Facebook’s Chinese gold mine
Dear reader,
No big news today, but below are the items that caught my eye.
Also: If you are in New York City, please scroll down to the bottom of this email for information on The China Project’s upcoming events in the city.
—Jeremy Goldkorn, Editor-in-Chief
Year of the Pig, day 3: Status update
Facebook’s big China business
Paul Mozur and Lin Qiqing in the New York Times (porous paywall) look at Facebook’s China cash cow. It’s not too bad being blocked after all:
How Facebook’s tiny China sales floor helps generate big ad money
…In total, Facebook’s revenue from Chinese-based advertisers reached an estimated $5 billion in 2018, or about 10 percent of its total sales, according to Pivotal Research Group. That would be enough to rank Facebook somewhere around the seventh-largest listed internet company in China…
Huawei and 5G development
There’s no real news today (though in yesterday’s newsletter, we linked to news from Norway, Denmark, the U.K., Germany, and the EU), but lots of commentary and reporting of side stories:
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Huawei and the 5G revolution: Race for 5G domination in China / Straits Times (paywall)
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Huawei and the 5G revolution: Japanese telcos to roll out 5G services, but without Chinese tech / Straits Times (paywall)
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Huawei and the 5G revolution: South Korean telcos make early strides / Straits Times (paywall)
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Huawei’s access to 5G could expand China’s surveillance state, cyber diplomat warns / Washington Post
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China tests 5G self-driving bus / ET Telecom
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Chinese consumers rally round embattled Huawei / FT (paywall)
Other trade war and Pacific Reset news
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US-China garlic fight a stinker with claims of racketeering and prison labour / SCMP
“A Chinese immigrant to the United States has become a key player in a trade dispute, which is pitting industry powerhouses in his native China and the US against small farmers trying to make a living out of growing garlic.” -
Trump, Xi unlikely to meet before March 1 trade deadline: US officials / Reuters via Channel NewsAsia
“U.S. President Donald Trump and Chinese President Xí Jìnpíng 习近平 are unlikely to meet before their countries’ March 1 deadline to reach a trade deal, two U.S. administration officials and a source familiar with the negotiations said on Thursday.”
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Our whole team really appreciates your support as Access members. Please chat with us on our Slack channel or contact me anytime at jeremy@thechinaproject.com.
—Jeremy Goldkorn, Editor-in-Chief
BUSINESS AND TECHNOLOGY:
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The booming pet business
Once denounced as bourgeois vanity, pets are big business in China / Economist (porous paywall)
“The market for food, toys, coats and other products for pets was worth 170bn yuan ($25bn) in 2018, up by more than a quarter from the previous year, reckons Goumin, a pet-services portal. This would make it bigger than China’s tea industry. Goumin says China has 73.5m cat- or dog-owners, a group approaching the size of the 90m-strong Communist Party.” -
The booming surveillance business
Hikvision’s meteoric rise coincides with surveillance boom / SCMP
“Big brother in China is watching you, and there is a good chance that it is watching through a camera made by Hangzhou Hikvision Digital Technology, one of the world’s largest suppliers of video surveillance equipment.” -
Oil, gas, and ethanol
Drill, China, drill: State majors step on the gas after Xi calls for energy security / Reuters
“Responding to President Xi Jinping’s call last August to boost domestic energy security, China’s trio of oil majors — PetroChina, Sinopec Corp and CNOOC Ltd — are adding thousands of wells at oil basins in the remote deserts of the northwest region of Xinjiang, shale rocks in southwest Sichuan Province and deepwater fields of the South China Sea.”
Long, strange trip: How US ethanol reaches China tariff-free / ABS-CBN
“Two months later — after a circuitous journey that included a ship-to-ship transfer and a stop in Malaysia — its cargo arrived in China, according to shipping data analyzed by Reuters and interviews with Malaysian and Chinese port officials.” -
China’s car-buying boom is really over
Jaguar Land Rover posts £3.4bn loss as China demand slips / BBC
“Jaguar Land Rover booked a loss for the last three months of 2018 as sales collapsed in China.” -
State-owned enterprises: Zombies and vampires
To kill a zombie: China steps up efforts to close failed companies / SCMP
“Plans to liquidate China’s thousands of ‘zombie’ companies are underway in several of its provinces, according to state media, as the government moves towards an aggressive target of eliminating such firms by 2020.”
