No response from Canada to Beijing’s greeting for new ambassador

Access Archive
Jeremy Goldkorn

Dear Access member,

If you’re interested in Hong Kong, we had a highly informative discussion with Antony Dapiran on Slack today. Click here to view the chat from its beginning (and click here if you still need to set up an account on Slack). A few of Antony’s comments are also cited in our story on Hong Kong today. 

Let us know whom you would like to talk to, or what you would like to talk about next on the Slack channel! 

Propaganda workers continue to push the new favorite word of Xí Jìnpíng 习近平: struggle (斗争 dòuzhēng), which was our word of the day on Tuesday. Today’s People’s Daily features a front-page article (in Chinese) titled “Set the correct direction for struggle, clearly define the tasks of struggle.”

Today’s The China Project word is Black Cat Detective (黑猫警长 hēi māo jǐngzhǎng), a beloved 1980s TV cartoon series whose creator died yesterday. 

—Jeremy Goldkorn, Editor-in-Chief

Screenshot from beloved 1980s cartoon Black Cat Detective, whose creator died on September 4 (see below).

1. ‘Release Meng’ — no response from Canada to Beijing’s greeting for new ambassador 

Yesterday, Canada nominated Dominic Barton — former global managing director of consulting firm McKinsey & Co — as its new ambassador to Beijing. Agence France-Presse says Barton “helped shape the economic policies of Prime Minister Justin Trudeau’s government and is said to be well-known in Beijing.”

Barton’s predecessor was fired in January after saying it would be “great” for Canada if the U.S. dropped its extradition request for Huawei executive Mèng Wǎnzhōu 孟晚舟. 

The new ambassador will have to deal with the exact same problem — dealing with Beijing’s bullying over Huawei. China is already using Barton’s appointment to call for Meng’s release. Per AFP, earlier today, foreign ministry spokesperson Gěng Shuǎng 耿爽 said: 

China has already agreed the appointment of the new ambassador of Canada to China… We look forward to his active role in pushing China-Canada relations back on track… Canada is very clear about the crux of the problem in the current Sino-Canadian relationship…

We urge Canada to reflect on its mistakes, treat China’s solemn stance and concerns seriously, and immediately release Meng Wanzhou, so that she can return home safely.

While the Chinese foreign ministry feels free to castigate Canada for standing by its treaty commitments to honor American extradition requests, the Canadian government has barely said anything about Michael Kovrig and Michael Spavor, the two Canadians detained on trumped-up charges and held in unknown conditions since December 2018. 

The most recent public statement from the Canadian government on Kovrig and Spavor is this extremely vague assurance on August 9 from foreign minister Chrystia Freeland that “we are doing a lot.” 

—Jeremy Goldkorn

2. Hong Kong: The protests will go on

A day after Hong Kong chief executive Carrie Lam (林鄭月娥 Lín Zhèng Yuè’é) announced that she would formally withdraw the extradition bill that sparked massive protests nearly three months ago — a move overwhelmingly seen as “too little, too late” by protesters — she held another press conference to defend her choices. The South China Morning Post reports that Lam:

  • Insisted that the “decision to withdraw the contentious extradition bill was hers,” and said that Beijing was “supportive of her ‘all the way’ and fully understood and respected her calls over the entire three-month-long crisis.”

  • Minimized the significance of the bill withdrawal — “[Lam] maintained she had not changed her mind over the bill, saying the legislation’s withdrawal was no different in substance to her earlier decisions to suspend it on June 15 or call it ‘dead’ on July 9.” 

  • Said that “the Independent Police Complaints Council (IPCC) would conduct a fact-finding exercise” on police conduct.

  • But as Antony Dapiran pointed out in our Slack Q&A today, “protesters argue that this body is (1) stacked with pro-Beijing people; (2) has no proper investigative powers (can’t subpoena witnesses, etc), and is essentially a toothless tiger.” 

The New York Times writes that there is “no sign of more concessions” coming from Lam in the near future: 

[Lam] suggested on Wednesday that democratic reforms could eventually be a possibility, under the right circumstances. But she dismissed the protesters’ other demands. She did not address them on Thursday, instead promising to establish a “dialogue platform” to address the city’s troubles.

Demonstrators said they would carry on with protests that had been scheduled for this week, including plans to disrupt access to the airport on Saturday and to stage various small rallies. Plans for large-scale marches were also being discussed.

Antony Dapiran today suggested that we watch for three dates in the coming months that could be significant for the protests: 

September 28 — anniversary of the start of the Umbrella Movement
October 1 — National Day
November 24 — district council election

If the elections “result in pan-dem candidates making big gains, that may be enough for the people to feel that their efforts on the street have converted into some kind of tangible outcome in the formal political system.” But a “new normal” of ongoing protests and unrest is just as likely an outcome, and in Antony’s view is “the most likely one.” 

