined 426 million yuan, the property, artworks, jewelry and cash once illegally possessed by former Tianjin police chief Wu Changshun makes Wu one of the fattest ‘tigers’ netted in China’s anti-corruption campaign under President Xi Jinping.”
• Chinese Communist Party’s austerity drive picks back up in April / Financial Times (paywall)
  “The flagship austerity drive of the Chinese Communist Party’s anti-corruption campaign saw activity tick up in April as the number of cadres disciplined rose in year-on-year terms for the first time since September…[which] may indicate that a recent period of relative leniency is coming to an end.”
• China woos South Korea’s new leader, but the U.S. left behind a spoiler / NYT (paywall)
  “How is Mr. Moon, a lawyer, going to finesse the demands of China that THAAD [missile defense system] disappear, and the insistence of the United States that it remain?”
• Southeast Asia finds China love as Xi pushes One Belt, One Road dream / Bloomberg
  “Chinese companies poured a record $14.6 billion of foreign direct investment into Southeast Asia in 2015, almost double from the previous year and a gargantuan leap from $156 million a decade ago.”

SOCIETY AND CULTURE:

Communist Youth League will help you find love

The Zhejiang provincial branch of the Communist Youth League is planning to set up a “marriage and dating” division in June to help single young people find a mate, according to Qianjiang Evening News (in Chinese). More than 20 matchmaking activity centers will be built across the province to serve that end.

According to Wang Huilin 王慧琳, deputy secretary of the provincial Youth League, the goal of the new department is to “solve dating needs of single men and women, construct a platform where young people can meet each other, create a database of singles, and organize dating activities under the guidance of staff from the division.” Wang also stated that dating and marriage have become the most pressing problems to solve for the youth now because of geographical barriers, the accelerated pace of work, and shrinking social circles.

The national Communist Youth League has previously sent out signals in recent years that guiding singles into marriage is a pressing matter. On May 17, He Junke 贺军科, one of the top officials in the Youth League, said in a press conference that “getting married is the biggest problem for young people.” However, the news triggered outrage from some internet users. One of the most upvoted comments on Weibo reads (in Chinese), “Whether I marry or not is none of your business.”

— The above is drawn from our weekly WeiWatch, a roundup of trending topics on Chinese social media.

• Behind the rise and fade of China’s literary sensation Fan Yusu / What’s on Weibo
  “Beijing migrant worker Fan Yusu became an overnight sensation when her autobiographical essay ‘I Am Fan Yusu’ went viral on Chinese social media in late April 2017. The author has since gone into hiding and her essay has been removed.”
• China’s prince of ping-pong suspended amid casino dispute / Caixin
  “A debt racked up at a Singapore casino has called a timeout on the career of Chinese ping-pong hero Kong Linghui 孔令辉, the current chief coach of the national women’s table tennis team.”
• China’s female athletes winning in competition but losing fame game / ESPN
  “Chinese female athletes appear to be continually underrated and underappreciated compared to their male counterparts.”
• Manchu, once China’s official language, could lose its voice / Sixth Tone
  “With few practical incentives to preserve their language, 10 million Manchus have found their mother tongue in a critical state.”
• How to destroy the heart of a Chinese city / Foreign Policy
  “Beijing is wrecking migrants’ shops and lives—and the capital’s spirit with them.”
• Keeping their heads down: The daily struggle of life as a Beijing rickshaw driver / SCMP