How China’s SOEs squeeze private firms / WSJ (paywall)
“The predatory behavior of China’s inefficient state-owned enterprises is a concern for both policy makers there and U.S.” -
Capital winter for startups
For Chinese startups, an economic slowdown brings a ‘freezing winter’ / WSJ (paywall)
Chinese biotech feels chill in harsh winter for venture capital / FT (paywall)
POLITICS AND CURRENT AFFAIRS:
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Xinjiang
She fled China’s camps — but she’s still not free / Foreign Policy (porous paywall)
“Speaking to a packed courthouse in eastern Kazakhstan in August 2018, Sayragul Sauytbay — an ethnic Kazakh Chinese national — provided some of the earliest testimony about Beijing’s vast internment camp system for Muslim minorities in its western Xinjiang region… In an interview with Foreign Policy, Sauytbay, 42, said she fears that she may be sent back to China and that despite the August court ruling, her status in the country remains in limbo.” -
Foreign bar association responds to harsh sentencing of rights lawyer
China faces barrage of criticism over jailing of human rights lawyer Wang Quanzhang / SCMP
“Bar associations from England and Wales, Geneva, Germany, France and the International Association of Lawyers all criticized the Tianjin No 2 Intermediate People’s Court’s guilty verdict” against Chinese human rights lawyer Wáng Quánzhāng 王全璋, who was sentenced to four and a half years in prison for subversion. The sentence was delivered without an open trial — which the critics say “contravened the Chinese constitution and international conventions.” -
Beijing influence ops — Australia’s reaction
Billionaire’s ban from Australia seen as key pushback against Chinese foreign influence ops / AFP
“Australia’s decision to ban a well-connected Chinese businessman for his political activity is being seen as a potential watershed moment, the start of pushback against Beijing’s long-running operations to buy influence overseas.” -
Beijing influence ops — Taiwan
China lures Taiwanese into ‘brainstorming’ talks on island’s future / FT (paywall)
“China has started pulling mainland-based Taiwanese businesspeople and students into ‘brainstorming’ sessions on the future of the de facto independent nation, as President Xi Jinping seeks to show progress in moving toward unification.” -
Filipinos wary of Chinese labor
How come there are so many Chinese workers here?: Inquirer / Straits Times
[T]he ubiquitous presence of Chinese nationals in the metropolitan landscape had been the talk of the town in the past two years. Last month, the Senate labor committee chaired by Senator Joel Villanueva set out a formal inquiry, and the initial findings were disturbing, to say the least.
The most startling revelation was that government officials do not even have accurate figures on illegal Chinese workers in the country, and how many of them are in jobs that, by mandate of the Constitution, should be for Filipinos.
SOCIETY AND CULTURE:
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Planting trees in Chengdu
Chengdu blossoming as China’s ‘park city,’ but at what cost? / SCMP
“Urban planners hail the approach to environmental protection adopted by the capital of western Sichuan Province. But mass demolitions and relocations have made the plans for urban renewal unpopular with some.” -
Film: Science fiction
Chinese sci-fi blockbuster draws crowds on opening day / China Film Insider
“Chinese film fans ushered in the Year of the Pig with a new single-day box-office record on Tuesday, with the country’s first big-budget sci-fi blockbuster, ‘The Wandering Earth,’ contributing a significant share.” -
Impressive calligraphy
Dude writes Chinese calligraphy on stone with power grinder / Shanghaiist
“Just think of the time that ancient scholars could have saved!”
VIDEO ON SUPCHINA
Fireworks on Chinese Lunar New Year’s Eve
Many cities in China held massive fireworks shows to celebrate the start of the Year of the Pig. Here is a compilation of fireworks footage uploaded to the social video network Kuaishou!
FEATURED ON SUPCHINA
The curator of old China: Tong Bingxue and his photographs
You may know Tong Bingxue 仝冰雪 from his Twitter account, where he frequently posts historical yet timely photos that reveal stories of a bygone China, far from modern reference points. But his real work happens offline, where he has collected old photographs of China for nearly two decades, becoming a historian and curator along the way. Tong sat down with us to talk about his work, from his first photo purchase for 50 yuan to now hosting exhibitions around the world.
Opinion: In dealing with China, the U.S. can draw on a Cold War lesson: Be more open
Scott Moore writes: Recently, China has seriously shaken America’s techno-confidence, and in response, U.S. policymakers have adopted a siege mentality. But the great techno-freakout of the past two years is hardly America’s first crisis of technological confidence. And the last one — a long battle for technological supremacy with the Soviet Union during the Cold War — shows that America’s real advantage has less to do with technology itself than with its culture of openness and innovation.
SINICA PODCAST NETWORK
Sinica Podcast: Live from the US-China Business Council: The bilateral trade relationship in 2019
This week on the Sinica Podcast, we’re live from the US-China Business Council’s Forecast 2019 Conference in Washington, D.C. This show was recorded on January 31 — the day (and hour) that Donald Trump met with China’s top official in charge of trade negotiations, Liu He. Kaiser and Jeremy spoke with Tim Stratford, the chairman of the American Chamber of Commerce (AmCham) in the People’s Republic of China, and with Craig Allen, the president of the US-China Business Council. The wide-ranging conversation covers everything from technology policies to the structural changes that China is being asked to make to address U.S. complaints over unfair trade practices.
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Subscribe to the Sinica Podcast on Apple Podcasts, Overcast, or Stitcher, or plug the RSS feed into your favorite podcast app.
PHOTO OF THE DAY
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Starting off the new year with a bang
Access member Matt Chitwood took this photo in a rural village in Yunnan Province, and sent it to us with this caption: “Former village mayor, Mr Zhu, lights off a Roman candle to welcome the new year. Sometimes flames shoot out the bottom, too, I was warned, so he holds it far from his body.”
How did you start the Year of the Pig? If you like, share some photos with us at editors@thechinaproject.com — we would love to hear from you!
The China Project events next week and beyond
In New York City, we are hosting several events:
Live Sinica Podcast with Zha Jianying
Spend Valentine’s Day with me, my Sinica co-host, Kaiser Kuo, and Zhá Jiànyīng 查建英, author of the books China Pop and Tide Players, on February 14!
We’ll record a live podcast about activism in the current Chinese political climate — specifically through the lens of Zha’s brother, a democracy activist who has been jailed and has seen firsthand how the state suppresses those accused of “subversion.” Zha recently wrote about her brother for the New Yorker in a story we highly recommend: China’s bizarre program to keep activists in check.
If you’d like to attend, please reserve your space here.
On February 28, we will have a The China Project Women’s Network Monthly Series event with Jolyne Caruso, CEO of The Alberleen Group — details here.
Finally, mark your calendars for the third annual The China Project Women’s Conference! Early-bird ticket sales are coming soon.