Other news and reports about Hong Kong:

“The home of pro-democracy media tycoon Jimmy Lai was firebombed in the early hours of Thursday,” according to the Financial Times (paywall), which added that Lai (黎智英 Lǐ Zhìyīng), “the publisher of Apple Daily, who was unharmed in the attack, is a vocal supporter” of the protesters, and “has been labeled a traitor by state media in mainland China.” 

Pro-Beijing politicians are not happy: “Almost across the board, Hong Kong’s pro-Beijing camp expressed scepticism that the embattled leader’s sudden U-turn on a full withdrawal of the extradition bill would help stop the violence that has rocked the city for three months, with some even fearing it might fuel an escalation,” the SCMP reports. 

“We remain a safe, open, welcoming and cosmopolitan society and an internationally connected, vibrant and dynamic economy,” reads an ad that the Hong Kong government is inserting into major international newspapers, per SCMP. 

Reuters has a helpful explainer that addresses the question, How important is Hong Kong to the rest of China?

Panda politics in Germany: The Berlin Zoo is the home of two baby pandas, and the Guardian reports that “a competition to name them has increased pressure on the government of Angela Merkel, who kicked off a trip to Beijing with a large economic delegation on Thursday. The German tabloid Bild has called on Berliners to choose Hong and Kong as names for the cubs.” 

—Lucas Niewenhuis

3. Placebo trade talks set for October in Washington

“China and the United States on Thursday agreed to hold high-level talks in early October,” reports Reuters: 

The meeting was arranged during a phone call between Chinese Vice Premier Liú Hè 刘鹤 and U.S. Trade Representative Robert Lighthizer and U.S. Treasury Secretary Steven Mnuchin, China’s commerce ministry said in a statement on its website. China’s central bank governor Yì Gāng 易纲 was also on the call…

“Lead negotiators from both sides had a really good phone call this morning,” China’s commerce ministry spokesman Gāo Fēng 高峰 said in a weekly briefing. “We’ll strive to achieve substantial progress during the 13th Sino-U.S. high-level negotiations in early October.”

The markets — damned fools — responded immediately: “The Dow Jones Industrial Average jumped more than 400 points, or roughly 1.6 percent, in late morning trading,” according to the Washington Post. “The broader S&P 500 index also rose as did the technology-heavy NASDAQ.”

It’s hard to believe, however, that the talks will lead to much. As the Washington Post says, “It’s unclear whether either side expects significant outcomes from the talks.” The New York Times says (porous paywall) that “if held as scheduled, the talks would take place after new American tariffs kick in, which could make it difficult for the two sides to reach a deal.” 

A little spicier, and in my view correct, is this view from Beijing-based American lawyer and former four-term chairman of the American Chamber of Commerce in China James M. Zimmerman, on Twitter: 

Beijing is done with Trump’s tactics. The October meeting is to get peacefully past the PRC’s 70th anniversary. They’ll stall to 2020 when Trump becomes desperate for an election year deal, any deal. Meanwhile, the economy suffers. 

But maybe I am wrong: “Reliable China insiders hint that this round of trade talks could lead to a ‘breakthrough,’” says CNBC, citing the editor of nationalist rag Global Times, and the Taoran Notes blog, which seems to have close ties to senior leaders. 

Other news from various fronts of the U.S.-China techno-trade war, day 427 by our count:

Huawei not on the agenda: “Donald Trump said on Wednesday the United States does not want to discuss the U.S. blacklisting of Huawei Technologies with China as the two biggest world economies try to end escalating trade tensions,” reports Reuters. Trump said Huawei was a “security concern,” an apparent about-face from his previous comments suggesting that Huawei could be used for leverage in trade talks. 

Huawei on Tuesday accused the U.S. government of “‘launching cyberattacks to infiltrate Huawei’s intranet and internal information systems,’ menacing its employees ‘to turn against the company,’ urging other companies to bring unsubstantiated claims of wrongdoing against it and denying visas to Huawei employees,” according to the Washington Post. 

U.S.-China trade deficit rises to six-month high: “The U.S. trade deficit narrowed slightly in July, but the gap with China, a focus of the Trump administration’s ‘America First’ agenda, surged to a six-month high,” reports Reuters. 

“The number of stomachs in China, and the growing population that is middle class — you’re not coming anywhere close in the next decade,” says one analyst cited by industry website Restaurant Business. “There’s no way to replicate what China is right now.” The publication remains bullish on China despite the trade war: “The market is too big and growing too fast for [American] restaurant companies to ignore.”

Chinese and Mexican structural steel are subject to new duties after a U.S. Commerce Department announcement yesterday that it had determined “that producers in both countries had dumped fabricated structural steel on the U.S. market at prices below fair market value,” reports Reuters. Most Chinese steel products are already subject to punitive tariffs and anti-dumping duties. 

