Americans to pay more — much more — for packages from China
Dear Access member,
We bring bad news if you live in the U.S. and like buying stuff on Etsy and other websites that offer merch from China: Postal rates look set to go up dramatically — see our first story below.
Our word of the day is Universal Postal Union (全球邮政联盟 quánqiú yóuzhèng liánméng).
—Jeremy Goldkorn, Editor-in-Chief
1. Packages from China will get much more expensive for Americans
The U.S.-China techno-trade war, now on day 438, is no closer to a resolution. From Washington, D.C., the Hill reports:
China’s refusal to yield in trade negotiations with the U.S. has left President Trump with dwindling leverage as he seeks a deal that will have profound consequences for his reelection prospects. Xí Jìnpíng 习近平 and top Chinese officials have signaled a willingness to accept lagging economic growth under the weight of U.S. tariffs rather than appease Trump with major concessions.
That stance may be the greatest obstacle for next month’s trade talks between leaders of the world’s two largest economies.
Meanwhile, in a move that may personally sting hundreds of thousands — perhaps millions — of online entrepreneurs on both sides of the Pacific, Freight Waves earlier this month reported that “the U.S. Postal Service (USPS) will leave the Universal Postal Union (UPU) on October 17, ending 144 years of U.S. involvement in the international body that governs the exchange of mail and postal parcels between countries, and perhaps fundamentally changing the landscape of global air shipping.”
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Under the current system, “developing countries enjoy relatively low shipping rates into the U.S. Meanwhile, the U.S., with its highly advanced market, would typically pay more… For example, a 4.4-pound parcel shipped from China to the U.S. could cost less than a domestic shipment shipped between, say, New York and Detroit.”
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A massive increase in postal costs: “The practical effect of the exit of the U.S. would be a rate increase of at least 300 percent on postal parcel traffic to the U.S. from heavy net exporting countries as rates kept artificially low for decades begin to normalize,” according to an analysis cited by Freight Waves.
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When will prices change? It’s not clear. But the meeting that will confirm America’s departure from the UPU takes place in Geneva on September 25 and 26.
2. Australia keeps Chinese hack secret for fear of disrupting trade?
Reuters reports:
Australia’s cyber intelligence agency — the Australian Signals Directorate (ASD) — concluded in March that China’s Ministry of State Security was responsible for the attack, the five people with direct knowledge of the findings of the investigation told Reuters…
The report, which also included input from the Department of Foreign Affairs, recommended keeping the findings secret in order to avoid disrupting trade relations with Beijing, two of the people said.
While revelations of Chinese malfeasance (real or perceived) have been making headlines in Australia for some time now, nearby New Zealand has remained complaisant. That is changing, too. On the weekend, Kiwi website Stuff reported:
The Auckland Confucius Institute — which has strong ties to the Chinese Communist Party — has been acting as a conduit between the University of Auckland and the Chinese Consulate-General, documents obtained under the Official Information Act reveal.
Messages and emails show staff at the institute organised multiple meetings between senior university staff and the Consul-General since mid-2018, including a dinner at the Consul-General’s home.
The university has defended the arrangement, but an independent academic labelled the institute’s involvement with the university as “entirely inappropriate.”
3. Solomon Islands breaks with Taiwan
After a week of speculation, the government of the Solomon Islands has confirmed it. The Guardian reports:
The Solomon Islands’ government has voted to sever its long-standing ties with Taiwan and take up diplomatic relations with Beijing. The move is a huge blow to self-ruled Taiwan, which has lost six allies since 2016, and to Taiwan’s president, Tsai Ing-wen, who is seeking re-election in January amid rising tension with China.
The Solomon Islands, a country of about 600,000 people in the south Pacific, is the latest country to switch allegiance to China since Tsai came to office in 2016, following Burkina Faso, the Dominican Republic, São Tomé and Príncipe, Panama and El Salvador.
Context: Little Red Podcast co-host Graeme Smith went to the Solomon Islands last week, and interviewed the prime minister and other major players: Should I stay or should I go now? Inside the Solomons’ big switch.
4. Another Taiwanese citizen disappears in China
“Apparently there is another Taiwanese citizen who has gone missing in Xiamen since last July, and this guy has been promoting closer cross-Strait ties for years,” tweeted William Yang, Taipei-based correspondent for Deutsche Welle:
His family sought help through Taiwan’s Straits Exchange Foundation but was only notified that he is held at a detention center in Fuzhou under some “security reasons.” There has not been any official confirmation of any details about the case.
This is an alarming development for Taiwanese nationals that frequently travel between Taiwan and China. With signs of Taiwanese citizens being detained indiscriminately (regardless of your political affiliation,) a strained government-level interaction means Taiwanese citizens could be left with no reliable system to guarantee their safety in China.
Something to take note is that Tsai holds a PhD degree from Xiamen University, so it’s safe to assume that he has a deep connection with China.