“Here is my prediction about China,” wrote New York Times columnist Nicholas Kristof in 2013:

The new paramount leader, Xí Jìnpíng 习近平, will spearhead a resurgence of economic reform, and probably some political easing as well. Mao’s body will be hauled out of Tiananmen Square on his watch, and Liú Xiǎobō 刘晓波 the Nobel Peace Prize-winning writer, will be released from prison.

So perhaps we should take with a pinch of salt his new column titled This is how a war with China could begin, which suggests that a cyberattack on Taiwan could, and perhaps should, herald the start of a transpacific hot war. But while Kristof’s prophetic skills may be lousy, he has an excellent read on the mindset of a politically significant class of Americans — we can expect Taiwan to be a growing source of irritation in the Sino-American relationship.  

4. Star private equity investor bets big on biotech

Shān Wěijiàn 单伟建 is CEO of PAG, a Hong Kong–based private equity firm. He was previously a managing director of JP Morgan, a professor at the Wharton business school, and during the Cultural Revolution, a farm laborer in Inner Mongolia. He has written a memoir titled Out of the Gobi: My Story of China and America.

  • PAG has paid $540 million for a controlling stake in Hisun BioRay Biopharmaceutical, the biotech division of state-owned Hisun Pharma, reports the Financial Times (paywall). 

  • Hisun Pharma is best known for co-developing an Ebola remedy, “the experimental MIL-77 drug combination used to successfully treat Anna Cross, a British Army reserve nurse who contracted Ebola in Sierra Leone in 2015.”

  • “Hisun BioRay specializes in making biosimilar drugs, which involves manufacturing much more complex molecules than for many other drugs. It has already commercialized one drug to treat autoimmune diseases such as rheumatoid arthritis. It also has plans to launch two others.”

I’ve been boring readers for years with my predictions that China is going to become a pharma and biotech superpower. This news does nothing to change my mind. 

5. People’s Daily goes after Apple, part two

“Qualitative measures” (质量型的措施 zhìliàng xíng de cuòshī) was an ominously vague threat in the early days of the U.S.-China techno-trade war that Beijing used to describe non-tariff restrictions. One such measure is the hounding of American companies by state media.  

Today, the People’s Daily published part two (in Chinese) in a series of op-eds on technology companies and recent privacy controversies. Like part one, the new piece directs most of its vitriol at Apple (along with a swipe at FedEx). It does, however, also mention the “deepfake” app Zao, whose user data policies have been the subject of a recent controversy.

6. State hackers target the phones of Uyghurs abroad 

“Hackers working for the Chinese government have broken into telecoms networks to track Uyghur travelers in Central and Southeast Asia,” according to intelligence officials and security consultants cited by Reuters: 

The hacks are part of a wider cyber-espionage campaign targeting “high-value individuals” such as diplomats and foreign military personnel, the sources said. But China has also prioritized tracking the movements of ethnic Uyghurs, a minority mostly Muslim group considered a security threat by Beijing.

In related news, at least 100 protesters rallied in Kazakhstan in the “volatile southwestern town of Zhanaozen [to demand] President Qasym-Zhomart Toqaev cancel his upcoming trip to China,” reports Radio Free Europe: “Anti-Chinese sentiment in Kazakhstan has been rising in recent months amid reports about the plight of indigenous ethnic groups, including Kazakhs, in China’s northwestern region of Xinjiang.”

7. Obituary: ‘Black Cat Detective’ animator 

There was not much to watch on Chinese TV before its commercialization in the 1990s, but there were a few shows that electrified the nation. One of these was Black Cat Detective (黑猫警长 hēi māo jǐngzhǎng), a cartoon remembered with a great deal of nostalgia by many Chinese people who grew up in the 1980s.

Yesterday, Dài Tiěláng 戴铁郎 — the man who created Black Cat Detective — died at the age of 89. Sixth Tone reports:

The Shanghai Animation Film Studio — where Dai worked as a designer, director, and screenwriter for more than 30 productions — said in a tribute post [in Chinese] on microblogging platform Weibo that his works were “full of imagination” and had helped create “beautiful childhood memories for generations upon generations” of fans. Dai is best-known for directing the “Black Cat Detective” cartoon series, which aired from 1984 to 1987.

Born in Singapore in 1930 to parents from Guangdong, Dai moved to China in 1940 and graduated from the prestigious Beijing Film Academy in 1953. He then worked with both the Shanghai Film Studio and the Shanghai Animation Film Studio.

You can find whole seasons of Black Cat Detective on YouTube. 

—Jeremy Goldkorn

BUSINESS AND TECHNOLOGY:

A 1,000-square-foot apartment in downtown Xiamen, a port city on China’s southeast coast, is almost as expensive as the average home in London, even though local wages are a quarter of what’s on offer in the U.K. capital. In Hangzhou, home to the headquarters of tech giant Alibaba Group Holding Ltd., prices per square foot now rival Seattle, where Amazon.com Inc. is based…

While it costs a Londoner around 13 times their annual salary to purchase property in the U.K. capital, residents in 14 Chinese cities including Sanya on the tourist island of Hainan and Fuzhou on the east coast, face a higher ratio.

  • Ford cancels plans for American-style sales system in China
    In U-turn, Ford ditches plan to unify China sales system after partners push back / Reuters
    Ford Motor Co has scrapped a plan announced last June to combine sales channels for vehicles manufactured by its joint-venture partners Chongqing Changan Automobile Co and Jiangling Motors Group. While such a setup is typical in other markets, in China, the plan “ignored realities on the ground”: 

Chinese automakers, often in 50-50 partnerships with foreign car makers, are reluctant to lose control over sales decisions, rarely willing to trust each other and loyal to local provinces that are fiercely competitive in their quest for economic growth and tax revenues from vehicle sales.

Many major foreign automakers have 2 or 3 partners in China, involving different marketing and distribution strategies for each partner. Ford is the only one known to have tried combining sales channels for mainstream cars.

Apple mistakenly transferred payouts totaling around seven times what was due to some of its Chinese app developers as a result of a recent issue experienced by its partner, Deutsche Bank, according to a screenshot of an email sent by the iPhone maker circulating on microblogging platform Weibo.

Tin prices jumped in Shanghai and London on Thursday after some of the world’s top refined tin producers said they would cut production this year following a recent slump in prices for the metal. 

A group of 14 Chinese smelters, led by Yunnan Tin, said they had agreed to cut a total of 20,200 tonnes of output this year. 

SCIENCE, HEALTH, AND THE ENVIRONMENT: 

China’s Chang’e-4 lunar rover has discovered an unusually colored, ‘gel-like’ substance during its exploration activities on the far side of the moon.

The mission’s rover, Yutu-2, stumbled on that surprise during lunar day 8. The discovery prompted scientists on the mission to postpone other driving plans for the rover, and instead focus its instruments on trying to figure out what the strange material is.

  • Gansu to store nuclear waste
    China earmarks site to store nuclear waste deep underground / SCMP
    China has selected a site in Gansu to build an underground storage facility for highly radioactive nuclear waste. The development is key to developing China’s own domestic nuclear energy industry, but if the site is successful, it will also solve a global problem, according to Léi Yì’ān 雷奕安, a professor at Peking University’s school of physics:
    “Leakage has happened in [repositories] in the U.S. and the former Soviet Union… It’s a difficult problem worldwide,” he said. “If China can solve it, then it will have solved a global problem.”

  • Economic slowdown’s climate consequences
    China’s industrial heartland fears impact of tougher emissions policies / FT via InsideClimate News
    As the economy slows, environmentalists fear that polluting industries will advance in the perennial tug-of-war between economic development and environmental protection. 

POLITICS AND CURRENT AFFAIRS:

The Solomon Islands intends to sever diplomatic ties with Taiwan and align itself with China, according to the leader of a high-level government team representing the South Pacific archipelago. 

Only 17 countries now recognise Taiwan, which includes the Vatican City and a string of small Pacific, Caribbean, and Latin American states. 

Duterte, in a televised press conference on Wednesday night, quoted the Chinese leader as replying almost in a whisper: “You know, our statement was: ‘We will not budge.’ We don’t want to discuss that because it’s ours. We own the property. Why should we talk to you?”

When reporters asked him what he would do next, Duterte shot back: “If you can help by suggesting. Is there any other suggestions? Or have you heard of any sane solution short of going to war with China saying ‘we will not budge’?”

  • Meanwhile, China seems to be upping the pressure on Vietnam. The South China Morning Post reports:  

A Chinese giant crane vessel has been tracked to 90km (56 miles) from the Vietnamese coastline — in an area claimed by Hanoi as its exclusive economic zone — fueling the risk of further maritime confrontation between the two countries.

Regional observers said the presence of the ship so close to the Vietnamese coastline indicated Beijing may be upping the ante in its weeks-long stand-off with Vietnam in the disputed South China Sea, by stretching Hanoi’s maritime capacity to its limit.

  • Belt and Road propaganda
    China releases a movie drama featuring its Belt and Road project / Economist (porous paywall)
    “‘Please don’t take it as a propaganda movie,’ urges an employee from the Chinese entertainment company behind Common Destiny, the world’s first film featuring China’s Belt and Road Initiative, a global infrastructure-building scheme. That is a tall order.”

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Jeremy Goldkorn worked in China for 20 years as an editor and entrepreneur. He is editor-in-chief of The China Project, and co-founder of the Sinica Podcast. Read more

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