There’s more detail in this report (in Chinese) from Taiwan’s Storm Media. In other news of people running into trouble in China, last year, the New York Times reported (porous paywall) on three American citizens — Victor and Cynthia Liu, and their mother, Sandra Han, who have been unable to leave China for nearly two years because their “father, Liú Chāngmíng 刘昌明, a former executive at a state-owned bank, is accused of being a central player in a $1.4 billion fraud case.”
On the weekend, USA Today followed up with a report on the increasing desperation of the Liu siblings:
“They are trapped. They are alone. They are desperate to come home,” David Pressman, the siblings’ New York-based attorney, told USA TODAY. “They are literally breaking down.”
So far, there seems to be no consequences for the Chinese government for the growing number of extra-legal disappearances of foreign nationals in China.
5. What to do when you get tear gassed in Hong Kong
In media industry jargon, “service journalism” refers to useful information provided to make the reader’s daily life better — news you can use. It is a sign of the times in Hong Kong that the South China Morning Post, the city’s premier English-language newspaper, has published an interview with a doctor who offers helpful advice on what to do after you get tear gassed. In brief:
“What should you do after coming in contact with tear gas? Flush your eyes with water or saline…wash your skin with soap and water.”
The doctor advises on what to do if tear gas comes into your apartment (a common occurrence recently): Get out of there as quickly as possible!
If the last weekend is anything to go by, Hong Kongers will need to heed that advice for many weeks to come. Here is the latest from the troubled Special Administrative Region:
There were violent clashes between protesters, police, and counter-protesters throughout the weekend. The South China Morning Post has a good five-minute video that sums up Sunday’s action: On Sunday, central Hong Kong once again became a battleground.
Carrie Lam defended Hong Kong judges: The South China Morning Post reports that Lam (林鄭月娥 Lín Zhèng Yuè’é) “and two leading legal bodies have strongly condemned an ‘unfounded’ attack on local judges by Beijing loyalists, who accused them of being too lenient in granting bail to protesters and failing to hand down deterrent sentences.”
“Guangzhou surpassed Hong Kong International Airport in terms of the number of monthly passengers carried for the first time in August, while Shenzhen airport also reported a significant uptick in flight traffic, according to official data,” according to the South China Morning Post.
“Moody’s has downgraded Hong Kong’s rating outlook to negative, citing growing risks to the Asian financial hub’s institutional strength, but maintained its current rating in a break with the recent downgrade by rival Fitch Ratings,” reports the Financial Times (paywall).
6. The clock is ticking for TikTok
At least since our Red Paper in January, we’ve been harping about the coming scrutiny for Chinese internet firms operating in the U.S. The two most obvious targets are Tencent’s WeChat and TikTok, the short-video app popular amongst young Americans that is owned by Beijing-based Bytedance.
WeChat — which offers all the services of Facebook, Twitter, WhatsApp, Venmo, PayPal, Instagram, and much more — operates without impediment in the U.S. None of the American companies listed above operates consumer-facing services in China, and the main reason is that the government keeps it that way.
But it’s TikTok that may be the first to encounter serious headwinds in the U.S. According to an informal survey done in August by China Books Review, most of the app’s American users have no idea that it is made in China, but that might be about to change. The Washington Post reports:
A search for “#hongkong” on Twitter reveals a vast visual patchwork of the city’s unavoidable protests, including pro-China agitprop, sympathetic memes and imagery from the hundreds of thousands of pro-democracy marchers who have braved police crackdowns.
But the same searches for Hong Kong on TikTok, the short-video app from a Beijing-based tech giant that has gone viral in the U.S., reveal a remarkably different — and, for the Chinese government, more politically convenient — version of reality: playful selfies, food photos and singalongs, with barely a hint of unrest in sight…
The company declined to provide details of how the app is policed in the U.S. or how the U.S. team shields itself from being influenced by authorities in Beijing, where ByteDance is headquartered. Officials in the Chinese embassy did not respond to requests for comment.
7. New cybersecurity campaign, same as the old one
Xí Jìnpíng 习近平 “has highlighted the necessity for a cyberspace environment that is safe and manageable as well as open and innovative…in an instruction to a week-long national awareness campaign on cybersecurity,” according to Xinhua (in English, or at greater length in Chinese). Xi also said that “efforts should be made to raise people’s sense of fulfillment, happiness and security in cyberspace.”
What makes people happy in cyberspace? Spreading Xi Jinping Thought naturally! Radio Free Asia reports:
China’s internet regulator this week issued a set of guidelines detailing what more than 700 million internet users and content creators should post online, including “spreading the thought of President Xi Jinping.” The guidelines titled “On managing the online ecology” [in Chinese] contain a long list of 20 items that are forbidden, including content that makes fun of ruling Chinese Communist Party leaders and historical figures and religious content deemed to be part of an “evil cult” by the authorities.
—Jeremy Goldkorn
BUSINESS AND TECHNOLOGY:
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Gloom and doom from Li Keqiang
Difficult to maintain 6 percent growth, says PM Li Keqiang / CNBC
Chinese Premier Lǐ Kèqiáng 李克强 said [in Chinese] it is “very difficult” for China’s economy to grow at a rate of 6 percent or more because of the high base from which it was starting and the complicated international backdrop.
The world’s No. 2 economy faced “certain downward pressure” due to slowing global growth as well as the rise of protectionism and unilateralism, Li said in an interview with Russian media which was published on the Chinese government’s website, gov.cn.
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Li’s pronouncement follows sub-6 percent forecasts made by Oxford Economics, Bank of America Merrill Lynch, and Bloomberg Economics earlier this month.
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Mengniu to buy Australian infant formula company, pending approval
China Mengniu Dairy agrees to buy Bellamy’s for $1 billion / Bloomberg (porous paywall)
China Mengniu Dairy Co. agreed to buy organic infant formula maker Bellamy’s Australia Ltd. for A$1.5 billion ($1 billion), securing a premium brand in one of the fastest-growing segments of the dairy market.
The deal, which is subject to approval from Australia’s Foreign Investment Review Board, would hand China’s second-largest dairy producer a trusted formula brand as it seeks to wrest back market share from global rivals.
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The sale might not win approval: The offer “is facing regulatory and political scrutiny in Canberra, setting up another crucial Chinese foreign investment test for Treasurer Josh Frydenberg,” reports the Australian Financial Review (paywall).
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iPhone 11 sales set to soar?
What tepid reception? JD.com notches turbocharged iPhone 11 preorders / Caixin Live
Per Reuters, there may have been a “tepid reaction” in Asia to Apple’s new iPhone 11, but more than a million iPhone 11s have been preordered on JD.com. According to JD (in Chinese), presales have surged by 480 percent compared with iPhone sales at the same time last year. -
Here come the China-made passenger planes
Beijing ups pressure on domestic airlines to buy China-made jets / Nikkei Asian Review (porous paywall)
China’s government is increasing the pressure on domestic airlines to use more jets developed and manufactured in the country, a push that could present a big challenge to Boeing of the U.S. and Airbus, the European multinational.
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Indebted Evergrande wants to make electric cars
China Evergrande plans to build electric cars, batteries in Qingdao / Caixin Live
Real estate giant China Evergrande Group, which Bloomberg recently called (porous paywall) “China’s most indebted company,” plans to build a factory to make electric cars and batteries in the port city of Qingdao. “The initial investment in the plant will be 10 billion yuan ($1.41 billion),” according to media reports.
POLITICS AND CURRENT AFFAIRS:
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Child separations in Xinjiang
Xinjiang children separated from families / Human Rights Watch
Human Rights Watch interviewed five families from the Xinjiang region now living outside the country who described having no contact with their children. Some know and others believe the authorities placed their children in state-run institutions without their family’s consent.
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Taiwan presidential elections: Terry Gou drops out
Foxconn billionaire Terry Gou drops his bid for Taiwan’s presidency / SCMP
“In a surprise statement, Gou [郭台銘 Guō Táimíng] said he would not join the competitive race after losing the nomination from the opposition, China-friendly Kuomintang party.” -
China’s supersonic drone
China unveils supersonic spy drone during National Day military parade rehearsal / SCMP
The photos, which have prompted discussion among military enthusiasts, showed at least two types of unmanned aerial vehicle (UAV) – identified as the DR-8 or Wuzhen 8, and the Sharp Sword stealth attack drone.
The DR-8 would be expected to play a key role should there be a conflict with US aircraft carrier strike groups in the South China Sea or Western Pacific.
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No kites in Beijing as city preps for 70th anniversary parade
Beijing bans kites, pigeon flying in preparation for China’s 70th anniversary parade / AP via SCMP
It’s parade season in Beijing, and that means inconvenience for the city’s residents.
In the next two weeks, expect restrictions on mailing packages, outdoor dining, the use of windows in apartments along the parade route. And of course, anything that flies.
SOCIETY AND CULTURE:
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China’s love for the NBA
Popularity of NBA in China seems to create endless options / Star Tribune
In 1998, Kobe Bryant went to China and no one recognized him. How things have changed.
The footprint of the NBA has grown at an extremely rapid pace over the last two decades in China, where more than 500 million people watched games last season and where one new streaming deal alone will pump $1.5 billion into the league’s coffers over the next five years.
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The Sinica Podcast Network is proud to introduce the latest member of our family, Strangers in China. It features the voices of an emergent new China. Dissident voices, outspoken voices, marginalized voices, queer voices. Some are people who just find one aspect of living in China unreasonable, others are people who are rebellious. Some want to push the boundaries creatively, while others are just fighting to be seen. All are uniquely Chinese.
Subscribe to Strangers in China to hear the voices of a new China. Find the podcast on Apple Podcasts, Overcast, Stitcher, or plug the RSS feed directly into your favorite podcast app.
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